CHAPTER 254

PUBLIC SERVICE COMMISSION

AN ACT TO CREATE AND ESTABLISH A PUBLIC SERVICE COMMISSION, AND PRESCRIBING ITS POWERS AND DUTIES, AND TO PROVIDE FOR THE REGULATION AND CONTROL OF PUBLIC SERVICE CORPORATIONS AND PUBLIC UTILITIES, AND MAKING APPROPRIATIONS THEREFOR.

Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met:

Section 1. A commission, vested with the powers and duties hereinafter specified, is hereby created, which shall be designated and known as "The Public Service Commission of Delaware."

The Public Service Commission (hereinafter called "the Commission") shall consist of three persons, citizens of this State, not under thirty years of age, who shall be appointed by the Governor and confirmed by the Senate. The Governor shall also designate one of the Commissioners as Chairman. Not more than two of said Commissioners shall be members of the same political party. One of the members of the said Commission shall be appointed for the term of two years, another for the term of four years, and another for the term of six years. Thereafter, and at the expiration of each term, a successor shall be appointed for a term of six years. All vacancies, except through the expiration of term, shall be filled for the unexpired term only. The Governor, with the advice and consent of the Senate, may remove any member of said Commission for neglect of duty or misconduct in office, giving to said member a copy of the charges against such person and affording an opportunity of being publicly heard in person or by counsel, upon ten days' notice. In constituting the Commission the appointments shall be made so that there shall always be on the Commission one resident of New Castle County, one resident of Kent County and one resident of Sussex County.

The members of the Commission shall each receive annual compensation of $4,500.00, to be paid in equal monthly payments by the Treasurer of the State.

The Commission shall employ a secretary and such other employees as it may deem necessary, and fix their duties, compensation and terms of service. The Attorney General shall be the legal adviser to the Commission.

The Commissioners and Secretary and other employees of the Commission shall be entitled to receive from the State of Delaware their necessary traveling expenses while traveling on the business of said Commission, which shall be paid by the State Treasurer out of the general funds of the State on proper voucher therefor approved by the Chairman of the Commission.

The Commission shall have an office in the State House, and shall be provided with all necessary furniture, stationery and supplies, and office appliances. It shall provide itself with a seal for the authentication of its proceedings and orders. It shall have power to make all needful rules for its government and other proceedings not inconsistent with this Act. It shall meet at such times and places within this State as it may provide by rule or by special order.

Section 2. The Public Service Commission shall have general supervision and regulation of all public utilities and also over their property, property rights, equipment, facilities and franchises so far as may be necessary for the purpose of carrying out the provisions of this Act. The term "public utility" is hereby defined to include every individual, copartnership, association, corporation, joint stock company, agency or department of the State, or any association of individuals engaged in the prosecution in common of a productive enterprise (commonly called a "Cooperative"), their lessees, trustees, or receivers appointed by any court whatsoever, that now operates or hereafter may operate, within the State of Delaware, any steam railroad, street railway, traction railway, motor bus, electric trackless trolley coach, taxicab, automobile truck, express, steam, manufactured gas, natural gas, electric light, heat, power, water, telephone or telegraph service, system, plant or equip-

ment, for public use, but shall have no supervision or regulation over any public utility or over the property, property rights, equipment, facilities or franchises of any public utility that is municipally owned.

Section 3. The Public Service Commission shall have power:

(a) To investigate, upon its own initiative or upon complaint in writing, any matter concerning any public utility as herein defined.

(b) From time to time to ascertain and determine the fair value of the property of any public utility as herein defined whenever, in the judgment of said Commission, it shall be necessary so to do for the purpose of carrying out any of the provisions of this Act, and in making such valuation the Commission may have access to and use any books, documents, or records in the possession of any department or board of this State or any political sub-division thereof. In ascertaining and determining such fair value, the Commission may determine every fact, matter, or thing which, in its judgment, does or may have any bearing on such value; and may take into consideration, among other things, the original cost of construction, particularly with reference to the amount expended in the existing and useful permanent improvements; with such consideration for the amount in market value of its bonds and stocks, the probable earning capacity of the property under particular rates prescribed by statute or ordinance, or other municipal contract, or fixed or proposed by the Commission, and for the items of expenditures for obsolete equipment and construction, as the circumstances and the historical development of the enterprise may warrant; the reproduction costs of the property, based upon the fair average price of materials, property and labor, and the developmental and going concern value of such public service company; and these, and any other elements of value, shall be given such weight by the Commission as may be just and right in each case.

() After hearing, upon notice, by order in writing to fix just and reasonable individual rates, joint rates, charges or

schedules therof, as well as commutation, mileage and other special rates, which shall be imposed, observed and followed thereafter by any public utility as herein defined whenever the Commission shall determine any existing individual rate, joint rate, toll, charge or schedule thereof, or commutation, mileage, or other special rate to be unjust, unreasonable, insufficient, or unjustly discriminatory or preferential.

(d) To require every public utility as herein defined to file with the Commission complete schedules of every classification employed and of every individual or joint rate, fare, or charge made, charged or exacted by said public utility for any product supplied or service rendered within this State or specified in such requirement.

(d) After hearing, by order in writing, to fix just and reasonable standards, classifications, regulations, practices, measurements or services to be furnised, imposed, observed and followed thereafter by any public utility as herein defined.

(e) After hearing, by order in writing, to ascertain and fix adequate and reasonable standards for the measurement of quantity, quality, pressure, initial voltage or other condition pertaining to the supply of the product or service rendered by any public utility as herein defined, and to prescribe reasonable regulations for examinations and test of such product or service and for the measurement thereof.

(f) After hearing, by order in writing, to establish reasonable rules, regulations, specifications and standards to secure the accuracy of all meters and appliances for measurements.

(g) To provide for the examination and test of all appliances used for the measuring of any products or service of a public utility as herein defined.

() To enter, by and through its agents, experts or examiners, upon any premises occupied by any public utility as herein defined for the purpose of making the examination and tests provided for in this Act and to set up and use on such premises any apparatus and appliances necessary therefor.

(j) To fix the fees to be paid by any consumer or user of any products or service of a public utility as herein defined, who may apply to the Commission for an examination or test to be made of the meters or other appliances of the utility. If the meter so tested shall be found to be accurate within such commercially reasonable limits as the Commission may by general or special order fix for such meters or class of meters, the fee shall be paid by the consumer requiring such test, but if not so found, then the cost thereof shall be borne by the public utility furnishing said meter.

(k) After hearing, upon notice, by order in writing to direct any railroad, or street railway, or traction company, or any motor bus passenger line, steamboat company, or auto truck freight line to establish and maintain at any junction or point of connection or intersection with any other line of said company, or with any line of any other railroad, or street railway, or traction company, or motor bus, electric trackless trolley coach, passenger line, or steamboat company, or auto truck freight line, such just and reasonable connection as shall be necessary to promote the convenience of shippers of property, or of passengers, and in like manner to direct any railroad, street railway, or traction company, engaged in carrying merchandise, to construct, maintain and operate upon reasonable terms a switch connection with any private side track which may be constructed by any shipper to connect with the railroad or street railway or traction railway where, in the judgment of the Commission, such connection is reasonable and practicable, and can be put in with safety and will furnish sufficient business to justify the construction and maintenance of the same.

Section 4. The Public Service Commission, after hearing, upon notice, shall have power by order in writing to require every public utility as herein defined:

(a) To comply with the laws of the State of Delaware and any ordinance of any political sub-division thereof relating thereto, and to conform to the duties imposed upon it thereby or by the provisions of its own charter, whether obtained under any general or special law of any State.

(b) To furnish safe, adequate and proper service and keep and maintain its property and equipment in such condition as to enable it so to do.

(c) To establish, construct, maintain and operate any reasonable extension of its existing facilities where, in the judgment of said Commission, such extension is reasonable and practicable and will furnish sufficient business to justify the construction and maintenance of the same, and when the financial condition of the said public utility reasonably warrants the original expenditures required to making and operating such extension.

(d) To keep its books, records and accounts so as to afford an intelligent understanding of the conduct of its business and, to that end, to require every such public utility of the same class to adopt a uniform system of accounting.

Section 5. Unless the Commission otherwise orders, no public utility shall make any change in any rate which has been duly established under this Act except after thirty days' notice to the Commission, which notice shall plainly state the changes proposed to be made in the rates then in force and the time when the changes will go into effect. All proposed changes shall be shown by filing new schedules or shall be plainly indicated upon schedules filed and in force at the time and kept open to public inspection. The Commission, for good cause shown, may allow changes in rates without requiring the thirty days' notice under such conditions as it may prescribe. All such changes shall be immediately indicated upon its schedule by such public utility.

Whenever there is filed with the Commission by any public utility any schedule stating a new rate or rates, the Commission may, either upon complaint or upon its own initiative, upon reasonable notice, enter upon a hearing concerning the lawfulness of such rate or rates; and pending such hearing and the decision thereon, the Commission may, at any time before said rate or rates become effective, suspend the operation of such rate or rates, but not for a longer period than ninety days beyond the time when such rate or rates would otherwise go into effect unless the Commission shall find that a longer time will be required, in which case the Commission may extend the period

for not to exceed six (6) months; provided, and notwithstanding any such order of suspension, the public utility may put such suspended rate or rates into effect on the date when it or they would have become effective, if not so suspended, by filing with the Commission a bond in a reasonable amount approved by the Commission, with sureties approved by the Commission, conditioned upon the refund, in a manner to be prescribed by order of the Commission to the persons entitled thereto of the amount of the excess, if the rate or rates so put into effect are finally determined to be excessive; or there may be substituted for such bond, other arrangements satisfactory to the Commission for the protection of the parties interested. If the public utility fails to make refund within thirty days after such final determination any person entitled to such refund may sue therefor in any court of this State of competent jurisdiction and be entitled to recover, in addition to the amount of the refund due, all court costs and reasonable attorney's fees, but no suit may be maintained for that purpose unless instituted within two years after such final determination. Any number of persons entitled to such refund may join as plaintiffs and recover their several claims in a single action; in which action the court shall render a judgment severally for each plaintiff as his interest may appear. During any such period of suspension, the Commission may, in its discretion, require that the public utility involved shall furnish to its consumers or patrons a certificate or other evidence of payment made by them under the rate or rates which the public utility has put into operation in excess of the rate or rates in effect immediately prior thereto.

If, after such hearing, the Commission finds any such rate or rates to be unjust, unreasonable or unjustly discriminatory, or in any wise in violation of law, the Commission shall determine the just and reasonable rate or rates to be charged or applied by the utility for the service in question, and shall fix the same by order to be served upon the utility; and such rate or rates are thereafter to be observed until changed, as provided by this Act.

Section 6. No public utility as herein defined without having first obtained the approval of the Commission shall (1) directly or indirectly merge or consolidate with any other company, sell, lease, assign, mortgage, except by supplemental

indenture in accordance with the terms of a mortgage outstanding September 1, 1949, or otherwise dispose of or encumber any essential part of its franchises, plant, equipment or other property, necessary or useful in the performance of its duty to the public; (2) issue any stocks, stock certificates, notes, bonds or other evidences of indebtedness payable in more than one year from the date thereof. It shall be the duty of the Commission to approve of any such proposed issue when satisfied that the same is to be made in accordance with law and the purpose of such issue be approved by said Commission. The Commission shall approve or disapprove each such issue within fifteen days after the filing of the written application for such approval. If not disapproved within said fifteen days, such issue shall be deemed to be approved. The provisions of this section relating to the issuance of securities shall not apply to securities of railroad companies subject to the jurisdiction of the Interstate Commerce Commission. Nothing herein contained shall be construed in any wise to prevent the sale or lease or other disposition by any public utility as herein defined of any of its property in the ordinary course of its business.

Section 7. No public utility as herein defined shall make, impose or exact any unjust or unreasonable or unduly preferential or unjustly discriminatory individual or joint rate for any product or service supplied or rendered by it within the State, or adopt, maintain or enforce any regulation, practice or measurement which shall be unjust, unreasonable, unduly preferential or unjustly discriminatory or otherwise in violation of law, or make, or give, directly or indirectly, any undue or unreasonable preference or advantage to any person or corporation or to any particular description of traffic, in any respect whatsoever.

Section 8. No franchise or privilege hereafter granted to any public utility as herein defined by any public authority in this State shall be valid until approved by the Public Service Commission, such approval to be given when said Commission determines that such franchise or privilege is necessary and proper for the public convenience.

Section 9. The Public Service Commission shall have power to compel the attendance of witnesses and the production

of tariffs, contracts, papers, books, accounts and all other documents, and any member of the Commission shall have power to administer oaths to all witnesses who may be called before the Commission or any member thereof. Subpoenas issued by the Commission shall be signed by one of the members thereof and attested by the Secretary and may be served by any Sheriff, Deputy Sheriff, Constable, or any employee of the Commission and return thereof made to the said Commission. The fees and mileage of witnesses required to attend before the Commission shall be computed at the rate allowed to witnesses.in the Superior Courts, of the State of Delaware, such fees to be paid when the witness is excused from further attendance and the disbursements made in payment of such fees shall be audited and paid in the same manner provided for the payment of expenses of the Commission; provided, however, that no witnesses subpoenaed in the instance of parties other than the Commission shall be entitled to compensation from the State for attendance or travel unless the Commission shall certify that the testimony was material to the matter investigated. If a person subpoenaed to attend before the Commission, or a member thereof, fails to obey the command of such subpoena without reasonable cause, or if a person in attendance before the Commission, or a member thereof, refused without lawful cause to be examined or to answer a legal or pertinent question, or to produce a book or paper when ordered to do so by the Commission, or any member thereof, the Commission or such member thereof may apply to the Superior Court in and for the County where such hearing or investigation is being held or any Judge thereof in vacation, who shall have the power of the said Court for such purpose, for an order returnable in not less than two or more than ten days, directing such person to show cause before the Court, or any Judge thereof in vacation why he or she could not comply with the subpoena or order of the Commission; upon the return of such order the Court or Judge, before whom the matter shall come on for hearing, shall examine under oath the persons whose testimony may be relevant, and such person shall be given an opportunity to be heard, and if the Court or Judge shall determine that said person refused without legal excuse to obey the command of such subpoena or to be examined, or to answer a legal or pertinent question, or to produce a book or a paper which he or she was ordered to produce, said Court or

Judge may order such person to comply forthwith with the subpoena or order of the Commission, and any failure to obey such order of the Court or Judge may be punished by said Court or Judge as a contempt of said Superior Court.

Section 10. No person shall be excused from testifying or producing any book, document or paper in any investigation or inquiry by or upon hearing before the Public Service Commission, or any member thereof, upon the ground that the testimony, evidence, book, document or paper required of such person may tend to incriminate such person or subject such person to penalty, or forfeiture, but no person shall be prosecuted, punished, or subjected to any penalty or forfeiture for or on account of any act, transaction, matter or thing concerning which he shall, under oath, have testified or produced incriminating evidence; provided, however, that no person so testifying shall be exempt from prosecution or punishment for any perjury committed by such person in her or his testimony. Nothing herein contained is intended to give, or shall be construed in any manner to give, any corporation immunity of any kind. No member, employee or investigator of the Public Service Commission shall be required to give testimony in any Court suit to which the said Commission is not a party with regard to information obtained by said member or employee in the discharge of official duty.

Section 11. The Public Service Commission, where the depositions of witnesses within or without the State are necessary in any hearing or investigation being held by the said Commission, may request the Superior Court in and for the County to provide for the obtaining of such depositions in accordance with the rules of said Court.

Section 12. Every order made by the Public Service Commission shall be served upon the person or public utility as herein defined affected thereby, within ten days from the time said order is filed, by personally delivering or sending by registered mail a certified copy thereof to the person to be affected thereby, or in case of a public utility to any officer or agent thereof upon whom a summons may be served in accordance with the provisions of the law of this State. All orders of the said Commission to continue service or rates in effect at the time said order is made shall be immediately operative; and all orders shall become effective upon the date specified therein, which shall be at least twenty days after the date of said order.

Section 13. In default of compliance with any order of the Public Service Commission when the same shall become effective, the public utility affected thereby shall be subject to a penalty of Fifty Dollars 050.00) per day for every day during which such default continues, to be recovered in an action of debt in the name of the State and observance of the orders of the said Commission may be compelled by mandamus or injunction in appropriate cases, or by bill in equity to compel the specific performance of the order or orders so made or of the duties imposed by law upon such public utility.

Section 14. Any person who shall knowingly and wilfully perform, commit or do, or participate in performing, committing or doing, or who shall knowingly or wilfully cause, participate or join with others in causing any public utility corporation or company to do, perform or commit, or who shall advise, solicit, persuade, or knowingly and wilfully instruct, direct or order any officer, agent or employee of any public utility, corporation or company to perform, commit or do any act or thing forbidden or prohibited by this Act, shall be guilty of a misdemeanor, and upon conviction thereof shall be punished by a fine not exceeding Five Hundred Dollars ($500.00) or by imprisonment not exceeding six (6) months, or by both such fine and imprisonment, in the discretion of the Court.

Section 15. The Attorney General, or any public utility affected by any order made by the Public Service Commission may appeal from such order to the Superior Court of the State of Delaware within thirty clays from the date upon which such order becomes effective, as herein provided. Said appeal shall be filed with the Prothonotary of said Court and summons in said appeal shall be served upon the Secretary of the said Commission either personally or sent by registered mail to the office at the State House, Dover, Delaware, and shall also be served upon the public utility or upon the Attorney General, as the case may be. Upon every such appeal the cause shall be determined by the Court from the record (which shall include a typewritten copy of the evidence and of the findings and order of the Commission) without a jury, and the Court may affirm,

modify or revise the order of the Commission, in whole or in part, or may remand the cause to the Commission for rehearing, in whole or in part. The Superior Court is hereby vested with jurisdiction and power to hear and determine all such appeals, and with power to make any and all rules needful or convenient in the premises. Upon the determination of every appeal, a copy of the opinion and order of the Superior Court shall be certified to the Commission.

Section 16. The filing of an appeal from any order of the Public Service Commission shall in no case supersede or stay the order of the said Commission, unless the said Superior Court, or a Judge thereof in vacation, shall so direct, and the appellant may be required by the said Court, or a Judge thereof in vacation to give bond in such form and of such amount as the said Court, or the Judge thereof, allowing the stay, shall require.

Section 17. Copies of all official documents and orders filed or deposited in the office of the Public Service Commission, certified by the Chairman and the Secretary to be true copies of the original and given under the official seal of said Commission, shall be evidence in like manner as the original in all courts of the State of Delaware; such charges may be taxed and collected for such copies as are taxed and collected for like services in the Superior Court of this State.

Section 18. This Act shall in no wise be construed to prevent the issuance by any street or traction railway, motor bus, electric trackless trolley coach, auto truck freight line, telephone or telegraph companies, or any other public utility of free passes or franks to their employees, officers, agents, surgeons, physicians, attorneys-at-law and their families, and the interchange between said public utilities and common carriers of passes or franks for their employees, officers, agents, surgeons, physicians, attorneys-at-law and their families, nor to prevent the carrying without fare upon electric trackless trolley coaches, street railways, or buses, of policemen, fireman, health officers and park guards in uniform, or plain clothes detectives, sheriffs, deputy sheriffs, employees of the Street and Sewer Department of the City of Wilmington, and other public employees wearing official badges.

Section 19. If any provision of this Act shall be held to be unconstitutional or invalid, it is hereby provided that all other portions of the same, which are not expressly held to be unconstitutional or void, shall continue in full force and effect.

Section 20. There is hereby appropriated, out of any of the general funds of the State not otherwise appropriated, the sum of Twenty Thousand Dollars ($20,000.00), or so much thereof as may be necessary, which sum, or any part thereof, may be expended by the Commission in its discretion for the purpose of this Act. Said sum shall become available on the first day of September, A. D. 1949, for the fiscal year beginning July 1, 1949; and a like sum, or so much thereof as may be necessary, is hereby appropriated for the same purposes for the fiscal year beginning July 1, 1950. All expenditures from said appropriations shall be paid by the State Treasurer on proper voucher therefor, approved by the Chairman of said Commission.

Section 21. This Act shall take effect on the first day of September, A. D. 1949. Thereafter all jurisdiction, powers and authority vested in the Board of Public Utility Commissioners for the City of Wilmington, appointed under the provisions of the Act of March 29, 1911, shall be transferred to the Public Service Commission hereby created, and all matters and proceedings of any kind pending before said Board of Public Utility Commissioners for the City of Wilmington shall be transferred to the Public Service Commission hereby created. Thereupon the said Act of March 29, 1911, and all Acts amendatory thereof and supplemental thereto shall be repealed and the said Board of Public Utility Commissioners for the City of Wilmington shall thereupon cease to exist.

Approved June 15, 1949.