McCrady Bros. v. Pittsburgh & Lake Erie Railroad ( 1917 )

Opinion by

Trexler, J.,

The Public Service Commission fixed the following rates per net ton-on sand and gravel from Braddock (P. & L. E. R. R.) to Wilkinsburg, Pa., 30 cents, Wilmerding, Pa., 37 cents, East Pittsburgh, Pa., 37 cents, Jeannette, Pa., 53 cents, Greensburg, Pa., 53 cents, Indiana, Pa., 62 cents, which rates it found and determined to be just and reasonable and remunerative to the carriers. The carriers complained against having appealed from the decision of the Public Service Commission, it remains for us to determine whether or not the above rates are reasonable and in conformity to law. In considering the questions involved we are confined to the record as presented to us. The Public Service Commission Act of July 26,1913, P. L. 1374, Art. V, Sec. 3, provides that the commission shall determine all matters presented to them after hearing and (Art. VI, Sec. 18) that a record shall be made of the testimony taken therein and findings if any based upon such testimony. Upon appeal this court is charged with the duty of inquiring, whether upon the record, the order is reasonable and in conformity with law (Sec. 22), the order of the commission being prima facie evidence of its reasonableness and the burden being upon the appellant of proving the contrary and the notes of testimony are to be considered as the testimony in the case (Sec. 23). If the Superior Court upon the record find that the order appealed from is unreasonable or based upon incompetent evidence materially affecting the determination or order of the commission, or otherwise not in conformity to law it may reverse the order of the commission (Sec. 24).

The rate between Braddock and Wilkinsburg complained of was 42 cents. This was a joint rate for the Philadelphia & Lake Erie and the Pennsylvania Railroads. The commission reduced this to 30 cents. The complainant had a sand hoist at Braddock and a retail yard at Wilkinsburg, and alleged that the defendants charged higher rates to Wilkinsburg and certain other points than they did from other shipping points in the vicinity of Braddock to the same destination to the prejudice of the complainant and that the rates in themselves were unreasonable. If we turn to the report of the commission we find that its order fixing the rates is based upon the following premises, (a) The rates attacked are so high as to be prohibitive, (b) Being prohibitive they are therefore unlawful and unreasonable, (c) Being unreasonable there must be some lower rates established to take their place.

It has been said that the question of the reasonableness of rates is always a perplexing one. A great variety of considerations are necessarily involved in each instance. In coming to the conclusion that the existing rates were prohibitive the commission used the following language.: “The carriers have established a commodity rate, and this may be considered as some evidence of the fact that there is traffic to be moved between the points covered by such rate; if the rate is fixed so high as to be prohibitive, then it defeats its own ends and we may properly conclude it to be unjust and unreasonable.” We cannot accede to the proposition that the fact that a rate is prohibitive makes it per se unlawful. There are many elements which may enter into the fixing of a rate, such as the factor of distance, ton-mile revenue, car-mile revenue, earnings per car and a comparison of the rates on other commodities of equal or higher value, the volume of movement, the value of the service to the shipper or consignee and the cost of service. See Art. Ill, Sec. 1 (b). When all or some of these matters and possibly others, which are not mentioned are taken into consideration it does not follow that they will always result in the fixing of rates that will make it profitable for every shipper to use the means of transportation. His need may be a factor to be considered but it is not a determining one. The fact that traffic does not move is not conclusive that the rates are not reasonable. If we look at the testimony we find nothing that shows that the rates from Braddock to points mentioned are per se prohibitive but that plaintiff claims that they are too high in comparison to the rates applicable to other producers from other points. This may be evidence that the rates need adjustment but is not proof that the rates are in themselves too high for the other rates may be too. low. The question thus resolves itself not into the unreasonableness of the rates per se but considered as a competitive rate. The commission did not find that the rate was unreasonable, as giving an undue' preference.

But assuming that the rates are fixed by comparison with other rates although the commission does not arrive at its conclusion by this method we find a more serious error in the fact that the commission fixed the rates upon the shorter route between Braddock and Wilkinsburg and other points named. There is no doubt in fixing a rate, ordinarily it is the shortest route between the points that must primarily be considered to control the rate. The facts in this case show that the present route used by the respondents is from Braddock via the P. McKee & Y Transfer, the Penna. B. R. to Thompson and thence via East Pittsburgh to Wilkinsburg the point of destination, a total of 17 miles including constructive bridge mileage or 13 miles by the ordinary computation. The commission adopted the rates suggested by the complainants and these rates are premised upon a route going from Braddock to Wilkinsburg via Bessemer over the Union Railroad. The Union Railroad Co. is not a defendant in this case. If it were desired to show that the shorter route was a feasible route and that the rate was to be fixed in relation to it, the Union R. R. Co. should have been made a party to the proceedings or at least at some place in the proceedings notice should have been served upon it so that it might be heard upon any or all the subjects which are pertinent to an inquiry of this kind. There is nothing to show that the Union R. R. Co. is compelled to grant facilities for the conveyance of sand from Braddock to Wilkinsburg at the rates set by the commission or that such facilities exist. The rates fixed apply only to the roads who were parties to the proceeding. It is not right that the commission should fix a rate for a route of a mileage of 13 miles upon a basis of what the rate should be upon a route of 7.6 miles when it does not appear that the shorter route is available, or that the carrier whose road comprises part of the shorter route is a party to the proceedings.

The order of the commission is reversed.