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(262 . S. 276, 67 L. ed. 981, 43 Sup. Ct. Rep. 544.)

investment at work for the public, either as property serving the public, or funds held in reserve for such property, no policy should be followed in estimating depreciation that will reduce the property to a value less than the investment. (P. 1726.)

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"Estimates of the cost of reproduction should be based on the assumption that the identical property is to be reproduced, rather than a substitute property" (p. 1719), -"although such a substitute property, much less costly than the existing plant, might furnish equal or better service, it is not reproduction of service, but of property, that is under consideration; and clearly the estimate should be of existing property created with public ap

proval, rather than of a substituted property." (P. 1772.)

If the aim were to ascertain the value (in its ordinary sense) of the utility property, the inquiry would be, not what it would cost to reproduce the identical property, but what it would cost to establish a plant which could render the service; or, in other words, at what cost could an equally efficient substitute be then produced. Surely the cost of an equally efficient substitute must be the maximum of the rate base, if prudent investment be rejected as the measure. The utilities seem to claim that the constitutional

protection against confiscation guarantees them a return both upon unearned increment and upon the cost of property rendered valueless by obsolescence.

ANNOTATION.

Rate of return to which telephone company is entitled.

It is well settled that the state may regulate telephone companies (26 R. C. L. p. 513), and that this power or regulation extends to the matter of rates and charges (26 R. C. L. p. 520). One of the factors in regulating rates and charges is the return to which the company is entitled on its capital.

On the return to which a telephone company is entitled, there is little judicial authority in addition to the reported case (MISSOURI EX REL. SOUTHWESTERN BELL TELEPH. Co. v. PUBLIC SERV. COMMISSION, ante, 807) holding that a return of 53 per cent upon the minimum value of its property was inadequate under the facts there existing.

In Cumberland Teleph. & Teleg. Co. v. Louisville (1911) 187 Fed. 637, where the telephone company had strong competition from a rival, and was obliged to contest the validity of certain municipal legislation, the court held that it was entitled to be allowed to earn, if it could, as much as 7 per cent annually on the fair value of its property devoted to the public use in the city, before its rates could fairly be reduced by legislative

regulation. The judgment in this case was reversed by the United States Supreme Court (1912) 225 U. S. 430, 56 L. ed. 1151, 32 Sup. Ct. Rep. 741, on the theory that the enforcement of the municipal ordinance there involved should not be enjoined as confiscatory before the ordinance had been given a trial to show its actual effect. The court said: "We express no opinion whether to cut this telephone company down to 6 per cent by legislation would or would not be confiscatory. But when it is remembered what clear evidence the court requires before it declares legislation otherwise valid void on this ground, and when it is considered how speculative every figure is that we have set down with delusive exactness, we are of opinion that the result is too near the dividing line not to make actual experiment necessary."

An order of the railroad commission allowing a return of 8 per cent was affirmed in Detroit v. Michigan R. Commission (1920) 209 Mich. 395, 177 N. W. 306, on the theory that it was not shown by those who sought to have the rate reduced that the

order of the commission in this regard was unlawful or unreasonable.

In Home Teleph. Co. v. Carthage (1911) 235 Mo. 644, 48 L.R.A. (N.S.) 1055, 139 S. W. 547, Ann. Cas. 1912D, 301, it was held that the court would not interfere with rates fixed for telephone service which allowed a return of over 9 per cent on the corporation's own valuation of its property. The court, in discussing the question, says that, under the facts and circumstances of the case, rates which would yield a less return upon the telephone company's property than 6 per cent would be unreasonably low and could not be sustained. It being shown by the evidence in the case that the return on the investment was in excess of 9 per cent, even on complainant's valuation of the property, and over 11 per cent on what the court considered a reasonable value, it was held that the telephone company failed to prove that it was entitled to the relief prayed for; that is, that the municipal ordinance involved was invalid and the rates therein prescribed unreasonable.

In Pioneer Teleph. & Teleg. Co. v. Westhaver (1911) 29 Okla. 429, 38 L.R.A. (N.S.) 1209, 118 Pac. 354, an

action to compel the reduction of rates by a telephone company, it appeared that the company was earning approximately 5 per cent on the value of its plant. The corporation commission, in making its estimates and suggestions, had treated an earning of 8 per cent on the then value of its property as a fair rate it was entitled to earn. The court held it was not necessary to determine what rate would be a fair one, saying that it was sufficient for the purposes of the case at bar that, if the rates or charges yielding a net return to it of approximately 5 per cent per annum were not excessive or unreasonable to the public for the service rendered, they should be permitted to stand. The court then mentioned the fact that the legal rate of interest in the state, in the absence of any contract, was 6 per cent; by contract, the parties might agree upon any rate not to exceed 10 per cent. The conclusion is reached that the schedule of charges then made by the telephone company, yielding to it a return upon the value of its property less than the legal rate of interest in the state, could not be said to be unreasonable or an oppressive schedule of charges. W. A. E.

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1. Chiropractors who are permitted to practise without a license are required to exercise care and skill in diagnosis if they undertake to diagnose, under a statute providing that any person practising any form or system of treating the afflicted without having a license shall be liable to all the penalties for malpractice, and ignorance shall not lessen such liability for failing to perform or unskilfully performing any duty assumed, and which is ordinarily performed by a licensed physician. [See note on this question beginning on page 830.]

(180 Wis. 238, 192 N. W. 1015.)

- measure of care required.

2. A physician is required to exercise only that degree of care, diligence, judgment, and skill which other physicians of good standing of the same school, or system of practice, usually exercise in the same or similar localities under like or similar circumstances, having due regard to the advanced state of the medical profession at the time in question.

[See 21 R. C. L. 381–385; 3 R. C. L. Supp. 1152; 4 R. C. L. Supp. 1413.] -negligence in diagnosis as malpractice.

3. Malpractice may consist in a lack

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APPEAL by plaintiff from an order of the Circuit Court for Kenosha County (Belden, J.) sustaining a demurrer ore tenus to the complaint in an action brought to recover damages for alleged malpractice. Reversed.

Statement by Vinje, Ch. J.:

Action for malpractice. The material allegations of the complaint are as follows:

"That the above-named defendant is a chiropractor, so called, practising his profession in the city of Kenosha, in said county and state. That at the time hereinafter mentioned he has held himself out to the public as capable of treating persons afflicted with disease and bodily ailments, and holding out, representing, and advertising to relieve and cure persons so afflicted, without the use of medicines or drugs, and by a form or method peculiar to the class of practitioners to which the defendant belongs, and who are known to the public as chiropractors.

"That on or about the 28th day of September, 1918, the abovenamed plaintiff was afflicted with and suffering from such disorders of bodily functions as to cause him to believe in the necessity of consulting and conferring with some person of the required learning, skill, and experience to alleviate, relieve, and cure such affliction of which he was suffering.

"That on or about said day he consulted the above-named defendant, who was then practising his said profession at the city of Kenosha, and employed the said defendant as such chiropractor to relieve

and cure him of such disease or malady from which he then suffered for compensation to be paid therefor, and for that purpose the said defendant undertook as a chiropractor to attend and care for the plaintiff.

"That the said defendant then entered upon such employment, and, either through lack of care, want of understanding, or knowledge of the symptoms of well-known disease, did not use due and proper care or skill in endeavoring to cure plaintiff of the disease or malady of which he was suffering, and negligently undertook the treatment of said plaintiff upon misapprehension that the said plaintiff was suffering from some derangement of the stomach. with resulting nervousness and headache, of which the said plaintiff then suffered. That at said time the said plaintiff was afflicted with and suffering from a tumor which was growing in his head, and which was the cause of such derangement of bodily function.

"That the said defendant, for compensation paid to him from time to time by the plaintiff, continued to treat the plaintiff according to the methods used by members of defendant's profession for a period of eight months, during which time the said defendant failed to either relieve or alleviate the suffering of said plain

tiff, but the pain and suffering of said plaintiff continued to grow worse and worse, and disorders of his body became more aggravated under such treatment, whereupon the said defendant advised plaintiff to go West for relief on or about the 21st day of May, 1919.

"That while in the West the defendant continued to fail in health and the pain and suffering continued to increase, and his headaches and dizziness of which he continually suffered became more severe, and finally he became at times. blind.

"That on or about the 8th day of August, 1919, he returned to Kenosha, Wisconsin, and on the 10th day of September, 1919, he went to the Augustana Hospital in the city of Chicago, for treatment, and there his malady was immediately diagnosed by a physician and surgeon of skill and experience as a tumor growing within the head, which had been for a long time, and then was, irritating the brain, and it became necessary to operate upon the said plaintiff, and, in order to save the life of plaintiff, it was necessary to remove a large portion of the skull of plaintiff in order to relieve the intracranial pressure resulting from the growth of such tumor.

"That this plaintiff is informed and believes that if the said defendant had possessed ordinary skill or ability in the treating of disease he would, by the exercise of ordinary care, have known that the said defendant was suffering from the effect of a tumor growing in his head, and by the exercise of ordinary care would have known that the methods adopted by him to relieve said plaintiff were useless and only aggravated his suffering and affliction.

"Plaintiff further alleges, and he is informed and believes, that if the said defendant had used ordinary care and skill in diagnosing the affliction of the plaintiff he would have known by the use of such ordinary care that the said plaintiff was afflicted with tumor, and that an operation upon the plaintiff at the

time when the plaintiff first consulted the said defendant would have effected an immediate and permanent cure.

"That because of the long time which the said tumor was allowed to grow under the treatment of the said defendant, it became impossible for surgeons of acknowledged skill and ability to remove such tumor from the head, but the only relief which could be accorded to the plaintiff was the operation herein before alleged.

"That by reason of the defendant's negligence and unskilled examination and treatment of said plaintiff, the said plaintiff was made sick, and kept from attending to his business ever since about the 8th day of September, 1918, suffered much pain and was put to great expense, and has been, and still is, disabled from attending to his labor and business, to the damage of the plaintiff, $25,000."

The defendant entered a demurrer ore tenus, which the court sustained. From an order entered accordingly, the plaintiff appealed.

Mr. Robert V. Baker for appellant. Messrs. Lewis W. Powell and Morris, Winter, Esch, & Holmes, for respondent:

A physician is not required to exercise the highest degree of skill or the utmost care in diagnosis or treatment; but, whether duly licensed or not, only that degree of care, diligence, judgment, and skill which others of good standing of the same school or system of practice usually exercise in the same or similar localities under like or similar circumstances, having due regard to the advanced state of the science at the time in question.

Nelson v. Harrington, 72 Wis. 591, 1 L.R.A. 719, 7 Am. St. Rep. 900, 40 N. W. 228; Wurdemann v. Barnes, 92 Wis. 206, 66 N. W. 111; Marchand v. Bellin, 158 Wis. 184, 147 N. W. 1033; Hrubes v. Faber, 163 Wis. 89, 157 N. W. 519; Jaeger v. Stratton, 170 Wis. 579, 176 N. W. 61; Finke v. Hess, 170 Wis. 149, 174 N. W. 466; 30 Cyc. 15711588; 21 R. C. L. 28; Force v. Gregory, 63 Conn. 167, 22 L.R.A. 343, 38 Am. St. Rep. 371, 27 Atl. 1116; Patten v. Wiggin, 51 Me. 594, 81 Am. Dec. 595; Grainger v. Still, 187 Mo. 197, 70 L.R.A. 49, 85 S. W. 1114.

(180 Wis. 238, 192 N. W. 1015.)

Vinje, Ch. J., delivered the opinion of the court:

The trial court sustained the demurrer on the ground that, the complaint having alleged that defendant treated the plaintiff according to the methods used by members of defendant's profession, namely, by chiropractors, it negatived negligence and lack of skill; since the rule is that a physician is required to exercise only that degree of care, diligence, judgment, and skill which other physicians of good standing of the same school or system of practice usually exercise in the same or similar localities under like or similar circumstances, having due regard to the advanced state of the medical profession at the time in question-citing Nelson v. Harrington, 72 Wis. 591, 1 L.R.A. 719, 7 Am. St. Rep. 900, 40 N. W. 228; Wurdemann v. Barnes, 92 Wis. 206, 66 N. W. 111; Marchand v. Bellin, 158 Wis. 184, 147 N. W. 1033; Hrubes v. Faber, 163 Wis. 89, 157 N. W. 519; Jaeger v. Stratton, 170 Wis. 579, 176 N. W. 61. Such is undoubtedly the rule of law in this

Physicians and surgeonsmeasure of care required.

state, and, were the

complaint grounded upon a lack of skill, care, or of negligence in treatment only, the trial court came to the right conclusion. But we construe the gravamen of the complaint to charge a lack of skill and care in diagnosis, in the failure of defendant to discover the nature of the ailment from which plaintiff suffered. "Malpractice" may consist in a lack of skill or care in diagnosis as well as in treatment. Jaeger v. Stratton, supra.

-negligence in diagnosis as malpractice.

A woman may be in the early stages of pregnancy. A doctor may diagnose it as an ovarian tumor and operate. There may be no lack of skill or care in the operation, but there may be in the diagnosis.

It is a familiar principle that a complaint must be liberally con

Pleading

strued in favor of the pleader. By examining the complaint set out in the constructionstatement of facts, liberality. it will be found that the pleader says that through a lack of skill and care the defendant negligently undertook to treat plaintiff for a malady from which he was not suffering, and that had the defendant possessed ordinary skill or ability in treating disease he would, by the exercise of ordinary care, have known the true cause of his ailment. The com

plaint also alleges that plaintiff "is informed and believes that, if the said defendant had used ordinary care and skill in diagnosing the affliction of the plaintiff, he would have known by the use of such ordinary care that the said plaintiff was afflicted with tumor, and that an operation upon the plaintiff at the time when the plaintiff first consulted the defendant would have effected an immediate and permanent cure." This pressly charges lack of care and skill in diagnosis, with resultant damages.

ex

-sufficiency of complaint.

That chiropractors, who by the provisions of § 1435e, Stat. 1921, are permitted to practise without a license in this state, are required to exercise care and

Physicians and

liability of

skill in diagnosis, if surgeonsthey undertake to chiropractors for diagnose, there can negligence in be no doubt. Sec- diagnosis. tion 1435i directly so provides and So far as here applicable, it reads: makes them liable for malpractice. "Any person practising medicine, surgery, osteopathy, or any other form or system of treating the afflicted without having a license or a izing him so to do, shall not be excertificate of registration authorempted from, but shall be liable to, malpractice; and ignorance on the all the penalties and liabilities for part of any such person shall not lessen such liability for failing to perform or for negligently or unskilfully performing or attempting

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