author: PER CURIAM:

text:
    UNITED STATES of America v. Albert L. HARMON, Appellant.
    No. 72-1010.
    United States Court of Appeals, District of Columbia Circuit.
    Sept. 19, 1973.

      Gerald B. Greenwald, Washington, D. C. (appointed by this Court), for appellant.
    Peter R. Reilly, Asst. U. S. Atty., with whom Harold H. Titus, Jr., U. S. Atty., and John A. Terry, Asst. U. S. Atty., were on the brief, for appellee.
    Before BAZELON, Chief Judge, and LEVENTHAL and ROBINSON, Circuit Judges.
   PER CURIAM:

Appellant was convicted in the District Court on each of two counts charging, respectively, violations on August 24, 1970, of provisions of the Harrison Narcotics Act and the Jones-Miller Act. Thereafter, pursuant to the Narcotic Addict Rehabilitation Act of 1966 (NARA), appellant was examined at the Federal Correctional Institution at Danbury, Connecticut, for purposes of an evaluation as to addiction and the likelihood of rehabilitation through treatment. The report on the examination confirmed his “life long addiction” but concluded that “he is not adequately motivated to participate in our treatment program and is not likely to be rehabilitated by it at this time.” The letter transmitting the report to the District Court stated similarly that appellant “is not likely to be rehabilitated through treatment in this program in this institution!’

At sentencing, appellant explained that “the program [at Danbury] just wasn’t geared for my condition.” The judge, confronted by the report and the Government’s unopposed information alleging earlier narcotic convictions, however, expressed the feeling that his “hands are tied . . ..By passing up that program,” the judge said, “you are putting yourself right in a box and I can’t get you out of it . . . I am compelled to impose the minimum mandatory sentence of ten years on each count . . ,.” Appellant was then sentenced to two concurrent ten-year terms of imprisonment.

On this appeal, appellant originally contended that he was impermissibly prosecuted for possession of narcotics for his own use. He also contended that by reason of the Comprehensive Drug Abuse Prevention and Control Act of 1970, which prior to sentencing repealed the sections heretofore mentioned, the judge was free to impose a suspended sentence. As appellant now concedes, the first argument is foreclosed by our decision in United States v. Moore, and the second by the Supreme Court’s in Bradley v. United States. We accordingly affirm the convictions.

Appellant also urges, however, that contrary to the trial judge’s belief, the unfavorable evaluation report by Danbury did not bar consideration of alternative treatment dispositions under NARA. The Government concurs in that position, and so do we. The report concluded only that it was unlikely that appellant would achieve rehabilitation through the program at Danbury. It reflected little or nothing as to the rehabilitative possibilities of programs elsewhere. The judge left the latter matter unexplored, and thereby — and unfortunately — marred what the record reveals as a conscientious effort to help appellant solve his drug problem.

The judge was not limited to a choice between treatment at Danbury or no treatment at all. NARA expressly calls for a judicial determination as to whether a convicted defendant found to be an addict is “likely to be rehabilitated through treatment.” If the determination is in the affirmative, and facilities and personnel therefor are available, a commitment “for treatment under” NARA is required. “Treatment,” as defined by NARA, encompasses a wide range of rehabilitative programs and services which by no means are localized at Danbury.

We have declared “that the interest of justice calls for thoroughgoing review of NARA possibilities . . ..” We have approved “a remand following a sentence when there is a possibility that there was a failure to give NARA dispositions full consideration.” To the end that adequate consideration may now be forthcoming, we must take that course here.

The judgment of conviction appealed from is affirmed. The sentences imposed thereon are vacated, and the case is remanded to the District Court for reconsideration thereof.

So ordered.

      . 26 U.S.C. §4704 (a) (1964).

      . 21 U.S.C. § 174 (1964).

      . 18 U.S.C. § 4251 et seq. (1970).

      . See 26 U.S.C. § 7237(a), (c) (1964).

      . The judge’s obvious reference was to the mandatory minimum terms of imprisonment set by § 174 for violations of that section and by 26 U.S.C. § 7237(b) (1964) for violations of § 4704(a), and to the prohibitions on sentence-suspension and probation levied by 26 U.S.O. § 7237(d) (1964).

      . 21 U.S.C. § 801 et seq. (1970).

      . 156 U.S.App.D.C. _, 486 F.2d 1139 (1973).

      . 410 U.S. 605, 93 S.Ct. 1151, 35 L.Ed.2d 528 (1973).

      . 18 U.S.C. § 4253(a), (b) (1970).

      . Id. § 4253(a).

      . Id.% 4251(c).

      . United States v. Moore, supra note 7, 158 U.S.App.D.C. at _, 486 F.2d at 1205.

      . Id. at _, 486 F.2d at 1203.

      . Compare United States v. Miller, 155 U.S.App.D.C. 110, at 111, 476 F.2d 555, 556 (1973); United States v. Hunter, 158 U.S.App.D.C. _, at _, 485 F.2d 1036, at 1036 (1973); United States v. Harrison, 158 U.S.App.D.C. _, at ___ _ ___, 485 F.2d 1008, at 1010 (1973); United States v. Marshall, 158 U.S.App.D.C. _, at _, _, 485 F.2d 1062, at 1064-1006 (1973).


source: Caselaw Access Project

license: Public Domain

text:
    David Lee Den HARTIGH, Appellant, v. John LATIN, Jr., et al. Michael H. MARSH, Appellant, v. Walter W. HOLLINGSWORTH et al.
    Nos. 73-1279, 73-1740.
    United States Court of Appeals, District of Columbia Circuit.
    Oct. 5, 1973.

      Alan Dranitzke, Washington, D. C., was on the Motion for Summary Reversal in No. 73-1279.
    John E. Vanderstar, Washington, D. C., was on the Motion for Summary Reversal in No. 73-1740.
    C. Francis Murphy, Corp. Counsel, Richard Barton and David P. Sutton, Asst. Corp. Counsel, Washington, D. C., were on the opposition for appellee.
    Before BAZELON, Chief Judge, and LEVENTHAL, Circuit Judge.
   PER CURIAM:

These cases both arise from complaints alleging excessive use of force and other violations of constitutional rights by named officers of the Metropolitan Police Department, their immediate supervisors, and the District of Columbia. Both cases were certified to the Superior Court of the District of Columbia, and it is from such transfers that these appeals are taken.

Because of the importance of the questions raised by these appeals, and the policy of the District Court which they reveal, we have thought it important to set forth the reasons for granting appellants' motions for summary reversal of those transfers.

Appellants asserted that jurisdiction over their claims below arose under both the Constitution and the Civil Rights Acts of the United States, in particular 42 U.S.C. §§ 1983 and 1985. Both appellants also asserted that the amount in controversy exceeded $10,000.

In District of Columbia v. Carter, the Supreme Court held that 42 U.S.C. § 1983 does not apply to suits for damages arising under “color of law” of the District of Columbia, since the District of Columbia is not a “State or Territory” within the meaning of the statute. The District Court in both eases based the transfer of the actions to the Superior Court on the Carter decision. We believe that extension of the Carter case to be erroneous.

Jurisdiction below was also asserted in both cases on the basis of 28 U.S.C. § 1331(a) which provides:

The district courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum of value of $10,000, exclusive of interest and costs, and arises under the Constitution, laws, or treaties of the United States.

The Supreme Court has held that under this provision the district courts have jurisdiction over disputes which involve alleged infringements of constitutional liberties by federal officers. Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388, 395-396, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971); Bell v. Hood, 327 U.S. 678, 685, 66 S.Ct. 773, 90 L.Ed. 939 (1946). Moreover, for the purpose of determining jurisdiction, such allegations are not to be interpreted harshly against the plaintiff:

Before deciding that there is no jurisdiction, the district court must look to the way the complaint is drawn to see if it is drawn so as to claim a right to recover under the Constitution and laws of the United States. [W]here the complaint, as here, is so drawn as to seek recovery directly under the Constitution or laws of the United States, the federal court but for two possible exceptions must entertain the suit. .
. The previously carved out exceptions are that a suit may sometimes be dismissed for want of jurisdiction where the alleged [federal question] . . . appears to be immaterial ... or ... wholly insubstantial and frivolous.

. In two recent cases, this court has found jurisdiction under 28 U.S.C. § 1331 (a) over alleged police misconduct in depriving citizens of rights secured to them by the Fourth and Fifth Amendments. In Sullivan v. Murphy, this court specifically found that jurisdiction to consider equitable relief from police misconduct in the District of Columbia under § 1331(a) survives the Carter finding that such jurisdiction cannot be maintained under 42 U.S.C. § 1983. In Gomez v. Wilson, where the appellant sought equitable relief against enforcement of the District of Columbia vagrancy statute on the grounds that it infringed his rights under the Fourth and Fifth Amendments, this court held that the controversy was one properly within the “federal question” jurisdiction of the court.

However, the test for jurisdiction under § 1331(a) is both the existence of a federal question and determination of an amount in controversy of more than ten thousand dollars. When the amount claimed to be in controversy is asserted for jurisdictional purposes, the plaintiff’s allegation is to be accepted unless “it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed, or that the plaintiff never was entitled to recover that amount.” St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 289, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938); Gomez v. Wilson, supra; Spock v. David, 469 F.2d 1047, 1052 (3d Cir. 1972); Gillentine v. McKeand, 426 F.2d 717, 720 (1st Cir. 1970); Arnold v. Troccoli, 344 F.2d 842, 845 (2d Cir. 1965). Upon the record before us in these cases, we cannot find, to a legal certainty, that no recovery could satisfy the statutory standard in the cases before us.

Appellant Marsh alleged that on February 20, 1970, while he was standing in the lobby of his dormitory at George Washington University watching an antiwar demonstration, two police officers assaulted him and arrested him. Subsequently, they again beat him, took him to the local police station and booked him, and incarcerated him for approximately nine hours. His complaint below sought $10,000 in compensatory damages for physical injuries, mental anguish and medical bills. He also sought compensation for actual and prospective loss of earnings due to his injuries.

Plaintiff Marsh’s allegations for the compensatory damages alone would seem to meet the statutory requirement. He submitted below an affidavit of medical bills totalling over $900, and computed lost compensation for summer work as $530. At the time of the alleged beating, he was a law student at George Washington University and he alleges that he will lose future earnings as a lawyer because of the effects of the beating. Plaintiff also sought $25,000 in punitive damages. It is clear that punitive damages should be considered in determining the jurisdictional amount in controversy. Bell v. Preferred Life Assurance Society, 320 U.S. 238, 240, 64 S.Ct. 5, 88 L.Ed. 15 (1943); Barry v. Edmunds, 116 U.S. 550, 562, 6 S.Ct. 501, 29 L.Ed. 729 (1886); Davis v. Peerless Insurance Co., 103 U.S.App.D.C. 125, 129, 255 F.2d 534, 538 (1958). Finally, there is no record below that supports a finding of lack of good faith in alleging the jurisdictional amount. Wood v. Stark Tri-County Building Trades Council, 473 F.2d 272, 274 (6th Cir. 1973); Deutsch v. Hewes Street Realty Corp., 359 F.2d 96, 100-101 (2d Cir. 1966).

Appellant Hartigh alleged that while he was incarcerated in the jail of Metropolitan Police Force No. 8 he was beaten by police officers who broke his wrist. The complaint also alleged that appellant was imprisoned under conditions amounting to cruel and unusual punishment, and was denied the equal protection of the laws. Plaintiff below prayed for $100,000 in compensatory damages and $100,000 in punitive damages. As in No. 73-1740, there was no record that these jurisdictional allegations of damages were disputed below.

The factual allegations of injury before this court are that appellant suffered a broken wrist and sustained medical bills of $24.00. In view of these very limited medical injuries, there may arise some question of the amount in controversy. However, appellant also claims the infringements of constitutional rights. Although infringement of these rights may be difficult of precise monetary evaluation, that does not make them non-justifiable under § 1331(a). Spock v. David, supra; Wolff v. Selective Service Local Board No. 16, 372 F.2d 817, 826 (2d Cir. 1967). This Court has accepted, for jurisdictional purposes, allegations of an amount in controversy exceeding $10,000 for twelve to fourteen hours of false imprisonment without physical injury. Sullivan v. Murphy, supra, at n. 34 of 478 F.2d. Furthermore, Hartigh sought punitive damages below, and such damages are to be included in the amount in controversy for jurisdictional purposes. Bell v. Preferred Life Assurance Society, supra.

Where the plaintiff has asserted a denial of constitutional rights and more than $10,000 in damages, and where the defendant has not disputed the amount in controversy, the plaintiff is entitled to at least a hearing on the factual issue of whether or not the dispute reaches the jurisdictional amount. In this case, there was no factual or legal hearing on the issue of jurisdiction; the court merely stated:

In light of the Carter case, this will be certified to the Superior Court.

With regard to the actions against the superior police officers and the District of Columbia, since plaintiffs have made sufficient allegations to meet the statutory minimum for jurisdiction in the action against the officers, they are entitled to invoke the doctrine of ancillary jurisdiction against the other defendants for negligence. Marusa v. District of Columbia, 157 U.S.App.D.C. _, 484 F.2d 828 (1973).

In No. 73-1740, we vacate the order of April 26, 1973, certifying the case to the Superior Court and remand the case to the District Court for further proceedings. In No. 73-1279, we vacate the order of February 9, 1973, and remand the ease for further proceedings.

So ordered.

      . 409 U.S. 418, 93 S.Ct. 602, 34 L.Ed.2d 613 (1973).

      . In No. 73-1209, the court below stated:
      In light of the Carter case, this will be certified to the Superior Court.
      This does not require a motion. That was 'the decision of the Judges of this Court, that these cases would be certified to the Superior Court.
      In No. 73-1740, the court, based its order on both the Carter decision and a finding that the action would not justify a judgment of more than $10,000.

      . Bell v. Hood, supra, at 681-683, 66 S.Ct. at 775-776. .

      . 155 U.S.App.D.C. 28, 478 F.2d 938, 960 (1973).

      . 155 U.S.App.D.C. 242, 250, 477 F.2d 411, 419 (1973).

      . Tr. of Status Call on February. 12, 1973, at 2.


author: WYZANSKI, Senior District Judge:

text:
    PINE VIEW GARDENS, INC., Appellant, v. MUTUAL OF OMAHA INSURANCE CO.
    No. 71-1010.
    United States Court of Appeals, District of Columbia Circuit.
    Argued Nov. 2, 1972.
    Decided June 29, 1973.
    Marshall H. Brooks, Washington, D. C., for appellant. Mark P. Friedlander, Washington, D. C., was on the brief for appellant.
    Walter H. Fleischer, Atty., Dept. of Justice, with whom L. Patrick Gray, III, Asst. Atty. Gen., at the time the brief was filed, Thomas A. Flannery, U. S. Atty., at the time the brief was filed, and Patricia S. Baptiste, Atty., Dept. of Justice, were on the brief for appellee. Morton Hollander, Atty., Dept. of Justice, also entered an appearance for appellee.
    Before TAMM and LEVENTHAL, Circuit Judges, and WYZANSKI, Senior United States District Judge for the District of Massachusetts.

       Sitting by designation pursuant to Title 28, U.S.O. § 294(d).

   WYZANSKI, Senior District Judge:

Plaintiff, Pine View Gardens Inc., appeals from the District Court’s dismissal, presumably on the ground that it fails to state a cause of action, of a complaint against defendant, the Mutual of Omaha Insurance Company.

The abbreviated complaint, without so much as indicating the assumed basis of the District Court’s jurisdiction, tells us merely that the parties are, respectively, corporations of Maryland and the District of Columbia, and the amount in controversy exceeds $10,000; that plaintiff qualified with the Social Security Administration “as an extended care facility” [presumably this means also as a “provider of services” under what is commonly called the Medicare Act, 42 U.S.C. § 1395x(u) (1969)], “and as such was employed and did give such extended care to patients under the policies or contracts [presumably of the patients] with the Defendant”; that in 1967 and 1968 “certain services were furnished and extended care given” [presumably by plaintiff to patients who had policies or contracts with defendant]; that on that account defendant owes plaintiff a balance of $60,137 for 1967 and $49,048 for 1968; and that “plaintiff claims of the defendant the sum of $109,185 with interest.”

Defendant’s response to the complaint was a motion to dismiss or for summary judgment. The District Court, by order, but without opinion, granted the motion and that is the order now here for review.

We note that the complaint makes no reference to a written contract between the parties. It may be, as plaintiff’s brief in this court appears to assume, that the complaint is founded either on an oral contract or on quantum, valebat and quantum, meruit claims in quasi contract; and that on such an approach, plaintiff relied on the District Court’s diversity jurisdiction under 28 U.S.C. § 1332. Possibly, plaintiff, because its claims relate to services which it, as an extended-care facility, gave to beneficiaries protected by Title XVIII of the Social Security Act, 42 U.S.C. § 1395 et seq., and who were insured by defendant as a carrier and fiscal intermediary under that Act, also relies on the District Court’s jurisdiction under the Administrative Procedure Act, 5 U.S.C. § 701 et seq.

We are spared a full, precise recital of the statutory and administrative background of this controversy because it has already been splendidly and accurately done by Circuit Judge Feinberg in a case, which though plainly distinguishable on its merits, is set, in legislative, in executive, and, above all, in relevant time span, in a context fully congruent to that here relevant. Aequavella v. Richardson, 437 F.2d 397 (2nd Cir., 1971). In that suit, brought, as the title emphasizes, against the Secretary of Health, Education, and Welfare, Judge Feinberg observed that, under what is generally denominated the Medicare Act, 42 U.S.C. §§ 1395-139511, the Secretary of HEW, pursuant to 42 U.S.C. § 1395cc (1969), may make an agreement with a so-called private “extended-care facility” to act as a “provider of services” under 42 U.S.C. § 1395x(u) (1969). The Secretary may also make contracts with insurance companies or like private organizations to act as the government’s fiscal intermediary. Through such an intermediary, the Secretary, rather than the patients, reimburses the provider of services for the extended care it has given. There are complicated, safeguarding provisions in the statutes and regulations, which, since Judge Feinberg summarized them, we shall not set forth, and which govern the Secretary’s payments, advances, audits, and other controls with respect to the relations between a fiscal intermediary and the Secretary, on the one hand, and the provider of services, on the other hand.

In the case at bar, plaintiff, as a provider of services, is seeking from defendant, as the Government's fiscal intermediary, further reimbursement for extended-care services plaintiff alleges that in 1967 and 1968 it rendered to beneficiaries of the Medicare program.

The question initially presented is whether, there being diversity of citizenship between the parties, plaintiff may sue in contract or in quasi contract the defendant insurer. Inasmuch as it is plain from the statutory set-up, and is at least implied in the complaint, that the defendant insurer was a disclosed agent and fiscal intermediary for the Government, and it being incontrovertible that the Government itself has not consented to be sued in this manner, the defendant insurer is immune from this action premised on alleged underpayments. What plaintiff is seeking, indirectly to be sure, is payment by the Government. Plaintiff sought to avoid the problems of sovereign immunity by casting his complaint against the insurer as though it were the real party in interest, and as if its real principal (the Government) is an undisclosed principal. The statute and regulations, of which we may take judicial notice, make it clear that Mutual is an agent for the Government as a disclosed principal, and preclude our having to deal with the case on the basis of plaintiff’s synthetic construct. Were plaintiff to succeed, it would, in effect, be requiring a governmental fiscal agent to make a payment for which, in turn, the agent would reasonably seek, and justly claim, reimbursement from the Government. This is not a case in which the Government has given its fiscal agents funds to pay plaintiff, and in which the agent is not turning the money over to the appropriate ultimate payee. On the contrary, it is an attempt to compel the Government to act, and is, therefore, not within the District Court’s diversity jurisdiction. Cf. Larson v. Domestic & Foreign Corp., 337 U.S. 682, 704, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949); Land v. Dollar, 330 U.S. 731, 67 S.Ct. 1009, 91 L.Ed. 1209 (1947); Kuenstler v. Occidental Life Ins. Co., 292 F.Supp. 532 (C.D.Cal., 1968); Allen v. Allen, 291 F.Supp. 312 (S.D.Iowa, 1968).

A secondary question is whether, though not so pleaded, this complaint may be viewed as an action brought against defendant as a governmental “agency” suable under the Administrative Procedure Act, 5 U.S.C. § 701. It suffices to say that the case was not brought on this theory: that plaintiff has in effect asserted a breach of contract, and not, c. g., an official abuse of discretion or action unsupported by substantial evidence, and hence has not asserted the kind of wrong made cognizable by the Administrative Procedure Act; that there is at least a question whether Mutual is an “agency” within 5 U.S.C. § 701(b)(1); and that we do not think our judicial function requires us to pose and answer questions that would arise from a sweeping reconstitution of the nature of plaintiff’s claim.


text:
    UNITED STATES of America v. Richard J. LEE, Jr., Appellant.
    No. 72-1371.
    United States Court of Appeals, District of Columbia Circuit.
    Argued April 2, 1973.
    Decided June 29, 1973.
    David R. Anderson, Washington, D.C. (appointed by this Court), for appellant.
    Douglass J. McCollum, Asst. U. S. Atty., with whom Harold H. Titus, Jr., U. S. Atty. and John A. Terry, Asst. U. S. Atty., were on the brief, for appellee.
    Before LEVENTHAL and MacKINNON, Circuit Judges, and WYZANSKI, Senior United States District Judge for the District of Massachusetts.

       Sitting by designation pursuant to 28 U.S.C. § 294 (d).

   WYZANSKI, Senior District Judge:

The single issue is whether the trial court erred in allowing the complaining witness to testify as to her showup identification of defendant.

Edna M. Carslaw on March 17, 1970, at about 6 P.M. was held up, in the basement of an office building where she worked, by two men, one of whom, for convenience, we shall at this introductory stage call X, and the other Y. X told her, “Don’t make any noise, this is a hold-up,” and directed her to open the safe. Next, X came around the counter, went through the drawers, and took $18 from Mrs. Carslaw’s purse. Then he put her into a locker and told her to stay there. Y stayed farther back and held a gun behind a newspaper until he came around the counter when Mrs. Car-slaw was seated, and Y was 3 feet from her. After staying for some time in the locker, Mrs. Carslaw went upstairs to report the robbery to a building guard, Scott.

About 6 P.M. Scott saw enter a telephone booth a man whom at this stage we shall call A (without indicating whether he has already been given another symbol in this statement of facts). Scott testified that he recognized A as a man who had been hanging around the building at the time of an earlier robbery. About 3 minutes later Scott saw go to the telephone directory a second man whom at this stage we shall call B (without indicating whether he has already been given another symbol in this statement of facts).

A came out of the phone booth and conferred with B. When A and B started to get into the elevator the guard asked them to sign in; and they did. Then the guard summoned the police. After a policeman, Odell, arrived and had begun talking to Scott, the elevator door opened and revealed A within the elevator. Simultaneously B appeared at the door of the stairway. Scott said to Odell with respect to A and B, “Those are the two I’m talking about.” Odell stopped B to escort him to a desk. B attempted to pull a gun. Odell wrestled with B, pinned him to the floor, handcuffed him, and arrested him.

Soon other police arrived. About 15 minutes after Odell arrested B, Mrs. Carslaw appeared in the lobby and told the police she had been robbed. She testified she was then excited and in a state of shock. The police did not then ask her to describe the persons who had robbed her. An officer other than Odell brought Mrs. Carslaw to where B was lying face down on the floor, handcuffed with his arms behind his back, and asked her if that was one of the robbers. She bent over, looked for several seconds at B, and said, “No, I don’t think so.” She then went to the elevator with another policeman. Then in response to further questioning by officer Odell while both were in the elevator, she told him, without his questioning her directly to the point, that B was the man who had been the second of those who had robbed her. At the trial, Mrs. Carslaw testified that she did not immediately identify B because she “didn’t want to" say it in front of the man.”

Mrs. Carslaw at a subsequent lineup identified defendant Lee who was in the lineup as being, in effect, identical with B and Y. Then at a pretrial hearing she testified that she had made that identification of B on the basis of her mental picture of the man in the robbery, not her mental picture of appellant lying handcuffed on the floor. (Appellant’s Brief at 9).

Referring to standards established in Stovall v. Denno, 388 U.S. 293, 302, 87 S.Ct. 1967, 18 L.Ed.2d 1199 (1967) and such succeeding cases as Russell v. United States, 133 App.D.C. 77, 81, 408 F.2d 1280, 1284 (1969), defendant contends that his conviction in the District Court denied him due process of law guaranteed by the Fifth Amendment because the conviction was based almost entirely on an impermissible (because highly suggestive set of surrounding circumstances) identification by the complaining witness, Mrs. Carslaw, of him at the trial as the second of the two men who robbed her.

We affirm the conviction because in our view the circumstances of the identification by Mrs. Carslaw in the elevator, even if it were — which she does not admit — the source or a source of her identification of him in court, were permissible and not highly suggestive.

The dominant aspect of the circumstances is that the elevator identification was made within a few minutes of the crime, almost on the scene of the crime, in the very building where the crime occurred. In our view this makes this ease wholly distinguishable from cases cited to us and other cases of a showup or lineup of the conventional type.

Affirmed.


text:
    UNITED STATES of America v. James I. TAYLOR, Appellant.
    No. 72-1812.
    United States Court of Appeals, District of Columbia Circuit.
    Argued April 2, 1973.
    Decided June 28, 1973.
    Fred Warren Bennett, Washington, D.C. (appointed by this Court), for appellant.
    Peter R. Reilly, Asst. U.S. Atty., with whom Harold H. Titus, Jr., U.S. Atty., John A. Terry, and Charles H. Roistacher, Asst. U. S. Attys., were on the brief for appellee.
    Before LEVENTHAL and MacKINNON, Circuit Judges, and WYZANSKI, Senior United States District Judge for the District of Massachusetts.

       Sitting by designation pursuant to 28 U.S.C. § 294 (d).

   PER CURIAM:

Appellant was charged with escape from custody of the Attorney General in violation of 18 U.S.C. § 751(a). The Government’s proof showed that following conviction in the District Court in Criminal Case No. 616-69, on a charge of robbery, appellant was sentenced on March 3, 1970, to the custody of the Attorney General for a term of two to six years. Appellant served part of his sentence at Lorton Reformatory. On January 11, 1971, he was admitted to a halfway house run by Efforts from Ex-Convicts '(EFEC), a non-profit organization that operates under a contract with the District of Columbia Department of Corrections to house and provide services to offenders not on parole, referred by the Department of Corrections, for work release programs.

Mr. Rudolph Henry Yates, an official of EFEC, testified that after he informed appellant that he was to be returned to Lorton Reformatory, for a “violation,” appellant left the halfway house, without permission. This proof established an escape from the legal custody of the Attorney General, to which appellant was remitted at time of sentence, and which continued even when he was assigned by the Attorney General, or his representative, here the Director of the Department of Corrections, to an institution or facility not under the control of the Department of Justice. Frazier v. United States, 119 U.S.App.D.C. 246, 339 F.2d 745 (1964); 24 D.C.Code § 425. The contention rejected in Frazier is now articulated by appellant’s counsel in terms of a variance from the indictment, but we find no substantial lack of notice or prejudice, no fatal variance.

Appellant claims he was erroneously denied consideration under Title II of the Narcotic Addict Rehabilitation Act, 18 U.S.C. §§ 4251-4255. But appellant was ineligible under NARA in view of 18 U.S.C. § 4251(f)(3), which excludes an offender serving a sentence following conviction on a felony charge that has not been fully served. This is not unconstitutional under the doctrine of United States v. Hamilton, 149 U.S.App.D.C. 295, 462 F.2d 1190 (1972). The classification involved in the ease at bar is not unreasonable or arbitrary. The fact that some part of the outstanding felony sentence remains to be served undercuts the kind of immediate commitment to the Surgeon General for rehabilitation contemplated by NARA.

Affirmed.


text:
    UNITED STATES of America v. Clifford L. ESTES, Appellant. UNITED STATES of America v. Henry B. JOHNSON, Appellant.
    Nos. 72-1465, 72-1466.
    United States Court of Appeals, District of Coumbia Circuit.
    Argued April 3, 1973.
    Decided June 29, 1973.
    Rehearing Denied Sept. 11, 1973.

      Alan Y. Naftalin, Washington, D.C., with whom Bruce P. Moore, Washington, D.C. (both appointed by this Court) was on the brief, for appellant in No. 72-1466, and argued for appellant in No. 72-1465.
    Robert J. Corber, Washington, D.C. (appointed by this Court), with whom Michael J. Malley, Washington, D.C., was on the brief, for appellant in No. 72-1465.
    John J. Mulrooney, Asst. U.S. Atty., with whom Harold H. Titus, Jr., U.S. Atty. and John A. Terry, Asst. U.S. Atty., were on the brief, for appellee.
    Before LEYENTHAL and MacKINNON, Circuit Judges, and WYZANSKI, Senior United States District Judge for the District of Massachusetts.

       Sitting by designation pursuant to 28, U.S.C. § 294(d).

   WYZANSKI, Senior District Judge:

Defendants Estes and Johnson were indicted for armed robbery and other offenses. After trial, the District Judge imposed substantial prison sentences. On a first appeal reported in United States v. Johnson, 147 U.S.App.D.C. 31, 452 F.2d 1363 (1971), this court, after setting forth in a characteristically full opinion by Chief Judge Bazelon the matter in detail which it would be bootless to repeat, remanded the case to the District Court with directions to determine (1) whether substitute lineup counsel communicated with trial counsel and participated in the trial preparations, and, if not, whether the lack of communication between them adversely affected the ability of trial counsel effectively to conduct the defense with respect to the lineup identifications; (2) whether the trial court’s finding of an independent source for the lineup and in-court identifications of defendant Estes by the witness Gaines had a factual basis other than Gaines’ own opinion that those later identifications were based on a source independent of the photographic display; and (3) whether the taking by police of a color photograph of defendant Johnson at a time when he was not under arrest, and when there was no probable cause to arrest him, constituted an involuntary detention under the form of a photographic seizure in violation of the Fourth Amendment.

The District Court, after hearing evidence pursuant to the remand, made findings to this effect: (1) although substitute lineup counsel had neither communicated with trial counsel concerning the lineup nor participated in the trial preparations, trial counsel adequately represented defendants at trial on the issue of identifications; (2) Gaines’ observations during the robbery provided him with an independent source for his identification; (3) defendant Johnson consented to his photographing.

Inasmuch as there is convincing evidence which supports the District Judge’s careful findings and conclusions, just summarized, we see no reason to review the second and third points. It is sufficient to say that we hold that on both those points the District Judge was clearly warranted in his conclusions, and defendants are not on those scores entitled to reversal of their convictions.

We need to make a more extended comment on the first point. We have satisfied ourselves that on the particular facts of this case, as fully developed in the hearings before Judge Gasch and in his well-founded findings and conclusions, neither defendant was prejudiced by the failure of the substitute counsel to pass on to the trial counsel, or of trial counsel to elicit from substitute counsel, a full account of the substitute counsel’s experience at the lineup. In the cases at bar each defendant had a fair trial. There was nothing more that could have been accomplished for either defendant if trial counsel had a complete briefing of what happened at the lineup. Neither defendant is entitled to reversal on this score.

However, we deem it appropriate to emphasize what, in our view, would have been better practice, and what those who practice in the District Court ought hereafter to follow as a regular practice. When a lawyer accepts appointment, assignment, retainer, or like obligation to represent a defendant in a criminal case, it shall be his duty, if he personally does not appear at any lineup which involves his client, fully to inform himself of what has occurred, by conference with the substitute lawyer whom he or another authorized to appear at such lineup. The failure of a trial lawyer so to proceed in cases arising hereafter may serve as some evidence that the defendant involved has not received the assistance of counsel to which he is constitutionally entitled.

Affirmed.


text:
    Diana K. POWELL, Petitioner, v. WASHINGTON METROPOLITAN AREA TRANSIT COMMISSION, Respondent, D. C. Transit System, Inc., Intervenor.
    No. 21750.
    United States Court of Appeals, District of Columbia Circuit.
    Argued June 23, 1970.
    Decided June 28, 1973.

      Diana K. Powell, pro se.
    Douglas N. Schneider, Jr., Gen. Counsel, Washington Metropolitan Area Transit Commission, Washington, D. C., for respondent.
    Harvey M. Spear, New York City, for intervenor.
    Before ROBINSON and MacKINNON, Circuit Judges, and DAVIS, Judge, United States Court of Claims.

       Sitting by designation pursuant to 28 U.S. C. § 293(a) (1970).

   SPOTTSWOOD W. ROBINSON, III, Circuit Judge:

This petition is one of two bringing under review an order promulgated by the Washington Metropolitan Area Transit Commission in a proceeding initiated by D.C. Transit System, Inc. (Transit) for authority to increase its fares for public transportation by bus in the District of Columbia and its suburbs. That order, No. 773, granted increases, but in amounts lower than those sought; others, Nos. 781 and 781a, denied reconsideration of the earlier order. After examination of the administrative record in light of petitioner’s several contentions, we conclude that the Commission’s action, to the extent that it is properly before us for review herein, was well within its regulatory domain. We accordingly affirm Order No. 773 in the aspects reviewed in this opinion.

On September 1, 1967, Transit filed with the Commission new tariffs contemplating a number of changes in its fare schedules. On September 15, the Commission announced that public hearings would be held on Transit’s application, and on September 29, suspended operation of the proposed fares pending completion of the proceeding thereon. After extensive investigation, the Commission, on January 26, 1968, issued Order No. 773 granting Transit a partial increase.

In that order, the Commission found that Transit’s existing fares were “unjust and unreasonable” because they would “not produce sufficient revenues to enable the carrier to meet its operating expenses and earn a reasonable return.” The Commission further found that the fares sought by Transit were “unjust and unreasonable in that they would produce net operating revenues in excess of a fair return,” but that somewhat smaller increases, which the Commission allowed, would produce just and reasonable results. By the two orders responsive to subsequent applications for reconsideration, the Commission maintained that position without change.

Petitioner first contends that the Commission failed to adequately assess the hardship imposed upon the busriding public by the fare raises which it allowed. During the hearings, petitioner introduced exhibits showing that an elevation of fares would adversely affect Transit’s patrons, particularly those on low and fixed incomes, and that many were unable to afford other means of transportation. Indeed, evidence was hardly essential to a triggering of the Commission’s responsibility to minimize the impact of higher fares. In its ratemaking function — which no longer obtains as to Transit — the Commission labored under a mandate to “give due consideration, among other factors, to the need, in the public interest, of adequate and efficient transportation service by such carriers at the lowest cost consistent with the furnishing of such service . . . .” We ourselves have underscored the Commission’s duty to “see to it that the fare-payers pay no more than is necessary to ensure the continued adequacy of the company’s service and provide a return to the shareholders that is reasonable under the circumstances.” As is well known, any appreciable increase in the cost of public transportation renders the service less useful to the community. It is obvious, too, that such an increase lays its heaviest burden on the poor, and may even price some marginal riders out of the market.

We do not, however, discern on the Commission’s part any indifference toward this problem. Rather, the indications of record are that the Commission was advertent to the consequences of fare raises and did its best to ameliorate them.

In dealing with Transit’s application for leave to elevate its fares, the Commission was called upon to balanee the interests of both the company and the public. Much of the evidence taken during the Commission’s extensive hearings explored Transit’s operating costs, and Order No. 773 reflects the Commission’s careful analysis and scrutiny of expense data. The factor contributing mainly to the raises which the Commission allowed was an inescapable increase of $1.5 million to Transit’s labor costs during the future annual period.

As a utility’s expense of providing service to the public unavoidably inflates, the price charged for the service must also rise. This is the more so in the labor-concentrated transit industry, wherein fewer expense decreases through technological advances are feasible. And, of course, any raise in Transit’s fares was bound to promote difficulties for some. To ease the financial burden of the fare increases in question, the Commission permitted Transit to scale down its bus-purchase program, and thereby to extend the depreciation life of its existing rolling stock, and the rate of return the Commission allowed cannot be deemed immodest. We perceive no ground for disturbing the Commission’s order in this respect.

Petitioner further contends that the Commission erred in including Transit’s retained earnings as part of the base upon which its computation of return on equity was made. We think that position cannot be sustained. Transit’s net earnings after taxes were stockholder property — property which its management was free to reinvest in the company. Earnings reinvested in the business enterprise become equity capital no less than other capital contributions do, and are entitled to consideration in the calculation of fair return to the same extent that any other capital investment is. Reinvested earnings, like other components of investors’ equity, are risked in the business, and in the same degree warrant compensation for the risk.

There is nothing to suggest that Transit’s earnings were unnecessarily reinvested in order to secure higher fares that could not be justified otherwise. On the contrary, Transit’s recent financial history has consistently connoted instability, for which its low capitalization was largely responsible. Moreover, Transit’s equity fund was overwhelmingly its retained earnings — as the Commission found, stockholder equity in Transit on May 31, 1967, was $500,000 in initially-contributed capital and $2,-261,544.04 in reinvested earnings- — so that there was every reason for the Commission to encourage a buildup of equity through retentions of earnings. An important inducement to accumulate earnings as reinvested capital is the expectation that a return on all equity will be given consideration in the determination of just and reasonable fares. To have removed the incentive to reinvest Transit’s earnings in the business would have jeopardized one of its prime sources of new capital.

Petitioner also argues that the Commission gave improper consideration to Transit’s high debt-equity ratio in determining the rate of return it allowed. The reasoning is that that ratio, as primarily a management decision, is set in the interest of maximum return on investment, and should not be allowed to support a claim of inadequate return. We find this argument unacceptable. We have heretofore held that the ratio of Transit’s debt to its equity is a factor to be taken into account in ascertaining a fair return. The uneontradicted evidence in the record before us is that Transit can obtain debt capital at far less cost than equity capital. By the same token, a smaller rate of return may be required for an enterprise having a high debt-equity ratio than for one for which the ratio is substantially lower. To the extent that a utility’s operations and service are adequately and efficiently maintained at a lower aggregate cost, the ratepayer reaps a benefit. There is no basis in this record upon which we could conclude that the Commission’s treatment of Transit’s debt-equity ratio contributed to the fare increases it awarded.

Petitioner’s final contention is that the Commission erred in viewing, on the question of fair return to Transit, the latter’s position as a component of a corporate conglomerate. In Order No. 773, the Commission called attention to two prior administrative rulings that that position affected the risk factor for which Transit was compensated in the computation of its rate of return. We do not examine the merits of this facet of petitioner’s presentation for the point is not properly before us.

The Washington Metropolitan Area Transit Regulation Compact, which defines our jurisdiction to review Commission action, authorizes persons affected by final Commission orders to seek reconsideration by the Commission, requires that the applicant for reconsideration “stat[e] specifically the errors claimed as grounds for such reconsideration,” and specifies that “[n]o person shall in any court urge or rely on any ground not so set forth in such application.” Only recently we held that failure to submit a question to the Commission for administrative reconsideration forecloses judicial review of that question Petitioner did not .include among the specifications of error in her application to the Commission for reconsideration any issue as to the propriety of recognizing the risk factor in Transit’s case for what it really was. It follows that the issue cannot now be litigated here.

To the extent reviewed in this opinion, Order No. 773 is

Affirmed.

      . The other is presented in Democratic Cent. Comm. v. Washington Metropolitan Area Transit Comm’n, 158 U.S.App.D.C. _, 485 F.2d 786, decided today. f

      . D.C. Transit Sys., Inc. (Order No. 773), 72 P.U.R.3d 113 (1968).

      . D.C.Transit Sys., Inc. (Order No. 781) (WMATO Feb. 26, 1968) (unreported); D.C. Transit Sys., Inc. Order No. 781a), 74 P.U.R.3d 178 (1968). The first of these two orders announced the denial of the petitions for reconsideration, and the second discussed the Commission’s reasons therefor.

      . See also note 5, infra. The procedures by which changes in fares may be achieved are specified in the Franchise Act § 5, 70 Stat. 598, 599 (1956), and in the Washington Metropolitan Area Transit Regulation Compact (Compact), tit. II, art. XII, §§ 5, 6, 74 Stat. 1031 (1960), as amended, 74 Stat. 765 (1962), and set forth following D.C.Code §§ 1-1410, 1-1410a (1967). See also D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, 151 U.S.App.D.C. 223, 225, 466 F.2d 394, 396-397, cert. denied, 409 U.S. 1086, 93 S.Ct. 688, 34 L.Ed.2d 673 (1972). The most prominent changes Transit sought were increases in the basic District of Columbia fares to 30 cents cash and four tokens for $1.10.

      . D.C. Transit Sys., Inc. (Order No. 735), (WMATC Sept. 15, 1967) (unreported). Transit originally sought fare increases in early June, 1967, which closely followed upon March 15, 1967, fare increases. See D.C. Transit Sys., Inc. (Order No. 684) (WMATC March 13, 1967) (unreported), aff’d, Payne v. Washington Metropolitan Area Transit Comm’n, 134 U.S.App.D.C. 321, 415 F.2d 901 (1968). Operating results under the March 15 fares were thus available for only two and one-half months, a period the Commission deemed too limited a basis for a reliable assessment of Transit’s experience with those fares. The Commission accordingly required Transit to supplement the record with evidence of experience over a more extended period. D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 121. When the hearings on the September 1 filing opened on October 12, 1967, Transit provided the Commission with statistical data reflecting its revenues and expenses for the preceding twelve-month historical period, the greater portion of which followed inauguration of the March 15 fares. D.C. Transit Sys., Inc. (Order No. 684), supra, at 46-47. An evaluation of the evidence relating to experience since March 15 revealed that the Commission had set fares at a level which, in harmony with the Commission’s predictions, generated revenues of $36 million and, after all obligations were met, a return of about $600,000. Id. at 30.
      On May 26, 1967, prior to the refiled fare-increase application, Transit sought authority to use reconditioned buses in lieu of new bus purchases required by previous order of the Commission. D.C. Transit Sys., Inc. (Order No. 362) (WMATC May 27, 1964) (unreported). The earlier application was consolidated with the fare-increase application. D.C. Transit Sys., Inc. (Order No. 741) (WMATC Sept. 29, 1967) (unreported). See text infra at notes 21-22.

      . D.C. Transit Sys., Inc. (Order No. 739), (WMATC Sept. 29, 1967) (unreported).

      . The Commission held fifteen sessions of public hearings to which five formal party-protestants, including petitioner, were admitted as participants. A total of 111 exhibits were introduced, and the transcript aggregates 2,716 pages. The Commission also processed 85 formal petitions, protests and letters in connection with Transit’s application.

      . D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 158. See note 12, infra.

      . D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 159. See Compact, supra note 4, tit. II, art. XII, § 6(a)(3), quoted infra note 15.

      . D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 159.

      . Id.

      . Id. at 159-160. The principal increases were in cash fares from 25 cents to 27 cents, and in token fares from four for 98 cents to four for $1.00, in the District of Columbia. Id. at 160.

      . D.C. Transit Sys., Inc. (Order No. 781a), supra note 3, 74 P.U.R.3d at 181.

      . See Democratic Cent. Comm. v. Washington Metropolitan Area Transit Comm’n, supra note 1, 158 U.S.App.D.C. at ___ _ ___, 485 F.2d at 827-829. Relief with respect to any error vitiating Order No. 773 would now be afforded by way of restitution. Id. at 1082.

      . “In the exercise of its power to prescribe just and reasonable fares and regulations and practices relating thereto, the Commission shall give due consideration, among other factors, to the inherent advantages of transportation by such carriers; to the effect of rates upon the movement of traffic by the carrier or carriers for which the rates are prescribed; to the need, in the public interest, of adequate and efficient transportation service by such carriers at the lowest cost consistent with the furnishing of such service; and to the need of revenues sufficient to enable such carrier under honest, economical, and efficient management, to provide such service.” Compact, supra note 4, tit. II, art. XII, § 6(a) (3).

      . D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, 121 U.S.App.D.C. 375, 402, 350 F.2d 753, 780 (en banc 1965).

      . A fare increase is inevitably accompanied by a drop in ridership. This phenomenon is reflected in ratemaking practice by a “resistance factor” — a percentage figure related to ridership falloff — which was applied by the Commission and Transit to each one percent of fare increase to calculate the number of rides which would occur at the new rate and the revenues which those rides would generate. See D.C. Transit Sys., Inc. (Order No. 1052), 85 P.U.R.3d 1, 18 (WMATC 1970); D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 122-23; Bristol Traction Co., 94 P.U.R. (n. s.) 140, 144 (Conn. Pub.Utils. Comm’n 1952); Honolulu Rapid Transit Co., 90 P.U.R. (n. s.) 129, 138 (Hawaii Pub. Utils. Comm’n 1951); Baltimore Transit Co., 94 P.U.R. (n. s.) 129, 138 (Md. Pub. Serv. Comm’n 1952).

      . See Compact, supra note 4, tit. II, art. XII, §§ 6(a)(3), (4), quoted supra note 15; D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 400, 350 F.2d at 778.

      . D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 124-33.

      . Id. at 120.

      . The requirement for annual purchases of new buses was reduced from one-twelfth to one-fourteenth of Transit’s fleet. Id. at 160.

      . The extension was from twelve to fourteen years. See note 21, supra. This produced a saving of about $500,000 annually. Id. at 161.

      . The Commission found that the fares set by its last previous rate order — No. 684, see note 5, supra — were providing a fair return. D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 121. The Commission, however, could foresee no way to avoid an increase in fares to meet the $1.5 million annual increase in Transit’s labor costs. Id. at 120. The fares authorized by Order No. 684 were projected to produce net operating income of $1,544,246 during the ensuing twelve months, which was insufficient to cover interest expenses, meet the additional labor costs and also provide a fair return. Id. at 120-21. Accrdinogly, the fare increases authorized by Order No. 773 were calculated to produce net operating income of $2 million, of which $767,000 would be a return on equity. Id. at 151-52. This was a rate of return of 5.33 percent, and it coincided with the recommendation of an expert whose opinion was that it would have “the least effect upon the movement of traffic” and would “produce the least resistance required by an increase in fares.” Id. at 159. Although this return was somewhat less than it had been in previous years, the Commission considered it adequate, feeling that Transit’s risk to capital diminished as it became better established in the community. Id. at 153.

      . E. g., Universal Camera Corp. v. NLRB, 340 U.S. 474, 496-497, 71 S.Ct. 456, 95 L.Ed. 456 (1951).

      . It should be noted that the Commission traditionally considered return on equity as only one of several ratemaking factors in determining a fair margin of return. See D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 4, 151 U.S.App.D.C. at 237 n. 97, 466 F.2d at 408 n. 97; D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 400, 350 F.2d at 778.

      . See Board of Pub. Util. Comm’rs v. New York Tel. Co., 271 U.S. 23, 32, 46 S.Ct. 363, 70 L.Ed. 808 (1926). See generally A. Priest, Principles of Public Utility Regulation 200-02 (1969).

      . See Boston Consol. Gas Co. v. Department of Pub. Utils., 327 Mass. 103, 107, 97 N.E.2d 521, 524 (1951). See also D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 400, 350 F.2d at 778.

      . See D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 402, 350 F.2d at 780; D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 4, passim.

      . D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 148.

      . We have had occasion to point out that the Commission liad to consider, as a relevant factor in the determination of a just and reasonable fare, “the incentives required by a stockholder to keep his money in the business and the dividends and growth rates requisite to supply these incentives. . . .” D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 401, 350 F.2d at 779.

      . Id.

      . During the hearings, one expert testified that Transit would have to pay about 32 percent to attract equity capital but only about 7 percent to obtain debt capital. Another testified that Transit’s costs of equity capital would be about 15 percent while the cost of debt capital would be 7.5 percent. D.C. Transit Sys., Inc. (Order No. 773), supra note 2, 72 P.U.R.3d at 141-144.

      . One of the factors which may be taken into consideration in calculating rate of return to a public utility, however, is the degree of risk to which its capital is put. Greater risks to the utility, i. e., financial instability, may result from a high debt-equity ratio ; therefore, the rate of return may be proportionately higher. See D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 4, 151 U.S.App.D.C. at 228 n. 33, 466 F.2d at 399 n. 33.

      . Admittedly, there are factors which may also make a high debt-equity ratio unbeneficial to riders, among which are the inhibition to reinvest and improve service because the return to equity is low, and the degeneration of a utility’s financial condition to a point of instability. See D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 16, 121 U.S.App.D.C. at 401, 350 F.2d at 779. And see D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 4.

      . Transit is a wholly-owned subsidiary of D.C. Transit of Delaware, which, in turn, at the time of the proceedings before the Commission, was itself a wholly-owned subsidiary of Trans-Caribbean Airways, Inc. In addition to Transit’s local transportation business, the corporate complex of which Transit is a part engaged in some number of unrelated operations which were conducted through subsidiaries of Transit and through other subsidiaries of its parent corporation.

      . D.C. Transit Sys., Inc. (Order No. 684), supra note 5, at 16-20; D.C. Transit Sys., Inc. (Order No. 656) (WMATC Jan. 12, 1967) (unreported), at 25-28.

      . In D.C. Transit Sys., Inc. (Order No. 684), supra note 5, at 14, the Commission accepted testimony that, because of its position in the Trans-Caribbean holding system, Transit was a smaller business risk than other transit companies, and that resultantly it had readier access to capital markets. By that analysis, of course — which Transit has consistently opposed — Transit’s cost of debt capital was lowered and its entitlement to compensation for the risk factor in its rate of return was lessened.

      . Supra note 4.

      . “Any person affected by any final order or decision of the Commission may, within thirty days after the publication thereof, file with the Commission an application in writing requesting a reconsideration of the matters involved, and stating specifically the errors claimed as grounds for such reconsideration. No person shall in any court urge or rely on any ground not so set forth in such application.” Compact, supra note 4, tit. II, art. XII, § 16.

      . See note 39, supra.

      . D.C. Transit Sys., Inc. v. Washington Metropolitan Area Transit Comm’n, supra note 4, 151 U.S.App.D.C. at 242-243, 466 F.2d at 413-414.

      . But see Democratic Cent. Comm. v. Washington Metropolitan Area Transit Comm’n, supra note 1.