Alabama Public Service Commission v. Atlantic Coast Line R. Co.

• Decision Date: 23 March 1950
• Docket Number: 3 Div. 544
• Citation: 45 So.2d 449,253 Ala. 559
• Parties: ALABAMA PUBLIC SERVICE COMMISSION v. ATLANTIC COAST LINE R. CO.
• Court: Alabama Supreme Court

Page 449

45 So.2d 449

253 Ala. 559

ALABAMA PUBLIC SERVICE COMMISSION v. ATLANTIC COAST LINE R. CO.

3 Div. 544.

Supreme Court of Alabama.

March 23, 1950.

Rehearing Denied April 20, 1950.

A. A. Carmichael, Atty. Gen., and MacDonald Gallion, Asst. Atty. Gen., for appellant.

Evans Hinson, of Montgomery, and G. E. Reeves, of Tampa, Fla., for appellee.

FOSTER, Justice.

This case comes to us on appeal from the Circuit Court, in Equity, of Montgomery County. It originated in an application made on February 2, 1948 by appellee to the Alabama Public Service Commission 'to discontinue the present turn-around mixed train service, daily except Sunday, between Sprague, Alabama, and Luverne, Alabama, and to substitute tri-weekly local turn-around service between Montgomery, Alabama, and Luverne, Alabama.' From Sprague to Luverne is 32.3 miles. After a formal hearing and finding of facts and conclusions of law, the commission made an order December 20, 1948 denying the application. On appeal to the circuit court, in equity, that court, on July 8, 1949, reversed the order of the commission and granted the application. The commission has appealed to this Court.

The power and duty of the court on such appeal is controlled by Title 48, section 82, Code. The circuit court concluded that the commission erred in its application of the law and that its finding of facts was contrary to the substantial weight of the evidence.

There are some preliminary principles of law which need to be mentioned.

There is no statutory nor contractual duty of appellee to render such service. But the commission is charged with the duty of supervising, regulating and controlling all transportation companies doing business in this State in specified particulars, including the maintenance of such public service as may be reasonable and just. Title 48, section 104, Code.

When the statutory law of the state or provisions of a legislative charter make it the duty of a railroad operating in that state to maintain a daily railroad service, there is a different principle applicable than the one where there is no such duty. In the former instance the principle is linked to due process in two aspects, (1) the financial burden and (2) the need of the service: there is also involved its effect on interstate commerce. It is thus expressed in State v. Georgia Southern & Florida R. R. Co., 139 Fla. 115, 190 So. 527, 532, 123 A.L.R. 914: 'The reasonable needs of the public are to be first considered, and all the revenue receipts, interstate and intrastate as well as mail, express and all other sources of revenue duly accruing to the line, should be considered in determining, not whether the line is self-sustaining, but whether the financial burden of the line grossly exceeds the needs of the public to a continuance of the service, and so reduces the revenue receipts of the company's entire system as to be a deprivation or taking of property of the company without due process and without just compensation, or so as to unduly burden the interstate commerce transportation service of the company. * * * it is (under that set up) clear that the duty to furnish reasonably adequate train service to local communities served by such carrier, is essentially among the imperative duties that are by law (of Florida) imposed upon railroad common carriers in consideration of the privileges conferred upon them by the State for the benefit of the public.' (That is by the statutory law of Florida.)

Such imperative duty must be observed unless it 'unduly affect[s] the receipts from the entire railroad system of the company, or impair[s] organic rights or directly and unreasonably burden[s] or impede[s] interstate or foreign commerce.'

But under the authorities due process does not, under such statutes, require that each line or branch shall under every set-up yield sufficient revenue to provide a profit on that particular feature of the system. Insofar as that is concerned, the question goes to the burden on the entire system. 123 A.L.R. 930, 44 Am.Jur. 583, section 368.

When the imperative duty exists by statute such legal effect is well supported by the authorities. State v. Georgia S. & F. R. R. Co., 139 Fla. 115, 190 So. 527, 123 A.L.R. 922, et seq.; 51 Corpus Juris 972, section 883; Atlantic Coast Line R. R. v. North Carolina Corp. Comm., 206 U.S. 1, 27 S.Ct. 585, 51 L.Ed. 933, 11 Ann.Cas. 398; Atlantic Coast Line R. R. v. Public Service Comm. of South Carolina, 77 F. Supp.D.C., 675; Southern Railway Co. v. Public Service Comm., 195 S.C. 247, 10 S.E.2d 769; Kurn v. State, 175 Okl. 379, 52 P.2d 841; Ft. Smith L. & T. Co. v. Bourland, 267 U.S. 330, 45 S.Ct. 249, 69 L.Ed. 631; Railroad Comm. v. Texas & New Orleans R. R., Tex.Civ.App., 197 S.W.2d 176.

When that duty is not imperative, but what is called relative, as in Alabama, in order to justify a reduction of the service, the carrier is not required to show that the rate of return on the system requires the reduction, or that it would impede interstate commerce, but it is sufficient if the reduced plan would supply such train service as the public necessities demand and require. Delaware L. & W. R. Co. v. Van Santvoord, D.C., 232 F. 978, and cases last above cited, including Atlantic Coast Line R. R. v. Public Service Comm., D.C., 77 F.Supp. 675, 685. In the language of our statute, is 'reasonable and just.' Title 48, section 104, Code. 'It is evident that the public service agency is under no obligation to continue to offer a service which the public will not use, where the offer is a financial burden, and where it is unreasonable to demand its continuance.' Thompson v. Boston & Maine R. R., 86 N.H. 204, 166 A. 249; Atlantic Coast Line R. R. v. Public Service Comm., supra 77 F.Supp. at page 684.

Another statement of the principle is that although the operation of the entire system yields a net profit, the loss resulting from the maintenance of a certain service on a particular branch must be of sufficient importance to outweigh the inconvenience which the public will suffer as a result thereof. 123 A.L.R. 928; Thompson v. Boston & Maine R. R., supra; Delaware L. & W. R. Co. v. Van Santvoord, supra.

Again, it is said: 'The controlling criteria as we see it are these, the character and population of the territory served, the public patronage, or lack of it, the facilities remaining, the expense of operation as compared with revenue from same, and the operations of the carrier as a whole.' Atlantic Coast Line R. R. v. Public Service Comm., D.C., 77 F.Supp. 675, 684(12).

The volume of business and the revenue from it fluctuate normally in business cycles. The volume of business on this branch prior to 1946 is not shown by the finding of facts. Prospects of patronage for the future look more favorable according to the evidence and findings. The population and business in the territory served seem to have steadily increased. Plans for business expansion have been made. In this connection the commission found as follows:

'The granting of the petition was vigorously opposed by a large delegation of protestants. Since 1940 the population of Crenshaw County, in which the greater portion of the branch is located, has increased about 4,000 and at Luverne, Alabama, the termini of the branch, the increase has been about 800. With increasing population it would normally follow that business would also increase in this area.

'Protestants point out that Luverne has been assured of a furniture factory, employing two to three hundred people, to be established as soon as a suitable building can be made available. This factory plans to manufacture and ship by rail one carload of furniture each day.

'One protestant, in the lumber business, stated that tri-weekly service would result in the loss of considerable export tonnage as shipments are made on telegraphic advice for immediate unloading which means that arrival at the port cannot be made ahead of time and one day's delay would...