Gulf & S. I. R. Co. v. Laurel Oil & Fertilizer Co

• Decision Date: 25 March 1935
• Docket Number: 31376
• Parties: GULF & S. I. R. Co. v. LAUREL OIL & FERTILIZER CO
• Court: Mississippi Supreme Court

158 So. 778

159 So. 838, 160 So. 564, 172 Miss. 634

GULF & S. I. R. Co. v. LAUREL OIL & FERTILIZER CO

No. 31376

Supreme Court of Mississippi

March 25, 1935

Division B

January 14, 1935.

February 25, 1935.

APPEAL from the circuit court of Hinds county HON. W. H. POTTER Chancellor.

Action by the Laurel Oil & Fertilizer Company against the Gulf &amp Ship Island Railroad Company. Judgment for plaintiff, and defendant appeals. Affirmed in part, and reversed and rendered in part.

On suggestion of error. Suggestion of error overruled, and opinion amended.

On motion to correct judgment. Motion sustained.

Affirmed in part, and reversed in part. Overruled. Motion sustained.

May Sanders, McLaurin & Byrd, of Jackson, and Burch, Minor & McKay, of Memphis, Tennessee, for appellant.

The Gulf & Ship Island Railroad Company was not a party to the proceedings in which said order was entered and no legal process was ever served on it.

Alexander v. Livingston, 89 So. 520; Section 7033, Code of 1930; Section 4834, Code of 1906; Langstaff v. Town of Durant, 122 Miss. 471, 491; Belt et al. v. Adams, 124 Miss. 194, 202; Miss. Railroad Commission et al. v. G. M. & N. R. R. Co., 155 So. 212; Burns v. Burns, 133 Miss. 485, 97 So. 814.

The Mississippi Railroad Commission had no right, power or authority to prescribe rates for the Gulf & Ship Island Railroad Company. The Gulf & Ship Island Railroad Company has continuously operated under a charter granted to it by the Legislature of the state of Mississippi, being chapter DXLII of the Laws of 1882.

G. & S. I. R. R. Co. v. Adams, State Revenue Agent, 90 Miss. 559; Miss. Railroad Commission v. G. & S. I. R. R. Co., 78 Miss. 750; Stone v. Y. & M. V. R. R. Co., 62 Miss. 607.

The commission being a creature of statute has only the powers granted to it by statute, as construed and defined by the court and the commission cannot enlarge its own powers and jurisdiction, and it must be able to point to some statute giving it the power to act.

G. & S. I. R. R. Co. v. Miss. Railroad Commission, 94 Miss. 124.

The proceedings in which the order of December 3, 1925, was entered were not instituted against the Gulf & Ship Island Railroad Company, and the order makes no finding of facts whatever with reference to the Gulf & Ship Island Railroad Company and its rates, and the facts and circumstances revealed by the record show that it was not intended by any person that said order should apply to the Gulf & Ship Island Railroad Company and its rates.

Section 7029, Code of 1930; Section 4836, Code of 1906.

Gulf & Ship Island tariff H-2011 was a legal, lawful and binding tariff.

2 Thompson on Corporations (2 Ed.), page 146, section 1200.

Where the charter or statute is not clearly prohibitive, it is generally held that directors may delegate to a committee or to other subordinate agents matters that may involve the exercise of judgment and discretion, as well as ordinary routine duties.

1 Elliott on Railroads, section 298; 7 R. C. L., page 447; Jones v. Williams, 37 L.R.A. 682; The Bank of the United States v. Danbridge et al., 12 Wheaton 64, 6 U. S. (L. Ed.) 62; Olcott v. Tioga R. R. Co., 27 N.Y. 546, 84 Am. Dec. 298; Manson v. Curtis, 223 N.Y. 313, Ann. Cases 1918E 247; Manchester, etc., Railroad Co. v. Fish, 33 N.H. 297.

The Supreme Court of Mississippi held that a subsequent confirmation on the part of a corporation of the act of its agent is equivalent to a previous command.

Planters Bank v. Sharp, 4 S. & M. 75; 1 Elliott on Railroads, sec. 266, page 426.

A ratification of an act, done by one assuming to be an agent relates back, and is equivalent to a prior authority.

7 R. C. L., page 662, sec. 663; Young Heading Co. v. Paine, 127 Miss. 48.

The three-year statute of limitations applied to the claim in controversy.

Pate v. Southern Ry., 115 Miss. 402; Buntyn v. Building & Loan Assn., 86 Miss. 454.

Lotterhos & Travis, of Jackson, for appellee.

This case involves the question of the proper rates to be charged on intra-state shipments of cotton seed moving in the state of Mississippi over the lines of the Gulf & Ship Island Railroad Company during the years 1929 and 1930. The appellee relies upon a certain order of the railroad commission made on December 3, 1925, which order prescribed a uniform mileage scale to apply to intra-state shipments of cotton seed, and the court below gave judgment in favor of the appellee for the amount which the appellant railroad company had charged on the shipments in question in excess of the rates fixed by the said mileage scale.

I. C. R. R. Co. v. Miss. Railroad Commission, 143 Miss. 805, 109 So. 868; I. C. R. R. Co. v. Miss. Cotton Seed Products Co., 166 Miss. 579, 148 So. 371.

The order of December 5, 1925, is valid and binding upon the appellant.

Under section 7033, Code of 1930, it is not necessary that the notice be actually received by the carrier, but a method is prescribed whereby upon mailing the citation or notice in a certain way, proof of the mailing shall be sufficient to bind the carrier just as it would be bound by the return of a sheriff upon service by him, as is likewise permitted by the said section.

State v. Florida East Coast Ry. Co., 68 So. 729.

The appellant railroad company cannot be heard to make a technical contention about the method in which the notice was mailed, when in fact it did have notice, received by its official, and had an opportunity to be heard before the commission.

Chicago, etc., Ry. Co. v. Public Utilities Commission, 108 N.E. 729; Stone v. Farmers Loan & Trust Co., 116 U.S. 307, 29 L.Ed. 636; Home Telephone & Telegraph Co. v. Los Angeles, 211 U.S. 265, 53 L.Ed. 176.

It is not to be overlooked that the railroad commission in prescribing rates is merely performing a function which the Legislature itself has the power to exercise. The Legislature itself has the power to fix rates without any notice at all, but of course its action would be subject to review in the courts on the question of whether or not it had exceeded its power in fixing a rate confiscatory and in deprivation of property.

State v. Maine Ry. Co., 92 A. 837; State v. Public Service Com., 194; S.W. 287; L. & N. R. R. Co. v. Greenbrier, 187 S.W. 296; Houston Chamber of Commerce v. Railroad Co., 198 S.W.2d 583; 2 Elliott on Railroads (3d), sec. 808; Texas Steel Co. v. Ry. Co., 40 S.W.2d 78; Mississippi Railroad Commission v. G. M. & N. R. Co., 155 So. 212; Kimbrell v. L. & N. R. R. Co., 67 So. 586; Western Ry. v. Montgomery County, 153 So. 622; Section 7031, Code of 1930; Brotherhood of Railroad Trainmen v. Agnew, 155 So. 205.

The legislative charter attempting to take away from the Legislature certain of its sovereign rights with respect to rate regulation, must be very strictly construed, and the said charter grants this part of its sovereign power to the board of directors of the railroad company and not the company generally, and the board of directors cannot delegate this special power.

2 Hutchinson on Carriers (3 Ed.), sec. 574; 4 R. C. L., Carriers, sec. 87, page 615; Miss. Railroad Commission v. Y. & M. V. R. R. Co., 62 Miss. 607; Miss. Railroad Commission v. Natchez, etc., Railroad, 62 Miss. 646; Miss. Railroad Commission v. G. & S. I. R. R., 78 Miss. 750, 29 So. 789; Chicago, etc., Railroad v. Minnesota, 134 U.S. 418, 33 L.Ed. 970; Stone v. Farmers Loan & Trust Co., 116 U.S. 307, 29 L.Ed. 636; Benwood v. Public Service Com., L.R.A. 1915C, page 261; Indianapolis v. Navin, 41 L.R.A. 337; Collins v. Sherman, 31 Miss. 679; M. & O. Railroad Co. v. Franks, 41 Miss. 494; Gaines v. Coates, 51 Miss. 335; 1 Elliott on Railroads (3 Ed.), sec. 262; 14a C. J. 95; Y. & C. R. R. Co. v. Ritchie, 40 Me. 425; Farmers Mutual Fire Ins. Co. v. Chase, 56 N.H. 32; Percy v. Millaudon, 3 La. 568; Silver Hook Road v. Greene, 12 R. I. 164; Weidenfeld v. Sugar Run Road, 48 F. 615.

The general rule that may be deduced from the cases is that a board of directors cannot delegate their power or authority, when from its nature it involves the exercise of discretion and implies a special trust and confidence on the part of the donor and donee, unless there is some express authority or a custom authorizing such delegation.

2 Thompson on Corporations, sec. 1302.

The Gulf & Ship Island Tariff H-2011, is no protection to appellant in the face of the commission's order of 1925, prescribing a maximum mileage scale.

Elliott on Railroads, sec. 820; Sections 7095, 7099 and 7091, Code of 1930; Brookhaven Lbr. Co. v. Miss. Central R. R. Co., 154 Miss. 303, 122 So. 472; Laurel Cotton Mills v. Gulf & Ship Island R. R. Co., 84 Miss. 339, 37 So. 134; Vandalia R. Co. v. Schnull, 122 N.E. 225; Simpson v. Vermont R. R. Co., 115 A. 299; Michigan Railroad Commission v. Railway Co., 150 N.W. 861; Dry Dock Railroad Co. v. Fullen, 239 N.Y.S. 501.

The six year statute of limitations applies rather than the three year statute.

Section 2292, Code of 1930; 10 C. J., Carriers, sec. 251; Mobile & Ohio Railroad v. Jensen, 162 Miss. 741, 139 So. 840; Washington v. Soria, 73 Miss. 665, 19 So. 485; Cock v. Abernathy, 77 Miss. 872, 28 So. 18; Fowlkes v. Lea, 84 Miss. 509, 36 So. 1036; Masonic Benefit Assn. v. First State Bank, 99 Miss. 610, 55 So. 408; Blodgett v. Pearl River County, 134 Miss. 816, 98 So. 227; Raleigh Co. v. Fortenberry, 138 Miss. 410, 103 So. 227; Vicksburg Water Works Co. v. Y. & M. V. R. R. Co., 102 Miss. 504, 59 So. 825; Keith v. Long, 143 Miss. 33, 108 So. 283; Milam v. Paxton, 160 Miss. 562, 134 So. 171.

There are numerous cases applying the statute of limitations governing written contracts to suits by railroads to recover freight charges and suits by shippers to recover damages for loss of goods shipped, these cases setting up that ...