Atlantic Coast Line R. Co. v. FLORIDA RR & PU COM'N

• Decision Date: 19 March 1951
• Docket Number: Civ. No. 302.
• Citation: 96 F. Supp. 583
• Parties: ATLANTIC COAST LINE R. CO. v. FLORIDA R. R. & PUBLIC UTILITIES COMMISSION et al.
• Court: U.S. District Court — Northern District of Florida

96 F. Supp. 583

ATLANTIC COAST LINE R. CO. v. FLORIDA R. R. & PUBLIC UTILITIES COMMISSION et al.

Civ. No. 302.

United States District Court N. D. Florida, Tallahassee Division.

March 19, 1951.

G. L. Reeves, Tampa, Fla., for plaintiff.

Lewis Petteway, Tallahassee, Fla., for Fla. R. R. & Public Utilities Com.

Before RUSSELL, Circuit Judge, and BARKER and DE VANE, District Judges.

BARKER, District Judge.

This is an action brought by the Atlantic Coast Line Railroad Company, a Virginia corporation, against the Florida Railroad & Public Utilities Commission, and the members thereof, to enjoin the enforcement of an order of the Commission entered October 19, 1950, requiring the continued operation of daily passenger train service between Lakeland and Clewiston, Florida. A Three-Judge Court was convened under authority of Title 28, U.S.C.A. § 2281, and when the matter came on for hearing before the court on Plaintiff's application for an Interlocutory injunction, the matter, by stipulation of the parties, was submitted to the Court on final hearing for permanent injunction.

The purpose of the action is to overturn the order of the Florida Railroad & Public Utilities Commission, which denied Plaintiff's application for authority to reduce to tri-weekly the daily operation of two passenger trains between Lakeland and Clewiston, Florida. The basis of the action is that the Commission's order is so arbitrary and unreasonable and so completely unsupported by the evidence that: (1) the order results in the confiscation of Plaintiff's property and, therefore, is in violation of the due process clause of the Fourteenth Amendment to the Constitution of the United States; (2) that it places a burden on Interstate Commerce not permitted by the Commerce Clause of the Constitution, Art. 1, Sec. 8, Clause 3; and, (3) that it violates the National Transportation Policy prescribed by Congress, as set forth in Transportation Act of 1940, 54 Stat. 899, 49 U.S.C.A. § 1 et seq.

Defendants filed an answer to the complaint and at the same time filed a motion to dismiss the complaint. The Court will first consider and dispose of the motion to dismiss. The grounds for the motion are:

1. It affirmatively appears from the allegations of the complaint that this court is without jurisdiction to entertain this cause and grant relief sought by plaintiff.

2. It affirmatively appears from the allegations of the complaint that the administrative remedies and processes afforded by the laws of the State of Florida have not been exhausted and as a result thereof this Court has not and cannot acquire jurisdiction of the subject matter of this cause until said administrative remedies have been exhausted, and,

3. It affirmatively appears from the allegations of the complaint that adequate remedies at law are available to Plaintiff and that it is not entitled to injunctive relief until said remedies have been pursued and exhausted.

The gravamen of this motion is that Plaintiff should have defied the order and forced the Commission to proceed in some form against it, or taken this case into the State Court, instead of the Federal Court, for relief. There is no doubt as to the complaint raising Federal questions, that the amount in controversy is in excess of $3,000 and that there is diversity of citizenship between the parties. There is also no question that the administrative remedies afforded Plaintiff by Florida law have been exhausted and the case has reached the judicial stage.

Since the decision of the Supreme Court of the United States, in Smyth v. Ames, 169 U.S. 466, 18 S.Ct. 418, 42 L.Ed. 819, there has existed no doubt as to the right of an aggrieved party, entitled to sue, to invoke the jurisdiction and powers of a Federal Court, whenever the established principles and rules permit such a suit in that Court, and a party cannot be deprived of that right by reason of the existence of the right to sue, or be sued, in a State Court on the same cause of action. Bacon v. Rutland Railroad Co., 232 U.S. 134, 34 S.Ct. 283, 58 L.Ed. 538; Oklahoma Natural Gas Co. v. Russell, 261 U.S. 290, 43 S.Ct. 353, 67 L.Ed. 659; and, Pacific Telephone & Telegraph Co. v. Kuykendall, 265 U.S. 196, 44 S.Ct. 553, 68 L.Ed. 975.

The motion to dismiss will be denied.

The complaint alleges that on April 29, 1949, Plaintiff filed an application with the Florida Railroad & Public Utilities Commission requesting authority to discontinue daily operation of Plaintiff's passenger trains Nos. 102-175 and 176-101, between Lakeland and Clewiston, Florida, and the substitution, in lieu thereof, tri-weekly service in opposite directions on alternate dates with no service in either direction on Sunday.

Plaintiff alleges that the application was made and filed for the reason that such large losses were being continuously sustained in the daily operation of said trains, due to the lack of public patronage, that their continued daily operation was no longer reasonably necessary for the service to the public, and that the proposed tri-weekly service would then have met, and now would meet, any reasonable transportation needs of the public.

The complaint further alleges that the evidence before the Commission disclosed, for the twelve-months' period, from May 1, 1948 through April 30, 1949, Plaintiff sustained passenger service losses of $213,594.69 and that for the following fourteen-months' period, from May 1, 1949 through June 30, 1950, Plaintiff sustained further losses of $217,019.67.

In support of its allegation that the lack of public patronage made continued daily operation no longer reasonably necessary for the service of the public, Plaintiff set out in the complaint much of the evidence introduced before the Commission, bearing upon the extent of the use of its passenger trains by the general public, which shows that few persons used the service and that the revenue derived therefrom does not even compensate for the wages paid the crews operating the passenger trains.

The answer filed by Defendants, in general, admits the averments of the complaint as to the losses sustained by Plaintiff from the operation of the passenger train service in question, but denies there exists no public need for the service. In addition, the answer sets up certain legal defenses which, if valid defenses, will defeat Plaintiff's right to the relief prayed.

Plaintiff submitted evidence in support of each and every allegation of the complaint, with reference to the monetary losses sustained and in support of its allegation that there was no public need for the service now rendered by it. The evidence submitted amply supports each allegation of the complaint as to the losses sustained and as to the existence of no urgent public need for the questioned service now being rendered by Plaintiff.

Defendants offered no testimony, but stood on their legal defenses to the complaint. Defendants rely first upon Florida Statutes, 1941, Sec. 350.16, F.S.A., which, in such part as is pertinent here, is as follows: "* * * Every railroad company shall operate over every part of its line not less than one passenger and one freight train each way daily except Sunday; provided if after hearing and investigation the railroad commissioners shall determine that the public need does not require such daily service they shall prescribe such service as in their opinion the public need does require and such service will be deemed sufficient until the commissioners shall otherwise order. However, nothing herein contained shall be held as limiting the right of the railroad commissioners to require of all railroads and common carriers such greater service as they shall deem to be to the best interest of the public."

The contention is that this Statute places on Plaintiff the obligation to operate over every part of its line not less than one passenger train each way daily, except Sunday, unless the Commission, after a hearing and investigation, shall determine that the public need does not require such daily service, and that since this Statute was in effect when this branch line of railroad was put into operation, that Plaintiff cannot now complain that the order of the Commission is confiscatory of property or otherwise in violation of the Constitution of the United States or the Transportation Act of 1940.

The second legal defense, which is, in fact, only complementary to the first, is that the complaint, on its face, shows that Plaintiff operates its passenger service over its entire system at a heavy loss and that freight rates have been increased by the Interstate Commerce Commission and many State Commissions, including the Florida Commission, to cover the deficit from system passenger operations. Defendants, therefore, contend it is...