The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1919-06-02
THE RAIL DECISION

freight and passenger rate increases
made last June were today upheld by
the United States supreme court
North Dakota supreme court DEGREES
enjoining the Northern Pacific rail-
way and Director General Hines from
enforcing an order of the railway ad'
ministration increasing rates in that
state wee reversed.
The court held that the authority
conferred by the resolution and act
were war powers conferred on the
pesident, and that the power of the
federal government was supreme and
conclusive"
The opinion was unanimous.
Two Billion Involved.
Upon the decision of the supreme
court today depended the authority OF
the federal railroad administration to
continue the collection of increased
freight and passenger intrastate rates
as provided in orders issued by Wil-
liam G, McAdoo when director genera
and placed in, effect in June, 1918. Tn
der these orders, a prec1pitate IN
crease Of twenty-five per cent was
made in freight rates while a general
increase in passenger fares to a three
cents mile basis was authorized. Re
ceipts from intrastate business OF the
carriers, railroad administration Off
Gals said, represent between 35 and
40 pc cent OF the total operating in
come of the lines under government
control of about O0,000,O00.
The decision resulted from appeals
brought by the government from North
Dakota supreme court DEGREES enjoln'
ing the Northern Pacific railroad in
that state as we'll as Director General
Hines from collecting the increased
rates. The proceedings were origin
ally instituted by North Dakota auth
critics, who cohtended the rates were
illegal and made without the approval
Of the state board Of railway com
missioners as required by he laws OF
that state and for that reason the fed
eral governments action was an in
reference with the state police pow
ers. l3 il
No Authority, Contention.
State officials further contended
that neither the joint resolution nor
the railroad control act under which
the government took over control and
or,eaSed stho rail systems OF the co'ln-
try authorized the president to initiate
intrastate rates; that the rates were
established upon misconstructlon OF
the powers delegated to the chief ex-
ecutive and that they were unreason-
able. s 9jy };5- s
A general denial Of these conten-
tions was made by the government
which insisted that the acts under
which the government took over the
operation Of the roads were war meas
ures and that section ten Of the rail-
road control act clearly, gave the pes
ident power to initiate all rates.
North Dakota Decision.
By three to two decision, the
state supreme court held that author
ity was not conferred upon the pres1-
dent to initiate intrastate rates super.
seding pre-existing rates prescribed
by the states authority. The court
also held that by exempting from con
tral of tho president the state police
regulations congress intended for
the states to retain power to make
rates. An order calling upon the
Northern Pacific to stop charging
rates procided in the federal order
was entered by the court. t.H stes
While this case affected directly
only North Dakota. similar proceed,
ings have been Instituted in South
Dakota. Nebraska, Iowa, Minnesota
and washington and upon this courts
decision depends the outcome Of these
cases. other suits of a like nature
have been threatened in a number OF
other states according to government
officials but pending final determina'
tion of these proceedings which were
designed by the government to De a
test case, state officials decided to
withhold prosecution Of those cases
temporarily.
Arguments in this case were heard
on May 5 in the supreme court the
court having previously agreed to ex-
pedite consideration owing to the I'm
nortance of the questions involved and
the serious effect such litigation
might have upon the revenues derived
by the government from the operation
Of the railroads.