Turner v. Connecticut Co.

The first seven assignments of error are assumed by the appellant to relate to the correction of the finding. In fact they relate to matters which are parts of the memorandum of decision. That is not made a part of the finding, so that its correction cannot be had. The cause is to be decided upon the facts found, not upon those contained in the memorandum of decision. Further, the agreed statements of facts which the appellant assumes to be a part of the record had no place in the record. They were not certified to by the trial court and made a part of the record. So far as we know they were not necessarily before the trial court, and certainly were not necessarily the only facts in evidence. Counsel for the appellee say the appellant petitioner introduced oral testimony. Whether this is accurate or not, the appellant cannot secure the correction of the finding under the method of General Statutes, § 797, without having the evidence certified and made a part of the record.

The assignments of error, aside from those relating to the correction of the finding, are varying ways of stating the single point, that the trial court erred in holding that the action of the Commission was reasonable in finding and deciding that the present rates complained of were not unreasonable.

The Act regulating Public Service Corporations (Chapter 128 of the Public Acts of 1911, p. 1394), in § 23, provides that "any ten patrons of any such company . . . may bring a written petition to the commission alleging that the rates or charges made by such company . . . are unreasonable." Thereupon, after hearing had, the commission, if it finds such rates and charges to be unreasonable, may determine and prescribe just and reasonable maximum rates and charges to be thereafter made by such company, and said company "shall not thereafter demand any rate or charge in excess of the maximum rate or charge so prescribed."

The limitation of rates to what are reasonable is the enactment, in statutory form, of an ancient rule of the common law. Raritan River R. Co. v. Traction Co., 70 N.J.L. (41 Vroom) 732, 743, 58 A. 332; Reagan v.Farmers Loan Trust Co., 154 U.S. 362, 397,14 Sup. Ct. 1062; Louisville N. R. Co. v. Garrett, 231 U.S. 298,311, 34 Sup. Ct. 48. "To limit the rate of charges for services in a public employment, or for the use of property in which the public has an interest, is only changing a regulation which existed before. It establishes no new principle in the law, but only gives a new effect to an old one." Munn v. Illinois, 94 U.S. 113, 134.

The remedy for the enforcement of reasonable rates provided by our Act was new in this jurisdiction. So long as the company establishes reasonable rates these cannot be lowered by commission or court. When it fails in this duty the Public Utilities Commission is authorized to prescribe just and reasonable maximum rates. And its authority, under this Act, may be invoked whenever the rates as fixed are either so high or so low as to be unreasonable.

The Commission is an administrative one with the delegated legislative function of fixing railway rates. A court may not be required to fix or regulate a tariff of rates for services to be rendered by a public service corporation, since this is a legislative function and may be conferred by law upon a specially designated ministerial body. Reagan v. Farmers Loan Trust Co.,154 U.S. 362, 397, 14 Sup. Ct. 1062; Interstate Com.Commission v. Cincinnati, N. O. T. P. Ry. Co.,167 U.S. 479, 499, 17 Sup. Ct. 896; Janvrin, Petitioner,174 Mass. 514, 55 N.E. 381; Raritan River R. Co. v.Traction Co., 70 N.J.L. (41 Vroom) 732, 58 A. 332.

Section 29 of the Act provides for an appeal to the Superior Court from any order of the Commission. And § 31, as amended by Chapter 225 of the Public Acts of 1913, provides that "said court shall hear such appeal and examine the question of the legality of the order . . . and the propriety and expediency of such order, . . . in so far as said court may properly have cognizance of such subject." Under this provision the court may hear and determine whether the order of the Commission fixing maximum rates, or its order declining to change the rate fixed by the company, is valid or not, by ascertaining whether the rate so fixed, or the rate unchanged, was reasonable or not. Such a question is a judicial one. It has been so held in construing a like or similar provision in State and Federal statute. Janvrin,Petitioner, 174 Mass. 514, 55 N.E. 381; RaritanRiver R. Co. v. Traction Co., 70 N.J.L. (41 Vroom) 732, 743, 58 A. 332; Chicago, M. St. P. Ry. Co. v. Minnesota,134 U.S. 418, 458, 10 Sup. Ct. 462, 702; Smyth v. Ames, 169 U.S. 466, 18 Sup. Ct. 418; Reagan v.Farmers Loan Trust Co., 154 U.S. 362, 397,14 Sup. Ct. 1062; Prentis v. Atlantic Coast Line Co., 211 U.S. 210,29 Sup. Ct. 67.

The reasonableness of the rate is to be determined after viewing its effect upon the public as well as upon the company. The rate may, on the one hand, be so low as to be destructive of the property of the company, or it may be so high as to be an unjust exaction from the public; either intrinsically so, or because it is discriminatory. In either instance the rate is unreasonable. What the court does in passing upon this question is to decide after hearing had, in the course of a judicial proceeding, whether the rate complained of is so high or so low as to be unreasonable. No satisfactory definition of reasonable, as applied to rates, applicable to each case, can be made. Each must be decided upon its own facts and upon a consideration of many varying elements. A passenger rate upon a railway to be reasonable, must be just to the public as well as to the railway. It should be large enough to provide for the passenger reasonable service and for the railway a reasonable return. The rate may be made high enough to cover the cost of service, the carrying charges, a reasonable sum for depreciation, and a fair return upon the investment. Less than this will not give the railway a reasonable rate. The action of a utilities commission which reduces a rate below this point unduly deprives the owners of their property without just compensation. If a rate exceeds this point to an appreciable degree and the commission, upon proper application, declines to reduce it, the court would, in the absence of other controlling facts, reduce it to a reasonable point.

If a rate in one locality is largely in excess of rates in other localities similarly situated and subject to like conditions, it is an unreasonable rate, for this would instance a discrimination against one locality in favor of another, or other localities. A discriminating rate of this character would be an unreasonable rate, since, as a general principle, the service of a public utility should be equal to all patrons similarly circumstances. Baldwin American Railroad Law, p. 214, Chap. 25, § 6; 4 Elliott on Railroads, § 1467; Union Pacific Ry. Co. v.Goodridge, 149 U.S. 680, 690, 13 Sup. Ct. 970; WesternUnion Tel. Co. v. Call Pub. Co., 181 U.S. 92, 99,21 Sup. Ct. 561; Portland Railway, L. P. Co. v. OregonR. R. Commission, 229 U.S. 397, 411, 33 Sup. Ct. 820.

When we examine the finding before us, we see that there are no facts found from which it could have been inferred as matter of fact by the trial court, or must be inferred by us as matter of law, that the ten-cent rate between Atlantic Square and Noroton is exorbitant or excessive. We have not before us the cost of service between these points, nor the fair share of the carrying charges and of depreciation, or what would be a fair return for this distance. We are not given either the gross or net earnings, or the per car hour, or per car mile, earnings. Nor are the conditions found to be similar. All that the finding tells us is that the earnings are less on this system than on the defendant's other systems. This unrelated fact, by itself, does not help in ascertaining what, if any, profits there are from this rate, and whether they are excessive or exorbitant.

The petitioner does not stand upon the intrinsic unreasonableness of this rate, but upon the claim that this rate is a discriminatory one, and results, and has resulted, to the serious disadvantage of the people of the village of Noroton. It would seem, from the facts found, that an inference of fact may have been justified that Springdale had grown greatly, and Noroton had not, because of the one community having had a five-cent rate to Atlantic Square and the other not. But we cannot so conclude unless there is a specific finding of that fact. Many other considerations may have operated, or largely contributed, to this result. We may assume that a five-cent rate would benefit Noroton and its public, for this is a self-evident fact. But we do not know what its effect would be upon the returns to the railway. It may be held to be a principle of traffic that a reduction of rates increases the volume of business, but no principle which we are at liberty to regard, tells us in a given case what will be the extent of the increase, or what the effect upon the net returns.Chicago Grand Trunk Ry. Co. v. Wellman, 143 U.S. 339,346, 12 Sup. Ct. 400. In determining the reasonableness of a rate we cannot leave out of the consideration the effect of the change of rate upon the railway return any more than we can that upon the public.

The petitioner's case reduces itself to this: that the schedule of rates upon the Stamford division gives a materially longer ride for a single five-cent fare on some of the lines converging at Atlantic Square than it does on the Noroton line. In a similar situation the court say: "The question presented for consideration is not the reasonableness per se of the charge, but its reasonableness considered in relation to charges made by plaintiff at other localities on its system for like and contemporaneous service; . . . the discrimination, without an excuse recognized by the law, would be in and of itself unjust and unreasonable." Portland Railway,L. P. Co. v. Oregon R. R. Commission, 229 U.S. 397,411, 33 Sup. Ct. 820. The petitioner is accurate in his claim as to the lines to Springdale, Sound Beach and Shippan's Point, but as to the other three lines converging at the Square the single five-cent fare on the Noroton line gives the longer ride. And the distance covered by the single five-cent fare on the Noroton line is practically the average distance the single fare will carry a passenger on all the lines of the system converging at the Square.

The element of distance may be a controlling factor in a case of discrimination, but not invariably so. As a rule other factors are necessarily relevant before the conclusion of a discrimination in rates can be made. Facts which affect the question of traffic profit are factors to be considered. It may be that a divergence in rates between communities similarly conditioned would be discriminatory irrespective of the element of traffic profit. That situation we leave open until it presents itself. And the identity or similarity of conditions are also important factors in determining whether a rate is discriminatory.

The foundation of the petitioner's claim of a discrimination is that the defendant charges "Noroton passengers twice the fare that it charges to other passengers similarly circumstances." The finding does not support this. The judgment must be controlled by the finding; and upon that we cannot hold that there was any undue preference or advantage in the other rates, or that the trial court erred in concluding that the rate complained of was not unreasonable, for the facts found do not support, much less require, the conclusion that this rate is either exorbitant, excessive or discriminatory.

There is no error.

In this opinion the other judges concurred.