Southern Ry. Co. v. Alabama Public Service Commission

• Decision Date: 07 June 1923
• Docket Number: 3 Div. 589.
• Citation: Southern Ry. Co. v. Alabama Public Service Commission, 97 So. 289, 210 Ala. 105 (Ala. 1923)
• Parties: SOUTHERN RY. CO. ET AL. v. ALABAMA PUBLIC SERVICE COMMISSION.
• Court: Alabama Supreme Court

97 So. 289

210 Ala. 105

SOUTHERN RY. CO. ET AL. v. ALABAMA PUBLIC SERVICE COMMISSION.

3 Div. 589.

Supreme Court of Alabama

June 7, 1923

Rehearing Denied June 28, 1923.

Appeal from Circuit Court, Montgomery County; Walter B. Jones Judge.

Appeal by the Southern Railway Company and others to the circuit court, in equity, Montgomery county, from an order of the Alabama Public Service Commission in a proceeding by the Alabama Company and others against the Southern Railway Company and others. From a decree affirming the order of the Commission, defendants appeal. Reversed and remanded.

Claudian B. Northrop and M. G. Roberts, both of Washington, D. C., W R. C. Cocke and John T. Stokely, both of Birmingham, Steiner Crum & Weil, of Montgomery, George W. Jones and E. Perry Thomas, both of Montgomery, and Nelson W. Proctor, of Louisville, Ky., for appellants.

Harwell G. Davis, Atty. Gen., Hugh White, Asst. Atty. Gen., J. J Mayfield, of Montgomery, and O. E. Harrison, of Washington, D. C., for appellee.

SAYRE J.

This proceeding had its origin in a petition addressed to the Alabama Public Service Commission, filed May 21, 1920, by the Alabama Company and other companies engaged in the production of pig iron and various iron and steel products at plants within and contiguous to what is known as the Birmingham district, in this state. This petition, to employ the language therein found, concerned the reasonableness and legal propriety of advanced rates on coal, coke, ore, and limestone, constituting raw material required and used by petitioners in the manufacture of pig iron. The traffic affected by the rates in question is exclusively intrastate. The petition showed that "for many years prior to August 15, 1916, the assembling rates on furnace raw materials in the state of Alabama had remained constant," such rates being "constructed on a zone basis;" that on the date mentioned these rates were advanced 5 cents per ton, and again, on July 20, 1917, "the rates were increased 5 cents a ton on each of these furnace raw materials," and that "notwithstanding the great advances in the rates, as above shown, further enormous advances, effective June 25, 1918, were made under authority claimed to have been granted under General Order No. 28 of the United States Railroad Administration." Petitioners show to the Commission the history of the development of their industry in this state, the present conditions under which their operations are conducted, conclude that "the said advanced rates and charges are intrinsically, in and of themselves, unjust, unreasonable and excessive, to the extent that they exceed the rates in effect immediately prior thereto," and pray, in effect, that the Commission restore the rates in effect immediately prior to the advance of June 25, 1918. The Commission, August 18, 1921, referred to the advances of August 15, 1916, and July 20, 1917, saying that "each of these advances was initiated by the carriers and approved by the Commission pursuant to the law of Alabama," and clearly evinced its recognition of the true character and legal status of the rates ordered on those dates by adding:

"The special industrial rates that were in effect preceding the advance under General Order No. 28 are not in issue."

Further it said:

"The function of this Commission is to determine whether the rates as so advanced [speaking, evidently, of the advance in pursuance of General Order No. 28] are just and reasonable, and to prescribe what it may find to be just and reasonable rates for the future."

Stating its opinion that "the situation and the service incident to this transportation in the Birmingham district is unique and without a parallel elsewhere to be found, *** and that these features clearly differentiate the service rendered complainants from any similar service rendered the public generally," though no facts were stated as a basis for this conclusion, the Commission made an order purporting to grant the petition, but in fact establishing new rates on coal, coke, ore, and limestone, "to be applied in the future to this furnace raw material traffic," these rates being, as to ore and limestone, less than the rates that resulted from General Order No. 28, but somewhat in excess of the rates which had been established by the Commission previous to General Order No. 28, and, as to coal and coke, in excess of any previous rates. On appeal to the equity side of the circuit court the order of the Public Service Commission was affirmed.

From the decree of the circuit court the defendant railroad companies have appealed.

In his opinion the circuit judge, after referring to the decision of this court in State ex rel. Attorney General v. Louisville & Nashville R. R. Co., 197 Ala. 203, 72 So. 494, correctly stated:

"The decisive legal question in this case is, Are the rates complained of special preferential industrial rates within the purview and sanction of section 14 1/2 of the act of November 23, 1907 (page 40), as re-enacted in section 13 of the Alabama Transportation Act of 1920?"

And the court held that the rates challenged were not special preferential industrial rates within the meaning of section 14 1/2, and that the complaining furnace companies had not asked for preferential rates, but had simply invoked the general powers of the Alabama Public Service Commission to find and prescribe reasonable rates. In the circuit court the order of the Public Service Commission was affirmed.

It is entirely clear on the language of the prayer for relief shown by the petition that petitioners sought to be relieved of the burden of the advance in rates made effective by General Order No. 28, and upon the language of its order...