Corporation Commission v. Seaboard Air-Line System

• Decision Date: 27 November 1900
• Citation: 37 S.E. 266,127 N.C. 283
• Parties: CORPORATION COMMISSION v. SEABOARD AIR-LINE SYSTEM.
• Court: North Carolina Supreme Court

37 S.E. 266

127 N.C. 283

CORPORATION COMMISSION v. SEABOARD AIR-LINE SYSTEM.

Supreme Court of North Carolina

November 27, 1900

Appeal from superior court, Wake county; Moore, Judge.

Proceedings between the railroads comprised in the Seaboard Air-Line System and the corporation commission to determine the validity of the commission's order fixing freight rates for the transportation of fertilizers. From a judgment sustaining the order, the railroad companies appeal. Affirmed.

Where the corporation commission fixed freight rates for fertilizers, declaring that 20 per cent. higher rates than those fixed might be charged for shipments less than a carload, and that 10 tons should be regarded as the "minimum carload," the commission's order was not ultra vires on the ground that the commission had no power to regulate the amount of merchandise which should constitute a transportation carload, since the provisions of the order should be construed merely as determining what should amount to a carload, in determining the rate to be charged, and not as an attempt to regulate the mode of transportation, or prohibit the shipment of more than 10 tons in a car.

J. D Shaw, W. H. Day, and J. B. Batchelor, for appellants.

Battle & Mordecai and Simmons, Pou & Ward, for appellee.

DOUGLAS J.

This is a proceeding originated before the corporation commission in the exercise of its statutory duty to regulate freight rates. It was appealed by the defendants to the superior court, and thence to this court. On the 27th day of April, 1899, the plaintiff commission issued an order providing that "on and after the 15th day of May, 1899, the maximum freight rates on fertilizers on all roads in this state will be as follows [specifying the rates per ton for different distances]. On less than car-load shipments, rates may be made 20 per cent. higher than above." This order is headed, "C. L., Ten (10) Tons, Minimum." This, we presume, means that the minimum car load shall be taken as 10 tons, and this seems the bone of contention. The defendants filed the following exceptions before the commission, all of which were overruled: "The said railroad companies except to the order of the North Carolina corporation commission, circular No. 1: First. Because the said reduction in the minimum car-load weight is directly antagonistic to the effort being made generally to reduce expenses through the furnishing of equipment of larger capacity, and involves an increase in the cost of transportation. Second. Because the said rates are not in themselves reasonable or just, but the same are unreasonably low, would fail to yield a just and reasonable revenue for the service, and these defendants would thereby be deprived of the equal protection of the laws, contrary to the constitution of the United States, art 14, § 1, and without due process of law would be deprived of their property, contrary to the constitution of the United States, art. 14, § 1. Third. Because the figures established for the tons, minimum, were unreasonably low, even when applied on car loads of fifteen tons minimum, were protested against before the North Carolina railroad commission, and only accepted by the carriers after the fifteen tons minimum in basis was made a part of the tariff, and then in so far as the carriers composing the Seaboard Air-Line System are concerned, with the understanding that they would be given a trial for the session of 1898-99 only. Fourth. Because circular No. 1 makes no exceptions in favor of weaker lines whose earnings are at a low rate per mile, which lines are unable to exist at the low rate thus sought to be instituted. Fifth. Because such rates unjustly reduce the revenues of lines formerly allowed a percentage of rate above the stronger or standard lines, thus resulting in an unfair reduction, greater in the case of one line than another." At the hearing on appeal before the superior court, the defendants abandoned all contentions that the rate was unreasonable. This practically disposes of all exceptions but the first.

It is true that the defendants in the superior court introduced among other evidence, the original charters of the Raleigh & Gaston Railroad Company, and the Seaboard & Roanoke Railroad Company, and contended that the provisions of those charters, passed prior to the adoption of the constitution of 1868, exempted those roads from the operation of any order of the corporation commission reducing passenger or freight rates below the maximum charges allowed in said acts. Whatever merit there may be in this contention is not now properly before us, as it was not included in the...