New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-06-10

innate what would be the actual cost OF
acquiring the right Of way. if the railroad
were not there. is 10 indulge in mere
speculation" said the justice. THE cost
Of reproduction method IS OF service In
asceriaining the present value Of the
plant, when ii is reasonably applied. and
when the cost Of reproducing the prop
erty may be ascertained with a proper
degree Of certainty. But it does not Jus
ufy the acceptance Of results which de-
pend upon mere conjecture"
Justice Hughes said that the railroad
would have no ground to complain II It
were allowed a value for its lands equal
10 the fair average market value OF SINH
lar lands in the vicinity. without additions
by the use Of mulupliers or otherwise 10
cover hypothetical OUTLAWS.
In criticising the apportionment OF
valuation between interstate and intra-
state business on the gross revenue
basis" Justice Hughes said that the d.
vision should be made according TO the
use that IS made Of the property. lie de-
clared that this use could not be meas
ured bv the return. when the return itself
was in question.
IF the return be taken as the basis
said he, then the validity OF the state s
reduction Of rates would have to be tested
by the very rates which the state de-
nounced AS exorbitsnt' He added that IL
would not be impossible to ascertain some
kind OF use units by which the property
could he divided both between interstate
and intrastate business on the one hand
and between passenger and freight bust
ness on the other. lie did not point out
what ;his unit" would be.
Apportionment of Expenses.
The justice next considered the lower
courts plan of apportioninG expenses on
the basis that it cost two and hail
times as much TO do intrastate freight
business as it did to do interstate, as well
as a larger amount 10 do interstate pas
senger business than 10 do interstate.
He said that the expenses had not been
kent separately In the accounts or sta
tistics of the company, that testimony as
10 the difference In expenses varied WIDE
Is. and that the intricate question OF
whether the rates were conhscatory could
not be decided on proof Of such genera
character.
Applying these principles 10 the North
ern Pacific the justice held that neither
the value OF the property employed nor
the share OF expenses attributable 70 IN
trastate business had been proved salts
factorily 10 show that the railroad
property was confiscated similar con-
clusion was reached BY applying the
principles to the Great Northern Railroad.
Coming to the Minneapolis -.
Louis Justice Hughes found that the net
return in 1908 20 that road was less than
3ia per cent and that the errors OF esti-
mating value and of apportionment were
not sufficient to change the result
To-days decision regarded as one OF
the most important ever announced by
the court. had been under consideration
for fourteen months. Railroad commits
sions from eight states and the Gov
ernors Of all the states filed briefs IN
support Of the state in the cases. recog-
nizing that the principles involved affect
ed them all.
Rate cases from Missour! Arkansas.
Oregon Kentucky and West Virginia
were not decided to-day, but the points
announced in the Minnesota cases are re-
garded as governing them generally.
These cases probably will be disposed OF
tomorrow, when the court will hold an
other session as it will also do on Mon
day. June l6. tho final day OF adjourn
ment for the term.