211 U.S. 210 (2019), Prentis v. Atlantic Coast Line Company

Citation:211 U.S. 210, 29 S.Ct. 67, 53 L.Ed. 150
Party Name:Prentis v. Atlantic Coast Line Company
Case Date:November 30, 1908
Court:United States Supreme Court

Page 210

211 U.S. 210 (2019)

29 S.Ct. 67, 53 L.Ed. 150



Atlantic Coast Line Company

United States Supreme Court

November 30, 1908




So far as the federal Constitution is concerned, a state may, by constitutional provision, unite legislative and judicial powers in the same body.

A judicial inquiry investigates, declares, and enforces liabilities as they stand on present or past facts and under existing laws, while legislation looks to the future and changes conditions, making new rules to be thereafter applied.

The making of a rate by a legislative body, after hearing the interested parties, is not res judicata upon the validity of the rate when questioned by those parties in a suit in a court. Litigation does not arise until after legislation; nor can a state make such legislative action res judicata in subsequent litigation.

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Proceedings legislative in nature are not proceedings in a court within the meaning of Rev.Stat. § 720, no matter what may be the character of the body in which they take place.

Whether a railroad rate is confiscatory so as to deprive the company of its property without due process of law within the meaning of the Fourteenth Amendment depends upon the valuation of the property, the income derivable from the rate, and the proportion between the two, which are matters of fact which the company cannot be prevented from trying before a competent tribunal of its own choosing. Where a state railroad commission, which is granted power by the state constitution to make and enforce rates, enacts and attempts to enforce rates which are so low as to be confiscatory, the proper remedy is by bill in equity to enjoin such enforcement, and such a suit against the members of the commission will not be bad as one against the state, but it should not be commenced until the rate has been fixed by the body having the last word.

While a party does not lose his right to complain of action under an unconstitutional law by not using diligence to prevent its enactment, on a question of railroad rates, when an appeal to the supreme court of the state from an order of the state Corporation Commission fixing such rates is given by the state constitution, it is proper that dissatisfied railroads should take this matter to the Supreme Court of their state before bringing a bill in the Circuit Court of the United States. Under the circumstances of this case, action on a bill was suspended to await the result of such an appeal.

The facts are stated in the opinion.

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HOLMES, J., lead opinion

MR. JUSTICE HOLMES delivered the opinion of the Court.

These are bills in equity brought in the circuit court to enjoin the members and clerk of the Virginia State Corporation Commission from publishing or taking any other steps to enforce a certain order fixing passenger rates. The bills allege, with some elaboration of the facts, that the rates in question are confiscatory, and other matters not necessary to mention, and set up the Fourteenth Amendment, etc. The defendants appeared specially, and by demurrer and plea, respectively, put forward that the proceedings before the commission are proceedings in a court of the state, which the courts of the United States are forbidden to enjoin, Rev.Stats., § 720, and that the decision of the commission makes the legality of the rates res judicata. On these pleadings, final decrees were entered for the plaintiffs, and the defendants appealed to this Court. Therefore, as the case is presented, it is to be assumed that the order confiscates the plaintiffs' property and infringes the Fourteenth Amendment if the matter is open to inquiry. The question principally argued, and the main question to be discussed, is whether the order is one which, in spite of its constitutional invalidity, the courts of the United States are not at liberty to impugn.

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The State Corporation Commission is established and its powers are defined at length by the constitution of the state. There is no need to rehearse the provisions that give it dignity and importance or that add judicial to its other functions, because we shall assume that, for some purposes, it is a court within the meaning of Rev.Stat. § 720, and in the commonly accepted sense of that word. Among its duties, it exercises the authority of the state to supervise, regulate, and control public service corporations, and to that end, as is said by the Supreme Court of Virginia and repeated by counsel at the bar, it has been clothed with legislative, judicial, and executive powers. Norfolk & Portsmouth Belt Line R. Co. v. Commonwealth, 103 Va. 289, 294.

The state constitution provides that the commission, in the performance of the duty just mentioned, shall, from time to time, prescribe and enforce such rates, charges, classification of traffic, and rules and regulations for transportation and transmission companies doing business in the state, and shall require them to establish and maintain all such public service facilities and conveniences as may be reasonable and just. Before prescribing or fixing any rate or charge, etc., it is to give notice (in case of a general order not directed against any specific company by name, by four weeks' publication in a newspaper) of the substance of the contemplated action and of a time and place when the commission will hear objections and evidence against it. If an order is passed, the order again is to be published as above before it shall go into effect. An appeal to the Supreme Court of Appeals is given of right to any party aggrieved, upon [29 S.Ct. 69] conditions not necessary to be stated, and that court, if it reverses what has been done, is to substitute such order as, in its opinion, the commission should have made. The commission is to certify the facts upon which its action was based and such evidence as may be required, but no new evidence is to be received, and how far the findings of the commission can be revised perhaps is not quite plain. No other court of the state can review, reverse, correct, or annual

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the action of the commission, and, in collateral proceedings, the validity of the rates established by it cannot be called in doubt.

When a rate has been fixed, the commission has power to enforce compliance with its order by adjudging and enforcing, by its own appropriate process, against the offending company, the fines and penalties established by law. But a hearing is required, and the validity and reasonableness of the order may be attacked again in this proceeding, and all defenses seem to be open to the party charged with a breach.

On July 31, 1906, under the provisions outlined, the commission published in a newspaper notice to the several steam railroad companies doing business in Virginia, and all persons interested, that at a certain time and place, it would hear objections to an order prescribing a maximum rate of two cents a mile for the transportation of passengers, with details not needing to be stated. A hearing was had, and the complainants (appellees) severally appeared and urged objections similar to those set up in the bills. On April 27, 1907, the commission passed an order prescribing the rates, but in more specific form. For certain railroads named, including all of the complainants except as we shall state, the rate was to be two cents; for certain excepted branches of the Southern Railway Company, two and one-half; for others, including the Chesapeake Western Railway, three, and for others, three and one-half cents a mile, with a minimum charge of ten cents. Publication of the order was directed, and at that stage these bills were brought.

In order to decide the cases, it is not necessary to discuss all the questions that were raised or touched upon in argument, and some we shall lay on one side. We shall assume that when, as here, a state constitution sees fit to unite legislative and judicial powers in a single hand, there is nothing to hinder, so far as the Constitution of the United States is concerned. Dreyer v. Illinois, 187 U.S. 71, 83-84; Winchester & Strasburg R. Co. v. Commonwealth, 106 Va. 264, 268. We shall assume, as we have said, that some of the powers of the commission

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are judicial, and we shall assume, without deciding, that, if it was proceeding against the appellees to enforce this order and to punish them for a breach, it then would be sitting as a court, and would be protected from interference on the part of courts of the United States.

But we think it equally plain that the proceedings drawn in question here are legislative in their nature, and nonetheless so that they have taken place with a body which, at another moment or in its principal or dominant aspect, is a court such as is meant by § 720. A judicial inquiry investigates, declares, and enforces liabilities as they stand on present or past facts and under laws supposed already to exist. That is its purpose and end. Legislation, on the other hand, looks to the future and changes existing conditions by making a new rule, to be applied thereafter to all or some part of those subject to its power. The establishment of a rate is the making of a rule for the future, and therefore is an act legislative, not judicial, in kind, as seems to be fully recognized by the Supreme Court of Appeals, Commonwealth v. Atlantic Coast Line R. Co., 106 Va. 61, 64, and especially by its learned president in his pointed remarks in Winchester & Strasburg R. Co. v. Commonwealth, 106 Va. 264, 281. See further Interstate Commerce Commission v. Cincinnati, New Orleans & Texas Pacific Ry. Co., 167 U.S. 479, 499-500, 505; San Diego Land & Town Co. v. Jasper, 189 U.S. 439, 440.

Proceedings legislative in nature are not proceedings in a court, within the meaning of Rev.Stat. § 720, no matter what may be...

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