The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1909-03-11

Kansas City, Mo, March 10-A not
able decision IN favor of the railroads
was handed down today by Judge Nc
Pherson, of the United tates district
court. in the two-cent fare and maxi
mum freight rate cases, involving Is
Missouri lines The railroads contend-
ed that the rates fixed by the statutes
of the state We're not remunerative, but
confiscatory, and that the enforcement
of the statutes be enioined. The state
brought proceedings 10 have them en-
forced.
The question:" said Judge McPher-
son. in his decision, "is whether the
traffic wholly within the state of Mis-
souri, generally referred to in the evil
dence as local traffic, can be carried
under the freight rate statute of 1907
and the passenger fare statute of 1907
at suck. profit as will give a reasonable
return after paying expenses upon the
investment, or whether such traffic is
carried al a loss Or less than such rea-
sonable profit. = h court has
reached the conclusion that. upon this
question, h statutory rates fixed by
either and both statutes are not re-
munerative.
import of Decision.
After the decision had been handed
down the views OF attorneys on both
sides OF the controversy sought as to
what the immediate effect the opinion
would have. While several railway at
torneys intimated Individual railroads
would go tnck to the 3-cent passenger
rate, none was able to state specifically
this would be done, or If done, when
action will be taken.
Frank Hagerman made the following
statement for various railroads.:
The maximum freight laws have
never beer enforced because temporary
injunctions We're granted when they be-
came effective. Therefore the situa-
ton regarding them will in the future
| no Tho 90 {, tho r~c< ,r ~,
fare law has, however, been enforced.
From the decision OF the court the
state may appeal to the supreme cour
OF the United States. Pending that APP
peal the railroads will not be bound by
the law, and may at any time adopt
and put in force the old rate by pub
: fishing the new schedules as required
by law.
The 2-cent rate is subject pending
litigation In Minnesota, South Dakota
ceivable that a rate c~onfiscatory in
Missouri can be compensatory in any
OF such states. What. If anything, will
be done in other states has not beer
determined. In view OF thorough in
vestigations n decisions in Pennsyl-
vania and Missouri cases, it is doubtful
whether Any state will longer attempt
to keep in force the 2-cent fare law.
MePherson's Reasons.
In giving n reasons for such con.
illusions, h decision says: 1.-The un.
questioned and ~undoubted rule is tina
and of law, in favor of the validity o
every legislative enactment. The rail
way companies have the burden of re,
moving h presumption. nj showing
that the statute clearly. as some court
say, palpably, and others say. beyond
a reasonable doubt, that the statute il
invalid. In these cases the court ha
recognized this rule. The authoritie
upon this question form a long and un
broken line. with the single exception
vania case, decided a yea ago. Cos
Att. Rep. SIC. And that one author
tty is no persuasive.
"All testimony and argument bearing
upon the question as to what consider
alton the legislature IF Missouri CAV,
tertal. Much was said in argument a
to the message Of Governor Hughes, o
New York. two years ago in declining
to approve the 2-cent fare statute o
moral courage to veto a measure O
popular favor because. as he believed
the question had not been fully con
sidered. But h relations of a COVER
nor to proposed legislation. and thos
Of a court to legislation contaminated
are entirely different.
Most OF the laymen and many law
yers believe that h question is wheth
er the railway company as q system l
earning sufficient revenue upon tn
value of the property OF the system
They believe that II the Burlington
Santa Fe. Wabash. or any other rail
road system is earning such money q
will pay all charges and expenses, in
Guiding taxes and interest. with reason
able dividends to h stockholders, tha
state rates for state business mus
stand OF course no one believes thl
who has given the slightest ~attentio
to h question. That precise questio
was before, and was decided by, Jus
tice Brewer. and affirmed by the gu
preme court in the Nebraska case {
smyth vs.. Ames. The only question
as to Missouri rates. less expense
IL this balance does not leave suff
cient to pay q reasonable return, tt
law is invalid. And If the railroad sys
tenn of any company is earning MOI
than a reasonable return by reason
Interstate rates, which affect the pee
pie many times moro than local rate
and If such interstate rates are tc
high. congress-, either acting alone {
through q commission, must make tt
correction.
The supreme court, during the pre-!
ent year. in the case of City OF Ne
York VS.. Consolidated Gas company,
New York, decided that 6 per cent w;
fair and right to be given to the OWL
ers upon the true valuation. My opil
!, N WOULD
PLEAD GUILTY TO