Louisville & N. R. Co. v. Railroad Com'n of Tennessee

• Court: U.S. District Court — Middle District of Tennessee
• Citation: Louisville & N. R. Co. v. Railroad Com'n of Tennessee, 19 F. 679 (M.D. Tenn. 1884)
• Decision Date: 29 February 1884
• Parties: LOUISVILLE & N.R. CO. v. RAILROAD COMMISSION OF TENNESSEE. EAST TENNESSEE, V. & G.R. CO. v. SAME.

19 F. 679

LOUISVILLE & N.R. CO. v. RAILROAD COMMISSION OF TENNESSEE.

EAST TENNESSEE, V. & G.R. CO. v. SAME.

United States Circuit Court, M.D. Tennessee.

February 29, 1884

[Copyrighted Material Omitted]

The Louisville & Nashville Railroad Company filed its bill alleging that it was a Kentucky corporation, extending its road into the state of Tennessee by authority of the laws of the latter state; that by other laws passed for the purpose it had been authorized to acquire and to consolidate with other roads extending into neighboring states; that by its charter, and the charters of the other roads so acquired by it, there were fixed certain maximum certain maximum rates of charges for transportation, which conferred a contract right to establish its own rates within the maximum, which had not been exceeded by it. The East Tennessee, Virginia & Georgia Railroad Company, by its bill, alleged that it was a Tennessee corporation, authorized by law to consolidate its roads with others, and operating a system of roads extending into neighboring states, and that by its charter there were fixed certain maximum rates which conferred upon it the contract right to establish its own rates within the maximum, and which it had not exceeded. Both bills alleged that the defendants had been appointed railroad commissioners, and were assuming to act by authority claimed under the act of the general assembly of the state of Tennessee, approved March 30, 1883, which is as follows:

'Chapter CXCIX.

'RAILROAD COMMISSION BILL.

'A bill to be entitled 'An Act to provide for the regulation of railroad companies, and persons operating railroads in this state; to prevent discrimination upon railroads in this state; and to provide for the punishment for the same; and to appoint a railroad commission.'

'Section 1. Be it enacted by the general assembly of the state of Tennessee, that the main track and all the branches of every railroad in this state is a public highway, over which all persons have equal rights of transportation for passengers and freights, on the payment of just and reasonable compensation to the owner of the railroad for such transportation; and any person or corporation engaged in the business of transporting passengers or freights over any railroad in this state who shall exact and receive for any such transportation more than just and reasonable compensation for the services rendered, or demand more than the rates specified in any bill of lading issued by such person or corporation, or who for his or its advantage, or for the advantage of any connecting line, or of any person or locality, shall make any unjust and unreasonable discrimination in transportation against any individual locality, or corporation, shall be guilty of extortion, and in every case it shall be for the jury to determine from all the evidence whether more than just and reasonable compensation was exacted and received, or whether any such discrimination in transportation, which may be established by the evidence, against the individual, locality, or corporation, as the case may be, was made for the benefit or advantage of the person or corporation operating such railroad, or of any person or locality: provided, that nothing in this act shall be construed to prevent contracts for special rates for the purposes of developing any industrial enterprise, or to prevent the execution of any contract now existing.

'Sec. 2. Be it further enacted, that the party injured may recover of the person or corporation guilty of extortion, as defined in this act, ten times the amount of damages sustained by the overcharge or unjust discrimination, as the case may be, and a reasonable fee for the counsel prosecuting the case in any court having jurisdiction of the amount, in any county where the person or corporation operating the railroad does business; but if it appears that the service in which the extortion was committed was done at rates or upon terms previously approved by the railroad commission hereinafter established, only actual damages, and no attorney's fee, shall be recovered.

'Sec. 3. Be it further enacted, that it shall be the duty of the commission to investigate and determine whether the provisions of this bill have been violated; and whenever said commissioners shall become satisfied that any railroad corporation has violated any of the provisions of this act, they shall immediately cause suit or suits to be commenced and prosecuted against any railroad corporation guilty of such violation in any court having jurisdiction of the subject-matter. Said suit shall be prosecuted in the name of the state of Tennessee, and conducted by the attorney general of the judicial circuit in which the same is instituted, under the direction of said commissioners, and no suit so instituted shall be dismissed without their consent. All moneys so collected shall be paid into the state treasury. If upon the trial of any cause for the recovery of the penalties provided in this bill, the jury shall find for the state, they shall assess and return with their verdict the amount of the penalty to be imposed on the defendant at any amount not less than $100, nor more than $1,000, and the court shall render judgment accordingly.

'Sec. 4. Be it further enacted, that in all suits or proceedings under this statute the defendant may give in evidence the fact that the rates or terms in respect to which extortion is alleged had been previously approved by the railroad commission hereinafter established, and such approval shall be prima facie evidence that such rates or terms were not extortionate.

'Sec. 5. Be it further enacted, that no rates or charges for service in the transportation of freight over any railroad shall be held or considered extortionate or excessive under any proceeding under this act, if it appears from the evidence that the net earnings of such railroad transporting freight, if done without such discrimination on the basis of such rate or charge, together with the net earnings from its passenger and other traffic, would not amount to more than a fair and just return on the value of which such railroads with its appurtenances and equipments to be assessed for taxation.

'Sec. 6. Be it further enacted, that all actions to recover damages under this act shall be commenced within six months after the cause of action accrues.

'Sec. 7. Be it further enacted, that the foregoing sections of this act shall not take effect until the first day of July, 1883.

'Sec. 8. Be it further enacted, that it shall be the duty of all persons or corporations in this state, who shall own or operate any railroad therein, to publish by posting at all the depots the tariffs of rates, which have been approved by said commission for transporting freights, showing the rates for each class, including general and special rates, and it shall be unlawful for such person or corporation to make any reduction or rebate from such tariff in favor of any person or corporation which shall not be made in favor of all other persons or corporations by a change in such published rates.

'Sec. 9. Be it further enacted, that it shall be unlawful and within the prohibition of this act for any railroad corporation doing business in this state, to make any contract, agreement, or arrangement with any other railroad corporation, or with any common carrier by water in respect to the transportation of freights of any description, from any place within this state by which it is to transport only a certain portion of such freights, or by which it is to refuse to transport such freights or any portion thereof, or by which any common carrier by water is to refuse to transport such freights or any portion thereof, or by which it is to receive any sum of money, or anything of value for not transporting all or any part with anything of value as an inducement to any other railroad corporation or common carrier by water not to compete with it in the transportation of such freights, or by which it and other railroad corporations or common carrier by water, distribute

'Sec. 10. Be it further enacted, that this act shall not prevent any railroad company from transporting freight free of charge, provided it is not done to evade the provisions of this act.

'Sec. 11. Be it further enacted, that it shall be the duty of the governor to nominate three competent persons, one from each grand division of the state, subject to the confirmation of the senate, if in session, who shall constitute the railroad commission of the state of Tennessee, and the commissioners, after qualifying, as prescribed in section 11 of this act, shall proceed to elect one of their number as president and one as secretary; and said commissioners shall hold their offices until the first day of January, 1885, and their successors shall be elected by the qualified voters of the state at the November election, 1884, and every two years thereafter.

'Sec 12. Be it further enacted, that the said railroad commissioners shall be state officers, and before entering on their duties shall take the oath of office prescribed for other state officers, and may be impeached and removed from office for the same causes, and in the same manner, as other state officers. They shall hold office for two years and until their successors respectively are duly elected or appointed and qualified, and any vacancy shall be filled by the governor; the person so appointed shall hold office until his successor is duly appointed, confirmed, and qualified as above provided. No person in the employ of any railroad corporation, or other person, owning or operating a railroad in this state, or owning any stock in any railroad corporation, shall be nominated by the governor as a...