Ortega Co v. Triay
| Citation | 43 S.Ct. 44,260 U.S. 103,67 L.Ed. 153 |
| Decision Date | 13 November 1922 |
| Docket Number | No. 75,75 |
| Parties | ORTEGA CO. v. TRIAY |
| Court | United States Supreme Court |
Messrs. Herman Ulmer and W. T. Stockton, both of Jacksonville, Fla., for appellant.
Messrs. Peter O. Knight, of Tampa, Fla., and J. L. Doggett, of Jacksonville, Fla., for appellee.
The case is in narrow compass. Its purpose is to enjoin the appellee, as receiver of the Jacksonville Traction Company, grantee of the Jacksonville Electric Company as hereinafter stated and a corporation of Massachusetts, from collecting more than a particular fare, 5 cents, and compelling the specific performance of an alleged contract providing for such fare.
The grounds of the suit are set forth with great detail but may be epitomized narratively as follows: The Ortega Company was in 1910 and prior thereto the owner, and operated a line of electric railroad from the city of Jacksonville to a point in a place designated as Ortega in Duval county, Fla. The Ortega Company sold the railroad to R. J. Richardson, February 12, 1910, in pursuance of a contract, and March 6, 1911, Richardson and his wife conveyed the railroad to the Jacksonville Traction Company. Richardson was at all the times agent of the Jacksonville Electric Company.
The conveyance from the Ortega Company contained, among other provisions, the following covenant:
'The Jacksonville Electric Company further covenants and agrees that said street railroad shall be operated in such manner that passengers for a single fare of 5 cents may travel from any point reached by street cars in the city of Jacksonville to the terminus in Ortega and vice versa, over the lines of the Jacksonville Electric Company, and the line conveyed by the Ortega Company.'
And it was covenanted that——
'Said single fare of 5 cents shall be sufficient compensation for a continuous journey either way, with such transfers as may be necessary.'
The Jacksonville Electric Company went into the possession of the railroad and operated it as agreed upon the basis of a 5-cent fare.
At the time of the conveyance, the railroad and its appurtenances were reasonably of the value of $33,157.37, and the conveyance was made in consideration of the covenant and a cash consideration of $10,000, less certain deductions. The cash consideration was of minor import; the principal consideration was the covenant.
At the time of making the contract with the Electric Company, the Ortega Company was engaged in the development of a large tract of land lying in Duval county at the terminus of the Ortega line, and the company sold the railroad for approximately $26,000 less than its reasonable value upon the express covenant of the Electric Company to operate the line upon a 5-cent basis. The continued violation of the covenant will deprive the Ortega Company of property worth many thousand dollars, and will result in irreparable injury to the company, 'the nature and character of which injury redress at law would be uncertain and inadequate and the damages resulting therefrom impossible of ascertainment.'
April 18, 1911, the Jacksonville Electric Company conveyed the railroad to the Jacksonville Traction Company and that company went into possession of the road and operated it in accordance with the covenant.
On October 30, 1919, appellee Triay was appointed receiver of the Traction Company and ever since has been, and still is, acting as receiver, managing and operating the railways and properties of the Traction Company, including the Ortega line.
From the time of the conveyance to the Jacksonville Electric Company until December 15, 1920, that company and the Traction Company and appellee, as receiver, successively operated the road on a 5-cent basis.
On the ————day of January, 1920, appellee filed with the Railroad Commission of Florida a petition asking that the Commission assume jurisdiction of the rates and fares of the Traction Company and authorize an increase in them. The request was granted December 2, 1920, and a fare of 7 cents was authorized and has since been charged.
The Railroad Commission was created by the Legislature of the state in 1897 (Laws 1897, c. 4549) and was required (by the same law passed) in the same year, to 'make reasonable and just rates of freight and passenger tariffs to be observed by all railroad companies and all others engaged as common carriers doing business in this state.' Acts 1897, c. 4549. The requirement was repeated by an act passed in 1913 (Acts 1913, c. 6527), and by the latter act it was made the duty of the Commission to make reasonable and just rules and regulations to enforce the observance by the carriers of their tariffs.
The only provision of the Constitution of the state dealing with the powers of the Legislature is section 30 of article 16 which provides as follows:
'The Legislature is invested with full power to pass laws for the correction of abuses and to prevent unjust discrimination and excessive charges by persons and corporations engaged as common carriers in transporting persons and property, or performing other services of a pubic nature, and shall provide for enforcing such laws by adequate penalties or forfeitures.'
By reason of the constitutional provision and limitation, so much, the petition proceeds, of the legislative provisions above stated, as attempts to confer upon the Commission the power to increase the rates and charges of appellee, is unconstitutional and void and the order of the Commission is void and of no effect, and impairs the obligation of the contract between the Ortega Company and the Electric Company and constitutes a taking of the property of the Ortega Company without due process of law contrary to the Constitution of the United States.
An injunction was prayed pending the suit and that appellee be compelled to operate the Ortega line at a 5-cent fare as covenanted and that the Ortega Company be granted such further relief as proper and agreeable to equity.
A motion to dismiss the bill for want of equity was made upon the ground that under the laws and ...
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