143 So.2d 75

#### GULF, COLORADO & SANTA FE RAILWAY COMPANY v. LOUISIANA PUBLIC SERVICE COMMISSION.

No. 45872.

Feb. 19, 1962.

On Rehearing June 29, 1962.

*291Jack P. F. Gremillion, Atty. Gen., Joseph H. Kavanaugh, Special Counsel, for defendant-appellant.

Porter & Scofield, Lake Charles, for plaintiff-appellee.

McCALEB, Justice.

This case involves the application of plaintiff railroad for permission to discontinue its agency station at Pitkin, Louisiana, a small rural community (less than 800 persons within a radius of 3 miles) in Vernon Parish. Gulf, Colorado & Santa Fe Railroad Company, a corporation chartered under the laws of Texas, does business, both interstate and intrastate, as a common carrier in Louisiana, its lines extending from points in Texas to Oakdale, Louisiana and for many years has operated freight agency stations at De Ridder (Beauregard Parish), Pitkin (Vernon Parish), and Elizabeth (Allen Parish). Pitkin is 23 miles north of De Ridder and Elizabeth is approximately 10 miles to the east. State Highways Nos. 10 and 113 run through Pitkin; both of these roads are asphalt paved, all purpose highways. However, there are no freight truck lines operating through Pitkin, which has only 10 business establishments, two groceries, two general mercantile stores, two cafes and four service stations. The principal freight shipped from the Pitkin agency station in carload lots (60 during a 12-month period) has been poles, pulpwood and logs and the freight shipments received in carload lots (9 during a 12-month period) have been feed, cement and limestone.

Alleging that, during a period extending from June, 1957 to May, 1958, it operated its station agency at a loss and that there was no public necessity for the continued operation of an agency at Pitkin, the railroad company applied on June 20, 1958 to the Public Service Commission for permission to discontinue operation of the station as such, suggesting that shippers and receivers of freight could be conveniently accommodated by its stations at either Elizabeth or De Ridder. This application was opposed by residents of Pitkin and the near vicinity. After a hearing, the Commission issued its Order No. 7598, denying the *293railroad’s request. A rehearing was applied for which was granted hut, after further consideration, the original order was affirmed.

Thereafter the railroad, asserting that the ruling of the Commission was without reasonable evidence to support it, being arbitrary and an abuse of discretionary power vested in that body, petitioned the Nineteenth Judicial District Court for the Parish of East Baton Rouge to annul the Commission’s order and declare that, in the future, it may operate its station at Pitkin as a non-agency station. In support of its claim of net operational losses, the railroad attached to its petition data showing that, over a period of 20 months extending from May, 1957 through December, 1958, it had sustained a loss totalling $8084. Since the period of operations reflected by the petition covered a longer operating period (20 months) than that presented to the Commission, the district judge, acting pursuant to R.S. 45:1194-1195, remanded the case to the Commission in order to afford it a review of the new evidence. However, a consideration of the railroad’s continuing losses did not alter the view of the Commission and, in reaffirming its holding, it stated that it found nothing in the new evidence to affect its previous decision that the public convenience and necessity required the service of an agent at the railroad station at Pitkin.

When the case was returned to the district court for review, the Commission’s orders were reversed and judgment was rendered permitting the closing of the agency station. In his written reasons, the judge indicated that, while he did not subscribe to the formula the railroad company employed in establishing a substantial loss in its operations at the Pitkin station, he felt bound by the well-settled jurisprudence of this Court that, in the absence of evidence challenging the accuracy of the railroad’s method of accounting, or unless some better system of accounting is presented, the Commission must accept the railroad’s formula for computing the revenue from and the cost of operating a station agency.1 See Missouri Pacific R. Co. v. Louisiana Pub. Service Comm., 238 La. 243, 115 So.2d 337; Louisiana & Ark. Ry. Co. v. Louisiana Pub. Service Comm., 240 La. 658, 124 So.2d 899; Illinois Central R. Co. v. Louisiana Public Service Comm., 240 La. 769, 125 So.2d 159; Illinois Central R. Co. v. Louisiana Public Service Comm., 241 La. 1, 127 So.2d 178 and Louisiana & Ark. Ry. Co. v. Louisiana *295Pub. Service Comm., 242 La. 67, 134 So.2d 551.

The Commission has appealed from the adverse ruling contending, in the main, that the judge erred in resting his decision entirely upon the loss experienced by the railroad under its formula and in failing to take into consideration, irrespective of such loss, the evidence which shows that the public convenience and necessity requires that the agency station at Pitkin be continued and maintained as such.

It is true that the reasons assigned by the judge for his decision are predicated on the railroad’s losses and he does not comment that he also took into account the public inconvenience which may ensue as a consequence of the closing of the agency. However, the converse is likewise true in respect of the views of the Commission— that is, the reasons assigned for its orders show that it attached no importance to and, indeed, placed no credence in the evidence adduced by the railroad relative to its continuing loss in the operation of the agency station. Our jurisprudence is that it is necessary to weigh one factor against the other. As stated in Texas & Pacific Ry. Co. v. Louisiana Pub. Service Comm., 240 La. 669, 672, 124 So.2d 902, 904:

> *“ * * **the test employed in determining whether or not a railroad may properly be entitled to discontinue an agency station, where an absolutely necessary service is not involved, is whether the public good derived from maintenance of the agency station outweighs the expense to the railroad in continuing such agency * * *

It was therefore incumbent on the Commission to weigh the losses suffered by the railroad against the inconvenience to the community of the discontinuance of the agency. This, the Commission failed to do and, consequently, the normal presumption of the correctness of its orders cannot apply here.

The question presented is what degree of inconvenience to the Pitkin community will attend the discontinuance of the agency and, is that degree sufficient to justify causing the railroad to continue to sustain a substantial loss by requiring it to maintain the agency.

The record convinces us that the public inconvenience involved is not great. The nearest agency to the Pitkin community is about ten miles away, in Elizabeth. Arrangements for shipping carload lots from Pitkin can be made by telephoning the agent in Elizabeth and the railroad will pay the cost of the call. Outgoing less than carload shipments can be turned over to the freight train conductor, who will sign the bill of lading and deliver it to the next agency for waybilling. Incoming carloads will be left on the siding at Pitkin and incoming less than carload lots will be off-loaded at the *297Pitkin station, it being suggested by the Tailroad that these goods be locked in the ■station freight room and the key left with ■some responsible person in the immediate vicinity. The only situation that would re■quire a trip to Elizabeth would be in connection with receiving a C.O.D. shipment. Although some inconvenience might be involved in these arrangements, such inconvenience is not of sufficient degree to justify requiring the railroad to maintain an agency when it could only do so at a substantial monetary loss.

The Commission’s Order No. 8478 (the last order) attached significance to the fact that the closing of the Pitkin agency would leave 34 miles of the line (between De Ridder and Elizabeth) without an agency. This ignores the fact that there are now .almost 25 miles (between De Ridder and Pitkin) without an agency and the closing *of the Pitkin agency would merely be the •closing of an agency where there is another .agency within 10 miles (Elizabeth).

The facts of the instant matter are not 'intrinsically different from those in Louisiana & Ark. Ry. Co. v. Louisiana Pub. Service Comm., 242 La. 67, 134 So.2d 551; Texas & N. O. R. R. Co. v. Louisiana Pub. Service Comm., 241 La. 635, 130 So.2d 398; Illinois Central R. Co. v. Louisiana Public Service Comm., 241 La. 1, 127 So.2d 178; Illinois Central R. Co. v. Louisiana Public Service Comm., 240 La. 769, 125 So.2d 159; Louisiana & Ark. Ry. Co. v. Louisiana Pub. Service Comm., 240 La. 658, 124 So.2d 899; Texas & Pacific Ry. Co. v. Louisiana Pub. Service Comm., 240 La. 669, 124 So.2d 902 and' Missouri Pacific R. Co. v. Louisiana Pub. Service Comm., 238 La. 243, 115 So.2d 337. All of these cases involved applications to close unprofitable agencies where the nearest neighboring agency was from four to ten miles distant. In each the railroad established precisely the same facts plaintiff has shown here, i. e., that the agency was operated at a loss and the people who used the agency could transact their business with a nearby agent, usually by telephone, the greatest ensuing inconvenience being that a few people would be required to go a few miles further to reach an agency station.

The judgment is affirmed.

FOURNET, C. J., absent.

PIAMITER, J., dissents.

1

. The railroad’s formula attributes to each agency only 50% of the revenues from • the freight it handles and applies against it, not only the expense of operating the • agency but also a certain portion of the systemwide operating costs. For a more complete explanation of this method, se,e Missouri Pacific R. Co. v. Louisiana Public Service Comm., 238 La. 243, 115 So.2d 337.

HAMITER, Justice

(dissenting).

After studying the evidence adduced in this cause I am convinced that the public good derived from maintenance of the agency station at Pitkin outweighs the expense to plaintiff in continuing it. Therefore, my opinion is that the order of the Louisiana Public Service Commission, which denied the closing application, should not be annulled.

I respectfully dissent.

*299ON REHEARING

SANDERS, Justice.

On application of the Louisiana Public Service Commission, we granted a rehearing in this proceeding to reconsider our judgment affirming the judgment of the district court which set aside the order of the Commission and authorized the discontinuance of the agency station at Pitkin, Louisiana operated by the plaintiff railroad.

On the original hearing, we found that the station was being operated at a substantial loss and that the public inconvenience involved in the discontinuance was not great.

On rehearing two contentions advanced by the Louisiana Public Service Commission have given us much concern. The Commission contends that the court failed to give sufficient consideration to the service rendered by the station to the area surrounding Pitkin. It also contends that Fort Polk, an army training center located between Pitkin and Leesville, has been reactivated and that the case should be remanded fo.r the reception of further evidence (which it proposes to offer) as to the revenues of and need for the agency station because of the change of conditions occasioned by- this development.

Pitkin is a rural community in the southeastern portion of Vernoh Parish. The descriptive exhibit filed by the plaintiff before the Commission shows that it contains-ten business establishments and has a population of 800 within a three mile radius.. However, the record also reflects that the-station serves a substantially larger surrounding area in Vernon, Rapides, Beauregard, and Allen Parishes. The service area embraces the communities of Cravens,. Fullerton, Foote, and Sugartown. It contains an estimated population of 2500. The record does not reflect with sufficient, clarity the extent that the public convenience and necessity of these environs, will be adversely affected by the discontinuance.

In the hearings before the Commission,, a small profit for the test period was reflected by plaintiff’s exhibits and conceded' by its superintendent, who appeared as a witness. On the original hearing, the station showed a profit of $213.45 for the-twelve month test period from June, 1957, through May, 1958, upon crediting to the-station only one-half of its revenue. On rehearing before the Commission, a profit of approximately $250 was shown for the fourteen month period from May, 1957, through June, 1958.

In the district court, the plaintiff adopted' an accounting period of twenty months from May, 1957, through December, 1958, and filed supporting exhibits reflecting a loss 'of $8,084 for the period. An exam*301ination of the exhibits shows no drastic 'decline in the business of the station for .the final six months of 1958. It is clear, therefore, that the loss asserted resulted from a change in the accounting procedures used in the hearings before the Commission.

The possibility of the reopening of Fort Polk was adverted to in the testimony of record. It was conceded on rehearing that this training center has been reactivated. 'The effect of this development on the ■economy of the service area and the business of the station is a matter of proof.

Article 2164 LSA-C.C.P. provides in part:

> “The appellate court shall render any judgment which is just, legal, and proper upon the record on appeal.”

In Missouri Pacific R. Co. v. Louisiana Public Service Comm., 241 La. 242, 128 So.2d 644, we said in reference to this article :

> “This salutary codal authority grants to this Court the prerogative of remanding a case on its own motion when the interest of justice requires it.”

We recognize that this case has been pending for an extended period. However, we find that the circumstances of the case warrant the exercise of this discretion to remand. The remand will afford an opportunity for the production of all available evidence relevant to the issues. We deem this to be in the interest of justice.

For the reasons assigned, the judgment of the district court is reversed, and the case is remanded to the Louisiana Public Service Commission for further proceedings according to law and consistent with the views herein expressed. All costs are to await the final disposition of the case.

McCALEB, J., dissents with written reasons.

HAMLIN, J., dissents, adhering to the views expressed in original opinion.

McCALEB, Justice

(dissenting).

I, of course, recognize the inherent .right of this Court to remand a case for the taking of further evidence when it appears that new or otherwise available evidence relevant to the issues can be produced and that, if such evidence is produced, there is a strong likelihood that the Court would render a different judgment.

However, this is not such a case. There has been no showing of any substantial nature, on rehearing or at any other time, that evidence could be produced before the Public Service Commission which would justify either the district court or this Court in concluding that the public good to be derived from the maintenance of the agency station at Pitkin outweighs .the ex*303pense to the railroad in continuing such agency.

This is one of the many run-of-the-mill railroad station-agency cases brought to this Court during the past few years on the complaint of the railroad applicants of their inability to obtain fair rulings from the Public Service Commission which has steadfastly denied applications to close unprofitable station agencies, despite the fact that, according to the .railroads’ system of accounting (which the Commission refuses to recognize but has never offered any evidence to show that the system is incorrect), the losses from operations have far outweighed whatever inconvenience the communities would sustain as the result of the discontinuance of the agency.

In its application for a rehearing (no brief was submitted by the Commission on the rehearing) the Commission requested, among other things, a remand simply stating that such relief should be granted so that it could “ * * * consider evidence as to the effect of the reopening of Fort Polk on the income and expense and need and necessity of the agency station at Pit-kin * * * ”. In acceding to this request, the majority opinion on rehearing predicates its ruling on two considerations —(1) that the record does not reflect with sufficient clarity the extent to which the people in the area surrounding Pitkin will be inconvenienced as a result of the discontinuance and (2) that, since Fort Polk has-been reactivated, its effect on the economy of the area served by the agency station, should be explored.

These reasons overlook, in my view, the-fundamental issue in the case—which is— whether, under the evidence heard by the-Commission- (there is no showing here, by-affidavit or otherwise, that all the available evidence touching on the issue presented was not produced), the Commission, abused its discretion in not granting the-railroad the relief sought. Once it has. been held by the courts that the Commission’s denial of the railroad’s application, was arbitrary, it just does not do to rule-that the case should be remanded so that, the Commission may hear additional evidence on the possibility that such evidence may be sufficient to change the scales and. justify the Commission in denying the application.

Adverting, now, to the majority’s first-reason for the remand, i. e., that the station, serves several communities in Vernon,. Rapides, Beauregard and Allen Parishes,, and the record does not reflect the adverse-effect on these communities as a result of the closing of the agency, I think it sufficient to say that these communities, as the-record already reveals, do not use the-agency to such an extent that any substantial degree of inconvenience will result *305from the closing of the agency. Indeed, if slight inconvenience ensues, it canaot be justifiably said that it outweighs the rail- ■ road’s loss of over $8,000 during a 20-month period in its operations.

So far as concerns the remand of the -case for the purpose of ascertaining whether the reactivation of Fort Polk has ■rendered necessary the continuance of the ¡station agency in the cause of public con■venience, I fail to see any sound basis for ■the ruling. First of all, the request for a ■remand is founded entirely on the unsupported statement of the Commission’s counsel that evidence should be heard on the effect the reopening of Fort Polk has had on •the railroad’s income and expenses and on ■the public necessity for the continuance of the agency. No facts or figures are produced, either by affidavit or even mere allegations, which exhibit that, since Fort Polk has been reactivated, the business of •the station agency has increased or even that the station’s facilities have been used by military personnel for the shipment or receipt of freight.

In the absence of some concrete showing that specific evidence can be produced which will require a different result from that reached on first hearing, a remand is unwarranted in my opinion. This case has been before the Commission on three occasions since July of 1958 and before the courts since February, 1959. During the

hearings, the opponents of the railroad had full opportunity to produce all available proof. It is high time that the case be brought to an end.

I respectfully dissent.