The San Francisco call., 1896-05-07
Counsel for the Railroad Says tht
Validity of Its Leases Cannot Be
Attacked Collaterally.

was as 10llOWS:
'The commission had no authority TO
inquire into the validity of these cases.
The constitution says that the said Com
missloners shall have the power and
authority to establish rates for the trans
portation OF passengers and freight by
any railroad and transportation company.
According to the construction OF the con-
stltution given by the Supreme Court of
the State of California the commission
was held to be partly judicial, and this
construction maintain must be taken by
this court as final. The Supreme Court of
this State has decided the organic law of
this State to say that by fixing rates is
meant liking just and reasonable rates.
"Those constructions of the constitution
OF California are binding on this court.
The answer given to this contention is
that those constructions did not refer to
this identical provision. 1t Is the declara-
ton of principle in relation to a pro-
vision between which and the one under
consideration | maintain the most acute
metaphysics cannot draw material diff
ference. Doesn't it follow necessarily that
when the same point arises in regard to
railroad commission it will receive ex-
actly the same decision? The Supreme
Court OF California was justified in saying
and was compelled 10 say that these
bodies were judicial bodies. Then take
1t as clear question that the Railroad
Commission must decide the question be-
fore them on its merits.
SIS 1t true or is it not that in fixing the
rates to be followed by any railroad COM
pany they must consider the validity of
these leases and their title to the property
which they heldP Can you believe that
the constitution intended that when a rail-
way commission wished to determine
rate it must go into these nice questions of
ultra wires, public policy and other mat
ters have been arguing? They had to do
with some one who was actually running
road. They are simply to determine
what Is fair and reasonable rate between
the parties running the road and the pub
lie with which they are dealing. 1t was
not the intention to give to this commits
sion the right to decide this question of
title. They couldn't decide it. They have
no machinery with which to pass upon
such question. If the railroad commission
can't decide anything in regard to the va
lidity of this lease how can this court on
an appeal by that body go further and de-
eide this question?
The Commissioners have to exercise an
honest and reasonable judgment, and they
must fix a reasonable rate. How are they
to fix a reasonable rate? They can't go
into the question of title. What is the
test? Isn't it the effect of that rate on the
whole extent and earnings OF the whole
road? They must make it reasonable with
respect to that piece OF property which
they are operating. 1t may be that the
Legislature of the State of California can
make some legislation by which some kind
of action in rem could be maintained
against certain road. But we are here to
consider what has been done, not what
might have been done. The power of the
State has been put into effect only to the
extent that somebody who is running the
road is to be regulated, not somebody who
ought to be running it.
ut was not the intention to give to this
commission not only the enormous power
of regulating the rates of all railroad
companies operating within their limits,
and also the multifarious duties of regulat-
ing these corporations in every regard.
The other departments of the State are
ample for this. These through proper
judicial channels by the wisdom of ages
have been always found sufficient.
II say the commission had nothing to
do with the lesser companies. They found
the Southern Pacific Company in charge
OF a certain line and they called them be-
fore them and regulated their rates.
They did not attempt to regulate any
other company. How could they regulate
the charges of a company which bas no
road and isn't making any charges2 The
thing is absurd.
1.-The intention in forming this comm is
sion was not to furnish a substitute for
mandamus and other well-known proceed
ings. 1t was not calculated that they
should listen to lawyers talk learnedly Of
ultra wires and public policy. They were
to be plain business men and citizens
called together to decide on a business
proposition.
THE commission, as previous commits
slons have done, acts upon the Southern
Pacific Company and upon no other.
How is this company going to comply
with the mandate nf this Hoard of Conn
mlssioners? The rate as now fixed is un-
constitutional if it deals with the roads as
system. When they regulate the system
as system how can you say that you are
going to support it on a principle recogniz-
ing the system not as a system but as in
dIv1dual constituent roads2
THE Southern Pacific says this action
Is conhscatory. The States position is
like that of a trespasser who destroys
property without any warrant OF law. You
propose to impose upon US penalties that
VIII destroy the company and plunge it
into bankruptcy. Do we become outlaws
because ten years after the event some
one discovers a new point that the State
has never insisted upon to take away our
property The rules of equity don't go
that far. They protect the apparent pos
SCISSOR. They do not regard the apparent
Claims OF third parties. A court of
equity as much as court of law will pro-
tect the rights of parties.
1.-The Commissioners cannot go beyond
the letter and the warrant of their author
lty. ALI that has been given them is the
power to control the company in possess
sion. They don't go into the question as to
whether the company ought to have the
road, but whether, having the road, it is
charging extortionate prices. The consti-
tuition and the statutes say, in so many
words, that you may regulate the charges
OF the company. Unless there is relief In a
court of equity the penalties must be paid
and the results must ensue. This company
certainly has right to complain if the
regulation is unlawful. Why will you
deny them relief? On the ground that this
is an unlawful systeml That they have
not good title to their property? If this
system is invalid how can the commission
regulate it as system? This regulation
presupposes and must stand or fall with