271 U.S. 153 (1926), 195, Colorado v. United States

Docket NºNo.195
Citation271 U.S. 153, 46 S.Ct. 452, 70 L.Ed. 878
Party NameColorado v. United States
Case DateMay 03, 1926
CourtUnited States Supreme Court

Page 153

271 U.S. 153 (1926)

46 S.Ct. 452, 70 L.Ed. 878

Colorado

v.

United States

No.195

United States Supreme Court

May 3, 1926

Argued March 5, 8, 1926

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

Syllabus

1. Under § 1, pars. 18-20, of the Interstate Commerce Act, as amended by Transportation Act, 1920, § 402, the Interstate Commerce Commission has power to authorize abandonment, as respects both intrastate and interstate traffic, of a branch line of railroad lying wholly within the the owning company's incorporation upon the ground that local conditions are such that public convenience and necessity do not require continued operation, and that such operation will result in large deficits constituting an undue burden upon interstate commerce. P. 161.

2. The exercise of federal power in authorizing such abandonment is not an invasion of the field reserved by the Constitution to the state, for the paramount power of Congress over interstate commerce enables it to determine to what extent and in what manner intrastate service must be subordinated in order that interstate service may be adequately rendered. P. 165.

3. In a suit to enjoin an order of the Interstate Commerce Commission, the court may consider the objections that essential findings were not made and that findings made were not supported by evidence if all the evidence before the Commission was introduced in the court below and is substantially incorporated in the record on appeal. P. 166.

4. While the constitutional basis of authority to issue the certificate of abandonment is the power of Congress to regulate interstate commerce, the Act does not make issuance of the certificate conditional upon a finding that continued operation will result in discrimination against interstate commerce, or that it will result in a denial of just compensation for the use in intrastate commerce of the property of the carrier within the state, or that it will result in a denial of such compensation for the property within the state used in commerce intrastate and interstate. P. 167.

5. The sole test prescribed by the Act is that abandonment be consistent with public necessity and convenience; in determining this, the Commission must have regard for the needs of both intrastate and interstate commerce. P. 168.

Affirmed.

Page 154

Appeal from a decree of the district court which dismissed the bill brought by the State of Colorado against the United States, the Interstate Commerce Commission, and the Colorado & Southern Railway Company seeking to enjoin and in part set aside an order of the Commission -- a certificate permitting the railway to abandon a branch line in Colorado.

Page 159

BRANDEIS, J., lead opinion

MR. JUSTICE BRANDEIS delivered the opinion of the Court.

This suit was brought by Colorado against The United States, in the federal court for that state, to enjoin and set aside, in part, an order of the Interstate Commerce Commission issued February 11, 1924. The order is a certificate that present and future public convenience and necessity permit the abandonment by the Colorado & Southern Railway Company, six months thereafter, of a branch line located wholly in that state. The certificate was issued under Interstate Commerce Act, § 1, pars. 18-20, as amended by Transportation Act 1920, c. 91, § 402, 41 Stat. 456, 477.

The company is a Colorado corporation. It owns and operates in intrastate and interstate commerce a railroad system located partly in Colorado and partly in other states. The branch was constructed under the authority [46 S.Ct. 453] of Colorado, and was acquired by the company under its authority. The line is narrow gauge. It is now physically

Page 160

detached from other lines of the company; but it is operated in both intrastate and interstate commerce as a part of the system by means of connections with other railroads. The certificate was granted on the ground that the local conditions are such that public convenience and necessity do not require continued operation, that for years operation of the branch had resulted in large deficits, that future operation would likewise result in large deficits, that the operating results of the branch are reflected in the company's accounts, that it would have to make good the deficits incurred in operating the branch, and that, thus continued, operation would constitute an undue burden upon interstate commerce. Abandonment of Branch Line by Colorado & Southern Ry., 72 I.C.C. 315; 82 I.C.C. 310; 86 I.C.C. 393.

The application for the certificate was filed September 1, 1921. Before any hearing thereon, the state moved that the proceeding be dismissed on the ground, among others, that, as the branch was wholly intrastate, the Commission was without jurisdiction of the application. This objection was overruled. Thereafter, the state opposed, on the merits, the granting of the certificate. The case was first heard before Division 4 of the Commission on exceptions filed by the company to the examiner's proposed report. On July 28, 1922, the application was denied, with leave to renew it "if the improvement in operating results, confidently anticipated by protestants, should not materialize." 72 I.C.C. 315. On May 19.1923, the company filed a petition praying that the case be reopened and set for further hearing. Division 4 heard it. On September 24, 1923, an order was entered that the certificate issue. 82 I.C.C. 310. A hearing before the full Commission was then sought by the state and the other protestants. Compare United States v. Abilene & Southern Ry. Co., 265 U.S. 274, 281. The

Page 161

request was granted. On February 11, 1924, the order was affirmed with the modification that the certificate should not take effect until six months from that date. Abandonment of Branch Line by C. & S. Ry., 86 I.C.C. 393. The effective date of the certificate was later extended to September 11, 1924, and finally to October 11, 1924. 94 I.C.C. 657, 661.

Meanwhile, this suit had been begun. The Commission and the company intervened as defendants. On August 19, 1924, a decree dismissing the bill on the merits was entered, upon final hearing, without opinion. A motion for a suspension of the order of the Commission pending an appeal was denied. The case is here on direct appeal under the Act of October 22, 1913, c. 32, 38 Stat. 208, 220. The order is assailed as void insofar as it authorizes abandonment and discontinuance of operation in intrastate traffic. The remedy pursued is the appropriate one. See Texas v. Eastern Texas R. Co., 258 U.S. 204.

First. The main contention of the state is that the Commission lacks power to authorize the company to abandon, as respects intrastate traffic, a part of its line lying wholly within the state. The argument is this: while a railroad cannot, in the absence of express statutory provision or contract, be compelled by a state to continue operating its lines at a loss when there is no reasonable prospect of future profit, and may therefore, without such consent, abandon all lines within the state. Brooks-Scanlon Co. v. Railroad Commission, 251 U.S. 396; Bullock v. Florida, 254 U.S. 513, 520; Railroad Commission v. Eastern Texas R. Co., 264 U.S. 79, 85, it has no right to abandon a part of the lines, merely because operation will be attended by pecuniary loss, and still continue to enjoy the privilege of operating other parts within the state, Chesapeake & Ohio Ry. Co. v. Public Service Commission, 242 U.S. 603; Fort Smith Light & Traction Co. v. Bourland, 267 U.S. 330. The

Page 162

charter of the Colorado & Southern is a contract with the state. By accepting the charter, the company assumed the obligation of providing intrastate service on every part of its line within the state. Colorado & Southern Ry. v. Railroad Commission, 54 Colo. 64, 92-93. The extent and character of this service is subject to regulation by the state. The inherent power of a state to regulate intrastate traffic by requiring the railroad to operate every part of its line, like its power to order a particular service, is, of course, subject to the limitation that the order must not be unreasonable. But the fact that operation of the branch will necessarily result in financial loss would in no event be more than an important circumstance bearing upon the reasonableness of the state's order requiring the service. In the case at bar, no question of the reasonableness of the state's action can arise, because the state has not issued any order; it has merely protested against the Commission's releasing this Colorado corporation from the primary duty voluntarily assumed of maintaining some service on the branch. This the Commission cannot do as respects intrastate commerce. Transportation Act 1920 did not purport to take from the state its powers to control intrastate commerce. Nor did it confer upon the Commission power to release a corporation [46 S.Ct. 454] chartered by the state from its primary obligation to furnish service. If paragraph 18 of § 1 should be construed as authorizing the Commission to do so without the consent of the state, the provision would be unconstitutional. Compare Texas v. Eastern Texas R. Co., 258 U.S. 204, 217. Such is the argument.

The argument rests upon a misconception of the nature of the power exercised by the Commission in authorizing abandonment under paragraphs 18-20. The certificate issues not primarily to protect the railroad, but to protect interstate commerce from undue burdens or discrimination. The Commission, by its order,...

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222 practice notes
  • 210 F.Supp. 675 (M.D.N.C. 1962), C-158-D-62, State of North Carolina v. United States
    • United States
    • Federal Cases United States District Courts 4th Circuit Middle District of North Carolina
    • October 19, 1962
    ...Comm. v. Chicago, Burlington and Quincy R.R. Co., 257 U.S. 563, 589-590, 42 S.Ct. 232, 66 L.Ed. 371 (1922); Colorado v. United States, 271 U.S. 153, 163, 165-166, 46 S.Ct. 452, 70 L.Ed. 878 (1926). We find section 13a(2) As to plaintiffs' claim of a defect in notice, it is clear that the cl......
  • 36 F.2d 691 (2nd Cir. 1929), 34, United States v. Clyde S.S. Co.
    • United States
    • Federal Cases United States Courts of Appeals United States Court of Appeals (2nd Circuit)
    • December 2, 1929
    ...was complying with the law, without a complete knowledge of what it was doing. Colorado v. United States, 271 U.S. at page 165, 46 S.Ct. 452, 70 L.Ed. 878. It is true that in Terminal Taxicab Co. v. Kutz, 241 U.S. 252, 36 S.Ct. 583, 585, 60 L.Ed. 984,Ann.Cas. 1916D, 765, the Supreme Court h......
  • 146 So. 860 (Miss. 1933), 30095, Gulf States Creosoting Co. v. Southern Finance & Construction Corporation
    • United States
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    • March 27, 1933
    ...R. R. Co. v. U.S. 40 F.2d 921; Indian Valley v. U.S. 52 F.2d 485; New York Central Securities Corp. v. U.S. 54 F.2d 122; Colorado v. U.S. 271 U.S. 153, 165, 46 S.Ct. 452, 70 L.Ed. 878; R. R. Commission v. So. Pac. Ry., 264 U.S. 331, 44 S.Ct. 376, 68 L.Ed. 713. Argued orally by T. C. Hannah,......
  • 156 N.E. 298 (Ill. 1927), 18092, St. Louis Connecting R. Co. v. Blumberg
    • United States
    • Illinois Supreme Court of Illinois
    • April 20, 1927
    ...652, 50 L.Ed. 1046; Venner v. Michigan Central Railroad Co., 271 U.S. 127, 46 S.Ct. 444, 70 L.Ed. 868; State of Colorado v. United States, 271 U.S. 153, 46 S.Ct. 452, 70 L.Ed. 153. The action of the county court in dismissing appellant's petition in effect annulled and set aside the orders ......
  • Request a trial to view additional results
220 cases
  • 210 F.Supp. 675 (M.D.N.C. 1962), C-158-D-62, State of North Carolina v. United States
    • United States
    • Federal Cases United States District Courts 4th Circuit Middle District of North Carolina
    • October 19, 1962
    ...Comm. v. Chicago, Burlington and Quincy R.R. Co., 257 U.S. 563, 589-590, 42 S.Ct. 232, 66 L.Ed. 371 (1922); Colorado v. United States, 271 U.S. 153, 163, 165-166, 46 S.Ct. 452, 70 L.Ed. 878 (1926). We find section 13a(2) As to plaintiffs' claim of a defect in notice, it is clear that the cl......
  • 36 F.2d 691 (2nd Cir. 1929), 34, United States v. Clyde S.S. Co.
    • United States
    • Federal Cases United States Courts of Appeals United States Court of Appeals (2nd Circuit)
    • December 2, 1929
    ...was complying with the law, without a complete knowledge of what it was doing. Colorado v. United States, 271 U.S. at page 165, 46 S.Ct. 452, 70 L.Ed. 878. It is true that in Terminal Taxicab Co. v. Kutz, 241 U.S. 252, 36 S.Ct. 583, 585, 60 L.Ed. 984,Ann.Cas. 1916D, 765, the Supreme Court h......
  • 146 So. 860 (Miss. 1933), 30095, Gulf States Creosoting Co. v. Southern Finance & Construction Corporation
    • United States
    • Mississippi United States State Supreme Court of Mississippi
    • March 27, 1933
    ...R. R. Co. v. U.S. 40 F.2d 921; Indian Valley v. U.S. 52 F.2d 485; New York Central Securities Corp. v. U.S. 54 F.2d 122; Colorado v. U.S. 271 U.S. 153, 165, 46 S.Ct. 452, 70 L.Ed. 878; R. R. Commission v. So. Pac. Ry., 264 U.S. 331, 44 S.Ct. 376, 68 L.Ed. 713. Argued orally by T. C. Hannah,......
  • 156 N.E. 298 (Ill. 1927), 18092, St. Louis Connecting R. Co. v. Blumberg
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    • April 20, 1927
    ...652, 50 L.Ed. 1046; Venner v. Michigan Central Railroad Co., 271 U.S. 127, 46 S.Ct. 444, 70 L.Ed. 868; State of Colorado v. United States, 271 U.S. 153, 46 S.Ct. 452, 70 L.Ed. 153. The action of the county court in dismissing appellant's petition in effect annulled and set aside the orders ......
  • Request a trial to view additional results
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