Illinois Cent. R. v. Mississippi Railroad Commission , 116 Miss. 484 ( 1917 )

Stevens, J,

delivered the opinion of the court.

Two cases are presented by the one record. Appellants, the Illinois Central Eailroad Company and the Yazoo & Mississippi Valley Eailroad Company, each filed its bill of complaint against the Mississippi Eailroad Commission to enjoin the enforcement of penalties for violation of an order of the Commission. In 1907 the Eailroad Commission passed an order, prohibiting all railroads from charging passengers who boarded trains without tickets a fare in excess of three cents per mile. This order, it appears, was complied with by the carriers until about January 1, 1915, when appellants adopted a rule requiring each passenger who had an opportunity to buy a ticket and who had not provided a ticket to pay ten cents in excess of the regular fare of three cents per mile. In attempting to adopt this rule appellants filed with the Eailroad Commission a new tariff, giving notice of its intention to charge the extra sum of ten cents and promulgating an order directing their passenger conductors to collect the excess rate in all proper cases. This tariff or rule of the company was not approved by the Commission, and, indeed, before it could be approved appellants had begun to enforce the rule. Upon hearing, the Commission declined to approve the extra charge of ten cents, and entered an order, directing that if “the said charges were made after a given time the carriers would be fined five hundred dollars for each offense. In pursuance of this order of the Commission appellant Illinois Central Eailroad Company was fined five hundred dollars and the bill seeks to restrain the collection of this fine and any other fines that' might be imposed for the violation of the order in question. Appellant Yazoo & Mississippi Valley Eailroad Company averred that it was the intention of the Commission to impose similar fines upon it, and seeks by its bill to enjoin the imposition and enforcement of all such fines. The manifest object of the bills is to test the right of the Commission to impose these fines and to establish the right of the carriers to enforce what they term a ten-cent penalty. Their bills charge that this ten-cent penalty is not a part of the regular fare required of passengers, but is purely a penalty designed to enforce a regulation of the company, requiring passengers to provide themselves with' tickets. The new tariff, under which the penalty is being collected, was filed December 30, 1914, effective January 1, 1915. It will be noted, then, that the carriers adopted their new tariff, and were, enforcing the collection of this penalty without the express approval of the 'Commission. The Commission had, in December, 1902, fixed the maximum ticket rate at three cents per mile and the maximum train rate at four cents per mile. In February, 1907, the following order was passed:

“It is ordered, that the former order of this Commission, authorizing railroad companies operating within this state to collect through their conductors a rate of four cents per mile from passengers boarding trains at stations where tickets are on sale, who had opportunity to purchase tickets and failed to do so, is hereby canceled, and that in lieu thereof a rate of three cents per mile shall be. collected. It is further ordered, that the minimum amount to be collected from passengers shall be ten cents.”

Üpon the filing of the bills temporary injunctions were issued, general demurrers were thereafter filed by the attorney-general to the bills, and decrees entered by the trial court dismissing the bills. From these final decrees dismissing the bills, an appeal with supersedeas was allowed by the chancellor. It further appears from the bill of the Illinois Central Eailroad Company that the passenger who was required to pay the ten-cent penalty on January 1, 1915, for which the five hundred dollar fine was imposed by the Commission, had an opportunity to buy a ticket before the passenger boarded the train.

It is the contention of appellants that the rale of the company imposing a ten-eent penalty on all passengers who have not purchased tickets, regardless of their destination or the length of their journey, is a reasonable regulation, and that the order of. the Commission passed February 19, 1907, is unreasonable and void. There is a further contention that if the extra ten cents is to he regarded as a part of the regular fare and not.a penalty, the complainant carriers complied with the statute providing how their tariffs shall be made and published, and that they had the right to alter this tariff subject to review by the Commission on proper hearing. The bills also aver that when the complainants were cited by the Commission to show cause why they should not be punished, the complainants appeared with their attorneys and witnesses, and offered to show by evidence that the collection of the extra ten cents was a reasonable charge and a reasonable regulation; that the Commission declined to hear proof because of the admitted fact that the carriers were then enforcing the new tariff or rule, and the Commission declined to go into the facts while the carriers were in default and were violating the orders of the Commission, the necessary inference or deduction being that the Commision required a declaration on the part of the carriers that they would refrain from collecting the ten-cent penalty until the Commission approved or authorized the same by a new order spread upon its minutes.

Under our statutes, especially sections 4842 and 4843, the Eailroad Commission is empowered to fix and revise rates to be charged passengers. The power of the state, through the Commission as a governmental agency, to supervise common carriers and fix the maximum charges for the transportation of passengers and freight is- conceded. The method of regulating carriers by and' through administrative bodies acting as governmental agencies is now almost universally adopted in all the states and by the national government. “As the process of arriving at reasonable rates is a perplexing one, involving the exercise both of judicial functions in determining- whether a given rate is under the circumstances reasonable, and of legislative functions in fixing the rate after such determination, it was. early recognized that legislative assemblies could not give to such questions the required time to investigate and determine in advance the reasonableness and justness of the proposed rate or other requirement, necessitating, as such a question would, long and protracted hearings and intricate knowledge of such matters. For this reason the plan was devised ... of creating Commissions . . . and the delegation to such bodies of administrative and legislative powers.” 4 R. C. L., par. 93. When the Commission acts within the powers expressly delegated, its orders, when reasonable, speak with as much authority as a statute. The bills under review show upon their face that the Commission has exercised its delegated power in fixing the. maximum train rate at three cents per mile. Any intimation that the rate is unreasonable or confiscatory has no bearing upon the issues here. No facts are under review. The capital employed by the carriers, their expenses, experiences in charging three cents per mile, profits, etc., are not under review. The primary question is whether appellants may collect a sum in excess of a rate fixed by the Commission, whether this excess be regarded as a penalty or as additional compensation for the inconvenience to which carriers are put in collecting fares on trains.

It may be conceded that under the common law carriers may adopt reasonable rules and regulations and indeed that appellants could adopt reasonable regulations to prevent passengers from boarding passenger trains without first providing themselves with tickets; but in doing this, “the car rate can in no case exceed the maximum allowed the company by its charter or a statute fixing rates” (25 Am. & Eng. Encl. of L. [2d Ed.] 1104), or by the order of the Commission acting within the scope of its delegated authority. As well stated by Elliott on Railroads, vol. 4, par. 1603:

“The company may enact and enforce a rule or regulation requiring a reasonably higher rate of fare to be paid upon the train than the ticket rate, . . . but it cannot be fixed at such a sum that the fare collected on the train will exceed the maximum rate allowed by law. ’

“A rule of the carrier which requires that, when cash fare is paid, an extra amount shall be collected above the regular fare is not valid when the cash fare, together with the extra amount, exceed the maximum rate allowed by law.” Footnote 28, section 1033, vol. 2, Hutchinson on Carriers (3d Ed.), and authorities there cited.

In Zaglemyer v. Cincinnati, etc., R. R. Co., 102 Mich. 214, 60 N. W. 436, 47 Am. St. Rep. 514, it was held:

“That the company cannot impose, as a penalty for not purchasing a ticket, such a sum that the fare collected on the train, including such additional amount, shall exceed the maximum allowed by law” — citing Railroad Co. v. Skillman, 39 Ohio St. 444; Chase v. N. Y. Central R. R. Co., 26 N. Y. 523.

The case quoted from was decided in 1894 and is one of the leading cases on the subject. The same result is reached, and the infliction of á penalty for violating the law was upheld, in Hogan v. Long Island R. R. Co., 142 App. Div. 29, 126 N. Y. Supp. 449. The authorities indicate that this is the holding of practically all courts and commentators. The supreme court of Arkansas upheld a statute in terms very similar to the order of our Commission. St. Louis & S. F. R. Co. v. Kilpatrick, 67 Ark. 47, 54 S. W. 971.

It is insisted that the Commission has approved a maximum ticket rate of three cents per mile, and therefore the order fixing the maximum train rate at three cents per mile is upon its face unreasonable and void. We cannot yield to this suggestion. Our statutes devolve a delicate responsibility upon the Commission, and the decisions of such a tribunal should have the sympathetic regard of the courts. The orders of the Commission under review should not be striken down unless they are clearly unreasonable or void. Minn. St. P. & S. St. M. R. Co. v. Railroad Commission, 136 Wis. 146, 116 N. W. 905, 17 L. R. A. (N. S.) 821; Chicago, R. I. & P. R. R. Co., v. Nebraska Railroad Commission, 85 Neb. 818, 124 N. W. 477, 26 L. R. A. (N. S.) 444; I. C. R. Co. v. Interstate Commerce Commission, 206 U. S. 441, 27 Sup. Ct. 700, 51 L. Ed. 1128.

It is further contended that section 4055, Code of 1906, making it unlawful'for a railroad company to collect more than the regular fare from a passenger who boards a train at a place at which the company does not offer tickets for sale shows the policy of our state to authorize a discrimination between ticket and train rates. When this statute was enacted there was no order of the Commission fixing the maximum train fare at three cents per mile, but on the contrary, the order of the .Commission passed in 1902 authorized a four-cent train rate. The statute relied on does not-authorize the carrier to charge any specified rate, and was not designed to control the Commission in the exercise of its power to fix a maximum charge per mile to be paid by passengers boarding the train without tickets. The railroad companies are at liberty to lower their ticket rates in such way as to discriminate between ticket and train rates without violating the maximum prescribed by the Commission. The right or power of the carriers to discriminate between the ticket and train rates when the maximum charge does not exceed the maximum fixed by the Commission is not involved in the present cases. We are also not concerned in the inquiry whether the ten-cent charge is a penalty or additional compensation. If a fare, it exceeds the lawful; if a penalty, its collection operates to require •of passengers money in excess of the maximum train rate. Indeed railroad companies are not chartered for the purpose of inflicting penalties, but to do service for a patronizing public in return for a fair and reasonable compensation. No decision of onr court is in conflict with' the views herein expressed. On the contrary, the proper limitation is indicated by our court in Forsee v. A. G. S. R. R. Co., 63 Miss. 66, 56 Am. Rep. 801, as follows :

“It is competent for a railroad corporation to adopt reasonable rules for the conduct of its business, and to determine and fix, within the limits specified in its charter and existing laws, the fare to be paid by passengers transported on its trains. ’ ’

This decision of our court was rendered before the creation, of our Railroad Commission and prior to the adoption of the modern method of supervising carriers and their charges through a commission.

It follows that the demurrers to the bills were properly sustained, and the decrees appealed from must be affirmed.

Affirmed.