IN RE CITY OF LOUISVILLE, KENTUCKY, PETITIONER.

PETITION FOR WRIT OF MANDAMUS.

No. 11, Original. Argued November 10, 1913.-Decided January 5, 1914.

The mandate in the case of Louisville v. Cumberland Telephone Co., 225 U. S. 430, in which this court decided that the rates established by municipal ordinance were not confiscatory and reversed the judgment holding that they were, without prejudice, and remanded the case to the lower court, permitted further proceedings; and the judge of the District Court acted within his discretion in continuing the case and appointing a Master to take proof and report as to the amount collected by the company during the injunction period and also after the new rates had been put into effect.

Mandamus to compel the District Court to vacate supplemental orders of reference made in a case reversed and remanded, refused, on the ground that the case was decided without prejudice and the District Court acted within its discretion in the conduct of the case and the interpretation of the mandate.

THE facts, which involve the proper exercise of discretion of the trial judge in interpreting the mandate of this court in a case remanded for further proceedings, are stated in the opinion.

Mr. Pendleton Beckley, with whom Mr. J. W. S. Clements and Mr. Stuart Chevalier were on the brief, for petitioner: Where a decree of this court has been misunderstood or misconstrued by a lower court, the party complaining can have the error corrected either by an appeal to this court or by a motion for a writ of mandamus. City National Bank v. Hunter, 152 U. S. 512. See also Whitaker v. Desfosse, 7 Bosw. (N. Y.) 678; Cram v. Bradford, 4 Abb. Pr. R. 193; St. Paul & Sioux City v. Gardner, 19 Minnesota, 132, 136; 2 Cyc. 612, 613, and cases cited.

In any event a writ of mandamus is proper to bring before this court the question whether its opinion or mandate has been misconstrued by a lower court. Perkins v. Fourniquet, 14 How. 328; Gaines v. Caldwell, 148 U. S. 228; Re Sanford Fork & Tool Co., 160 U. S. 247; Re Potts & Co., 166 U. S. 263.

The city contends that the District Court should retain jurisdiction of this case for the purpose (but for the purpose only) of decreeing restitution to the patrons of the telephone company of the amount of overcharges accruing from the passage of the rate ordinance to the filing of the mandate of this court upholding that ordinance. Brown v. Detroit Trust Co., 193 Fed. Rep. 626; Northwestern Fuel Co. v. Brock, 139 U. S. 216; Southern Railway Co. v. Tift, 206 U. S. 435, and see report of the subsequent hearing in Tift v. Southern Railway Co., 159 Fed. Rep. 555.

Respondent in ordering another investigation of the rates and the supervision by a special Master of the operations of the telephone company, misconstrued or misunderstood the opinion of this court rendered on the former appeal.

The one issue made in the bill of complaint filed in this case in March, 1909, was whether the ordinance of March 6, 1909, was confiscatory as to the telephone company.

This court by its opinion reversed the decree of the lower court. In so reversing that decree this court adhered to the opinions in Willcox v. Consolidated Gas Co., 212 U. S. 19, and Knoxville Water Company Case, 212 U. S. 18, that the courts should not declare a rate ordinance confiscatory until the public service corporation had given it a fair trial.

The City of Louisville contends that by the opinions in each of these cases this court meant identically the same thing; that is to say, inasmuch as complainants had not shown by clear and unmistakable proof that the rates in question would be confiscatory, the court would not

affirm decrees enjoining the enforcement of such rates until the public service corporations had put the rate into effect, and given them a fair trial. In the meantime, it was clearly the purpose of this court in those cases that the decrees of the lower court should be reversed, and the cases dismissed in so far as the question of confiscation was concerned; but if any one of those three public service corporations saw fit in the future, and after testing the rates, to again try out the question of whether the ordinance was or was not confiscatory, its right to do so should not be prejudiced by anything contained in the opinions of this court or the decrees entered pursuant thereto.

See also Northern Pacific Ry. Co. v. North Dakota, 216 U. S. 579.

There is no possible ground on which a court can entertain jurisdiction of a cause in which a public service corporation alleged that it was ignorant of whether certain rates fixed by a legislative body were confiscatory as to it, that it had put the rates into effect and it now filed its bill of complaint for the purpose of having the court appoint a master to see if those rates were really in effect, to supervise the operations of the company, and to report to the court the gross earnings, gross expenses and net revenues of the company; and asked the court to determine from such a report whether the rates were or were not confiscatory.

Mr. Alexander P. Humphrey and Mr. W. L. Granbery, with whom Mr. Hunt Chipley was on the brief, for respondent.

MR. JUSTICE MCKENNA delivered the opinion of the court.

Petition for a rule on the Judge of the District Court of the United States for the Western District of Kentucky, VOL. CCXXXI-41

to show cause why a mandamus should not issue commanding him to vacate the supplemental order of reference entered on March 10, 1913, in the cause entitled Cumberland Telephone & Telegraph Company v. City of Louisville, pending in said District Court, and to desist from further trying in the cause the question whether the ordinance of March 6, 1909, in litigation in the cause, is confiscatory and void as to the company, and further commanding him to dismiss the bill of complaint, retaining the same on the docket, however, for the purpose of ascertaining the amounts collected by the company from its patrons in the City of Louisville in excess of the rates prescribed in the ordinance, and for the further purpose of distributing the same among the persons entitled thereto. A rule was issued in accordance with the petition and return thereon duly made by the District Judge.

The suit referred to was brought by the Telephone & Telegraph Company against the city in the Circuit Court, the predecessor of the District Court, on the eighth of March, 1909, and sought an injunction enjoining the City of Louisville from enforcing the ordinance referred to on the ground that the rates prescribed by it were confiscatory. Upon the filing of the bill a temporary restraining order was granted. A motion was also made for an injunction pendente lite but was not passed upon till final hearing on the twenty-fifth of April, 1911, when a permanent injunction was decreed, the court adjudging the rates fixed to be confiscatory.

On the fifteenth of June, 1909, the city moved for an order requiring the company to pay into court all sums collected in excess of those fixed in the ordinance. Thereupon the company agreed that if the court make no order in pursuance of the motion it would keep an accurate account of the sums collected in excess of the rates fixed in the ordinance and would, on the final hearing, pay the amounts into court for distribution among those entitled thereto,

provided the ordinance was not declared to be confiscatory. In pursuance of the agreement the court refrained from making the order prayed for and allowed the restraining order to remain in force.

An appeal to this court was taken by the city from the decree of perpetual injunction and the decree was reversed. 225 U. S. 430. This court reviewed the evidence upon which the Circuit Court decided that the rates were confiscatory, and said (p. 436):

"We express no opinion whether to cut this telephone company down to six per cent. by legislation would or would not be confiscatory. But when it is remembered what clear evidence the court requires before it declares legislation otherwise valid void on this ground, and when it is considered how speculative every figure is that we have set down with delusive exactness, we are of opinion that the result is too near the dividing line not to make actual experiment necessary. The Master thought that the probable net income for the year that would suffer the greatest decrease would be 8.60 per cent. on the values estimated by him. The Judge on assumptions to which we have stated our disagreement makes the present earnings 5-10.17 per cent. with a reduction by the ordinance to 3-6.17 per cent. The whole question is too much in the air for us to feel authorized to let the injunction stand. "Decree reversed without prejudice."

A mandate was issued, the material parts of which are as follows:

"On consideration whereof, It is now here ordered, adjudged and decreed by this Court that the decree of the said Circuit Court in this cause be, and the same is hereby, reversed with costs, without prejudice; and that the said defendant, City of Louisville, recover against the said complainant Three thousand nine hundred and forty-five dollars and sixty-five cents for its costs herein expended and have execution therefor.