Clear Creek Oil & Gas Co. v. Ft. Smith Spelter Co.

• Decision Date: 05 November 1923
• Docket Number: (No. 220.)
• Citation: 255 S.W. 903
• Parties: CLEAR CREEK OIL & GAS CO. v. FT. SMITH SPELTER CO.
• Court: Arkansas Supreme Court

Page 903

255 S.W. 903

CLEAR CREEK OIL & GAS CO. v. FT. SMITH SPELTER CO.

(No. 220.)

Supreme Court of Arkansas.

November 5, 1923.

Rehearing Denied December 10, 1923.

Appeal from Circuit Court, Pulaski County; Richard M. Mann, Judge.

Proceeding by the Clear Creek Oil & Gas Company before the Railroad Commission, in which the Ft. Smith Spelter Company intervened. From judgment overruling the rate established by the Commission, the petitioner appeals. Reversed and remanded, with directions.

Hill & Fitzhugh, of Ft. Smith, for appellant.

Mehaffy, Donham & Mehaffy, of Little Rock, and Daily & Woods, of Ft. Smith, for appellee.

HART, J.

This is the third appeal in this case. The opinions on the former appeals dealt with questions of law and of practice, and reference is made to the opinions for the particular questions decided. Clear Creek Oil & Gas Co. v. Ft. Smith Spelter Co., 148 Ark. 260, 230 S. W. 897; Ft. Smith Spelter Co. v. Clear Creek Oil & Gas Co., 153 Ark. 170, 239 S. W. 733. The present appeal is prosecuted to reverse a judgment of the circuit court overruling the rate established by the tribunal or commission which was vested with the power to establish rates.

The Legislature of 1921 abolished the Arkansas Corporation Commission, which had the power to regulate public service corporations and to establish rates therefor, and created the Arkansas Railroad Commission. General Acts of 1921, p. 177. The rates involved in this appeal were established by the Arkansas Corporation Commission, which had jurisdiction to establish rates for pipe line companies for the transportation of oil, gas, or water. In the former appeal it was held that the Clear Creek Oil & Gas Company was a public corporation engaged in the transportation and sale of natural gas. It was, also, held that the Corporation Commission in establishing the rates at which the gas should be transported and sold to customers acted in a quasi judicial capacity, and that its orders establishing rates were subject to review by the court in the manner prescribed by statute. Clear Creek Oil & Gas Co. v. Ft. Smith Spelter Co., 148 Ark. 260, 230 S. W. 897.

When the rates established by the Commission came on for hearing in the circuit court, the Arkansas Corporation Commission had been abolished and the present Railroad Commission created. The new act gave the Railroad Commission authority to establish rates for common carriers including pipe line companies for the transportation of oil, gas, or water. The act, also, provides for an appeal from the Railroad Commission to the Pulaski circuit court from any order made by the Railroad Commission.

Section 20 of the act provides that when the appeal is taken, the secretary of the Commission shall at once make a full and complete transcript of all proceedings had before such Commission in such matter and of all the evidence before it including all files therein, and deposit the same forthwith in the office of the clerk of the circuit court. Continuing, the section provides as follows:

"The said circuit court shall thereupon review said order upon the record presented as aforesaid in the case and enter its finding and order thereon and cause to be certified forthwith to such Commission the said order, therein directing that action be taken by said Commission in conformity therewith, unless on appeal from said order to the Supreme Court of this State shall be taken within the time hereinafter specified, and in case of such appeal to await further orders of said circuit court." General Acts of 1921, p. 177.

Thus it will be seen that the statute provides a fair opportunity for submitting the reasonableness of the rates established by the Commission to a judicial tribunal for determination upon its own independent judgment as to both the law and the facts, and it cannot be said that the order in establishing the rates was void because it is in conflict with the "due process" clause of the Constitution of the United States. Ohio Valley Water Co. v. Ben Avon Borough et al., 253 U. S. 287, 40 Sup. Ct. 527, 64 L. Ed. 908.

This brings us to a discussion of what consideration the circuit court should have given to the finding of fact by the Commission. It will be noted that the statute does not fix any rule of evidence to govern the court in the premises. In Louisville, etc., Railroad Co. v. Behlmer, 175 U. S. 648, 20 Sup. Ct. 209, 44 L. Ed. 309, Chief Justice White, speaking for the court in a discussion of the weight to be given to the finding of the Interstate Commerce Commission, said:

"But the law attributes prima facie effect to the findings of fact made by the Commission, and that body, from the nature of its organization and the duties imposed upon it by the statute, is peculiarly competent to pass upon questions of fact of the character here arising."

Again, in Illinois Central Railroad Co., Gulf & Ship Island Railroad Company, and Sou. R. R. Co. v. Inter. Com. Com., 206 U. S. 441, 27 Sup. Ct. 700, 51 L. Ed. 1128, it was said that the findings of the Commission are made by law prima facie true and that the Supreme Court of the United States ascribed to them the strength due to the judgments of a tribunal appointed by law and informed by experience. In Darnell v. Edwards et al., 244 U. S. 564, 37 Sup. Ct. 701, 61 L. Ed. 1317, it was said that it is well established that in a question of rate-making there is a strong presumption in favor of the conclusion reached by an experienced administrative body after a full hearing.

In Railway Co. v. Smith, 60 Ark. 221, 29 S. W. 752, it was said that the courts can inquire into the reasonableness of passenger rates, and that in such cases the presumption is that they are...