State ex rel. Chicago, R. I. & P. R. Co. v. Public Service Commission

Citation312 S.W.2d 791
Decision Date14 April 1958
Docket NumberNo. 46338,46338
PartiesSTATE of Missouri ex rel. CHICAGO, ROCK ISLAND & PACIFIC RAILROAD COMPANY, Appellant, v. PUBLIC SERVICE COMMISSION of the State of Missouri, Respondent.
CourtUnited States State Supreme Court of Missouri

O. L. Houts, Chicago, Ill., Lester G Seacat, Jefferson City, Hale Houts, Hogsett, Houts, James, Randall & Hogsett, Kansas City, for relator-appellant Chicago, R. I. & P. R. Co.

Glenn D. Evans, Gen. Counsel, Howard L. McFadden, Jefferson City, Harry H. Kay, Eden, of counsel, for respondent, Public Service Commission.

HOLLINGSWORTH, Judge.

This case comes to the writer on reassignment following transfer to Court en Banc.

The Chicago, Rock Island and Pacific Railroad Company, hereinafter referred to as 'the company', has appealed from a judgment of the Circuit Court of Cole County affirming an order of the Public Service Commission of Missouri, hereinafter referred to as 'the commission', denying the company's application for authorization to discontinue its trains numbered 23 and 24 operating between Kansas City, Missouri, and Eldon, Missouri. The application alleged that public convenience and necessity no longer required the operation of these trains; and that their operation resulted in an annual out-of-pocket loss to the company in excess of $50,000, thereby imposing undue burden upon interstate commerce in violation of Article I, Sec. 8, Clause 3, of the Constitution of the United States, and depriving the company of its property in violation of Sec. 1 of the 14th Amendment of said Constitution and of Article I, Sec. 10, of the Constitution of Missouri, V.A.M.S.

It is here contended that the decision of the commission finding that public convenience and necessity required that the operation of said trains be continued and denying the application to discontinue their operation is not supported by competent and substantial evidence upon the whole record; that it could not have been reasonably made upon consideration of all of the evidence and is contrary to the weight of the evidence and the overwhelming weight thereof; and that it is violative of the constitutional provisions above set forth.

Prior to determining the appeal on its merits, we are confronted with the necessity of a reconsideration of the proper scope of our review of orders of the Public Service Commission. The company insists that in reviewing this cause on appeal we are required by statute to weigh and determine the evidence 'as a suit in equity'; whereas, the commission insists that neither the circuit nor appellate courts are empowered to weigh the evidence upon which the commission or any other administrative agency of this state, after due hearing, has based a decision or order, and that judicial review in such cases is limited to determination of whether the decision or order under inquiry is reasonable and lawful. Admittedly, there has been confusion and inconsistency in our prior decisions dealing with this phase of administrative procedure.

When the public service commission law was enacted in 1913, the provisions relating to judicial review of orders and decisions of the commission were set forth in what is now Section 386.510 RSMo 1949, V.A.M.S. (All statutory references are to RSMo 1949, V.A.M.S., unless otherwise stated.) By that section, a writ of review may be obtained from the circuit court 'for the purpose of having the reasonableness or lawfulness of the * * * order or decision * * * inquired into or determined.' There the cause is heard by the court without intervention of a jury, 'on the evidence and exhibits introduced before the commission * * *.' The jurisdiction of the circuit court (other than to remand for the taking of testimony improperly excluded by the commission) is expressly limited to the affirmance or the setting aside of the decision under review. The clause of Section 386.510 that has given rise to most of the confusion is the herein italicized portion of the last sentence thereof, reading: 'The circuit courts of this state shall always be deemed open for the trial of suits brought to review the orders and decisions of the commission as provided in the public service commission law and the same shall be tried and determined as suits in equity.' (Emphasis ours.)

As late as 1928, this court construed that clause to mean that neither the circuit court nor the appellate court on appeal was bound by the findings of the commission, nor was the appellate court bound by a finding of the circuit court. State ex rel. and to Use of Pugh v. Public Service Commission, 321 Mo. 297, 10 S.W.2d 946, 948. However, in 1929, in State ex rel. Detroit-Chicago Motor Bus Co. v. Public Service Commission, 324 Mo. 270, 23 S.W.2d 115, 117, hereinafter referred to as the 'Detroit-Chicago Motor Bus case', this court, in an opinion by Ragland, J., said:

'It is true that all orders of the commission are subject to judicial review, and that suits brought for such review must be 'tried and determined as suits in equity.' But, after the chancellor has made his own finding of the facts, the only application he can make of them is to determine from them whether the order under review is reasonable and lawful. If he finds it both reasonable and lawful it is his duty to affirm it; if he finds it either unreasonable or unlawful, he must set it aside.'

Thereafter, we seem uniformly to have ruled that our review of the orders and decisions of the commission was confined to the question of their lawfulness and reasonableness. In the recent case of State ex rel. Kansas City v. Public Service Commission, 362 Mo. 786, 244 S.W.2d 110, 116, we said that the provision requiring 'the trial of suits brought to review the orders of the commission shall be tried and determined as suits in equity, does not confer general equitable power upon the reviewing court.'

In the interim between the Detroit-Chicago Motor Bus case, supra, and the last mentioned case, the framers of the 1945 Constitution placed therein an entirely new provision, Article V, Sec. 22, relating to judicial review of the decisions of administrative agencies, wherein it was declared that such decisions 'shall be subject to direct review by the courts as provided by law; and such review shall include the determination whether the same are authorized by law, and in cases in which a hearing is required by law, whether the same are supported by competent and substantial evidence upon the whole record.'

The debate upon the adoption of Article V, Sec. 22, reveals somewhat dramatically the reason for the specific provision above quoted. As originally introduced, the proposal with reference to judicial review (Page 2675 of the proceedings of the Constitutional Convention) contained the phrase:

'* * * And such review shall include the determination whether such decision, order, finding, or rule is based upon the weight of the evidence and is authorized by law.' (Emphasis ours.)

Following introduction of that proposed provision, Senator Allen McReynolds offered an amendment (Page 2683) excluding review based upon the weight of the evidence and incorporating the phraseology thereafter adopted. During debate of the proposed amendment, Sen. McReynolds was interrogated and answered as follows (Page 2694):

'Mr. Moore: If the appellate court was allowed to consider the whole record, what is wrong with requiring them to weigh the evidence?

'Mr. McReynolds: Everything, you substitute then the judgment of the court and it becomes the administering body. Whenever you do that, you destroy administration.'

Following adoption of the constitution, we held the scope-of-review provision of Article V, Sec. 22, to be a mandatory and self-enforcing provision fixing the minimum standard of judicial review of administrative decisions therein specified. At the same time, we further declared, however, 'This does not mean that the reviewing court may substitute its own judgment on the evidence for that of the administrative tribunal.' Wood v. Wagner Electric Corp., 355 Mo. 670, 197 S.W.2d 647, 649. In 1945 (Laws 1945, page 1504, Chap. 536 RSMo 1949, V.A.M.S.), the Legislature enacted the first comprehensive legislation relating to Administrative Procedure and Review in this state. The provisions of that act relating to judicial review of the orders and decisions of administrative agencies are found in Sections 536.100 and 536.140. In 1953 (Laws 1953, page 679), however, the Legislature amended Section 536.140, so that, as of now, its provisions to the extent here pertinent, as found in Sec. 536.140 RSMo 1949 Cum.Supp.1957, V.A.M.S., are:

'1. The court shall hear the case without a jury and, except as otherwise provided in subsection 4 of this section, shall hear it upon the petition and reocrd filed as aforesaid.

'2. The inquiry may extend to a determination of whether the action of the agency

'(1) Is in violation of constitutional provisions;

'(2) Is in excess of the statutory authority or jurisdiction of the agency;

'(3) Is unsupported by competent and substantial evidence upon the whole record;

'(4) Is, for any other reason, unauthorized by law;

'(5) Is made upon unlawful procedure or without a fair trial;

'(6) Is arbitrary, capricious or unreasonable;

'(7) Involves an abuse of discretion.

The scope of judicial review in all contested cases, whether or not subject to judicial review pursuant to sections 536.100 to 536.140, and in all cases in which judicial review of decisions of administrative officers or bodies, whether state or local, is now or may hereafter be provided by law, shall in all cases be at least as broad as the scope of judicial review provided for in subsection 2 of section 536.140; * * *.'

(Subsections 3 and 4 deal with the review of orders not involving the exercise of administrative discretion and orders in specific classes of cases in which the court is or hereafter may be entitled to determine the...

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