Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1913-06-10
STATES Vim VICTORY
\ RAIL RATE CASE.
CONTINUED from Page Two.)

neither the value Of the property en-
ployed nor the share Of expenses at
tributable to intrastate business had
been proven satisfactorily to show that
the railroads property was confiscated.
A similar conclusion was reached by
applying the principles to the Great
Northern railroad.
Coming to the Minneapolis & st.
Louis he found that the net return in
1908 to that road was less than 8 y per
cen, and that the errors CT estimating
value and of apportionment were not
sufficient TO change the result.
Momsntous Problem.
The so-called state rate cases have
presented to the supreme court one OF
the momentous problems of the decade.
In general terms. this group Of cases
called upon the courts to decide two
questions. One was whether the states
in passing maximum freight and 2-cent
passenger laws had unduly interfered
with interstate commerce. The other
was whether those laws confiscated the
property of the railroads by requiring
them to transact business at loss.
The group consisted Of forty five
cases. All arose out Of legislation en-
acted by state legislatures about 1907.
or just after the federal government
had passed the Hepburn rate law. The
forty-fi five cases concerned directly the
laws in six states. Missouri. Minnesota,
Kentucky, Oregon. Arkansas. and West
Virginia. Similar litigation arose in
Alabama, Iowa, Kansas Nebraska. Ok
lahoma and South Dakota. In all 1t
was said that seventy SIX suits In fed
eral courts depended upon the decision
in the forty-fiv cases before the su.
preme court.
Missouri Case the First.
The first of the forty-five cases to
reach the supreme court were the Mis-
souri, rate cases. In Missouri the eigh-
teen railroads crossing the state at
tackled. in separate suits. the validity of
state laws. fixing the maximum rate on
freight and limiting passenger fares TO
. cents a mile. Judge Mcpherson OF
the United States circuit court for
western Missouri. held the rates we're
confiscatory of the railroads property
and therefore unconstitutional, but he
declined TO hold that they interferec
with interstate commerce. Both the
railroads and the state appealed to the
supreme court, bringing in all thirty
six Missouri cases. Two cases grow.
ing out of "the Burlington suit were
presented TO the court in October. 1910.
bu, they were restored TO the docket
70: argument with the other Missouri
eases in April. 1912. The STATE pso-
tested that Judge Mcpherson should
not have apportioned expenses. as be-
tween state and interstate business on
a revenue basis, rather on q car-mile
or ,on-mile basis.
The Minnesota Casss.
The Minnesota rate cases arose out
OF suits by stockholders Of the North
ern Pacific. the Great Northern and
the Minneapolis & st. louis railroads
against the companies to en3oin them
from obeying the maximum freight and
2-cent passenger laws as unconstieu-
toinal and against the state officials
to enjoin them from enforcing the
laws. Judge Sanborn Of the United
States circuit court for Minnesota held
the laws Unconstitutional OF 4 conhs-
catory nature, and that they burdened
interstate commerce. The three suits
were appealed to the supreme court |
The contest over the interstate COM
merce feature Of the controversy was
similar 70 that in the Missouri cases.
In the Missouri cases, however. the
state and the railroads had agreed up
on the valuation Of the railroads. upon
which the percentage OF income from
rates was to be figured. No such agree
ment was reached in the Minnesota
cases and a bitter contest arose over
the holding of Judge Sanborn that the
fair valuation Of railroad property
was Its cost of reproduction new.
important to Iowa
The decision handed down by ehe SUI
preme court, thru Justice HusheA IN
the Minnesota rate case is highly i'm
portant TO the Iowa commission. Vafi-
Gus acts Of that commission would
have been destroyed as 20 their valid
ity II the sanborn decision had been
upheld. The effect Of the decision Is
to sustain the contentious OF the state
az to their Jurisdiction
over interstate rates. II is a blow q
tn. contentious Of the railroads WHOM
were seeking to eliminate the state
commissions as factors in rtae reguia-
ton.
There were two points involved tn
the Minnesota case. jurisdiction of the
Minnesota commission and whether
the Minnesota rates were confiscatory.
II is held the commission was not out
side its jurisdiction and that the rates.
except as to the Minneapolis ST
Louis. were not conflscatory.
rH~ord Tnorne of the Iowa com.