Shields v. Utah Idaho Cent. R. Co.

• Decision Date: 01 April 1938
• Docket Number: No. 1558.,1558.
• Citation: 95 F.2d 911
• Parties: SHIELDS et al. v. UTAH IDAHO CENT. R. CO.
• Court: U.S. Court of Appeals — Tenth Circuit

95 F.2d 911 (1938)

SHIELDS et al. v. UTAH IDAHO CENT. R. CO.

No. 1558.

Circuit Court of Appeals, Tenth Circuit.

April 1, 1938.

Wendell Berge, Sp. Asst. to Atty. Gen. (Robert H. Jackson, Asst. Atty. Gen., Leo. F. Tierney and Hugh B. Cox, Sp. Assts. to Atty. Gen., and Robert L. Stern, Sp. Atty., of Washington, D. C., on the brief), for appellant Shields.

Nelson Thomas, of Washington, D. C. (Daniel W. Knowlton, of Washington, D. C. on the brief), for appellant Interstate Commerce Commission.

J. A. Howell, of Ogden, Utah, and Robert E. Quirk, of Washington, D. C. (J. H. DeVine and David L. Stine, both of Ogden, Utah, C. D. Cass, of Washington, D. C., and Neil R. Olmstead, of Ogden, Utah, on the brief), for appellee.

Before LEWIS, BRATTON, and WILLIAMS, Circuit Judges.

LEWIS, Circuit Judge.

This case presents the issue whether appellee's railroad, on the procedure taken before the Interstate Commerce Commission prior to the institution of this suit or independently on the facts, was brought under and subjected to the Railway Labor Act of May 20, 1926, 44 Stat. 577, as amended by the Act of June 21, 1934, 48 Stat. 1185, 45 U.S.C.A. § 151 et seq., in its relations to and its dealings with its employes. Heretofore its employes have never been members of railway brotherhoods on steam railroad lines. They have had their own labor organizations on appellee railroad and through them they have dealt with appellee as to wages, hours and other conditions with which such organizations are usually concerned. That is true generally it seems with street, suburban and interurban railroads. Appellee company claims to be an interurban electric railway company, and it and its predecessor have operated as such for approximately 20 years. It is a Delaware corporation. The termini of its railway are Ogden, Utah, on the south and Preston, Idaho, on the north. Its mainline between those points is about 95 miles. It has two short branches. It carries freight, baggage, express and passengers. It passes through about fourteen towns and cities between Ogden and Preston. The four larger cities have a total population of 60,000. None of the others exceed 2,000. It runs frequent and rapid trains, both passenger and freight. It has restrictive franchises for its right to pass through the different towns and also franchises to operate on public highways in places. It has short sidings and spur tracks. It is standard gauge. It was built to develop and serve two valleys, a part of the Great Salt Lake Valley and the Cache Valley in northern Utah. It passes over the Wasatch Mountains to reach the Cache Valley and extends seven miles into Idaho. It makes frequent stops in serving the public in freight and passenger service, about one and a half miles apart on the average. Its owners built it to develop the resources of those valleys. Its grades and rails are not suited to steam railway trains. It and its owners have assisted in obtaining fruit and vegetable packing plants and canneries along its line. It has encouraged the production of sugar beets. It hauls these products to the plants and their output to steam railway lines for transportation to the general market. In summer some of its cars provide refrigeration and in winter heat. Its freight trains average six to seven cars, and its passenger trains less than two cars. Two high schools have buildings adjacent to its line, and it transports the students to and from them for a considerable distance. In 1926 it went into receivership in the United States District Court for Utah. A few years later it was taken out by reorganization and has since been operated in the same manner and in the same service that it had theretofore been operated. It was claimed and testified by those who have been closely connected with its operation for many years that it could not be operated as a steam railway without being reconstructed, and that it could not continue to operate as it had been operated with the additional burdens that would be placed upon it if it be made subject to the Railway Labor Act, because of those burdens. The record gives an exhaustive comparison between this road and steam railroads and expenses of operating them. Appellee's general manager for the past 15 years, who had held a position with the Southern Pacific for eight years before that, testified in great detail to increase in labor cost to appellee if its road should be brought under the Railway Labor Act. He said:

"It would be unfair and impractical, and in addition to that, your honor, if applied would have produced an increase in the labor bill that would prohibit us from continuing in existence."

Congress has full power of regulation over appellee. It has been an interstate carrier since the completion and operation of its road to Preston, Idaho. In its exercise of that power Congress may in its own judgment make different regulations applicable to interurban electric carriers from those applicable to steam carriers, or because of other material differences. It has done so, and that intention was exemplified in section 1, first, of the Railway Labor Act, as amended, 45 U.S.C.A. § 151, subd. 1. That section first gives a general definition of carriers subject to the Act, which is broad enough to include appellee, followed by the exempting proviso and then a grant of power to the Interstate Commerce Commission, thus:

"Provided, however, That the term `carrier' shall not include any street, interurban, or suburban electic railway, unless such railway is operating as a part of a general steam-railroad system of transportation, but shall not exclude any part of the general steam-railroad system of transportation now or hereafter operated by any other motive power. The Interstate Commerce Commission is hereby authorized and directed upon request of the Mediation Board or upon complaint of any party interested to determine after hearing whether any line operated by electric power falls within the terms of this proviso."

The last sentence just quoted, conferring power on the Commission, was not in the original Act of May 20, 1926. It was added by amendment in 1934. It is plain that before the amendment appellee was exempt from the Railway Labor Act, because it was not engaged in doing either of the things that would have made it subject to the Act. It continued after amendment to be a "line operated by electric power" and was not "operating as a part of a general steam-railroad system of transportation" etc. The Interstate Commerce Commission so found in its report on the hearing which it granted on the request of the Mediation Board. Among other things it said (Utah Idaho Central R. Co., 214 I.C.C. 707, 708): "This railway is operated by electric power, and none of its stocks or bonds are owned by any steam railroad. The only issue therefore is whether it is a street, interurban, or suburban railway within the meaning of the proviso." It further said: "It appellee's railway does not perform any intermediate service between other lines." This exhausted its power. Specifically, its only power was to determine "whether any line operated by electric power falls within the terms of this proviso." The proviso was not changed by the amendment, except, if at all, by enlargement of the words "any street, interurban, or suburban electric railway" to "any line operated by electric power." But the Commission misconceived, we think, the extent of its power by proceeding further. It closed its report by this finding: "that The Utah Idaho Central Railroad Company's lines do not constitute a street, interurban, or suburban electric railway within the meaning of the exemption proviso in the first paragraph of section 1 of the Railway Labor Act, as amended June 21, 1934." It did this on the proof before it that in the later years appellee's revenues for freight transportation had greatly exceeded its revenues for passenger transportation, and the Mediation Board accepted that finding as conclusive that appellee was thereupon brought under the Railway Labor Act in its relation with its employes. The Commission arrived at its conclusion solely on its own estimate of the facts and not because of any direct testimony that the line was not in fact an interurban electric railway. There was none, but there was direct, positive proof by at least one competent, qualified witness that it was and at all times has been an interurban electric railway.

Thereafter appellee filed its bill in the court below against Dan B. Shields, United States Attorney for the District of Utah, in which it sought among other things a writ enjoining Shields from prosecuting it and its officers for claimed commission of crimes defined by the Railway Labor Act. The bill alleged that appellee brought the suit to prevent irreparable injury and damage to it and its business and property used in the transportation of persons and property and to restrain Shields individually and in his official capacity from threatened enforcement of fines and penalties under the Railway Labor Act; that appellee is engaged in the business of operating as a common carrier an electric interurban line of railway between Ogden City, Utah, and Preston, Idaho, for the transportation of passengers, baggage, freight and express between those points and intermediate points. There are allegations as to the construction of the road, first as street car lines in some of the cities through which it now passes and thereafter their acquisition, consolidation and extension northward over the Wasatch Range to Preston, Idaho.

Those who undertook the venture were of that section. They also planned the location of canneries, processing plants for preserving vegetables and fruits for the market, and other developments of the two valleys.

Shields answered denying that the road is an interurban electric railway. He alleged that the Railway Labor Act creates a board known as the National Mediation Board and gives it...