Harlan F. Stone

“ The price of gas distributed through pipelines for public consumption has been too long and consistently recognized as a proper subject of regulation under the Fourteenth Amendment to admit of doubts concerning the propriety of like regulation under the Fifth. ”

“ Once a fair hearing has been given, proper findings made and other statutory requirements satisfied, the courts cannot intervene in the absence of a clear showing that the limits of due process have been overstepped. If the Commission's order, as applied to the facts before it and viewed in its entirety, produces no arbitrary result, our inquiry is at an end.
Going Concern Value. The companies insist that their business has a going concern value of $8,500,000 which the Commission did not include in the rate base and on which they are entitled to earn a return. ”

“ They transport the gas by their own pipeline in interstate commerce to Illinois, where they sell the bulk of it at wholesale to utilities, which distribute and sell it for domestic, commercial and industrial uses. ”

“ The earnings available during the period for return on the capital investment of both stockholders and bondholders-after taking out of income $19,558,810 for depreciation, depletion and retirements totalled $34,040,883; this makes an average of $4,862,983 annually, which is about 8% on the book figures for investment undepreciated, or 8.8% after deducting from investment the average depreciation and depletion reserves actually charged to earnings by the companies. [3] At the time of the hearing, over one-fourth of the bonds issued had been retired out of earnings. ”

“ So far as the order is supported by the evidence the companies cannot complain that they were denied a full hearing because they had not been able to examine on redirect their own witnesses who had not been cross-examined, or because they had no opportunity to cross-examine or rebut witnesses who were not offered by the Commission. The right to a full hearing before any tribunal does not include the right to challenge or rely on evidence not offered or considered. ”

“ Likewise for the purpose of the order, it accepted the companies' estimate that the value of all physical property-calculated at reproduction cost new (except for gas reserves taken on the companies' statement to have a present value of $13,334,775) -was $74,420,424, which the Commission adopted as the rate base. It took the companies' own estimate of twenty-three years ending in 1954 as the life of the business, and for the amortization base used their cost figure of $78,284,009 for the total past and estimated future investment after deduction of estimated salvage. ”