# Appendix — City of Jackson v. Mississippi Power & Light Co.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1941
- **Citation:** 312 U.S. 698

## Text

Ch nica TING at Cy IE Mtge le Ba IS WOOT ALD Nein OED IO

30

APPENDIX.

Sees. 2393 and 2426, Mississippi Code of 1930, are as fol-
lows:

‘9393. Powers or Mayor anp Boarp or ALDERMEN.—The
mayor and board of aldermen of every city, town, and vil-
lage shall have the care, management, and control of the
city, town, or village and its property and finances, and
shall have the power to enact ordinances for the purposes
hereinafter named, and such as are not repugnant to the
laws of the state, and such ordinances to alter, modify, and
repeal; and they shall have power.”’

‘69496. Tuirry-THirp.—May Prescrine Maximum Rares
AND CHarces For Water, Power, Licuts or Gas.—To pre-
scribe by ordinance maximum rates and charges for the sup-
ply of water, gas and electric energy or current for lights
and power, or either, furnished by an individual, company
or corporation to the municipality and its inhabitants, or
either, such rates and charges to be just and reasonable. If
the rates and charges prescribed be unjust and unreason-
able, they may be reviewed and determined by the chancery
court of the county, but the authority hereby granted shall
not be construed so as to impair the effect or obligation of
any valid or binding contract with any waterworks company,
electric light company or gas company, now existing or
heretofore made.’’

(2805)

Office ~ Supreme Court, US.
FILAoT

: FEB 98 194
SUPREME COURT OF THE UNITED STATES | |
OCTOBER TERM, 1940 patemen ey

No. 779

CITY OF JACKSON, ET AL.,

vs.

MISSISSIPPI POWER & LIGHT COMPANY.

RESPONSE OF MISSISSIPPI POWER & LIGHT COM-
PANY TO PETITION FOR CERTIORARI, WITH
SUPPORTING BRIEF.

MagcetLus GREEN,
Jackson, Mississippi;
R. A. Henperson,
2 Rector St., New York City;
A. M. Nzgtson,
Jackson, Mississippi;
Forrest B. Backson,
Jackson, Mississippi;
Garner W. GREEN,
Jackson, Mississippi;
Attorneys for Respondent.
Rew & Prisst,
2 Rector St., New York City.
Green & Green,
Jackson, Mississippi.
Jackson, Youna & Farenp,
Jackson, Mississippi, Of Counsel.

_—

INDEX. Pa
Sussectr Inpex. E
Page a
Response of Mississippi Power & Light Company to ‘
petition for certiorari, with supporting brief. __ 1 £
I hog a Soa 1 :
Questions involved .. Ania Ae Sais? xs 2
Pee WEI. 2
i eee vee 3
Jurisdiction of District Court................. 3
Me I os ss ok oe vw Ley ea 4
City’s motion to dismiss................... 8
ee WI eat tr 8
Point 1—Reply to City’s petition ©... . 10 .
Point Il—Reply to City’s brief—Preliminary P
RE AEE a an SOP IDI a en acento are eats a 20 .
I cP 0 ns es ys ees ss. i. 31 :
RRS SSG gy SA ta NLR RE nae an ie 32 z
I eho Pees cis Co ee. , 33 i
ASSES AIS SS pee aa en Pr ay ae 38 e
TaBie or Cases Crrep. 4
Htna Life Ins. Co. v. Haworth, 300 U. S. 227, 239-
242, 81 L. Ed. 617, 620-622, 57 S. Ct. 461, 108 ‘A. L. e
R. 1000 eee Ria sears cil Spe wk ek co. 12
Aetna Casualty & Surety Co. v. Quarles, 4 Cir., 92 F. ;
RRR SS I ge AL TGCS Sr eS ee ear 26 j
Almaras v. Hattiesburg, 180 So. 394, 181 Miss. 752. 12 S
Automobile Ins. Co. v. Freundt, 7 Cir, 5 103 F. (24) i
. RPS Sr aA a 29 .
Bell v. Kaye, 127 Miss. 165, 89 Aa Pee 12 ;
Bethke v. Grayburg Oil Co., 5 Cir., 89 F. (2d) 536,
Certiorari denied, 302 U. S. “730, 82 L. Ed. 564. . 13 ;
Chase National Bank v. Citizens Gas Co., 7 Cir. 113 %
MNP erry) cp tet ete 29 3
Cincinnati etc. v. Interstate Commerce Commission,
162 U. S. 197, 40 L. Ed. 935, 939................. 12
City of Laurel v. Mississippi Gas Co., 49 F. (2d)
a ee ee ee ne ee 26
— of El Paso v. Texas City Gas Co., 5 Cir., 100
DI rer ny ee eo 14
—2893

il INDEX

Columbus R., Power & Light Co. v. Columbus, 249
U.S. 399, 63 L. Ed. 669, 6 A. L. R. 1684... .
Corporation Commission v. Carey, 296 U. 8. 452, 80
Ric Se ES Oe igs Ce era a EE EKS
Currin v. Wallace, 306 U.S. 1-5, 88 L. Ed. 441.......
Driscoll v. Edison Light & Power Co., 307 U. 8. 108,
Ge Re ee es eee Ns ee een
Ex parte Bransford, 310 U.S. 354, 84 L. Ed. 1249...
Griffith v. Vicksburg Waterworks Co., 88 Miss. 371,
Ms a ee oe Pa ahs eae Ws ee ashes
Gulf & Ship Island R. Co. v. Laurel Oil & Fertilizer
Cu, Tae hy ey are Bete, GO ore ka i ce es
Gunter v. Atlantic Coast Line R. Co., 200 U. 8. 273,
ee a i Ss hk ack vc os el Re
Interstate Commerce Commission v. Alabama, ete.
Co., 168 U. S. 168, 42 L. Ed. 414, 423.............
Interstate Natural Gas Co. v. Louisiana Public Serv-
ice Commission (D. C. La.), 33 Fed. Supp. 50, 59;
ee PS I ee rae Ue ee es en
Julian v. Central Trust Co., 193 U. S. 93, 112, 48
ey A cere ear pena Pemerka ema
Kelleam v. Maryland Casualty Co., U. S. Law Week,
I Bile BOR es a ok 5s he wa Cee Renee
Kline v. Burke Construction Co., 260 U.S. 226, 67 L.
OE Re SS a aaa aie Beare OSA oT Ope vernal nA
Lake Erie Provision Co. v. Moore, 11 Fed. Supp.
a Sr eae ie re hes ek RL eT
Maryland Casualty Co. v. Pacific Oil & Coal Co., 85
Rie ae Rs SIND NS 2 osc en Loew es
McClellan v. Carland, 217 U. S. 281, 54 L. Ed. 762,
SO oe ee ee BS Palak RES He CR
Milk Wagon Drivers Union v. Meadowmoor Dairies,
Inc., U. S. Law Week, February 10, 1941, 4187....
Mississippi Power Co. vy. Aberdeen, 11 Fed. Supp.
OME a Poorer. ils Bete een enous eS
Mississippi Power & Light Co. v. Jackson, 9 Fed.
DREN or Sh ee eter ee
Munroe v. Raphael, 288 U.S. 485, 489, 77 L. Ed. 910,
el a i 3 er ee ha ee

Page

17

_—

INDEX ili
Page
Mountain States Power Co. v. Public Service Com-

mission, 299 U. S. 170, 81 L. Ed. 101........... 14
Nashville, etc. R. Co. v. Wallace, 288 U. 8S. 249, 77

Sc Bee Fs OF OAs Bh Re BA oe ie ca ee ea 13
New York Life Ins. Co. v. Roe, 8 Cir., 102 Fed. (2d)

Ry eee ays aon ae ee ee 26
Oklahoma Natural Gas Co. v. Corporation Commis-

sion, 88 Okla. 51, 211 Pac. 401, 31 A. L. R. 330... . 24
Pennsylvania v. Williams, 294 U. 8. 176, 188, 79 L.

DR SRC i eae a ie ye te eR Dei CES 27
Petroleum Exploration v. Public Service Commis-

sion, 304 U.S. 209, 214, 82 L. Ed. 1294, 1299... ... 14
Phillips v. United States, 85 L. Ed. 460............ 15
Powell v. United States, 300 U. S. 276, 286, 81 L. Ed.

Bidar hire ear a anmipe op ee OME 8 eee oop, I 15
Procter € Gamble Co. v. United States, 225 U.S. 281,

Be ee ys actos EN ee ener eee hla 15
Public Sevice Commission v. Brashear Freight Lines,

Inc., 306 U. 8S. 207, 83 L. Ed. 608, 610............. 14
Railroad Co. v. Blum Co., 88 Miss. 188, 42 So. 282. . 24
Sears, Roebuck & Co. v. Roddewig, 24 Fed. Supp.

WUE as ie ae a Gis oe ee Oe es OE 28
Shannahan v. United States, 303 U. S. 596, 599, 82

Sic mk I ks cl a a be 15
Skinner & Eddy Corporation v. United States, 249

11, Ge a Oe A I, A lg Fs eee aes 12
Southern Bell Tel., etc., Co. v. Railroad Commission,

AM re 6 ota yh BS Seka Re Tce Me Den ee 18
Southern Pacific Co. v. McAdoo, 9 Cir., 82 F. (2d) 121 29
State ex Rel. v. Benson, 108 Miss. 779, 67 So. 214... . 24
Stephenson v. Equitable Life Assurance Socicty, 4

Seer Fe te ee 6 oe ee eS 26
Stone v. Y.é M.V.R. Co., 62 Miss. 607, 116 U.S. 307,

Pe RG EE Sins Bel aa Nan ake sta ne eA 26
Stone v. Illinois Central R. Co., 116 U.S. 347... .... 26
Texarkana v. Arkansas-Louisiana Gas Co., 306 U.S.

i Bhs hc ee ies es es 17, 24
United States v. West Virginia, 295 U. 8S. 463, 79

Bi ME 5 ee T CR OL OE Ce Om: 13

United States v. Corrick, 298 U. S. 435, 80 L. Ed.
TN 5 ios here RAST ean 15

iv INDEX

United States v. Idaho, 298 U.S. 105, 109, 80 L. Ed.

I as ed tia se ck ik eases eos 15
United States Fidelity & Guar. Co. v. Koch, 3 Cir. *
I ry es bbs aus 29
Vicksburg Water Works Co. v. Yazoo, etc. Co., 102
I cick vase cs cedes 12
Vicksburg v. Vicksburg Waterworks Co., 206 U.S
Nn i I I sa he be Pee cae 26
Yazoo, etc. R. R. Co. v. McKay, 44 So. 780, 91 Miss.
ee rater alias W tik bi uiy Cu natia ney 24

Statutes Cirep.
Borchard Declaratory Judgment, Annotation, 87 A.

GM NI se so Cate ka ea oe ees 14
pe re ae en ee 13
I I eet eo pe eS po ale sk Wk EA WA 25
Judicial Code, Section 24, as amended, 28 U.S. C. A.,

Section 41(1), 48 Stat. 775, printed as Appendix

re een che Nan és 2
Natural Gas Act (15 U. S. C. A., p. 784, 52 U. S.

Statutes, 821, Section 717(a)) .................. 21
Pes RC I he eke s saree kh vn bids 15
pT a a Gen a 17
Pacers Gee memenyaras Bat. 2... £6 ee. 15
Pond Public Utilities, 4th Ed., 1772, See. 892........ 18
Revised Statutes, Sec. 3224, Sec. 1543, Title 26, U.S.

a re a wt 8 a a 29
Section 24, Judicial Code, as amended, 28 U.S. C. A.,

I ae a ee eee ay dial Vem Gms 8
Section 274d, Judicial Code, 28 U. S. C. A., Section

RRO EPS “ER NS Recreate arnt og Deen eee ae 8

Section 274(d), Judicial Code, 28 U. S. C. A. Section
400, as amended June 14, 1934, Chapter 512, 48
Stat. 955, as amended August 30, 1935, Chapter

829, Section 405, 49 Stat. 1027, Appendix B...... 2
Section 2426 originated in Chapter 231, Mississippi
RR ae Gs Sue ree Bey SG ey 25
Section 400, U.S. C. A., Title 28, Judicial Code 274d. 28
Urgent Deficiencies Act of October 22, 1913.......... 15
MO I. a es es eng ae 5 Gy bs 13
ee er I eis os ee ie ce kas 12
Ot A. Ts By, Rete, GOO... 2. ie 14

_———

SUPREME COURT OF THE UNITED STATES
OCTOBER TERM, 1940

No. 779

CITY OF JACKSON, ET AL.,

Us.

MISSISSIPPI POWER & LIGHT COMPANY.

RESPONSE OF MISSISSIPPI POWER & LIGHT COM-
PANY TO PETITION FOR CERTIORARI, WITH
SUPPORTING BRIEF.

Parties To LITIGATION:

City of Jackson (with its officials), Petitioner in this
Court, was appellee in the Court of Appeals and defend-
ant in the District Court, herein sometimes called (and
so substituted in quotations) City, Petitioner or
municipality ;

Mississippi Power & Light Company, Respondent here,
was appellant in the Court of Appeals and plaintiff in
the District Court, herein called (and so substituted in
quotations) Company, plaintiff or grantee.

‘‘Opinions Below.

‘*No opinion was delivered by the District Court, but
the judgment correctly appears in the petition herein

ld

2

(R. 92). The opinion of the Circuit Court of Appeals
is set forth, (R. 101 to 105 inclusive), (Appendix ©
hereto), and the judgment of the Circuit Court of Ap-
peals is correctly set forth in petition herein, (R. 106).
Otherwise the opinions and judgments below are not
yet officially reported.’’

Questions Involved.

Whether or not the Federal District Court was deprived
by the Johnson Act (Judicial Code, Section 24, as amended,
28 U. S. C. A., Section 41(1), 48 Stat. 775, printed as Ap-
pendix A) of jurisdiction to declare under Declaratory
Judgment Act (Section 274(d), Judicial Code, 28 U. S.
C. A. Section 400, as amended June 14, 1934, Chapter 512,
48 Stat. 955, as amended August 30, 1935, Chapter 829
Section 405, 49 Stat. 1027, Appendix B) that under the
terms of the franchise contract, Exhibit A to the complaint,
there is available from the Jackson Gas Field sufficient
natural gas for the requirements of the City; or differently,
whether or not, there being admittedly an insufficiency of
natural gas therein, Company may have thereasto a judicial
declaration as to its rights under said Exhibit A between
City and Company.

Preliminary Statement.

On June 18, 1940, District Judge Mize dismissed solely
for want of jurisdiction, under the Johnson Act, a petition
for Declaratory Judgment filed by Company against City,
seeking a declaration of Company’s rights under a written
contract, Exhibit A (R. 19), to supply City natural gas,
initially to be taken from the Jackson Gas Field, which
supply Company claimed had become insufficient for the
performance of that thereunder required. This claim the
City both judicially and extra-judicially denied. Compare
Exhibit ‘‘G’’, Ordinance of the City (R. 76), ‘‘There is

3

now a sufficient supply of natural gas in the Jackson Gas
Field to supply all Jackson consumers.’’ (Italics ours, un-
less otherwise noted.)

Upon appeal, on January 17, 1941, the Court of Appeals
for the Fifth Cireuit (Hutcheson, Circuit Judge, delivering
the opinion), declared:

‘Here the City and the Company, under contractual
relations with each other, which oblige the company to
furnish gas at rates fixed in the contract while the
Jackson Field holds out, and specifically relieve it from
so doing when the field has failed, are at loggerheads
over the facts upon which their respective rights and
duties depend and therefore over their respective rights
and duties under the facts.

‘‘The company insists that the field is insufficient,
the city that it is sufficient. Acting upon its view, the
company has made arrangements for bringing in pipe
line gas from a distance and is undertaking to exact
and collect for that gas, higher rates than those pro-
vided for in the contract. The city insisting that the
field is sufficient and the contract still holds is resisting
these efforts.

‘‘An authoritative determination as to the present
status of the contract and of the rights and duties of
the parties under it is essential in the interests of both
city and company and of the public that both serve.
For such a case, the declaratory judgment act is made
to order. Borchard Declaratory Judgments, pages
187, 188, 417, 424, 426, 433, 436, 566, 606, 101 A. L. R.
694.”’

Thereasto the city seeks certiorari.

Statement of the Case.
Jurisdiction of District Court.
The Company invoked the Declaratory Judgment Act,
predicating Federal Jurisdiction upon (a) diverse citizen-
ship, (b) rights arising under the Constitution, with juris-
dictional amount involved (R. 3).
2d

PIGS MCRL EE RV IS 3 F ——

4

The Complaint.

The Company operates a gas distribution system at Jack-
son, Mississippi (R. 3), having

(1) A perpetual franchise granted February 10, 1860
(Laws Mississippi, 1860, page 438), pursuant whereto gas
works were constructed, a part of which is still operated
by Company ;

(2) A franchise granted to M. H. Grossman (R. 4);

(3) The contract which is the basis of this controversy,
Exhibit A to the Complaint, executed October 20, 1930, and /
epitomized thus:

Section 2. This franchise was for 25 years and was con-
ditioned on Company ‘‘furnishing gas to the City of Jackson
and the inhabitants * * *, that is, natural gas shall
be furnished to the inhabitants of the City of Jackson as long
as commercial natural gas is produced in commercial quan-
tities in the City of Jackson * * * sufficient to supply
the demands of the City of Jackson and its inhabitants and
its industries,’’ (herein called Jackson gas or Jackson
Field).

‘‘Should the grantee herein, through any medium, ex-
cept with the consent of the City of Jackson, raise the
rates stipulated in paragraph 3 hereof during the time
that gas is furnished or can be so furnished in the City
of Jackson * * * then the City of Jackson may
purchase said property on the terms and conditions
hereinafter set forth.

«* * * Company gives option to the City of
Jackson to purchase its natural gas equipment oC ees
the terms of the option’’ are * *

‘Tn the event of the raise of rates as designated in
paragraph3 * * * the City will have four months
from the effective day of this raise * * *, within
which to notify the grantee in writing * * * of

5

its election to exercise its option to purchase * °* *»
at ‘‘the true or actual value of the physical properties,
properly depreciated at that time.’’ (R. 22.)

Section 3. ‘‘Pursuant to the municipality’s rate-making
power, and the terms and conditions upon which this fran-
chise, is given, the municipality establishes the following
rates and charges for natural gas service in Jackson for gas
taken from the Jackson, Mississippi, natural gas field
* * *) and therein were then prescribed the following
rates, domestic, commercial, heating, industrial and munici-
pal, but all said rates were for gas ‘“‘taken from the Jack-
son, Mississippi, natural gas a os ae

Section 5. ‘‘Should Jackson gas field * * * become
insufficient for the performance of that herein required of
grantee, tt may thereafter, and not before obtain natural
gas from other fields and rates therefore shall be fixed here-
under that are just and reasonable.’’

Section 8. ‘‘The grantee shall, as far as practical, furnish
gas * * * from and after the date on which this ordi-
nance goes into force and effect to all individuals, businesses
ind industries, within the corporate limits of the City.’’

The Company’s Complaint then averred:

The Jackson gas field for many months last past, especially 5
at February 7, 1940, and continuously since, was ‘‘insuf- 4
ficient for performance of that requiem * * OY

Particularizing, in part, thereasto:

(a) Gas is drawn directly from the wells, the demand
varies, being greatest between 8 and 9 a. m., (Exhibit B, R.
82). “The maximum available hourly production * * *
at January 19, 1940, (was) not in excess of 1,543,000 Cu.
Pt. per hour * * * yet the maximum requirements of
Company was then and now is (R. 10) 1,778,500 Cu. Ft. per
hour for the Jackson system, (Exhibit B-1), with at least

280,900 Cu. Ft. per hour safety factor, (Exhibit B-2), * * *.”
The demand therefor rapidly is increasing (Exhibit C). ‘It
has increased more than five times since 1930.’’

Exhibit E is a graphic representation of the decline of gas
wells in the Jackson Field. ‘‘Said gas wells in said Jackson
Field will continue to decline, so that within a period of to-
wit, one year or less, there may be no Jackson Gas available
at all, but certainly nothing like an adequate or dependable
supply.’’ (Exhibit E).

(b) As a public utility, without other gas available than
that from the Jackson Field, Company had to anticipate and
being advised by the United Gas Public Service Company
(herein called United, which was a large furnisher of gas)
in 1939 of this condition, a pipeline was constructed, costing
more than $3,000,000, making available at Jackson pipeline
gas.

(c) Company does not own gas gells, has no contract rela-
tion with such owners other than as averred, and the remain-
ing gas ‘‘is not available’? and renders the supply at Jack-
son insufficient.

City wrongly pretends there is no insufficiency as from De-
cember 26, 1939 to January 25, 1940, 780,000 MCF were with-
drawn from the Jackson Field, while the consumption within
the City of Jackson was 530,392 MCF. This claim er-
roneously fails to take into account these essential facts:

(1) The hourly rate of consumption and the gas available
to meet the hourly requirement determines the insufficiency
of the supply ;

(2) Other persons were lawfully entitled to dispose of
the gas (R. 13): therefore, not all of the Jackson field gas
was available to Company ;

(3) Insufficiency must not be allowed to actually oceur,
but arrangements must be made in advance to give a con-

-

7

tinuing dependable supply and Company could not wait un-
til the time of failure to make the supply sufficient ;

(4) The wells were being drained and could not meet
the hourly requirement.

‘*‘Company avers that notwithstanding the excessive
draft, there was not and is not presently, as at Feb-
ruary 7, 1940, or at any time since, nor will there be
from said Jackson gas field at any time in the future
(unless new discoveries are made, which are not now
available), natural gas in commercial quantities suffi-
cient in the Jackson gas field to meet Jackson’s require-
ments under said Exhibit A’’ (R. 14).

‘This gas is wholly inadequate to supply said City’s
demand but will cause in said City a gas famine, with
disastrous results to all concerned. The right thus to
furnish pipeline gas said City wrongfully assumes to
deny and thereasto there is between Company and City
an actual controversy whereasto a declaration is abso-
lutely requisite and essential.’’

Company is continuing to serve to Jackson citizens all
available Jackson gas, but has been required to the extent
of 36.59% to take pipeline gas to supplement the insufficient
local supply, and ‘‘ Company is entitled under said contract
to have this right established and adjudged’’ (R. 15).

‘‘Wherefore, Company prays * * * upon the

final hearing, a declaration be had as between Company
and City, * * *, that——

‘*(a) Under said Contract, Exhibit A, Company has
a right, as now, and from February 7, 1940, to furnish
in said City pipeline gas, * * *

‘*(b) That under said contract, Company has the
right, if the Court be of opinion that said Company may
not so furnish pipeline gas, to discontinue furnishing
said City and its inhabitants pipeline gas and to leave

3d

ii.
3 ;
Peete
i

8

the City solely dependent upon that portion of the gas
originating from said Jackson field that Company may
supply, and for such other, further, and general relief
as in equity and good conscience may seem meet.’’
(R. 17).

City’s Motion To Dismiss.

The City moved to dismiss upon divers grounds (R. 88).

The Court considered only the Johnson Act and dismissed
solely because of want of jurisdiction (R. 92). Reversal
occurred for the reasons set forth in the opinion of Hutche-
son, Cireuit Judge, appended as Appendix C. Thereto we
refer with great confidence for a thorough vindication of
the Company’s rights.

Statutes Involved.

Section 24, Judicial Code, as amended, 28 U. S. C. A,,
Section 41, (in full Appendix A), may be epitomized thus:

c* * 6 * ©The District Courts shall have original
jurisdiction * * * of all suits of a civil nature
* * * Notwithstanding the foregoing provisions
of this paragraph, no District Court shall have juris-
diction of any suits to enjoin, suspend or restrain the
enforcement, operation, or execution of any order of
* * * any rate-making body * * *, where juris-
diction is based solely upon the ground of diversity of
citizenship, or the repugnance of such order to the Con-
stitution of the United States, where such order (1) af-
fects rates chargeable by a public utility, (2) does not
interfere with interstate commerce, and (3) has been
made after reasonable notice and hearing, and where a
plain, speedy, and efficient remedy may be had at law
or in equity in the courts of such State.’’

Pursuant to Section 274d, Judicial Code, 28 U. S.C. A,
Section 400, Declaratory jurisdiction is provided:

**(1) In eases of actual controversy except with re-
spect to Federal taxes the courts of the United States

9

shall have power upon petition, declaration, complaint,
or other appropriate pleadings to declare rights and
other legal relations of any interested party petitioning
for such declarations, whether or not further relief is
or could be prayed, and such declaration shall have the
force and effect of a final judgment or decree and be
reviewable as such.

‘*(2) Further relief based on a declaratory judgment
or decree may be granted whenever necessary or proper.
The application shall be by petition to a court having
jurisdiction to grant the relief. If the application be
deemed sufficient, the court shall, on reasonable notice,
require any adverse party, whose rights have been ad-
judicated by the declaration, to show cause why further
relief should not be granted forthwith.

“ * * (Mar. 3, 1911, ec. 231, See. 274d, as added
June 14, 1934, e. 512, 48 Stat. 955; as amended Aug. 30,
1935, ¢. 829, See. 405, 49 Stat. 1027.) ”’

The sole issue presented to and decided by the District
Court was as to the sufficiency, vel non, of the Jackson gas
field under Sections 2 (R. 20), and 5, (R. 24), under the
complaint, as between the Company and the City, to give
those rights specifically by the contract, Exhibit A, annexed,
to the Company, when the Jackson gas field became ‘‘insuf-
ficient for the performance of that hereunder required.”’
Thereasto averring such insufficiency, the Company asked
declaratory relief.

Hutcheson, Circuit Judge, on appeal, declared, ‘*‘ For such
a case, the Declaratory Judgment Act is made to order,’’ and
excluded from consideration the merits and ‘‘the question
much discussed in the briefs of both appellant and appellee,
with authorities pointing both ways, whether the Declara-
tory Judgment jurisdiction is discretionary. * * * We
are concerned here with questions neither of discretion nor
of the merits, but only with whether there was jurisdiction,
and we think it plain that there was.’’ (Appendix C.)

10

Point I.

REPLY TO CITY’S PETITION.
i.

The City overlooks a controlling decision, Maryland Cas-
ualty Co. v. Pacific Oil & Coal Co., 85 L. ed. (Adv. Sheets)
455.

Therein, Mr. Justice Murphy stated the facts, in part,
thus:

‘Petitioner claimed that this truck was not one ‘hired
by the insured’ and hence that it was not liable to defend
the action by Orteca against the insured * * *. It
sought a declaratory judgment to this effect against the
insured and Orteca, ‘and a temporary injunction re-
straining the proceedings in the state court pending
final judgment in this suit.

‘‘Orteca demurred to the complaint on the ground
that it did not state a cause of action against him. The
District Court sustained his demurrer and the Circuit
Court of Appeals affirmed. 111 F. (2d) 214. We grant-
ed certiorari on October 14, 1940 ( U.S. "
ante, 56, 61 S €t 25) to resolve the conflict with the de-
cisions of other Cireuit Courts of Appeals cited in the
note."

‘“The question is whether petitioner’s allegations are
sufficient to entitle it to the declaratory relief prayed in
its complaint. This raises the question whether there is
an ‘actual controversy* within the meaning of the De-
claratory Judgment Act (Judicial Code Section 274d,
28 USCA See. 400), since the District Court is without
power to grant declaratory relief unless such a contro-
versy exists. Nashville, C. & St. L. R. Co. v. Wallace,
288 US 249, 259, 77 L ed 730, 733, 53 S Ct 345, 87 ALR
1191; USCA Constitution, Art. 3, See. 2.

‘The difference between an abstract question and a

1 This point thus decided was adverted to before the Court of Appeals
but excluded in its opinion.

11

‘controversy’ contemplated by the Declaratory Judg-
ment Act is necessarily one of degree, and it would be
difficult, if it would be possible, to fashion a precise test
for determining in every case whether there is such a
controversy. Basically, the question in each case is
whether the facts alleged, under all the circumstances,
show that there is a substantial controversy, between
parties having adverse legal interests, of sufficient im-
mediacy and reality to warrant the issuance of a de-
claratory judgment. See Aetna L. Ins. Co. v. Haworth,
300 US 227, 239-242, 81 L ed 617, 620-622, 57 S Ct 461,
108 ALR 1000.
* * 7

‘It is clear that there is an actual controversy be-
tween petitioner and the insured. Compare Actna L.
Ins. Co. v. Haworth, supra (300 US 227, 81 L ed 617,
07S Ct 461, 108 ALR 1000). If we held contrariwise as
to Orteca because, as to him, the controversy were yet
too remote, it is possible that opposite interpretations
of the policy might be announced by the federal courts.
For the federal court, in a judgment not binding on
Orteca might determine that petitioner was not obli-
gated under the policy, while the state court, in a sup-
plemental proceeding by Orteca against petitioner,
might conelude otherwise. (Citing cases).

‘*Thus we hold that there is an actual controversy
between petitioner and Orteea, and hence, that peti-
tioner’s complaint states a cause of action against the
latter. However, our decision does not authorize issu-
ance of the injunction prayed by petitioner. (Citing
Cases).”’

This decision clarifies and settles the right to proceed in
the District Court for a declaration, notwithstanding the
pendency in the State Court of a complaint. The City, with
deference, overlooks that at the same time there was pend-
ing before District Judge Mize (a) this complaint for a
Declaration; and (b) the complaint by the City for sub-
stantially specifie performance by the Company. Having

a

12

both causes in the same Court, the District Judge remanded
one and dismissed the other.

This cause (Maryland Casualty Company case) wrought
the requisite clarification as to declarations.

9

ae

Aetna Life Ins. Co. v. Haworth, 300 U. S. 227, 239-242,
61 L. ed. 617, 620-622, 57 S. Ct. 461, 108 A. L. R. 1000, mis-
applied.

With deference, this decision of this Court was properly
followed and applied by Judge Hutcheson, for the City
said the Jackson field was sufficient, the Company said it
was insufficient. Se assuming, the Company arranged to
import pipeline gas to avert a gas famine. The City has
fixed no rate for pipeline gas (there being no Public Serv-
ice Commission and the sole power being in the City to
regulate rates). The Company, as the owner of the pipeline
gas, collected therefor that which it deemed a reasonable
price. Almaras v. Hattiesburg, 180 So. 394, 181 Miss. 752;
Vicksburg Water Works Co. v. Yazoo, etc. Co., 102 Miss.
504, 59 So. 825; Bell v. Kaye, 127 Miss. 165, 89 So. 919.

It was not otherwise provided by statute, hence the Com-
pany has the primary right to fix the price of its property
sold. 13 C. J. S. 277, page 328; Skinner & Eddy Corpora-
tion v. United States, 249 U.S. 564, 63 L. ed. 772, 777; Inter-
slate Commerce Commission v. Alabama, etc. Co., 168 U.S.
168, 42 L. ed. 414, 423; Cincinnati etc. v. Interstate Com-
merce Commission, 162 U. 8S. 197, 40 L. ed. 935, 989. Pur-
suant to this collection by the Company for the pipeline
gas thus furnished, the City presently claims an option
upon the Company’s property and by reason of the suffi-
ciency, vel non, there is also brought about an option, vel
non, Whereasto judicial declaration is requisite, neither hay-
ing aught to do with rates,

=

13

When the declaration is made as to sufficiency, vel non,
it must be assumed that the City will not become a violator
of the law and leave undone those things that it ought to do
or do those things that it ought not to do. Mr. Justice Reed
in Milk Wagon Drivers Union v. Meadowmoor Dairies, Inc.,
U.S. Law Week, February 10, 1941, 4187, said:

‘*Tt is a postulate of reasoned thinking that the judi-
cial decrees will be faithfully carried out.’’

To have the City advise this Court in advance that it
should not make a declaration as to a justiciable contro-
versy because the City will not conform thereto, is not a
well-conceived argument. It savors of taking advantage of
one’s own wrong, (Allegans suam turpitudinem non est
audiendus, Broom’s Legal Maxims; 2 ©. J. 1148) of chal-
lenging constituted authority. We have no doubt when and
if it be adjudged as a fact that the Jackson gas field is
insufficient, the City will conform to that adjudication.
Should it not so do, there is for this failure adequate rem-
edy, (a) under the Declaratory Judgment Act in a Court
“having jurisdiction’’; (b) independently of this statute,
by reason of the inherent power of the Federal Court as a
Court. Compare Julian v. Central Trust Co., 193 U. 8. 93,
112, 48 L. ed. 629, 639; Gunter v. Atlantic Coast Line R. Co.,
200 U. S. 273, 292, 50 L. ed. 477; Munroe v. Raphael, 288
U.S. 485, 489, 77 L. ed. 910, 24 A. L. R. 1084; Bethke v.
Grayburg Oil Co., 5 Cir., 89 Fed. (2) 536, Certiorari denied,
302 U.S. 730, 82 L. ed. 564.

3.

City overlooks other controlling decisions of this Court
rendering Certiorari not requisite.

Compare Currin v. Wallace, 306 U. S. 1-5, 83 L. ed. 441;
Nashville, etc. R. Co. v. Wallace, 288 U.S. 249, 77 L. ed. 730,
87 A. L. R. 1191; United States v. West Virginia, 295 U. S.

—
ReRipcteni 4
eee:

14

463, 79 L. ed. 1546; Borchard Declaratory Judgment, Anno-
tation 87 A. L. R. 1205; 101 A. L. R., Annotation 689.

Wherefore, there is naught further requisite for this
Court to do in that regard.

4.

The City overlooks other decisions dealing with the John-
son Act and construing Federal statutes somewhat similar.

(a) Compare Corporation Commission v. Carey, 296 U.S.
452, 80 L. ed. 325; Mountain States Power Co. v. Public
Service Commission, 299 U.S. 170, 81 L. ed. 101; Driscoll v.
Edison Light € Power Co., 307 U. S. 108, 83 L. ed. 1134;
Petroleum Exploration v. Public Service Commission, 304
U. S. 209, 214, 82 L. ed. 1294, 1299, and the Fifth Circuit
has sought thereto to conform. City of El Paso v. Texas
City Gas Co., 5 Cir., 100 Fed. (2) 501.

(b) The provision of the Johnson Act is no jurisdiction
‘*to enjoin, suspend or restrain the enforcement, operation
or execution of any order of any rate-making body,’’ thus
directly withdrawing jurisdiction only when that sought
was by injunctive process. The Johnson Act does not as-
sume to deny jurisdiction of a proceeding to ‘‘annul’’ or
“‘vacate.’’

Compare the following:

(1) Section 266, where in Public Service Commission v.
Brashear Freight Lines, Inc., 306 U. S. 207, 83 L. ed. 608,
610, this Court said:

‘*Section 266 as originally enacted applied only to
eases in which an interlocutory injunction was granted
or denied and the purpose was to make interference by
such an injunction with the enforcement of state legis-
lation a matter for the adequate hearing and full de-
liberation which the presence of three judges was likely
to secure. Cumberland Teleph. & Teleg. Co. v. Louis-
iana Pub. Serv. Commission, 260 U. S. 212, 216, 67 L.

15

ed. 217, 222, 43 S. Ct. 75; Stratton v. St. Louis S. W.
R. Co., 282 U. S. 10, 14, 75 L. ed. 135, 137, 51 S. Ct. 8.
The amendment that the requirement of a court of
three judges should also apply to the final hearing on
the application for a permanent injunction was to end
the anomalous situation in which a single judge might
reconsider and decide questions already passed upon
by three judges on the application for an interlocutory
injunction. ’’

Compare Note, 83 L. ed. 1193; Phillips v. United States,

85 L. ed. 460.

(2) Ex Parte Bransford, 310 U. S. 354, 84 L. ed. 1249.

(3) Commerce Court, Procter & Gamble Co. v. United

States, 225 U.S. 281, 56 L. ed. 1091, where the excision was

to ‘‘annul’’ and ‘‘set aside.’’

(4) Section 316 of the Packers and Stockyards Act,

United States v. Corrick, 298 U. S. 435, 80 L. ed. 1263, 1266.
(5) Urgent Deficiencies Act of October 22, 1913, Shanna-

han v. United States, 303 U. S. 596, 599, 82 L. ed. 1039,

1041.

(6) United States v. Idaho, 298 U. 8. 105, 109, 80 L. ed.

1070, 1074; Powell v. United States, 300 U. S. 276, 286, 81

L. ed. 643, 644.

Hence, the excision of jurisdiction by the Johnson Act

under these decisions would not include the present suit.

5.

Further of the City’s Petition with Company’s comments
thereon and thereasto.

(a) The City sharply presents the issue thus:

‘The Company had fully complied with the contract;
that the Jackson gas field is presently insufficient for
the performance of the contract; that Company has
sought, obtained and is furnishing pipeline gas from
foreign fields at rates initiated by it (Company) but
not approved by the City as the rate-making power;

4d

16

that the City claims that the Jackson field is still suf-
ficient’’,

and with this issue thus put by the City, the prayer of the
Complaint is—

(1) Under said Contract, Exhibit A, Company has a
right, as at now, and upon February 7, 1940, to furnish in
said City pipeline gas, and that the rates prescribed by Sec-
tion 3 of the Contract do not apply thereto (pipeline gas).
That Section 3 rates do not apply was conceded in the City’s
brief (page 74), ‘‘The only rate agreed upon in the contract
franchise we admit is for natural gas from the Jackson
gas field, but if that becomes insufficient, within the terms
and provisions of the contract franchise, the Company is
required to obtain natural gas from other fields, then in the
language of the contract ‘rates therefor shall be fixed here-
under that are just and reasonable’,’’ but Section 3 (R.
22) can leave no doubt thereasto.

(2) ‘*That under said contract, Company has the right,
if the Court be of opinion that said Company may not so
furnish pipeline gas, to discontinue furnishing said City
and its inhabitants pipeline gas and to leave the said City
solely dependent upon that portion of the gas originating
from said Jackson field that Company may supply, and for
such other, further, and general relief as in equity and good
conscience may seem meet’’ (R. 17).

Hence, with this factual controversy existent, whereun-
der the City would take no step until it was adjusted, this
complaint for declaration was filed, and when made, this dec-
laration would, if favorable to the Company, cancel the
City’s claim for an option upon the Company’s plant and
place the parties litigant in such a status as that each could
do that specifically provided by the contract, for the City
had covenanted when pipeline gas was essential, to vouch-

17

safe thereasto just and reasonable rates. (Section 5, R.
25). So, for Jackson gas, Section 3 prescribed specific rates,
for pipeline gas, Section 5 provides for reasonable and just
rates, and the contract as an entirety was for judicial con-
struction, as to sufficiency, vel non, vouchsafing the respec-
tive parties different rights.

(b) The City claims, ‘‘We submit, therefore, that this is
essentially a rate case,’’ and therefore, any declaration in
the District Court would contravene the Johnson Act.
Thereto, the Company replies:

(1) The legislative history thereof in Appendix D dem-
onstrates that there was no withdrawal of jurisdiction in
such a cause.

(2) This could never be a rate case,—only a contract
case.

Columbus R., Power & Light Co. v. Columbus, 249 U. S.
399, 63 L. ed. 669, 6 A. L. R. 1684; note 74 L. ed. 236; Tex-
arkana v. Arkansas-Louisiana Gas Co., 306 U. S. 188, 83
L. ed. 598.

In the Texarkana Case, pursuant to a somewhat similar
contractual provision in its franchise, the Texas City sought
rates operative in the Arkansas City, and this Court said,
Off. Ed., page 195, L. ed. page 603:

‘‘Another bill was filed by the Texas City in May,
1934, seeking substantially the same relief * * *. The
two actions were consolidated. Later motions, plead-
ings and the decree in the two cases are the same.’’

Adverting to the cause as reported 97 Fed. (2), page 7,
5 Cir., Hutcheson, Circuit Judge, said:

‘On May 22, 1934, the City secured an order of dis-
missal of its suit then pending, and on the next day
filed substantially the same suit as a new proceeding
in the state court. This suit was also removed to the

18

Federal court, where, that court holding that the dis-
missal of the City’s petition in the first had not ef-
fected dismissal of defendant’s counterclaim, the City
obtained a reinstatement of its first suit, and an order
consolidating the two suits for trial.’’

The Johnson Act became effective May 14, 1934, and
neither this Court, the Court of Appeals nor the District
Court thought that such a suit was prohibited by the John-
son Act, and we rely confidently on that decision.

(3) Section 3 of the Contract here covers the rates for
Jackson gas—with a 950 B. T. U. content, and not pipeline
gas with 1,050 B. T. U. content, (R. 4), wherefor the City,
when rates therefor are to be fixed must, Section 5, recog-
nize rates ‘‘hereunder that are just and reasonable.’’ So
that in the same contract, we have rates for Jackson gas,
Section 3, rates for pipeline gas, Section 5, and the sole
question hereunder is sufficiency, vel non, option, vel non,
and naught else. When sufficiency or insufficiency is ad-
judged, the City will be presumed to be law-minded. Omnia
pracsumuntur legitime facta donec probetur in contrarium.
Broom’s Legal Maxims, 948.. Omnia praesumuntur rite et
solemniter esse acta donec probetur in contrarium. Broom’s
Legal Maxims, 944.

(c) The City’s petition contends that the Company is
not ‘‘at liberty to initiate higher rates for pipeline gas on
the assumption that the Jackson field is insufficient.’’

Our answer is:

(1) The City (with sole power to regulate rates) has not
acted thereasto for pipeline gas;

(2) Neither the District Court nor the Chancery Court
of Hinds County may fix rates.

3 Pond Public Utilities, 4th Ed., 1772, See. 892; Southern
Bell Tel. etc. Co. v. Railroad Commission, 5 Fed. (2) 77,
authorities supra. No approval of the rates fixed for pipe-

ie eR eae ee eet ee ee en a tee

19

line gas is sought, directly or indirectly. Even if such were
sought and such approval were beyond the power of the
District Court, just as this Court dissolved the injunction
in the Maryland Casualty Company Case, so here it could
delete from the relief that as to rates. Note the complaint
in its entirety was dismissed, and if but one right was
claimed therein within the Court’s jurisdiction, then as to
that right, jurisdiction remained.

(3) There is one factual issue: is the Jackson gas field
sufficient or insufficient? On that, the evidence will have
to be heard unless this Court should, as would the courts
in Mississippi, take judicial knowledge of the reports made
to the Oil & Gas Commissioner. As Appendix EK, we make
reference to supplemental figures filed by the City, showing
the absolute necessity of that herein asked, which figures
were made a part of the City’s brief in the Court of Ap-
peals. Under those figures, in Janua ‘y, 1939, as given, the
total consumption in Jackson (which we think is too small)
was 419,570 MCF; in February, 1939, 390,046 MCF; in
January, 1940, 529,416 MCF: in February, 481,917 MCF:
and the total monthly produetion of the field since May,
1940, has not exceeded 515,669 MCF, and as at November,
1940, had declined to 378,131 MCF, thus balanced against
the high point of January, 1940, leaving an actual monthly
deficit of 151,285 MCF, and this on the face of the City’s
interpretation of production figures.

Thereasto, we insert as Appendix K, a graph, adopting,
but without admitting the City’s figures to be correct, and
show the monthly production and the monthly consumption.
Therefrom, the Court will see that the monthly production
is presently below the monthly consumption in winter
weather, and relief might be appropriately had under the
City’s admission therein made,

20

(4) The City contends in its statement that ‘‘thereby
(Company) conceding that more gas is produced in the
Jackson field than is distributed by the respondent locally’’,
but, with deference, no such concession is made and for the
purposes of the jurisdictional question, it is admitted that
the field is insufficient.

(5) We disregard in large measure the contention of
the City as to the suit remanded to the State Court because
there was in the Court of Appeals, and probably would be
here, conflict between counsel as to what therein appeared.
Not being in the record, we therefore do not further advert
to it.

Point ITI.
REPLY TO CITY’S BRIEF.

Preliminary Statement.

The City consolidated the Specifications of Error and the
reasons for granting the petition into four points in the
City’s argument, and to avoid prolixity and the overlapping
in the Specifications, we reply only to these four.

i

The City contends this complaint is essentially ‘‘a rate
case’’ and the Company may not do indirectly what it cannot
do directly, hence the Johnson Act divests jurisdiction,

We reply:

(a) To save prolixity we refer to and reiterate Point I,
Subdivision 5 (b). (This is a contract case, not a rate case).

(b) The District Court and the Court of Appeals passed
on no question other or further than relief under a contract.

The three sections of the contract wereasto a declaration
is sought are as follows:

Section 2,

‘‘Natural gas shall be furnished to the inhabitants
of the City of Jackson as long as commercial natural

LT NS Re eee EE SRR IEEE A I A ED

21

gas is produced in commercial quantities * * * su ficient
to supply the demands of the City of Jackson * * * .”°

Section 3,

‘*Pursuant to the municipality’s rate-making power,
and the terms and conditions upon which this franchise
is given, the municipality establishes the following rates
and charges for natural gas service in Jackson for gas
taken from the Jackson, Mississippi, natural gas field.”’

Section 5,

** Should Jackson gas field * * * become imsufficient for
the performance of that hereunder required of the Gran-
tee, it may thereafter, and not before, obtain natural gas
from other fields * * * .”?

So long as the Jackson gas field was sufficient, though the
rates in Section 3 were phenomenally low (being the lowest
in the United States except at Monroe, Louisiana, where
they were the same), Company did not attack or question
that rate structure and does not now do so. The Jackson
field has become insufficient.

Pursuant to what Company assumed to be its rights under

ixhibit A, it brought into Jackson the requisite gas to sup-
ply the deficiency, under a contract with the United, who
made deliveries therefor from its pipelines at City Gate,
amounting, as at February 7, 1940, to 36.59% of all the
natural gas consumed in Jackson. (Tr., 15). Having been
compelled to pay to the pipeline for this interstate gas, mov-
ing under the Natural Gas Act, (15 U.S. C. A. p. 784, 52
U.S. Statutes, 821, Section 717 (a)), Company established
as to all consumers at Jackson the ratio existing between
the pipeline gas and the Jackson field gas consumed during
the month. For the proportion of gas from the Jackson
Field, Company charged the Jackson rates prescribed in
Section 3. For the proportion of the pipeline gas, it charged
reasonable rates, predicated upon the cost of pipeline gas,
as to which pipeline gas, the City has not yet taken any
regulatory action. The City challenged Company’s declara-

22

tion of insufficiency, declaring by ordinance (Tr., 76),
‘«There is now a sufficient supply of natural gas in the Jack-
son field to supply all Jackson consumers.’’ The City admits
Company’s right to supply pipeline gas if the Jackson field
be ‘‘insufficient’’.

Herein, the District Court dismissed in its entirety, deny-
ing the right of the Company to have even an adjudication
as to the option on its property, vel non, by reason of suffici-
ency of the Jackson field, vel non. Surely, the existence of an
option is appropriate for declaration.

‘‘The Company contends that a proper construction
of the franchise, Exhibit A, in view of the facts pre-
vailing, is that the Jackson gas field is now insufti-
cient for the performance of its obligation under the
franchise to supply the City of Jackson, its citizens
and its industries, and that, therefore, the Company is
free to supply gas derived from sources other than the
Jackson field, and under the franchise the Company
is not required to continue furnishing gas imported
over pipelines at the rates for Jackson field gas pre-
seribed in Section 3 of the franchise contract.

‘“‘The nub of the controversy is the fact, vel non, of
the sufficiency of the natural gas in the Jackson field to
supply the City of Jackson, its industries and its inhab-
itants, within the meaning of the Jackson Franchise
contract.

‘*We now proceed to point out, in the absolute, mat-
ters which are not involved in the controversy.

‘*No question of restraining any order of the govern-
ing body of the City of Jackson or any other govern-
mental body is involved. No injunctive relief, directly
or indirectly, is sought (R. 20—Section 20 of the Com-
plaint). No application for an injunction has been
made by the Company.

‘If the District Court upon the merits should find
as a fact, under the Jackson franchise contract, that
the supply of gas from the Jackson gas field was suffi-
cient for the requirements of the City of Jackson, its

—

23

industries and its inhabitants, the Company would be
obligated to supply Jackson field gas at the rates pre-
scribed by Sections 2 and 3 of the contract (R. 20, et
seq.). Inasmuch as in such an event the Jackson gas
field would be found sufficient, the question of any obli-
gation or right to supply pipe line gas would cease to be
involved.

‘*On the other hand, if the District Court should find
the supply of gas from the Jackson field to be insuffi-
cient under the Jackson franchise contract, the com-
pany would become entitled under Section 5 of the Jack-
son franchise contract to supply natural gas from other
fields at rates which shall be fixed that are just and rea-
sonable, or to supply artificial or manufactured gas at
rates therefor which shall be fixed that are just and
reasonable (R. 25).

‘Thus, there is nothing injunctive or restraining
about any finding which the District Court could prop-
erly make in the course of resolving this controversy.
Construction of the franchise contract in light of exist-
ing facts is all that is involved in the controversy.”’

(ec) By the Johnson Act, Federal jurisdiction was di-
vested only where the suit was ‘‘to enjoin, suspend or re-
strain the enforcement, operation or execution”’ thereof.

This suit does not seek, directly or indirectly, to ‘‘enjoin,
suspend or restrain the enforcement, operation or execu-
tion’’ thereof.

This suit does not seek, directly or indirectly, the enforce-
ment, operation or execution, but asks that a franchise con-
tract, not an order, be judicially interpreted in order that it
may thereafter be put in operation and executed as the
parties were by its terms obligated. Compare Texarkana v.
Arkansas Louisiana Gas Co., 306 U. S. 188, 83 L. ed. 598;
Interstate Natural Gas Co. v. Louisiana Public Service Com-
mission, (D. C. La.), 33 Fed. Supp. 50, 59; 34 Fed. Supp. 980.

‘*There is no substance to petitioner’s assertion that
the decision of the Cireuit Court of Appeals herein con-

24

flicts even with that of the District Court rendered in
1935 in Mississippi Power & Light Co. v. City of Jack-
son, 9 Fed. Supp. 564. In that case the complaint
sought to enjoin temporarily and permanently an Ordi-
nance of the City of Jackson establishing electric rates,
It was an out and out rate case, seeking to restrain the
rate fixing ordinance, quite apart from any franchise.
7 e case at bar more nearly resembles the case of An-
derson, Clayton & Co. v. Wichita Valley R. Co., State
of Texas, Intervenor, 15 Fed. Supp. 475, affirmed 92
F. (2d) 105, certiorari denied 302 U. S. 747, rehearing
denied 302 U. S. 780. In the District Court for the
Southern District of Texas, Anderson, Clayton & Com-
pany had sought successfully to have determined
whether certain shipments of cotton were shipments
in ‘‘interstate’’ and ‘‘foreign’’ commerce within cer-
tain rate regulations promulgated under the Interstate
Commerce Act. The District Court held that the com-
plainant was entitled to a declaratory judgment with
respect to the character of the shipments within the
purview of those certain rate schedules and that the
rate schedules of the Texas Railroad Commission did
not apply.’’

The Jackson gas field is insufficient and Company, there-
fore, has the right to introduce pipeline gas. The Company
may be compelled to serve as a public utility, State ex Rel.
v. Benson, 108 Miss. 779, 67 So. 214. It must make reasonable
and proper efforts to accommodate itself to a failure of the
gas supply, Railroad Co. v. Blum Co., 88 Miss. 188, 42 So.
282; Yazoo, etc. R. R. Co. v. McKay, 44 So. 780, 91 Miss. 150;
Oklahoma Natural Gas Co. v. Corporation Commission, 88
Okla. 51, 211 Pac. 401, 31 A. L. R. 330, and the Company must
be vouchsafed by declaration those rights given by Exhibit
A as to putting into operation and execution that validly
obtained as to supplying Jackson with pipeline gas when
and after the Jackson field became insufficient.

(d) The Johnson Act in no way applied, directly or in-
directly, to the course of conduct followed in this cause.

25

(e) Assuming, but not conceding, the franchise contract
to have been an order and the action one to enjoin it, yet the
Johnson Act divested jurisdiction only after reasonable
notice and hearing. The City declared that the supply was
sufficient, and having thus declared, they would take no
further action thereasto. This made, under the decisions of
this Court, the Johnson Act inapplicable.

(f) The City having declared by ordinance the supply
sufficient, without notice, refused to act further, and further
approach would have been futile as the City still maintains
the supply is sufficient. Hence, no further application was
requisite. Hills v. National Albany Exchange Bank, 105
U.S. 319, 26 L. ed. 1053.

(g) Furthermore, it is very doubtful whether Section
2426 provides a reasonable notice, as required by the John-
son Act. Compare Mississippi Power Co. v. Aberdeen, 11
Fed. Supp. 952; but see Mississippi Power & Light Co. v.
Jackson, 9 Fed. Supp. 564.

(h) Section 2426 may be unconstitutional as assuming to
vest this jurisdiction in the Chancery Court. Compare Sec-
tion 156, Constitution of Mississippi, providing :

‘*Section 156. The Cireuit Court shall have original
jurisdiction in all matters civil and criminal in this state
not vested by this Constitution in some other court, and
such appellate jurisdiction as shall be prescribed by
law.’’

Section 2426 originated in Chapter 231, Mississippi Laws
1904, so that as at 1890, the date of the Constitution, there
was no revisory jurisdiction in the Chancery Court and no
Court in Mississippi may fix rates. Authorities, supra.

(i) Griffith v. Vicksburg Waterworks Co., 88 Miss. 371,
40 So. 1011 did not involve this statute. As to further litiga-

ADT

RBA LIE ARAL LLNDLYS SERRE RD DD WAL TIGA OEP EN Mae PENI iby OLD dated Win DOA OR

26

tion about the water rights in Vicksburg, see Vicksburg v.
Vicksburg Waterworks Co., 206 U. S. 496, 51 L. ed. 1135.

(j) City of Laurel v. Mississippi Gas Co., 49 Fed. (2) 219
merely dealt with the right to regulate rates. Presently
there are no rates in Jackson for pipeline gas. It may well
be that the Company’s fixation thereof under the act of 1860
is conclusive whereby the Directors ‘‘of said Gas Light
Company * * * shall make all needful rules and regulations
for the management of said Gas Works and fix the terms
and conditions on which gas will be supplied to consumers.”’
Gulf & Ship Island R. Co. v. Laurel Oil & Fertilizer Co., 159
So. 838, 172 Miss. 630; Stone v. Y. & M. V. R. Co., 62 Miss.
607, 116 U.S. 307, 29 L. ed. 636; Stone v. Illinois Central R.
Co., 116 U.S. 347.

(k) The City then relies upon Aetna Casualty & Surety
Co. v. Quarles, 4 Cir., 92 Fed. (2) 321, which is not in any
way contra, for the same day the same Judge decided Ste-
phenson v. Equitable Life Assurance Society, 4 Cir., 92 Fed.
(2) 406, and in New York Life Ins. Co. v. Roe, 8 Cir., 102
Fed. (2) 28, 31, our conception is sustained.

All questions as to the merits and the discretion were
expressly excluded from consideration by the Court of Ap-
peals, and that presented to the District Court was solely
a jurisdictional question. The merits of the controversy
were not touched in dismissing, the District Court did so
because of the supposed limitation of the Johnson Act.
The question of an exercise of discretion as to the propriety
of a declaration was not properly before the Court and
necessarily is not before this Court on this petition, which
does not reach any aspect of the merits, but involves the
simple issue of jurisdiction.

27

The Company has entered upon the discharge of its duty
to distribute natural gas from foreign fields and therefore
what initially was optional, has become probably obligatory.

2.

The City next contends: ‘‘It was never the purpose of
the Declaratory Judgment statute to permit the trial of
a case piecemeal or to make any adjudication unless it dis-
poses of the whole controversy,”’

Whereto, we reply:

(a) These matters substantially covered, supra.

(b) These aspects are thoroughly settled, with defer-
ence, by the decisions of this Court, and that hereunder
sought is well within the rule thus laid down, and if the
District Court adjudges the Jackson field insufficient, there
will be no difficulty in having the City conform thereto.

(c) Pendency of a suit in a State Court in personam
never deprived one entitled to relief in the Federal Court
from proceeding there.

McClellan v. Carland, 217 U. S. 281, 54 L. ed. 762, 767;
Pennsylvania v. Williams, 294 U. S. 176, 183, 79 L. ed. 814;
Kline v. Burke Construction Co., 260 U. 8. 226, 67 L. ed. 226;
Kelleam v. Maryland Casualty Co., U. 8. Law Week, Feb-
ruary 18, 1941, 4204.

3.

The city next contends that the pendency of the suit in
the Chancery Court remanded thereto by the District Court
is a bar to the prosecution of this cause in the District
Court.

Thereto we have replied fully, swpra, and the Court of
Appeals expressly refused to pass on this point.

28

4.

Counsel’s final point has to do with ‘‘The opinion com-
plained of, we submit, is contrary to the principles an-
nounced by other Courts of equal dignity in reference to
tax cases.’’

Our reply is:

The City relies upon:

(a) Sears, Roebuck & Co. v. Roddewig, 24 Fed. Supp. 321,
but this had to do with the Iowa use tax. Compare 292 N.
W. 130, 238 Iowa ——, and was reversed by this Court on
February 17, 1941, U. S. Law Week, February 18, 1941,
4198, with the Chief Justice and Mr. Justice Roberts dis-
senting. The Johnson Act was not mentioned directly or
indirectly.

(b) William B. Schaife & Sons Co. v. Driscoll, 3 Cir., 94
Fed. (2) 664, and inadvertently refer to the Johnson Act
as having been there involved. With deference, therein
Counsel err. Said that Court:

‘““By Act of June 14, 1934, ce. 512, 48 Stat. 955, Jud.
Code, See. 274d, 28 U.S. C. A. See. 400 and note, Con-
gress authorized the finding of declaratory judgments
in certain types of cases in the federal courts. What-
ever would have been the status of the case at bar under
the original Declaratory Judgment Act, a subsequent
Act of Congress of August 30, 1935, c. 829, 49 Stat.
1027, Sec. 405, 28 U. S. C. A. See. 400, specifically ex-
cluded questions of federal taxation from the opera-
tion of the Declaratory Judgment Act.’’

Note Section 400, U. S. C. A., Title 28, Judicial Code 274d.

‘*In cases of actual controversy except with respect
to Federal taxes the courts of the United States shall
have power upon petition, declaration, complaint, or
other appropriate pleadings to declare rights and other
legal relations of any interested party petitioning for

29

such declaration, whether or not further relief is or
could be prayed, and such declaration shall have the
force and effect of a final judgment or decree and be
reviewable as such.’’

Compare, also, Revised Statutes, Sec. 3224, Sec. 1543,
Title 26, U. S.C. A.:

‘‘No suit for the purpose of restraining the assess-
ment er collection of any tax shall be maintained in
any court.”’

(c) a‘ suother point, the City mentions Southern Pacific
Co. v. McAdoo, 9 Cir., 82 Fed. (2) 121, but therein naught
contra is found.

(d) At another point, the City mentions Automobile Ins.
Co. v. Freundt, 7 Cir., 103 Fed. (2) 613, but, note, further,
Chase National Bank v. Citizens Gas Co., 7 Cir., 113 Fed.
(2) 217, and naught contra is found.

(e) At another point, the City mentions United States
Fidelity & Guar. Co. v. Koch, 3 Cir., 102 Fed. (2) 288 in no
way conflicts with that herein contended for.

(f) Lake Erie Provision Co. v. Moore, 11 Fed. Supp. 522,
may be disregarded. Compare Currin v. V/allace, 306 U.
8. 1, 83 L. ed. 441.

Hence, there is no such conflict as calls for a uniform rule
to be announced here, unifying the law, for, with deference,
as to all hereunder claimed, the fundamental decisions ap-
plying the principles of law applicable are remarkably har-
monious. The City has already had one appeal and is not
entitled to another.

The importance of maintaining the Federal jurisdiction
is vital to this Company’s rights. Hence, this appeal there-
for is earnestly made. The opinion of the Court below,

Bs

with deference, is correct and the petition should be denied,
there being no adequate ground therefor assigned.

30

Respectfully,
MakceLLus GREEN,
_ Jackson, Mississippi;
R. A. Henperson,
2 Rector St., New York City;
A. M. NELson,
Jackson, Mississippi;
Forrest B. Jackson,
Jackson, Mississippi;
Garner W. GREEN,
Jackson, Mississippi;
Attorneys for Respondent.

Rew & Prisst,

2 Rector St., New York City.
Green & GREEN,

Jackson, Mississippi.
Jackson, Younc & FRIEnp,

Jackson, Mississipm, Of Counsel.

I, W. E. Morse, of Counsel for Petitioner, acknowledge
receipt of copy of the foregoing Response of Mississippi
Power & Light Company with Supporting Brief, this the
25th day of February, 1941.

W. E. Morss,
Of Counsel for Petitioner.

REGIE LG AOE IID OS ESAT TE EELS ALG SERIO iS PHONEMES NG ep TENN eR ENE 4a

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA43086415_0342%3A3. Public record. Not legal advice.