Source: https://www.law.cornell.edu/supremecourt/text/300/154
Timestamp: 2018-09-22 12:59:58
Document Index: 202785047

Matched Legal Cases: ['art. 72', '§ 69', 'art. 1', '§ 10', '§ 1420', '§ 1519', '§ 374', '§ 19']

GREAT NORTHERN RY. CO. v. STATE OF WASHINGTON. | US Law | LII / Legal Information Institute
300 U.S. 154 (57 S.Ct. 397, 81 L.Ed. 573)
GREAT NORTHERN RY. CO. v. STATE OF WASHINGTON.*
Argued: Dec. 7, 8, 1936.
This is an appeal from a judgment of the Supreme Court of Washington 1 in an action brought by the appellant to recover fees for the years 19291933 paid under protest to the State Department of Public Works. The relevant statutory provisions are: 2
The complaint 4 alleges that the Department of Public Works exercises jurisdiction and supervision over sundry public utilities, including common carriers by rail, electric, and street railways, gas, electrical and water companies, telegraph and telephone companies, wharfingers, warehousemen, and carriers by water, engages in many activities disconnected from, and unrelated to, the inspection and supervision of rail carriers, and has a variety of duties in the enforcement of the State's police power. The complaint affirms that the fee is not based upon or restricted to the cost of legitimate regulation or supervision but is used to defray the costs of other activities in connection with railroads and also of supervising and inspecting unrelated public utilities and of performing other duties the expense of which cannot legitimately be imposed upon carriers by rail; that the fee is grossly in excess of the reasonable cost of inspection and regulation of railroads; that, to January 1, 1933, there had accumulated from the fees collected more than $250,000 in excess of the amount expended by the department in the discharge of all its duties; that the statute is in truth a revenue measure; that the State taxes plaintiff's property and other like property on an ad valorem basis. The complaint charges that the fee is a burden on, and a regulation of, interstate commerce in violation of article 1, section 8 of the Constitution; is so arbitrary, excessive, discriminatory, and unequal as to deny the plaintiff equal protection of the laws and to deprive it of property without due process of law, in violation of the Fourteenth Amendment.
The principles governing decision have repeatedly been announced and were not questioned below. In the exercise of its police power the state may provide for the supervision and regulation of public utilities, such as rail roads; may delegate the duty to an officer or commission; and may exact the reasonable cost of such supervision and regulation from the utilities concerned and allocate the exaction amongst the members of the affected class without violating the rule of equality imposed by the Fourteenth Amendment. 5 The supervision and regulation of the local structures and activities of a corporation engaged in interstate commerce, and the imposition of the reasonable expense thereof upon such corporation, is not a burden upon, or regulation of, interstate commerce in violation of the commerce clause of the Constitution. 6 A law exhibiting the intent to impose a compensatory fee for such a legitimate purpose is prima facie reasonable. 7 If the exaction be so unreasonable and disproportionate to the service as to impugn the good faith of the law 8 it cannot stand either under the commerce clause or the Fourteenth Amendment. 9 The State is not bound to adjust the charge after the fact, but may, in anticipation, fix what the legislature deems to be a fair fee for the expected service, the presumption being that if, in practice, the sum charged appears inordinate the legislative body will reduce it in the light of experience. 10 Such a statute may, in spite of the presumption of validity, show on its face that some part of the exaction is to be used for a purpose other than the legitimate one of supervision and regulation and may, for that reason, be void. 11 And a statute fair upon its face may be shown to be void and unenforceable on account of its actual operation. 12 If the exaction be clearly excessive it is bad in toto and the state cannot collect any part of it. 13
In that case it appeared that the plaintiffs were packers of oysters taken from the waters of Maryland, Virginia, and New Jersey, and shipped to Baltimore. A statute of Maryland required that the oysters be inspected at Baltimore (Code Pub.Gen.Laws Md.1904, art. 72, § 69, as amended by Laws 1910, c. 413, p. 208). It imposed a charge of one cent a bushel 'to help defray the expenses of such inspection and the other expenses of the State Fishery Force, upon all oysters unloaded from vessels at the place where said oysters are to be no further shipped in bulk in vessels.' The plaintiffs refused to pay the exaction and, upon threat of enforcement, filed a bill in a state court for injunction alleging the fee was excessive, a burden on interstate commerce, and a violation of the constitutional provision that 'No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws.' (Const. art. 1, § 10) The Maryland Court of Appeals (117 Md. 335, 82 A. 380) affirmed a decree dismissing the bill and this court reversed its decision. The plaintiff asserted that as the act laid the fee for the expense of inspection, 'and other expenses,' it was obvious that the state had provided for the collection of more than was necessary for inspection. To this the state answered that the section levying the fee was but a part of an elaborate system of inspection imposed upon the state fishery force. It appeared from the evidence, as it does here, that the fishery force had duties other than those of inspection which were to be paid for out of the fund produced by the fees. This court said (232 U.S. 494, at page 503, 34 S.Ct. 377, 378, 58 L.Ed. 698): 'But while the two duties may sometimes overlap, there is a difference between policing and inspection, and if the state imposes upon one set of officers the performance of the two duties, and pays the whole or a part of the joint expenses out of inspection fees, it must be made to appear that such tax does not materially exceed the cost of inspection,the burden in such cases being on those seeking to collect the combined charge.' And said further (232 U.S. 494, at page 506, 34 S.Ct. 377, 380, 58 L.Ed. 698): 'But the commingling of these various duties, paid for out of a fund raised for inspection, does not necessarily show that the fee is excessive. For the presumption of invalidity arising from such intermingling might be met by carrying the burden of showing that, while the statute required payment out of which joint fund, the collections were not sufficient, but only helped, to pay the definitely ascertained expenses of inspection. The question of reasonableness, therefore, may be considered in the light of the practical operation of the law with a view of determining, with reasonable certainty, the permanent relation between the amount collected and the cost of inspecting.'
Passing the appellant's contention that a federal right may not be denied under the guise of the application of a state rule of evidence, 14 we come to the question whether, when the asserted right has been denied, this court is concluded by a finding of fact or a mixed finding of law and fact made by the state court. We have repeatedly held that in such case we must examine the evidence to ascertain whether it supports the decision against the claim of federal right. A recent exposition of the doctrine is found in Norris v. Alabama, 294 U.S. 587, 55 S.Ct. 579, 79 L.Ed. 1074, a case coming here from a state court, in which the appellant claimed that he had been denied due process by the systematic and intentional exclusion of negroes from the jury lists. The state court held that the evidence did not establish such exclusion. This court reviewed the evidence, reached a conclusion contrary to that of the state court, and reversed the judgment. At pages 589, 590 of 294 U.S., 55 S.Ct. 579, 580, 79 L.Ed. 1074, it was said: 'The question is of the application of this established principle to the facts disclosed by the record. That the question is one of fact does not relieve us of the duty to determine whether in truth a federal right has been denied. When a federal right has been specially set up and claimed in a state court, it is our province to inquire not merely whether it was denied in express terms but also whether it was denied in substance and effect. If this requires an examination of evidence, that examination must be made. Otherwise, review by this Court would fail of its purpose in safeguarding constitutional rights. Thus, whenever a conclusion of law of a state court as to a federal right and findings of fact are so intermingled that the latter control the former, it is incumbent upon us to analyze the facts in order that the appropriate enforcement of the federal right may be assured.'
Hearsay is competent evidence by the law of many enlightened countries. Stumberg, Guide to the Law and Legal Literature of France, pp. 148, 149; Encyclopedia of the Social Sciences, title Evidence; vol. v., pp. 646, 647. Even at common law it is competent at certain times and for certain purposes, though narrowly restricted. Wigmore, Evidence, vol. 3, § 1420 etseq.; Thayer, A Preliminary Treatise on Evidence at the Common Law, p. 518. The range of its competence has been greatly enlarged by statutes in many of the states, as, e.g., in the administration of Workmen's Compensation Laws, and by the relaxation of ancient rules as to entries in accounts. Dodd, Administration of Workmen's Compensation, pp. 227236; Wigmore, Evidence, Supplement, 1934, §§ 1519, 1520; Morgan v. others, The Law of Evidence, p. 51; New York Civil Practice Act, § 374a; cf. Massachusetts Bonding & Insurance Co. v. Norwich P. Co. (C.C.A.) 18 F.(2d) 934; Cub Fork Coal Co. v. Fairmont Glass Co. (C.C.A.) § 19 F.(2d) 273; United States v. Cotter (C.C.A.) 60 F.(2d) 689. The question may be laid aside whether a change in the law of evidence might be so radical and unjust as to work a destruction of fundamental rights and thus a denial of due process. Brown v. New Jersey, supra, 175 U.S. 172, at page 175, 20 S.Ct. 77, 44 L.Ed. 119. Assuming such a possibility, there is nothing in this ruling to make it a reality. If the legislature of Washington had passed a statute to the effect that vouchers in a public office, filed by the employees at the bidding of a superior, should be prima facie evidence of the truth of their contents, it is not open to doubt that such a statute would be valid. It would not even involve an extreme departure from common law analogies rooted in the presumption of official regularity. What a state may do in changing the rules of evidence through the action of its legislature, it may do with equal competence through the action of its judges, for anything to the contrary in the Constitution of the United States.
Rehearing denied 300 U.S. 686, 57 S.Ct. 504, 81 L.Ed. -.