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Public Utility Property J u s t p u b l i s h e d ! RENT CONTROL F td tw l, State, and Municipal U ERE it Ik t book off tho Hour, right up to 1 ' tho minuto. Tho authors^ Bernard Priod-lander and Anthony Currori, both Doputy A ttt. Corp. Counsels, Law Dopt., City off Now York, horo protont tho fflrtl authoritativo and comprohontivo onolytit of ono off tho mott complicated logoi problems of tho day. 939 pagos— 2156 ffootnotot— 3125 index tofforoncot— -1 01 Individual oppondlcot off Fodorol, Stoto, and N .Y .C . statutes, regula­tions, interpretations, and forms. Alreody acclaimed "a n indispensable working to o l" and "ono off tho most impor­tant and timely contributions to tho legal texts off tho post-war o ra ," RENT CON TR O L is a must for oil lawyers, law-makers, fudges, and libraries interested In the problem. W ill be supplemented semi-annually. PRICE $19.00 CENTRAL BOOK COMPANY taw Booksellers and Publishers 261 Broadway, Now York 7, N. Y. that the cost must be reasonable and, if not reasonable, be revisecT to a reasonable figure' N o distinction was made between land and other pro­perty in the Hope case. j^vmtageof the cost f°rmi,la as contrasted with other formulas is that it is certain or can be made certain] T hereaTferj a TaTe-fixing body has a fixed and definite standard in future rate cases about which there can be very little quarrel. On the other hand, the fair value rule lends itself to ever-changing value. There is no certainty at all about the value that should be used in the rate base, because there will usually be as many different con­clusions as to value as there are appraisers involved. In such circum­stances, the rate-fixing body is re­quired to exercise its independent judgment, or independent guess, as to what value figure to adopt. It appeals to me that the very nature of a public utility, occupying as it does a quasi-public and a quasi-trustee position, lends itself to the application of a rule of valuation in consonance with the obligations flowing from such a public status. It would appear that valuation on a cost basis fits into such status. Th e fair value rule creates an ever-chang­ing valuation figure, because proper­ty, particularly land, will fluctuate in value from year to year and in accordance with economic cycles and trends. In other words, in every rate case there will usually be a new guess as to what value to place upon the regulated property. On the other hand, having once arrived at the cost figure to be used as applied to land or any other property, thereafter the standard of valuation will remain constant. In this connection, Justices Iirandeis and Holmes pointed out (262 U.S. 276, 306-07): The adoption of the amount pru­dently invested as the rate base and the amount of the capital charge as the measure of the rate of return would give definiteness to these - two factors involved in rate controversies which are now shifting and treacher­ous, and which render the proceedings peculiarly burdensome and largely fu­tile. Such measures offer a basis for decision wh'ch is certain and stable. The rate base would be ascertained as a fact, no determined as a matter of opinion. It would not fluctuate with the market price of labor, or materials, or money. It would not change with hard times or shifting populations. It would not be dis­torted by the fickle and varying judg­ments . of appraisers, commissions, or courts. It would, when once made in respect to any utility, be fixed for all time, subject only to increases to rep­resent additions to plant, after allow­ance for the depreciation included in the annual operating charges. I agree with Justices Brandeis and. Holmes that a public utility should be permitted to earn a return only/ upon the capital prudently era/ barked in the business. N o contention is herein made that it would be unlawful to value pro­perty in a rate case at fair value or fair market value, as has been done in many cases in the past. Some day the courts may outlaw such proce­dure, but that has not been expressly done as yet. I believe that the cost basis is preferable for valuing all property for rate-fixing purposes. Th e prudent investment theory, with reasonable adjustment for special situations, recommends itself. Even though we may have no ready-made name, slogan or label to affix to such formula, we should not hesitate to adopt it if reason and justice de­mand. Let me most emphatically state that, in my opinion, no basis or formula can be devised that will produce exact results and will ex­clude all uncertainty or exercise of judgment in arriving at valuation. I do contend that the present rule followed by the Supreme Court is a vast improvement over the former chaos. 5mm The Lamars of Georgia (Continued from page 1102) for old soldiers in the War with Mexico. Senator Hoar of Massa­chusetts presented an amendment: "Provided further, that no pension shall ever be paid under this Act to Jefferson Davis, the late President of the so-called Confederacy’’. This aroused Senator Lamar, and he arose to make a reply. He was called down by the presiding officer; but on his appeal from the ruling of the chair, the question was put to the Senate and Lamar was per­mitted to proceed. H e said: The only difference between myself and Jefferson Davis is that his exalted character, his preeminent talents, his well-established reputation as a states­man, as a patriot, and as a soldier, en­abled him to take rhe lead in the cause to which I consecrated myself and to which every fiber of my heart responded. There was no distinction between insult to him and the South­ern people, except that he was their chosen leader, and they hi* enthusi­astic followers: and there has been no difference since. Jefferson Davis, since the war, has nevei counseled insurrection against the authority of this government. Not one word has he uttered inconsistent with the greatness and glory of this American Republic. The Senator from Massachusetts can point to no utter­ance of Jefferson Davis which bids the people of the South to cherish ani- 1156 Arncncan Bar Association Journal