Ratcliff v. The Wichita Union Stock-Yards Company

• Decision Date: 09 June 1906
• Docket Number: 14,421
• Citation: 86 P. 150,74 Kan. 1
• Parties: J. M. RATCLIFF v. THE WICHITA UNION STOCK-YARDS COMPANY
• Court: Kansas Supreme Court

86 P. 150

74 Kan. 1

J. M. RATCLIFF v. THE WICHITA UNION STOCK-YARDS COMPANY

No. 14,421

Supreme Court of Kansas

June 9, 1906

Decided January, 1906.

Error from Sedgwick district court; THOMAS C. WILSON, judge.

STATEMENT.

THIS is an action by J. M. Ratcliff to recover for overcharges on live stock placed in, and marketed at, the Wichita Union Stock-yards. He alleges that he is a raiser, dealer and shipper of live stock, operating in the vicinity of Wichita and that defendant's stockyards at Wichita are public and the only ones within a radius of 200 miles of Wichita, no others being nearer to plaintiff's place of business than the Missouri river, which is about 260 miles away. He avers that between April and September, 1903, he shipped and placed in defendant's stock-yards 6125 hogs and 1100 cattle which were delivered to and received by defendant for the purpose of being exposed to sale, and that for driving, yarding, watering and weighing these hogs and cattle the defendant charged and compelled plaintiff to pay eight cents per head for the hogs and twenty-five cents per head for the cattle, in violation of the provisions of chapter 487 of the Laws of 1903, which limit the charges for such services to six cents per head for hogs and fifteen cents per head for cattle. He further avers that he offered to pay the statutory rates; that the charges imposed by the defendant were paid under protest and compulsion; and that the amount of the excessive payment was $ 232.50, which the defendant refused, upon demand, to refund. The plaintiff asked judgment for this amount.

The defendant's answer admits the above-recited facts, and alleges that it is a corporation with a paid-up capital stock of $ 600,000, holding no franchises from the state of Kansas or the city of Wichita; that it acquired sixty-eight acres of land at Wichita, Kan., and constructed thereon stock-yards, with all of the facilities for handling live stock promptly and safely, and that every railroad entering Wichita has connections with its yards; that in providing structures, fixtures and appliances in making the yards in every way complete large sums of money were necessarily expended; that great expense was incurred in the construction of separate pens, and in maintaining the yards so as to comply with the quarantine regulations of the United States and of the state of Kansas; that its yards have a capacity equal to receiving and handling 5000 hogs and 3000 cattle daily, with a complete water and feeding system, track and car scales for weighing, barns and warehouses for storing supplies, and with walks for the convenience of shippers, dealers and customers; that its officers and stockholders, as well as the company, have expended $ 250,000 in securing the location of packing-houses, which it is alleged are necessary to a live-stock market.

Defendant also avers that the growth of its business has been slow; that there has been active competition by yards at Denver, Pueblo, Fort Worth, Kansas City, St. Joseph, Omaha, Sioux City, St. Paul, St. Louis, and Chicago, and that it has made no profit over and above the cost of its operation since its business was established; that because of the competition, and of the fact that shippers may send their stock to any market, its business is uncertain; that while its investment is permanent, the expense of operation and maintenance is continuous, and is liable at any time to exceed the revenue derived from the business. It is averred that for all of the facilities provided the company charges the shipper twenty-five cents per head for cattle and eight cents per head for hogs, and these are the rates which are charged at all the yards above mentioned, although such other yards operate at less expense and do not give better facilities. It is then alleged:

"Defendant further avers that in addition to furnishing all the facilities and labor at its yards for shippers of live stock and their animals, as above set forth, it also advances the money therefor and pays the freight charges on animals sold, guarantees its weights of the stock to be correct, and assumes great risks of injuries and damages thereto while in the custody of its employees, and all for the charges aforesaid; that defendant's charges are uniform to all shippers and are the customary charges at all other stockyards, and have been for many years; and that they are no more than a just, fair, and reasonable compensation for the facilities and labor furnished as aforesaid, and for the services rendered to live stock therefor as hereinbefore set forth, and they are only a reasonable exaction for such facilities, labor and services; and that any less charge therefor than twenty-five cents per head for cattle, and eight cents per head for hogs, would be, and is, an inadequate and insufficient compensation, and less than such facilities, labor and services are actually worth."

It further avers, as showing the reasonableness of its charges, that they are less than those made and collected by others for services in connection with handling live stock, and instances tending to substantiate this statement are given. Then follow these averments:

"Defendant therefore avers that whether the intrinsic value and worth of the services rendered by it for its aforesaid charges are considered, or whether those charges are compared with the charges made for services rendered by others in connection with such live stock, or for services somewhat similar rendered to other animals, its aforesaid charges are reasonable and fair in themselves, no more than made for similar services at other yards, and are the usual and customary charges everywhere; and that any less charges will be inadequate and insufficient compensation for the facilities and service furnished and rendered, and would not afford defendant any compensation whatever for some of such facilities and services."

It is further alleged that if the rates provided for in the act of 1903 were in force it would infringe the natural rights of the company and its stockholders, and deprive them of their property without due process of law, and otherwise violate the provisions of the constitutions of the United States and of the state of Kansas.

To this answer a general demurrer was filed, which the court overruled. The plaintiff elected to stand upon the demurrer, and therefore final judgment was rendered for defendant. The plaintiff complains.

Judgment reversed and cause remanded.

SYLLABUS

SYLLABUS BY THE COURT.

1. CONSTITUTIONAL LAW--Business Affected with a Public Interest--Regulation of Charges. The carrying on of stockyards at a commercial center, with which all the railroads entering the city connect, and which is the only available market in the city and for a large scope of country around it for the selling, feeding, resting and shipping of live stock, is a business affected with a public interest, and is subject to public regulation and control in respect to rates.

2. CONSTITUTIONAL LAW--Rates Not Confiscatory. The averments of an answer examined, and it is held, that they fail to show that the rates prescribed by chapter 487 of the Laws of 1903, defining public stock-yards and regulating the charges thereof, are so palpably unreasonable and unjust when applied to the defendant as to amount to the taking of private property without just compensation or due process of law.

3. CONSTITUTIONAL LAW--Legislative Powers--Limitation. There are no limits upon the legislative power of the legislature of the state, except such as may be found in the state and federal constitutions.

4. CONSTITUTIONAL LAW--Act Held Valid. Chapter 487 of the Laws of 1903 held not to be repugnant to the provisions of the state constitutions.

L. M. Day, for plaintiff in error.

Houston & Brooks, and H. Whiteside, for defendant in error.

JOHNSTON C. J. All the Justices concurring.

OPINION

JOHNSTON, C. J.

The validity of chapter 487 of the Laws of 1903, relating to stock-yards, is the principal question raised by the pleadings and the decision of the trial court. That act declares and defines what shall constitute public stock-yards, the duties of those operating them, and prescribes maximum charges for the use of the yards and for the facilities and services furnished, viz.: For cattle fifteen cents per head, calves eight cents per head, hogs six cents per head, and sheep four cents per head. There is also contained in the act a regulation of the sale of dead animals, and it finally provides that a violation of its provisions shall be deemed a misdemeanor, the penalties prescribed being a fine of not more than $ 100 for the first conviction; for a second conviction a fine of not less than $ 100 nor more than $ 200; for a third conviction a fine of not less than $ 200 nor more than $ 500 and imprisonment in the county jail for not more than six months; and for each subsequent offense there is imposed a fine of not less than $ 1000 and imprisonment in the county jail not less than six months.

It is contended that the act, if enforced, would infringe the natural right of the defendant to make such contracts in respect to its business as it might choose to make, deprive it of property and compensation for property without due process of law, and violate the federal constitution, particularly the fifth, eighth and fourteenth amendments of that instrument; and, further, that it conflicts with sections 1, 9 and 20 of the bill of rights of the state constitution. (Gen. Stat. 1901, §§ 83, 91, 102.)

The first and main contention is that the Wichita stock-yards company is strictly a private corporation, engaged in a purely private business, with full liberty of contract, and is therefore not subject to legislative regulation and...