The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-07-16
COURT HOLDS P. sc.
CAN RAISE FARES
"Times When Police Power
Modifies Contract" the
Judges Rule.
MAY MEAN CITY BOOSTS
Agreements Here Would Not
Hold Under Broad Applica-
ton Of New Decision.
MAY MEAN CITY BOOSTS
spec,o, De.po,eh 10 The Sen.

ALBANY, July is. - Tho Court OF
Appeals decided to-day that the Public
Service Commission, Second district, was
within its powers in granting increased
trolley rates to the International Rail-
way Company OF Buffalo despite what
was known as the Milburn agreement
fixing the rate at cents.
In some quarters tonight the opinion
Of the Court OF Appeals was construed
as gres; victory for all the street rail-
way companies Of the State that have
been seeking Increased fares but have
been checked by local agreements or
franchises Chairman Hill OF the Public
Service Commission. however. refused
to comment on the opinion or It's effect
until he has had time to go over II fully.
One sentence OF the opinion reading !:
There are times when the police power
mobiles q contract in spite OF the inten-
ton OF thoee who have contracted" Is
unofficially understood to mean that no
matter what contracts stand In the way.
the Public Service Commission. under
power delegated by the Legislature, can
order Increased fares IL 1t determines
them to be necessary.
Under such a construction none of the
agreements in New York city limiting
the rate OF fare to cents would stand
In the way Of an order by Public Service
Commissioner Nixon granting s. or even
Z cent fares to the street surface. sub
way and elevated lines II he should de-
Would Extend Power.
II this broad construction is correct
there will be no need for passage by
the Legislature of a bill such as the
Carson Martin bill OF last year specifi-
cally granting to the Public Service
Commission the power and authority to
order increased trolley fares after an
investigation. 1t was consideration of
this measure which brought about the
sensational charges by Senator George
F. Thompson Of Niagara county that he
had been approached with bride offer
OF a $500, 900 campaign fund to let him
run for Governor II he would help put
the Increased trolley fare bill through
the Legislature.
It Is believed the Public Service Com
mission will have formal statement in
a day or two regarding the Court OF
Appeals decision. The opinion, written
by Judge Cardozo, was concurred in by
all the Judges and said in part:
Municipality and railroad. have Joined
in the declaration that the rate fxed by
their agreement shall not be final but
provisional. 1t Is to be subject in case
Of need to denomination and read1ust-
ment by the agents Of the State. The
need that was foreseen as possible has
arisen. In unfolding the Jurisdiction
of the commission to deal with IL we do
NOT override the conditions of the fran
chise. We heed and enforce them.
DAn A
There are times when the police
power modifies a contract In spite or the
intention OF those who have contracted.
Here its action Is in aid Of their inten-
tons. The covenant which limits rates
4. a condition Of the consent. but only an
equal measure with the covenant pre-
serving and defining the power OF
amendment. So far as the power OF the
commission is concerned the result Is
the same as II no condition had been i'm
posed at ALL"
The opinion holds that the Public Ser
vice Commission has the power to in
crease fares as well as reduce them,
saying;
The source OF the power to reduce
rates is the same as the source of the
power to Increase them. The Legislature
surely did not mean TO withdraw from
the commission the power to reduce. II
that is so It has not withdrawn the
power 10 Increase"
The Court of Appeals decision was
based upon the following question GER
tilted by tho attorneys: Has the Public
Service Commission jurisdiction and
power under the facts shown in this
proceeding to regulate the rate OF fire
to he charged by the respondent Unter-
national Railway Company for the
transportation OF passengers in the city
of Buffalo" The court holds that this
power must be upheld.