State v. Public Service Commission

• Court: Missouri Supreme Court
• Writing for the Court: Faris
• Citation: State v. Public Service Commission, 194 S.W. 287, 270 Mo. 547 (Mo. 1917)
• Decision Date: 30 March 1917
• Docket Number: No. 19377.,19377.
• Parties: STATE ex rel. RHODES v. PUBLIC SERVICE COMMISSION OF MISSOURI et al.

194 S.W. 287

270 Mo. 547

STATE ex rel. RHODES v. PUBLIC SERVICE COMMISSION OF MISSOURI et al.

No. 19377.

Supreme Court of Missouri. In Banc.

March 30, 1917.

Motion for Rehearing Denied April 9, 1917.

Appeal from Circuit Court, Cole County; J. G. Slate, Judge.

Proceedings by certiorari by the State of Missouri, at the relation of M. E. Rhodes, against the Public Service Commission of the State and its members and the Chicago & Alton Railroad Company. From a judgment reversing a finding of the Commission, the latter, its individual members, and the railroad company appeal. Reversed and remanded, with directions to affirm the order of the Commission.

This is an appeal from the circuit court of Cole county in a proceeding by certiorari, to bring up to that court the record of the Public Service Commission in a certain cause wherein some 14 railroads doing business in Missouri sought, by an application to said Public Service Commission, to obtain an increase in intrastate freight and passenger rates. The Public Service Commission (hereinafter for brevity called the Commission), which is one of the appellants herein, granted some part of the relief prayed for, whereupon the relator, a citizen of Missouri, and a potential patron of the railroads of this state, brought the case up to the Cole county circuit court by a so-called writ of review. This latter court reversed the finding of the Commission, and from such judgment of reversal the Commission and the component individual members thereof, and the Chicago & Alton Railroad Company have appealed.

The facts necessary to an understanding of the case are few and simple, and, touching such facts as will serve to make clear the law points we find it necessary to discuss, there is no dispute.

Historically and chronologically the facts as to the legislation which will come under review and the years of the passage thereof run thus: In 1905 an act was passed by the Legislature establishing freight rates in this state. This act was amended in 1907. There was also passed in 1907 an act fixing the intrastate passenger rates at two cents per mile per person upon the railroads which are parties to this application. In 1913 there was passed by the Legislature the Public Service Commission Act, which act contained, among other provisions, a section designated as section 47, which it is averred conferred upon appellant Commission the power and duty of ascertaining and establishing reasonable maximum rates for the carriage of persons and freight in intrastate traffic upon the railroads in this state. More extended references to these several acts will be made hereinafter. Pursuant to the power which the appellants urge was lodged in the Commission by said section 47, appellant railroad and 13 other railroads made, on September 15, 1914, as stated, an application, praying for the revision upwards of freight and passenger rates. After a comprehensive investigation by their rate experts and expert accountants and engineers, exhaustively and diligently carried on for more than a year, the Commission made its finding and entered orders, granting to appellant Railroad Company and to the other common carriers named in the application for an increase of rates certain modified measures of relief to take effect January 1, 1916. This finding, so far as the extent of our review here is concerned, is sufficiently set forth by appellant Commission in the below quoted language of their report and finding, to wit:

"We conclude that the applicants herein are entitled to a measure of relief, but not to the extent of the rates as proposed by applicants. Therefore, an order in conformity with the views expressed herein should be entered fixing the reasonable rates, fares and charges for passenger service and commodity rates and charges for freight service to be in effect as maximum rates for the services to be performed for a period of twelve months from January 1, 1916, and thereafter until changed or abrogated by the Commission."

Thereafter in the Commission's order followed specifications of the reasonable maximum rates fixed by the Commission and to be charged by the several classes of railroads on divers commodities of merchandise, as well as an order fixing a maximum passenger rate per person per mile upon intrastate traffic upon the several classes of railroads; and orders requiring the issuance of round-trip tickets at 2¼ cents; 500-mile books, usable by bearer and persons for whom presented, and joint interchangeable 1,000-mile books, likewise usable by bearer and persons for whom presented, at 2 cents per mile. As stated, with the details of these matters and rates, we have here nothing to do; for the whole case turns upon the question whether said section 47 conferred on the Commission under the Constitution the power and authority to make or fix reasonable maximum intrastate rates for the carriage of freight and passengers in this state.

If other facts shall become necessary in order to make clear the law points involved, these facts will be found set out in our opinion.

For convenience of expression we shall, in setting forth our views, speak of delegating the power of legislating to the Commission, while laboring to show that what has been done is either no delegation of power at all, or that it is a delegation which is beneficent and permissible and not forbidden.

Alex. Z. Patterson and James D. Lindsay, both of Jefferson City, for appellant Public Service Commission. Scarritt, Scarritt, Jones & Miller, of Kansas City, for appellant Chicago & A. R. Co. M. E. Rhodes, of Potosi, for respondent. Thomas R. Morrow, of Kansas City, amicus curiæ.

FARIS, J. (after stating the facts as above).

I. The only questions in this case are questions of cold law. The stipulation filed so limits them, and the points briefed by learned counsel upon both sides doth the like. So as a limiting foreword we may observe that we approach their determination without any hampering compunctions touching whether the orders made by the Commission are upon the facts warranted or unwarranted, just or unjust, or whether as contended, the practical carrying out of these orders will prove so meager in increase of income and so burdensome in accounting as to make actual defeat for the carriers out of seeming victory.

The Legislature has acted by passing the Public Service Commission Act, containing, among other provisions, section 47, which delegated, it is contended upon one side and denied upon the other, the whole matter of railroad ratemaking to the Commission, and its constitutional power to do this (if it did it) is here the bone of contention. The Commission has acted pursuant to its interpretation of the powers conferred upon it by the section supra. Within their respective legal spheres both the legislative and the administrative branches have, it is contended and denied, done what the law enjoins. It is our sole duty, therefore, as the other co-ordinate branch of government, to see whether the legislative branch and the executive, or administrative, branch had the power to do what they have done. In short, we have nothing whatever to do with the facts, or the public policy involved, or with the inherent correctness or incorrectness of the orders made; it is alone our duty herein to deal with the power of the Legislature under the Constitution to pass section 47 and to interpret and construe its meaning and effect, if it is valid under the Constitution. Therefore it follows that, concretely stated, the two questions involved are pure questions of law and they are: (a) Does section 47 (Laws 1913, p. 583) of the Public Service Commission Act confer authority upon the Commission to raise railroad rates above the maximum fixed by the Legislature? (b) If said section 47 has this effect, is it invalid because in violation of the provisions of section 14, art. 12, of the Constitution?

II. Taking these questions in their order and discussing them without noticing the phase of interdependence, we conclude that section 47 does confer this identical power upon the Commission. The pertinent portions of said section 47 read thus:

"Whenever the Commission shall be of opinion, after a hearing * * * upon its own motion or upon complaint, * * * that the maximum rates, fares or charges, chargeable by any such common carrier, railroad corporation or street railroad corporation are insufficient to yield reasonable compensation for the service rendered, and are unjust and unreasonable, the Commission shall with due regard among other things to a reasonable average return upon the value of the property actually used in the public service and to the necessity of making reservation out of income for surplus and contingencies, determine the just and reasonable rates, fares and charges to be thereafter observed and in force as the maximum to be charged for the service to be performed, notwithstanding that a higher rate, fare or charge has been heretofore authorized by statute, and shall fix the same by order to be served upon all common carriers, railroad corporations or street railroad corporations by whom such rates, fares and charges are thereafter to be observed." Laws of Mo. 1913, 1. c. 583.

We may observe as a foreword that: The Constitution of Missouri is a limitation upon the powers of the General Assembly, which body may therefore pass any law upon any subject not forbidden by our organic law or by the federal Constitution (Ex parte Roberts, 166 Mo. 212, 65 S. W. 726; Chicago, etc., Ry. Co. v. Otoe County, 16 Wall. 667, 21 L. Ed. 375), and there is no question here of the federal Constitution. This power is conferred by section 1 of article 4 of the Constitution of 1875, which says:

"The legislative power, subject to the limitations herein contained, shall be vested in a Senate and House of Representatives, to be styled `the General Assembly of the state of Missouri.'"

Cf. section 1, art. 3, Const. 1820; ...