Southern Railway Company v. City of Morristown, 71-1032.

• Decision Date: 22 September 1971
• Docket Number: No. 71-1032.,71-1032.
• Citation: 448 F.2d 288
• Parties: SOUTHERN RAILWAY COMPANY, Plaintiff-Appellant, v. CITY OF MORRISTOWN, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

448 F.2d 288 (1971)

SOUTHERN RAILWAY COMPANY, Plaintiff-Appellant, v. CITY OF MORRISTOWN, Defendant-Appellee.

No. 71-1032.

United States Court of Appeals, Sixth Circuit.

September 22, 1971.

Charles A. Horsky, Washington, D. C., for plaintiff-appellant; David H. Hickman, Washington, D. C., Wm. H. Inman, Morristown, Tenn., on brief.

James K. Miller, Morristown, Tenn., for defendant-appellee.

Before PHILLIPS, Chief Judge, and McCREE and MILLER, Circuit Judges.

WILLIAM E. MILLER, Circuit Judge.

This case involves a determination whether Ordinance Number 1813 (dated August 4, 1970) of the City of Morristown, Tennessee, requiring Southern Railway Company to install and maintain entirely at its own expense three automatic signals at street-railway crossings in the city is arbitrary and unreasonable in light of all the circumstances and therefore in violation of the due process and equal protection clauses of the Fourteenth Amendment to the Constitution.

The action was instituted by Southern in the United States District Court for the Eastern District of Tennessee, Northeastern Division, seeking a declaratory judgment declaring invalid Ordinance Number 1764 of the City of Morristown (dated January 7, 1969), and temporary and permanent injunctive relief prohibiting its enforcement. Ordinance Number 1764 was essentially identical to the ordinance before us except that it contained no legislative findings. Following a pretrial conference at which the parties stipulated facts, Southern moved for summary judgment. The District Court granted the motion, stating in its memorandum opinion and order (filed June 30, 1970):

Although there is an implication in the Gainesville case, ibid., that the trial court is to make such findings, this Court is of the opinion that, (unless the gaps in the stipulated facts are supplied adequately) the factual considerations, which prompted the legislative body to allocate one hundred per cent of the cost to the plaintiff, cannot be declared reasonable or unreasonable under all of the circumstances judicially, unless the defendant\'s legislative body sets forth in the body of its enactment its considered findings. In other words, the subjective findings of the legislative body enacting the ordinance, not the objective findings of the tribunal confronted with the responsibility of testing the reasonableness of those findings, are crucial.

Previously in its opinion the court had outlined the sort of considerations pertinent to such a determination:

Proper considerations in deciding such reasonable relation are: equity, benefit, degree of danger caused by the plaintiff, and what is generally, under comparable circumstances, considered to be reasonable by courts and governmental agencies. Citing City of Gainesville v. Southern Railway Company, 423 F.2d 588, 590 (5th Cir. 1970).

The court stated that its purpose in granting the motion and keeping in effect a temporary restraining order was to allow "compliance within a reasonable time by the defendant with the sense of this opinion," so that the city might make a determination as to whether the requirements of due process and equal protection had been met. The city's legislative body then passed Ordinance Number 1813, amending and supplementing Ordinance Number 1764. Southern renewed its application for relief and the city moved for summary judgment. Again relying on City of Gainesville and detailing the factors declared therein to be relevant to such determinations, the district court held:

The stipulated facts and exhibits now demonstrate by a preponderance of the evidence that the aforementioned Ordinance Number 1813 of the defendant City of Morristown does not constitute an abuse of its police power, that the traffic controls ordered to be installed are reasonably necessary, and it is reasonable for the City of Morristown to require the plaintiff Southern Railway Company to bear the entire cost of the installation and maintenance of signals at the grade crossings on Fairmont Street, High Street, and Industrial Avenue.

The findings of the district court are set forth in the appendix.

We agree with the district court's determination that under the circumstances the City of Morristown acted neither arbitrarily nor unreasonably in allocating to the Southern Railway Company one hundred percent of the cost of installing and maintaining the safety devices. Because of the force and persuasiveness with which Southern advances its position, it is well to review the applicable legal principles and to focus on the particular factual situation before us.

Southern relies primarily on Nashville, C. and St. L. Ry. v. Walters, 294 U.S. 405, 55 S.Ct. 486, 79 L.Ed. 949 (1935). There the court, in a typically careful and detailed opinion by Mr. Justice Brandeis, found arbitrary and unreasonable the application of a state statute authorizing the State Highway Commission to require the separation of grades when a state highway crosses a railroad and when the Commission finds it necessary for the protection of travelers. As the court stated, "without conferring upon the commission any discretion as to the proportion of the cost to be borne by the railroad the statute required the latter to pay in every case, one-half of the total cost of the separation of grades." Southern correctly sees the Nashville case as highlighting an evolutionary shift by both courts and legislatures away from mechanical application of the maxim, "He who creates and maintains upon his premises a condition dangerous to others is under an obligation to guard it and protect it so that injuries to third persons may not result therefrom."¹ And, indeed, appellant is correct in stating that: "The Supreme Court thus established — more than 35 years ago — that with respect to grade crossings, no less than in other areas, there are considerations of equity, reasonableness, and beneficial interest which apply to the exercise of the police power," citing Nashville, C. & St. L. Ry. v. Walters, supra.

However, Mr. Justice Brandeis also made it quite clear that, while the 50% allocation of costs then before the court was unreasonable and arbitrary in light of the "special facts" of the case, an allocation of the entire cost would often be perfectly fair and reasonable. He stated:

It (the Railway) concedes that in Tennessee, as elsewhere, the rule has long been settled that, ordinarily, the state may, under the police power, impose upon a railroad the whole cost of eliminating a grade crossing, or such part thereof, as it deems necessary. The claim of unconstitutionality rests wholly upon the special facts here shown. Nashville, C. & St. L. Ry. v. Walters, 294 U.S. 405, at 413, 55 S. Ct. 486, at 487, 79 L.Ed. 949. Cf. cases cited id. n. 3 at 413, 55 S.Ct. 486 and Erie R. R. Co. v. Board of Public Utility, 254 U.S. 394, 41 S.Ct. 169, 65 L.Ed. 322 (1921) (emphasis added).

Three different sets of factors, none of which are present in the instant case, seem to have led to the result reached by the court in the Nashville case. First, as noted above, the act whose application was questioned was a state statute which allocated to the railroad 50% of the cost of the improvement in all cases which fell into a broad class, not allowing the Highway Commission any discretion to allocate cost among the parties in a manner fair and reasonable in light of all the circumstances. This, in itself, would seem to be the essence of arbitrariness.

Second, the Tennessee Supreme Court, in reversing the trial court and approving the application of the statute did not consider the circumstances pertinent to the allocation of costs.

Third, the facts surrounding the imposition of costs in Nashville strongly supported a finding of arbitrariness and unreasonableness. This was pointed out by the Supreme Court in Atchison, T. & S. F. R. Co. v. Pub. Util. Comm'n, 346 U.S. 346, 74 S.Ct. 92, 98 L.Ed. 51 (1953), where it stated:

The grade separation ordered in the Nashville case was located in the rural community of Lexington, Tennessee, which had a population in 1910 of 1,497, in 1920 of 1,792, and in 1930 of 1,823. The improvement was not required to meet the transportation needs of Lexington and was being constructed without regard to that community\'s growth or to considerations of public safety and convenience resulting from such growth. The highway there under improvement was

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