Evening journal., 1918-07-03
CourF Decides Utilities Board
7-Cenf Car Fare Order Is LeqaI


Upon the second ground urged against
the act OF the board. the court were
by no means free from doubt, and our
difficulty was much increased because
Of the fact that there is a decision in
our own Stale by the Court OF Errors
and Appeals that seemed to be against
The decided preponderance Of authority
in other States.
\ Undoubtedly the Important, indeed.
the vital question In the present case
Is this Was the statutory provision
which fixed the maximum fare that the
railway companies should charge. at
i've cents a contract or a mere reQI-
lation or condition. subject 10 the 20
lice power Of the Slater In most Siales.
and notably In New Jersey. every
doubt In such controversies is resolv-
ed In favor Of the police power, and a
stipulation respecting the rate Of fare
10 be charged by a railway company.
IN a statute or. municipal ordinance, Is
held TO be, wherever possible. a condi-
tion or regulation, and not a contract
binding upon the State BUT the au-
thorities practically agree that 10 Is pos
sible for the State 10 make such a con-
tract sand whenever the language clear
ly and unmstakably shows that such
was the intention OF the Legislature. it
/ Is binding, and cannot be changed ex-
oept by the consent Of the contracting
parties.
In no case, perhaps, has the law
upon the subject been more clearly
and succinctly stated than in Mnwau-
kee ys. r. r. Commission OF Wiscon-
sin, 23s u. s. IA. Mr.. Justice Day. in
delivering the opinion OF the court
said The fixing OF rates which may
be charged by public service corpora
tions, OF the character here involved. IS
legislative function Of the state. and
while the right 30 make contracts
which shall prevent the State during
given period from exercising this i'm
portant power has been recognized and
approved by judicial decisions. II has
been uniformly held In this court that /
the renunciatlon OF a sovereign right 1
OF this character must be evidenced by |
terms so clear and unequvocal as to .
permit OF no doubt as to their proper
construction"
To the same effect Is the case OF
Home Telephone Company vs.. Los An
geles, 2ii u. s. PCS, 273 wherein the
court said: For the very reason that
such a contract has the effect OF extin-
gushing pro tanto an undOubted power
OF government. both its existence and |,
the authority to make It must clearly
and unmistakably appear, and all doubts
must be resolved In favor OF the con
tinuance OF the power"
Undoubtedly the reason for the law
as now recognized and declared by the
courts is 10 some extent the growth and
development Of the police power Of the
State. The importance and necessity
OF such power Is better understood now
than formerly, and many acts are now
regarded as within It's scope, which
were not 80 considered in former
years.
The Delaware case OF p, W. & B. r.
r. Co. vs.. Bowers, 3 Houst. SOC (53i /
was decided In 1873. In that case Chan
'oellor Bates said: The power 10 ad-
just its tariff OF charges by its own
officers, according TO their views Of
the necessities Of business and Of JUS
tice 10 the public. without supervision,
was a part OF the franchise as 10 was
granted. The attempted regulation by
the Legislature OF this power. mate !
rally abridges the beneficial exercises
Of ii by the corporation, and, without a
my doubt lmpsirs the obligation Of the
contract in the sense Of the constitu- v
lion as interpreted by the Dartmouth O
College case" C
10 Is also true that since the decision 7
" Chancellor Bates the police power Of p
he State has been very much extended a
W statute and judicial decision, but b
uch doctrine was urged by counsel 6,
nd considered by the court in that 81
sse. and il was distinctly held that the V
ower of the company TO adjust its O.
arin by its own officers according TO p
he necessities Of business and justice q,
o the public, was a contract the obli- c
alton OF which the Legislature could n
lot IMPAIR" and not a regulation that n
vas subject 20 the police power OF the p
itale. This was a decision by the high
st court Of the State and cannot be h
lightly considered or disregarded be G
.ause OF changed conditions. 10 would p
ieem 10 dispose OF the question so fully II
lrgued by counsel In the present case r.
whether the power given by the Leg p
stature TO a public utility company TO I,
,nargo certain rates is contract or a
mere regulation. a
We say very frankly that the Bowers r.
ease Will not be disrcgarded by this u
court unless the present case can be 8
distinguished therefrom. "A
It clearly appears from the authOri- O
.ios that the fixing OF rates to be q
,harged by public service corpora b
lions Is a governmental function, and
hat II can be conferred by The Legis- a
0ture on a state agency such as a mu- S
licipality or Public Utility Commission: c.
hat when the rate has been fixed by h
statute, It cannot be changed by one "
iarty. without the consent Of the other b
+ the grant Of the right clearly and q
constitute a contract be e
ween the parties; II II was not a c6n-
roct but a more regulation prohlbi
ion, or condition Of franchise, the
state may. under its police power, i
which is an attribute Of sovereignty. l
egulate or alter the rate that had been
.Xed by statute, municipal ordinance
II commissions order
Applying to the present case the
est contained in the opinion Of Justice
Day above quoted was the fixing by
tatute OF a maximum rate Of five cents a.,
renunciation Of the sovereign right In
D fix rates evidenced by terms so clear
nd unequivocal as to permit of no ol
oubt as TO their proper construction i,,
Vas il clearly contract between the -,
tate and the companies, or merely the ~,
onditiOn OF power or franchise ~
ranted? When the legislature said the M M
0mpanies should not charge a rate ~