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Natural Gas Service Co. v. Serv-Yu Cooperative, Inc.

Supreme Court of Arizona

May 29, 1950

NATURAL GAS SERVICE CO. et al.
v.
SERV-YU COOPERATIVE, Inc

Original decision approved, and reinstated as clarified.

Stanley A. Jerman and Harold L. Jerman, Walter Roche, Phoenix, for appellant, Natural Gas Service Co.

Knapp, Boyle, Bilby & Thompson, Arthur Henderson, Tuscon, for appellant El Paso Natural Gas Co.

Evo DeConcini, Attorney General, Perry M. Ling, Chief Assistant Attorney General, for appellant Corporation Commission.

Dougherty, Chandler & Connor, Phoenix, for appellee.

La Prade, Chief Justice. Udall and Phelps, JJ., and Dudley W. Windes, Superior Judge, concurring. Stanford, Justice (specially concurring).

Note: Justice De Concini, whose name appears on the briefs as Attorney General, did not participate in this opinion.

OPINION

La Prade, Chief Justice.

Page 325

[70 Ariz. 237] After our decision and opinion in this case, see 69 Ariz. 328, 213 P.2d 677, a motion for rehearing was granted and oral arguments heard. An exhaustive and attentive review of our former opinion has not caused the court to arrive at any different conclusion as to the correctness of our original disposition of the case. Our attention has been directed to the fact that the conclusion drawn, that appellee is a public service corporation within the purview of article 15, section 2 of the Constitution, rests on the single factor that: "* * * Its character as a corporation whether it is a public service corporation or otherwise must be determined by what its articles and by-laws authorize it to do rather than by what it is now doing or may do in the immediate future. * * *" 69 Ariz. 328, 213 P.2d 677, 684.

We are now of the opinion that while this analytical observation may be technically correct, admittedly the statement is too broad and though doctrinal in form cannot be defended in the light of reason as exemplified by many well-considered cases. For collection and analysis of applicable cases see Rural Electric Co. v. State Board of Equalization, 57 Wyo. 451, 120 P.2d 741, rehearing denied 122 P.2d 189. The mere power, stemming from its articles of incorporation, "to manufacture, purchase, acquire and accumulate natural gas and/or gas * * * for its members only, and to transmit, distribute, furnish, sell and dispose of such gas to its members only * * *" etc. standing alone is not enough to brand it as a public service corporation. There were other factors that should have been pointed out, all of which were evidenced by our recitation of the facts in the original opinion.

1. What the corporation actually does.
2. A dedication to public use.
3. Articles of incorporation, authorization, ...

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