Chicago, Indianapolis and Louisville Railway Company v. Railroad Commission of Indiana

• Decision Date: 23 February 1910
• Docket Number: 21,314
• Citation: Chicago, Indianapolis and Louisville Railway Company v. Railroad Commission of Indiana, 90 N.E. 1011, 173 Ind. 469 (Ind. 1910)
• Parties: Chicago, Indianapolis and Louisville Railway Company v. Railroad Commission of Indiana
• Court: Indiana Supreme Court

90 N.E. 1011

173 Ind. 469

Chicago, Indianapolis and Louisville Railway Company v. Railroad Commission of Indiana

No. 21,314

Supreme Court of Indiana

February 23, 1910

Original Opinion of April 8, 1909, Reported at: 173 Ind. 469.

OPINION

Hadley, C. J.--

Appellant, in its petition for a rehearing, complains that we did not, in the original opinion, consider the constitutional question presented to a clause in subdivision j of section three of the act of 1905 (Acts 1905, p. 83), as amended in 1907 (Acts 1907, p. 454, § 3, § 5533 Burns 1908) relating to the power of the railroad commission to regulate the carrying of freights by certain railroads. The clause in question reads as follows: "None of the provisions of this act except as specified in this paragraph in any way relating to freight, freight tariffs, or the delivery or distribution of freight-cars, or the construction of sidings turnouts or connections for the use or operation of freight-cars, shall apply to any carrier unless or until the aggregate receipts for the carriage of freights on the carrier's line shall amount to thirty-three and one-third per cent, or more, of the gross receipts of the business of such carrier for the year preceding the filing of its last annual report as required by this act."

Appellant affirms that this provision is in violation of the equal-protection clause of the federal Constitution. The provision objected to, in a little more condensed form, may be stated thus: None of the provisions of the railroad commission act, in any way relating to the carriage and distribution of freights and freight-cars, shall apply to any carrier, unless or until the aggregate receipts for the carriage of freights on the carrier's line shall amount to thirty-three and one-third per cent, or more, of the gross receipts of the business of such carrier for the preceding year, except as specified in said paragraph, or subdivision j.

The preceding part of the paragraph or specification provides that all carriers operating steam roads, as between themselves, and all carriers operating interurban roads, as between themselves, shall afford reasonable facilities at junction points for the interchange of business, and shall promptly forward, without discrimination, to destination on their lines or other lines all passengers and property, and the commission may in certain cases require steam and interurban roads to interchange cars, carloads and less than carloads, and for that purpose may require the construction at junction points of proper facilities, and the commission may also require the construction of switch and private track connections in certain cases.

There is no doubt that the legislature has the authority to classify the subjects of legislation when there is such difference in the situation or condition of things of the same general kind that a general law cannot, in the opinion of the legislative body, be made justly applicable alike to all.

The only limitation upon the legislative power to make such classification is that the cause for it must not be capricious, but must rest upon some substantial ground or reason existing in and arising from the subject-matter, and that the law passed in pursuance of such classification be so framed as to operate alike upon all within the class. When such reason appears to exist, the propriety of classification is purely a legislative question. Indianapolis Traction, etc., Co. v. Kinney (1909), 171 Ind. 612, 85 N.E. 954; Bedford Quarries Co. v. Bough (1907), 168 Ind. 671, 14 L.R.A. (N.S.) 418, 80 N.E. 529; Pittsburgh, etc., R. Co. v. Montgomery (1898), 152 Ind. 1, 49 N.E. 582, 69 L.R.A. 875, 71 Am. St. 300; City of Indianapolis v. Navin (1898), 151 Ind. 139, 41 L.R.A. 337, 47 N.E. 525; Savannah, etc., Railway v. Savannah (1905), 198 U.S. 392, 25 S.Ct. 690, 49 L.Ed. 1097; Cotting v. Kansas City Stock-Yards Co. (1901), 183 U.S. 79, 22 S.Ct. 30, 46 L.Ed. 92; American Sugar Refining Co. v. Louisiana (1900), 179 U.S. 89, 21 S.Ct. 43, 45 L.Ed. 102.

In the case of Cotting v. Kansas City Stock-Yards Co., supra, it was said by Mr. Justice Brewer: "So again exercising the undoubted right of classification it may often happen that some classes are subjected to regulations, and some individuals are burdened with obligations which do not rest upon other classes or other individuals not similarly situated. License taxes are imposed on certain classes of business, while others are exempt. It would practically defeat legislation if it was laid down as a rule that a statute was necessarily adjudged invalid if it did not bring all within its scope, or subject all to the same burdens. It would strip the legislature of its inherent power to determine generally what is for the general interests, which interests may often be promoted by certain regulations affecting one class which do not affect another--certain burdens imposed on one which do not rest upon another."

Then, under the rule indicated, does there exist any natural and tenable reason for classifying railroads for the purpose of regulating their freight traffic?

It will be noted that the favor provision applies only to the handling of freight, and to a class of railroads whose income from freight carriage is less than one-third of the gross receipts from its combined business. So far as the handling of passengers and passenger-cars is concerned, all the regulations provided in the act apply alike to railroads of every class and character. It is only relating to freight traffic that a distinction is made. There is good reason for believing that the legislative purpose in the exception was to relieve electric interurban railroads from the labor and expense of providing facilities for handling freight and freight-cars that seemed to be wholly unnecessary from the small amount of business done of that character. At the time the subject of the exception was before the legislature, in 1907, it was shown by the reports made by the railroads of the State to the Railroad Commission of Indiana, that there was not a steam road in the State, that held itself out as a carrier of freights, that did not receive more than one-half of its income from freight, and not an interurban electric road in the State that did not receive more than one-half of its gross income from its passenger traffic. It further appears from the same source that the freight receipts from all the steam roads operating in the State amounted to more than seventy-five per cent of the gross receipts of their business, and that the freight receipts of the electric interurbans amounted to less than ten per cent of their gross receipts.

As a further evidence of the legislative judgment and policy there was passed at the same session another act (Acts 1907, p. 434, §§ 5203-5218 Burns 1908) regulating the movement of loaded freight-cars, and other matters pertaining to the freight service, which act excepts from its operation all carriers whose income from freight business does not equal thirty-three and one-third per cent of their gross revenues.

It is very plain that there are radical differences between the steam and electric interurban railroads relative to their construction, their motive power, their grades, their curves size of rails, of trains, of turnouts, inability to use each other's tracks, the facilities of interurbans for handling live stock and other heavy freights, their age and inexperience, their dominant purpose as shown by equipment, and their general inability to comply with freight regulations imposed upon steam roads. Add the fact that the freight business now done, or that may be done by them within their charter rights (Kinsey v. Union Traction Co. [1908], 169 Ind. 563, 612, 81 N.E. 922), is small, and attended with but little danger to employes or travelers. The extra hazards in the movement of large and heavy freight-trains, incident to steam roads, is absent from the slower single-car movement of the interurban. Besides, interurban electric roads are young, and yet in the...