Source: http://www.chanrobles.com/usa/us_supremecourt/311/295/case.php
Timestamp: 2020-01-19 06:00:45
Document Index: 307508579

Matched Legal Cases: ['§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1', '§ 1']

Undertaking to proceed under Paragraphs 18, 20 and 21, Section 402, Transportation Act, 1920, 311 U. S. 477, U.S.C. Title 49, § 1, petitioners, by bill filed December 30, 1938, in the United States District Court, Western District of Missouri, asked a decree enjoining respondent from constructing or operating an alleged extension, 26 F.Supp. 721. chanroblesvirtualawlibrary
Page 311 U. S. 298
"The complaint of the plaintiffs shows that they are commission merchants doing business on the Kansas City, Missouri, produce market, an old and well established
Page 311 U. S. 299
market which adequately serves the consuming public in its vicinity and receives produce from, and ships produce to, other states; that Kansas City, Missouri, is now engaged in constructing new market buildings for this market at a cost of about $500,000; that the market has suitable and adequate transportation facilities of all kinds; that the adjoining city of Kansas City, Kansas, proposes to build and is building a 'food Terminal' or produce market on a tract of land which it owns at a cost of about $4,000,000, of which $1,710,000 is a grant from the Public Works Administration of the United States, and that the balance of the necessary funds will be procured by a sale of the City's bonds to the defendant railroad company; that the defendant proposes, at an expense of some $500,000, to furnish trackage to serve this Kansas City, Kansas, market; that this trackage constitutes an extension of the defendant's lines of railroad, for the construction of which it has procured no certificate of convenience and necessity from the Interstate Commerce Commission as required by law; that the construction and operation of the proposed extension in Kansas City, Kansas, will adversely affect and will destroy the business and properties of the plaintiffs and the large investments which they have made in and adjacent to the Kansas City, Missouri, produce market; that it will create an unnecessary and uncalled for rival market at an inconvenient place without creating any more produce to be handled or any more customers to be served; that it will result in the unnecessary duplication of railroad facilities at a cost of $500,000 without increasing the amount of freight to be handled; that it will divert traffic from other railroads which are now adequately handling the traffic to the Kansas City, Missouri, produce market, and will cause destructive competition between the defendant and other railroads, and will cause a wasteful and needless expenditure
Page 311 U. S. 300
of money by the defendant; that,"
"It is obvious that the only basis for the plaintiffs' claim that the alleged extension of the lines of the defendant to the Kansas City, Kansas, market will particularly injure them is that they do business upon the Kansas City, Missouri, market, and that, if the proposed rival market in Kansas City, Kansas, functions, it will divert business from the market upon which they operate, and will thus hurt them, their business, and their investments in Kansas City, Missouri, and that, since the proposed extension of its tracks by the defendant is necessary to enable the rival market to function, such extension will therefore injure the plaintiffs. It seems equally obvious that, except for the fact that the proposed
Page 311 U. S. 301
extension is essential to the operation of the rival market in Kansas, it could not possibly have any direct or immediate effect upon the plaintiffs, their property, or their business in Missouri other than the effect which a wasteful expenditure by the defendant of its money would have upon the public generally. The proximate cause of the injury to the plaintiffs will be the competition created by the construction and operation of the rival market, and not the construction or operation of the transportation facilities furnished to it by the defendant or by others engaged in the transportation business."
"The plaintiffs have no definite legal right which is threatened. They are, however, persons whose welfare may be adversely affected by the bringing about of a material change in the transportation situation, in the sense that the extension proposed by the defendant, if built and operated, will enable a competitive market to function to their detriment. In that sense, we think it may safely be said that the proposed extension of defendant's lines may adversely affect the plaintiffs' welfare. We are of the opinion, however, that their complaint discloses that their welfare cannot be directly, but only indirectly and consequentially, affected by the proposed extension. They are not in competition with the defendant. They are not engaged in the transportation business. Their only peculiar interest in that business is in the effect which changes in it may have upon the market where they do business, and upon rival markets now or hereafter established in the territory which the plaintiffs serve. . . . We conclude that the statute is not to be so liberally construed as to enable
Page 311 U. S. 302
those who fear adverse effects upon their business from the establishment of competitive enterprises requiring transportation facilities, to maintain suits to enjoin railroads from constructing what are claimed to be unauthorized extensions to serve such enterprises."
"the prohibition of paragraph 18 is absolute. If the proposed track is an extension and no certificate has
Page 311 U. S. 303
been obtained, the party in interest opposing construction is entitled as of right to an injunction."
The Transportation Act, 1920, was designed to protect the public against action which might endanger its interest. In order to aid that general purpose, Paragraph 20, Section 402, provides that suit for an injunction may be instituted by the United States, the Commission (I.C.C.), any Commission or Regulative Body of the state or states affected, or any "party in interest." Such chanroblesvirtualawlibrary
Page 311 U. S. 304
a suit cannot be instituted by an individual unless he "possesses something more than a common concern for obedience to law." The general or common interest finds protection in the permission to sue granted to public authorities. An individual may have some special and peculiar interest which may be directly and materially affected by alleged unlawful action. See Detroit & M. Ry. Co. v. Boyne City, G. & A. R. Co., 286 F.5d 0. If such circumstances are shown, he may sue; he is then "party in interest" within the meaning of the statute. In the absence of these circumstances, he is not such a party.
The challenged judgment must be affirmed. chanroblesvirtualawlibrary
Page 311 U. S. 305
A city deeming itself adversely affected by a proposed illegal extension would naturally turn to its state commission to assert its interests. If, for any reason, the state agency does not employ its power under § 1(20) on behalf of the city's claims, the latter can invoke the law enforcing authority of the Interstate Commerce Commission and also enlist the power of the Attorney General to initiate litigation. It is reading § 1(20) chanroblesvirtualawlibrary
Page 311 U. S. 306
without illumination of the scheme and purposes of the Transportation Act to expand the categories of public agencies explicitly named by Congress for enforcing § 1 (18) by including a city as a "party in interest." To do so would disregard recognition of a state utility commission as the special repository of all the interests of a state in this particular field, and of the Interstate Commerce Commission as the national organ for enforcing the body of interstate commerce acts. Clearly, therefore, Kansas City cannot be deemed a "party in interest" for the litigious purposes of that phrase in § 1(20).
Who, then, is a "party in interest"? As a part of the very system through which the national policy is to be achieved, a railroad has been deemed by this Court a "party in interest" to effectuate the railroad policy introduced chanroblesvirtualawlibrary
Page 311 U. S. 307
by the licensing system of the Transportation Act. Texas & Pac. Ry. Co. v. Gulf, C. & S.F. Ry. Co., 270 U. S. 266, 270 U. S. 277; Western Pacific California R. Co. v. Southern Pac. Co., 284 U. S. 47. And one who in a proceeding initiated before the Interstate Commerce Commission has been treated by it as a party to the litigation, cf. Los Angeles Passenger Terminal Cases, 100 I.C.C. 421; id., 142 I.C.C. 489; Atchison, T. & S.F. Ry. Co. v. Railroad Commission, 283 U. S. 380, 283 U. S. 393-394, may perhaps be deemed a "party in interest" in the further pursuit of claims before a court after adverse action by the Commission. Compare Interstate Commerce Comm'n v. Oregon-Washington R. Co., 288 U. S. 14, and Federal Communications Commission v. Sanders Bros. Radio Station, 309 U. S. 470. But to allow any private interest to thresh out the complicated questions that arise out of § 1 (18-22) [Footnote 1] -- as, for instance, whether a proposed construction is an "extension" or a "spur," compare Texas & Pacific Ry. Co. v. Gulf, C. & S.F. Ry. Co., 270 U. S. 266 -- is to invite dislocation of the scheme which Congress has devised for the expert conduct of the litigation of such issues. [Footnote 2] It also would put upon the district courts the task of drawing fine lines in determining when a private claim is so special that it may be set apart from the general public interest and give the claimant power to litigate a public controversy. These inquiries are so harassing and unprofitable as to be avoided, unless Congress has explicitly cast the duty upon the courts. Against any such implication, in the absence of rather plain language, the whole course of chanroblesvirtualawlibrary
Page 311 U. S. 308
federal railroad legislation and the relation of the Interstate Commerce Commission to it admonishes. The interests of merely private concerns are amply protected even though they must be channelled through the Attorney General or the Interstate Commerce Commission or a state commission.
Section 1 (18) of the Transportation Act of 1920, 41 Stat. 474, 477, 49 U.S.C. § 1 (18), forbids the extension of its line by a railroad without a certificate of the Interstate Commerce Commission that "the present or future public convenience and necessity require or will require" the construction of the extension. Similarly, it prohibits the abandonment of any portion of a line of railroad without a like certificate permitting the abandonment. chanroblesvirtualawlibrary
Page 311 U. S. 309
Section 1 (19) requires the Commission to give notice of application for a certificate to the governor of the state in which the proposed extension is to be constructed and to publish the notice in each county through which the line of railroad is constructed or operated. By § 1(20), the Commission is authorized to attach to its certificate such "conditions as in its judgment the public convenience and necessity may require," and authorizes any court of competent jurisdiction to enjoin the prohibited construction or abandonment "at the suit of the United States, the Commission, any commission or regulation body of the State or States affected, or any party in interest. . . ." By § 1(22), spur, industrial, side tracks, and the like are excluded from the authority of the Commission, and the railroad may build them without applying for a certificate.
The interest of petitioners in maintaining the suit, as shown by the pleadings, is derived from the injury to the public which, it is specifically alleged, will result from the proposed extension through the injury to the community in Kansas City, Missouri, and vicinity, of which community petitioners are a part and in which they are property owners, and the consequent injury alleged to affect them individually. The public injury, it is alleged, will be caused by (a) the loss or serious impairment in utility of the Kansas City public produce market and the destruction or serious diminution of values of property and business and of financial investments in and about the market, which will be brought about by the extension, through the creation of a rival market and the diversion of traffic to it at a point in Kansas City, Kansas, far removed from the center of population of Kansas City, Missouri, and to the inconvenience of the great majority of the citizens of both cities who are served by the existing market, which is adequate to the needs of the community; (b) by the chanroblesvirtualawlibrary
Page 311 U. S. 310
unnecessary duplication of railroad facilities in the Kansas City district at large cost, with wasteful and needless expenditures by respondent and no increase in freight to be handled, and (c) by the diversion of traffic to respondent railroad from other railroads and destructive competition between the railroads operating in the vicinity.
The statute does not define the "parties in interest" whom it permits to sue to restrain an unauthorized extension. It cannot be assumed that the phrase is meaningless or that the statute should be read as though the words were omitted. Obviously the parties intended must have, as do petitioners, an interest in the outcome of the litigation other than the "common concern for obedience to law." See Massachusetts v. Mellon, 262 U. S. 447, 262 U. S. 488. And, as the language of the statute plainly indicates and as we have held, they may be, as are petitioners, others than the public bodies named in the statute as appropriate plaintiffs. Atchison, T. & S.F. Ry. Co. v. Railroad Commission, 283 U. S. 380, 283 U. S. 393-394. And they may maintain the suit although the injury which they allege is not strictly an actionable wrong independently of the paragraphs in question. chanroblesvirtualawlibrary
Page 311 U. S. 311
Western Pacific R. Co. v. Southern Pacific Co., 284 U. S. 47.
It is not denied that the statutory language and the legislative history of the paragraphs in question require consideration by the Commission of the interests of cities, towns, and communities which are adversely affected by a proposed extension of a line of railroad, in order to determine whether "public convenience and necessity" require the extension. The phrase "public convenience and necessity" has long been used to signify the final result of the balancing of the consequences which flow from the proposed action to all those matters of public concern which are affected by it. Cf. 283 U. S. 42; United States v. Lowden, 308 U. S. 225. And we have held that, in the administration of the cognate provision relating to abandonment of railroad lines, the Commission must consider as a part of the public convenience and necessity the interests of local communities affected by the proposed abandonment. Colorado v. United States,@ 271 U. S. 153, 271 U. S. 168. A community may suffer injury through the loss of railroad service and diversion of traffic resulting from the construction and operation of a railroad extension without any compensating public advantage which is comparable in kind and amount with injury sustained by the abandonment of a line of railroad. One as well as the other should receive the consideration of the Commission in determining whether it should grant or withhold a certificate. Such appears to be its settled practice on applications for a certificate authorizing extension. [Footnote 2/1] chanroblesvirtualawlibrary
Page 311 U. S. 313
If the proposed construction is an extension, the injunction must issue as of right, but its only affect is to compel the railroad before proceeding further to apply to the Commission for a certificate of public convenience and necessity which is the public purpose of the Act. chanroblesvirtualawlibrary
Page 311 U. S. 314
Texas & Pacific Ry. Co. v. Gulf, C. & S.F. Ry. Co., 270 U. S. 266, 270 U. S. 273. The court is thus called on to decide no administrative issue which must be submitted to the Commission in advance of suit, and any decree which it may render involves no embarrassment to the Commission or otherwise in the administration of the Act. While the Commission itself may bring the suit, it is under no statutory duty to do so, and its only other authority in the premises is to grant or withhold the certificate when applied for. One injured by an unauthorized extension and opposed to its construction, whether a state commission, a competing railroad or any other injured party, is not authorized to initiate any proceeding before the Commission, and its only protection as of right from the consequences of the threatened public wrong is that afforded by suit authorized by § 1(20). See Texas & Pacific Ry. Co. v. Gulf, C. & S.R. Ry. Co., supra, 270 U. S. 272-274.
In considering the scope of the application of the statute, this Court has recognized that the public interest which the Commission is to protect includes the public interest in the maintenance of an adequate transportation system, and that a railroad whose welfare, although not its legal right, is adversely affected by an unauthorized, and therefore unlawful, extension of the line of another is a "party in interest" entitled to maintain suit to enjoin the extension. Western Pacific California R. Co. v. Southern Pacific Co., supra; cf. Claiborne-Annapolis Ferry Co. v. United States, supra. And it has held that one other than a carrier (a municipality), who has "a proper interest in the subject matter," may institute a proceeding before the Interstate Commerce Commission under § 1, paragraphs 18 to 22, to obtain a certificate of public convenience, so as to enable a railroad to build an extension to a new station which a state commission has ordered it to build. Atchison, T. & S.F. Ry. Co. v. chanroblesvirtualawlibrary
Page 311 U. S. 315
Railroad Commission, supra, 283 U. S. 393-394. Compare Detroit & M. Ry. Co. v. Boyne City, G. & A. R. Co., 286 F.5d 0.
If the statute permits some protection through commission action of the public interest in the preservation of communities adversely affected by the construction of railroad extensions, no plausible reason has been advanced for saying that an individual member of such a community whose property or financial interests are adversely affected by the proposed unauthorized extension, and who would be a proper party to the proceeding before the Commission on application for a certificate, [Footnote 2/2] chanroblesvirtualawlibrary
Page 311 U. S. 316
is not a party in interest, entitled to bring suit quite as much as a competing railroad whose property interests are likewise affected. On the contrary, petitioners have a special and peculiar interest in preventing the unlawful extension and in securing, before the extension is built, such consideration of the community interest as the Commission gives, and which can be insured only by resort to the suit authorized by § 1(20).
Just as Congress gave authority to a railroad to sue to enjoin an unauthorized extension by its competitor in order to effect the railroad policy of the Act, it gave like authority to complainants to effect its public policy with respect to a community injuriously affected by an chanroblesvirtualawlibrary
Page 311 U. S. 317
unlawful railroad extension. The statute gives no warrant for saying that the one may bring suit, but that the other can only ask some public body to bring it, and neither interferes with the functions which the Commission is authorized to perform and which, as we have seen, are distinct from those assigned to the court by § 1(20).