Case Name: PENNSYLVANIA-READING SEASHORE LINES, APPELLANT, v. BOARD OF PUBLIC UTILITY COMMISSIONERS, ET AL., RESPONDENTS
Court: Supreme Court of New Jersey
Jurisdiction: New Jersey
Decision Date: 1950-06-19
Citations: 5 N.J. 114
Docket Number: 
Parties: PENNSYLVANIA-READING SEASHORE LINES, APPELLANT, v. BOARD OF PUBLIC UTILITY COMMISSIONERS, ET AL., RESPONDENTS.
Judges: 
Reporter: New Jersey Reports
Volume: 5
Pages: 114–141

Head Matter:
PENNSYLVANIA-READING SEASHORE LINES, APPELLANT, v. BOARD OF PUBLIC UTILITY COMMISSIONERS, ET AL., RESPONDENTS.
Argued May 15, 1950
Decided June 19, 1950.
Mr. .James D. Carpenter argued the cause for the appellant (Messrs. Carpenter, Gilmour & Dwyer, attorneys).
Mr. James M. Davis, Jr., argued the cause for the respondents.

Opinion:
The opinion of the court was delivered by
Vandeebilt, C. J.
This is an appeal from a judgment of the Appellate Division of the Superior Court affirming an order of the Board of Public Utility Commissioners directing the appellant railroad to continue to operate its trains Nos. 828 and 829 on its Peiins Grove Branch daily except Satur days and Sundays.
The Penns Grove Branch, 20.3 miles in length, running from Woodbury to Penns Grove, is virtually paralleled by a Public Service bus route. On July 22, 1949, the railroad gave notice to the respondent Board of Public Utility Commissioners that commencing September 25, 1949, it would withdraw all passenger service on the Penns Grove Branch. The Board ordered the railroad to show cause why the proposed discontinuance would not constitute a violation of its obligation to provide passenger service and why such service should not be ordered continued. On September 12, 1949, a public hearing was held by the Board on the order to show cause. At this hearing, of which due notice was given as directed by the Board, no passengers of the railroad appeared to object, the only opposition to the discontinuance of passenger service coming from the representatives of the labor unions, members of which would be affected by the cessation of service.
The uncontroverted evidence at the hearing showed that the daily number of passengers (excluding, of course, Saturdays and Sundays) during the period from January 1 to August 31, 1949, averaged 6.2 on train No. 828 and 8.1 on train No. 829. During this period the total revenue derived from such passenger service was $767.13, while the total out-of-pocket cost of operations was $9,262.28. An exhibit of the financial results of the operations of both passenger and freight service on all of the appellant's rail lines disclosed that, with the exception of the war years 1943-1944, each year from 1934 to 1946 resulted in an operating deficit. The deficit for the first half of 1949 was $3,371,275, and for the year 1948 $4,195,386. The balance sheet of the railroad for December 31, 1948, showed an accumulated deficit of $37,379,107. The Board of Public Utility Commissioners found that:
"In our opinion the evidence wholly fails to support a finding that public convenience and necessity require continuance of passenger train operation on the Penns Grove Branch between Woodbury and Penns Grove. The continuing deficits experienced in the operation of the branch and the entire system of the Pennsylvania-Reading Seashore Lines jeopardize essential services performed by the utility. Continued operation of non-esential service at a substantial continu ing loss, particularly where as here another means of reasonably convenient public transportation is available, is, in our opinion, not justified as in the public interest."
Despite this unequivocal finding the Board, considering itself bound by the decision in O'Connor v. Board of Public Utility Commissioners, 129 N. J. L. 263 (E. & A. 1942), ordered the operation of Trains Nos. 828 and 829 continued. An appeal was taken to the Appellate Division of the Superior Court which affirmed the order below solely on the grounds of the O'Connor case. Prom the order of affirmance there an appeal has been taken to this Court.
Three questions are presented on the appeal: (1) should the O'Connor case be overruled as being unsound; (2) does the order'of the Board of Public Utility Commissioners deprive the railroad of its property in violation of Article I, paragraphs 1 and 20 of the New Jersey Constitution and the Fourteenth Amendment to the Federal Constitution; and (3) does the order of the Board place an undue burden on interstate commerce in violation of Article I, Section 8, clause 3 of the Federal Constitution ?
We are of the opinion that all three issues must be resolved in the affirmative.
(1) To answer the first question it is necessary to reexamine the reasoning of the decision in the O'Connor case. There the same railroad applied to the Board of Public Utility Commissioners for permission to discontinue passenger service on three branch lines. After a hearing, at which numerous passengers appeared and objected, the Board granted the application on the ground that public necessity and convenience did not require such service. On certiorari to the former Supreme Court (128 N. J. L. 35; 1942) the power of the Board of Public Utility Commissioners to order a discontinuance of all passenger service when it is reasonably considered unnecessary was unanimously upheld. On appeal to the Court of Errors and Appeals (129 N. J. L. 263; 1942) the judgment of the former Supreme Court was reversed and judgment entered denying the application of the railroad. The rationale of the opinion of the Court of Errors and Appeals was that "the cessation of the carriage of passengers would be clearly a breach of the contract [the railroad's franchise from the State], and further that no power of the Utility Board to waive this contract obligation and erase it from the contract is conferred by statutes either expressly or by implication." {Idem., p. 268.) A dissenting opinion was filed by Mr. Justice Heher and concurred in by Mr. Justice Colie and Judge Wells, expressing the view that "the Utility Commission has time and again over the years exercised, apparently without question, the authority here challenged; and, with knowledge of this judicial and administrative construction, these provisions were re-enacted without substantial alteration in the revision of our general public laws adopted in 1937. Such judicial and administrative construction must be deemed to have received legislative approval by the re-enactment of the. statutory provisions without material change."
The statutory language that the majority of the court in the O'Oonnor case regarded as placing a contractual duty on a railroad to operate both passenger and freight service and as limiting the regulatory powers of the Board of Public Utility Commissioners is to be found in the Railroad Act, R. 8. 48:12-99;
"Every railroad company shall start and run trains for the transportation of persons and property at regular times to be fixed by public notice.
"Every railroad company shall furnish sufficient accommodations for the transportation of all such passengers and property as shall within a reasonable time previous thereto be offered for transportation at the place of starting, the junctions of other railroads and at usual stopping places established for receiving way passengers and freight for that train.
"The company shall take, transport and discharge such passengers and property at and from and to such places, on the due payment of the legal fare or freight and shall be liable to the party aggrieved in an action for damages for any neglect or refusal in the premises."
The majority opinion, however, ignored equally pertinent provisions of the Railroad Act. Thus, R. 8. 48:12-14 provides in part:
"Every railroad company, in addition to the powers conferred by its charter or by any act or certificate under which it is or shall be incorporated, and notwithstanding any limitation expressly or impliedly imposed by any general or special law or by any act or certificate under which it is incorporated, may:
"c. Sell or otherwise dispose of any of its property, franchises, privileges or rights or any part thereof.
"Nothing herein contained shall authorize any railroad company to exercise any of the powers conferred upon it by this section, without the approval of the board of public utility commissioners where such approval is required by law."
and B. S. 48 :12—90 further provides:
"No railroad company shall, without first obtaining the approval of the Board of Public Utility Commissioners, abandon any railroad station, stop the sale of passenger tickets or cease to maintain an agent to receive and discharge freight at any station in this state at which passenger tickets are regularly sold or at which such agent is maintained."
Likewise it is important to consider the provisions of the Public Utilities Act setting forth the powers of the Board of Public Utility Commissioners. B. 8. 48:2-13 declares:
"The board shall have general supervision and regulation of and jurisdiction and control over all public utilities as hereinafter in this section defined and their property, property rights, equipment, facilities and franchises so far as may be necessary for the purpose of carrying out the provisions of this title.
"The term 'public utility' shall include every » steam railroad. "
and B. S. 48 :2-23 provides:
"The board may, after hearing, upon notice, by order in writing, require any public utility to furnish safe, adequate and proper service and to maintain its property and equipment in such condition as to enable it to do so."
and B. 8. 48:2-24 sets forth:
"If any public utility shall discontinue service and the Board after hearing upon notice shall find and determine that service should be resumed, the board may order that service be resumed forthwith, or on such date as it may fix."
When all of these statutory provisions are read in pari maleriae and an effort is made to give them all meaning and effect, it is reasonable to conclude that the Legislature did intend to give the Board of Public Utility Commissioners the power that it had exercised for many years until the decision in the O'Connor case forbade it and which it felt constrained in the instant case not to exercise solely because of that decision. This conclusion becomes inescapable when the two constitutional questions hereinbefore posed come to be considered, for in the view we take of each of them (to be dealt with later in this opinion) the statute as construed in the O'Connor case would he unconstitutional. Obviously that construction of the statute is to be preferred which would save it from being struck down as violative of our fundamental law. But this reasoning is also controlling when the practice aspects of the problem here presented are considered. It is common knowledge that there are a considerable number of railroads and branches of railroads in this State where freight service only has been rendered for years under the statutes as they had been construed before the O'Connor case. Even under the O'Connor case the Board admittedly has the power to reduce the number of station stops and the number of scheduled trains when justified by lack of patronage. Under the facts as they presently exist on the Penns Grove Branch of the appellant railroad one train a day each way is being operated for an average of about seven passengers, all of whom could ride the parallelling bus lines. Where is the limit of the Board's power to be drawn? Is it required to order the operation of passenger trains even though no passengers present themselves? Can it reduce the number of scheduled trains to one a week, or a month, or a year ? It seems only reasonable and, to avoid the absurd, necessary to hold that it was. the legislative intent to give the Board the power to permit a total discontinuance of passenger service when the public convenience and necessity no longer require such service. It seems unreasonable to interpret B. 8. 48:12-99 as requiring the operation of passenger service in a situation when only a nominal number of passengers present themselves for transportation, where other adequate means of public transportation are available, and when such operation results in continued substantial losses.
To reason, as the majority did in the O'Connor case, that a railroad must provide both passenger and freight service on penalty of forfeiting its franchise to operate as a railroad not only does violence to the legislative intent, but it is against sound public policy. It may well be, in fact experience on various railroads and branches in this State has demonstrated that it is, to the advantage of the public to have a railroad continue as a carrier of freight only rather than have its franchise forfeited. The Legislature very obviously realized that the regulation of public utilities is a continuing process, that circumstances in a given utility may and do change, requiring new arrangements in the public interest in particular places or instances from time to time. If the Board may in the public interest, on findings of public necessity and convenience, order a particular service suspended, it may later in changed circumstances on a similar finding order it restored. The mere fact that a given railroad or branch or train is operating at a loss will not of itself justify suspension of any service. The Board must act in the light of all the facts and circumstances and its findings are subject to judicial review; see Rule 3:81.
It is urged on us that the construction put on the statute by the O'Gonnor case became a part of the statute which we may not change, that power residing solely in the Legislature. However, this rule of legislative acquiescence in the well settled interpretation of a statute is but one of several principles that may guide a court in arriving at the true meaning of a legislative act. It is no more than an aid in statutory construction and it is merely one factor in the total effort to give meaning to the language of the statute. Moreover, it has been held that "one decision construing an act does not approach the dignity of a well settled interpretation," United States v. Raynor, 302 U. S. 540, 552, 82 L. Ed. 413, 420, 58 Sup. Ct. 353 (1938). The doctrine here contended for is not uniformly controlling; it must not be permitted to fetter the courts in their search for light. The principle of stare decisis which lies behind the doctrine is entitled to respect, but it
must not blind us to realities; it is not an idol to be worshipped in following either a judicial precedent or an antecedent statutory construction. "We recognize that stare decisis embodies an important social policy. It represents an element of continuity in law, and is rooted in the psycho-logic need to satisfy reasonable expectations. But stare decisis is a principle of policy and not a mechanical formula of adherence to the latest decision, however recent and questionable, when such adherence involves collision with a prior doctrine more embracing in its scope, intrinsically sounder, and verified by experience."; Helvering v. Hallock, 309 U. S. 106, 119, 84 L. Ed. 604, 612, 60 Sup. Ct. 444 (1940). In Kimberly School v. Montclair, 2 N. J. 28 (Sup. Ct. 1949), we had occasion recently to strip from the Tax Act a false judicial gloss that had grown up on the statute in a long series of cases. Nor was the suggested doctrine applied in the O'Connor case itself, which changed the previous construction that had been placed on these statutes by the Court of Errors and Appeals in Atlantic Coast Electric Railway Company v. Board of Public Utility Commissioners, 92 N. J. L. 168 (E. & A. 1918). despite the fact that the dissenting opinion in the O'Connor reuse specifically called attention (at p. 270) to the legislative acquiescence for many years in the earlier construction of the statutes under consideration. In addition to the several reasons hereinbefore mentioned for overruling the O'Connor case, there is an especial reason for holding that the suggested doctrine should not apply here: in the O'Connor cane the constitutional issues now presented to us were not raised, briefed or argued by counsel or considered by the court save in the dissenting opinion. "Lack of thorough consideration will reduce.—even destroy—the weight of the very ratio decidendi. There are numerous examples. Eirst, there may be no argument; and then there certainly cannot be thorough consideration ." Wambaugh, "How to Use Decisions and Statutes" in Abbott, ed. Brief Making and the Use of Law Books (1906), p. 93; "As it is the office of the court to pronounce a decision after having fully examined the ques tion presented and the law relating thereto, and as it is the office of counsel to aid the court by presenting the questions and the law with the fulness that comes from long familiarity with the case and from thorough examination of authorities, a case decided after little or no argument has not full weight." Wambaugh on The Study of Oases (1894), p. 46. See also 14 Am. Jur. 290, § 73.
(2) If the O'Connor case were upheld, we would nevertheless be constrained to vacate the order of the Board of Public Utility Commissioners in the instant case, since it violates Article I, paragraphs 1 and 20 of the New Jersey Constitution and the Fourteenth Amendment to the Federal Constitution. There can be no doubt of the power of a state functioning through an administrative body to regulate the services and facilities of common carriers so that the public necessity and convenience will be accommodated, but that power is not unlimited; it is circumscribed by the provisions of the United States Constitution. Under the guise of regulation the property of a railroad may not be taken by requiring it to furnish services or facilities not reasonably necessary to serve the public. Wisconsin M. & P. R. Co. v. Jacobson, 179 U. S. 287, 45 L. Ed. 194, 21 Sup. Ct. 115 (1900); Washington ex rel. Oregon R. & N. Co. v. Fairchild, 224 U. S. 510, 56 L. Ed. 863, 32 Sup. Ct. 535 (1912); Northern P. R. Co. v. North Dakota ex rel. McCue, 236 U. S. 585; 59 L. Ed. 735, 35 Sup. Ct. 429 (1915); Chicago, M. & St. P. R. Co. v. Wisconsin, 238 U. S. 491, 59 L. Ed. 1423, 35 Sup. Ct. 869 (1915); Mississippi R. Com. v. Mobile & O. R. Co., 244 U. S. 388, 61 L. Ed. 1216, 37 Sup. Ct. 602 (1917); Brooks-Scanlon v. Railroad Commission, 251 U. S. 396, 64 L. Ed. 323, 40 Sup. Ct. 183 (1920); Norfolk & W. R. Co. v. Public Service Com., 265 U. S. 70, 68 L. Ed. 904, 44 Sup. Ct. 439 (1924); Atchison, T. & S. F. R. Co. v. Railroad Com., 283 U. S. 380, 75 L. Ed. 1128, 51 Sup. Ct. 553 (1931); Interstate Com. Com. v. Oregon-Wash. R. & Nav. Co., 288 U. S. 14, 77 L. Ed. 588, 53 Sup. Ct. 266 (1933). The mere fact that the carrier was given an opportunity to be heard prior to the entry of the order appealed from is not sufficient to establish its validity, "Eor the guaranty of the Constitution extends to the protection of fundamenal rights,—to the substance of the order as well as to the notice and hearing which precede it. So that where the taking is under an administrative regulation, the defendant must not be denied the right to show that, as a matter of law, the order was so arbitrary, unjust or unreasonable as to amount to a deprivation of property in violation of the Fourteenth Amendment." Washington ex rel. Oregon R. & N. Co. v. Fairchild, 224 U. S. 510, 524, 56 L. Ed. 863, 868, 32 Sup. Ct. 535 (1912). That to compel a railroad to continue to operate even a branch at a pecuniary loss may constitute an unlawful taking of property has been firmly established, Brooks-Scanlon v. Railroad Commission, supra, 251 U. S. 396, 64 L. Ed. 323, 40 Sup. Ct. 183 (1920), although it is recognized that other factors must be considered in determining the reasonableness, and thereby the constitutionality, of the order. "As the duty to furnish necessary facilities is coterminus with the powers of the corporation, the obligation to discharge that duty must be considered in connection with the nature and productiveness of the corporate business as a whole, the character of the services required, and the public need for its performance." Atlantic C. L. R. Co. v. North Carolina Corp., 206 U. S. 1, 26, 51 L. Ed. 933, 945, 27 Sup. Ct. 585 (1907).
Applying these principles to the facts in the instant case, it is obvious that the action of the Board in ordering a continuation of passenger service on the Penns Grove Branch was patently arbitrary and unreasonable and therefore unconstitutional. It was specifically found by the Board after a public hearing on due notice that the continued operation of such service was not required by public necessity or convenience. Its order was founded solely on the ground that the decision in the O'Connor case left the Board without discretion; that under the statutes as there construed it was mandatory for the railroad to continue to operate passenger trains, even though such operation was entirely unnecessary and could only be carried on at a continued and substantial loss. If the situation were such that the branch line was serving a real public need of passengers or the railroad as a whole was making a profit although this particular branch was operating at a loss, the problem would be an entirely different one; in either of these events, to order the railroad to continue service might not be arbitrary and unreasonable in view of all the circumstances. But here the branch line serves no public need for passenger service and not only the branch line but the entire railroad has been operating at a loss for a considerable number of years.
The respondents contend that the principles of regulation we have enunciated are not applicable to the instant case. They argue that they apply only where the question is one of the degree of service and the duty of the utility a relative one, but that here the duty of the railroad to operate a minimum of passenger service is an absolute obligation upon the performance of which its corporate franchises are contingent and such an absolute obligation voluntarily assumed cannot be avoided, and the enforcement of it does not deprive the railroad of any constitutional rights. A public utility, it is argued, cannot, because of pecuniary loss, escape obligations voluntarily assumed. Applicable though the above contentions may be in a case where a utility is required to furnish a necessary public service at a loss (a question not now before us), we cannot consider them controlling in this case where there is no public need as shown by the unequivocal finding of the Board in which we concur. Where the public necessity and convenience do not require a particular service, there can be no obligation upon a public utility to furnish such service. The obligation is dependent upon the need; without the need, the obligation does not exist.
The cases relied upon by the respondents are not inconsistent with the position we take here. In Missouri, Pacific Railway Co. v. Kansas, 216 U. S. 262, 54 L. Ed. 472, 30 Sup. Ct. 330 (1910), the corporate charter required the railroad to furnish both passenger and freight service. The state ordered the railroad to run a separate train for passengers, rather than a mixed train for passengers and freight as had been customary. The railroad objected to the order on constitutional grounds, because of the fact that the service ordered could only be furnished at a loss. It was stated by Mr. Justice White (at ¶. 279, L. Ed., p. 479) : "It may not be doubted that the road, by virtue of the charter under which the branch was built, was obliged to carry passengers and freight, and therefore as long as it enjoyed its charter rights was under the inherent obligation to afford service for the carrying of passengers." But in that case the state board had specifically stated in its findings (at p. 268, L. Ed., p. 475) : "The board believes that the people along the line of the Madison branch of said company are entitled to better passenger train service than they are now receiving, and it has been represented to the board of [by] officers of said company that the respondent is constructing motor cars for establishment on its branch lines, that can be operated at a much less expense than steam service." So we find that not only was there a public need, but the railroad was well aware of it. It was not there contended, as it must be here conceded, that the order was unreasonable and arbitrary because it required the railroad to perform a futile task; the order was attacked only on the ground that to comply would result in a pecuniary loss.
Chesapeake & O. R. Co. v. Public Service, 242 U. S. 603, 61 L. Ed. 520, 37 Sup. Ct. 234 (1917), is the case most heavily relied upon by the respondents. In that case the railroad instituted proceedings to set aside an order requiring it to maintain daily passenger service on a branch line in addition to the freight service already being rendered. The order was assailed as violative of the "due process" and "equal protection" clauses of the Fourteenth Amendment in that the passenger service contemplated by the order would entail a pecuniary loss of indefinite duration, though there was nothing to indicate that the company's operations as a whole would not yield a reasonable return. The court after finding that the railroad's charter, by virtue of the statutes under which it was organized, required the transportation of passengers as well as of freight, stated (at p. 607, L. Ed., ¶. 522) : "An obligation to use it for both was imposed by law, and so could not be thrown off or extinguished by any act or omission of the railway company. It follows that the order, instead of enlarging the public purpose to which the line was devoted, does no more than to prevent a part of that purpose from being neglected." It is this language of the court that the respondent relies upon to support its position in the instant case. It is noteworthy, however, that the court in the Chesapeake case did not stop with the above quoted words, but continued immediately: "One of the duties of a railroad company doing business as a common carrier is that of providing reasonably adequate facilities for serving the public. This duty arises out of the' acceptance and enjoyment of the powers and privileges granted by the state, and endures so long as they are retained. It represents a part of what the company undertakes to do in return for them, and its performance cannot be avoided merely because it will be attended by some pecuniary loss. That there will be such a loss is, of course, a circumstance to be considered in passing upon the reasonableness of the order, but it is not the only one. The nature and extent of the carrier's business, its productiveness, the character of service required, the public need for it, and its effect upon the service already being rendered, are also to be considered, Applying these criteria to the order in question, we think it is not shown to be unreasonable." If in the instant case these same criteria are applied to the order now before us, no conclusion can be arrived at, as we have already indicated, but that the order is arbitrary and unreasonable. Thus the very case chiefly relied upon by the respondents is authority for, not against, the position we here have taken.
We are also referred to the case of Southern Ry. Co. v. South Carolina Public Serv. Com'n., 31 F. Supp. 707, 712 (1940), for a recent review of the authorities on this subject; see also Atlantic Coast Line R. Co. v. Public Service Commis sion, 77 F. Supp. 675, 685 (1948), for a still later discussion. Suffice it to say, however, that the case cited to us is not contrary to our conclusions, for it was there pointed out (at p. 714) that it was not unreasonable for the commission to consider the public convenience and that the service required was "undoubtedly of value to the communities served and is responsible for so small a portion of the loss."
We are thus constrained by the authorities to hold that public convenience and necessity are the criteria against which any discontinuance is to be measured, regardless of whether there is partial or total discontinuance of a particular service. If the service sought to be withdrawn is not required by the public convenience and necessity, the railroad cannot be constitutionally required to render the same, regardless of whether the discontinuance be partial or entire. To so require, in either circumstance, would constitute an arbitrary and unreasonable taking of property for private purposes and without compensation, a violation of the "due process" provisions of our State and Federal Constitutions.
(3) The last question raised on this appeal concerns the validity of the order of the Board when'viewed in the light of Article I, Section VIII, clause 3 of the Federal Constitution. The appellant is an interstate carrier that has been operating at a loss for years. The Board found that "the continuing deficits experienced in the operation of the branch and of the entire system of the Pennsylvania-Reading Seashore Lines jeopardize essential services performed by the utility." In these circumstances to subject it to continued operation of an unprofitable branch, when the local need does not so require, imposes an undue burden on its interstate operations.
In Chicago, B. & Q. R. Co. v. Railroad Commission, 237 U. S. 220, 59 L. Ed. 926, 35 Sup. Ct. 560 (1915), a statute was declared invalid which required a railway company to stop at least one passenger train a day at towns on its line having a population of over 200 persons. Acting under this statute, the Railroad Commission issued its order requiring one of the plaintiff's through trains to stop at the small town of Cochrane, Wisconsin. "The Commission expressing its view of the case presented, said: 'Independent of any statutory provision on the subject, we should feel constrained to hold that the existing passenger service afforded the village of Cochrane was adequate under the circumstances, and that, therefore, interstate trains could not be required to stop at that station/ And further: 'This statute deprives the Commission of any discretion in the matter. It fixes the quantum of passenger service for every station coming within the classification made/" (at ¶. 225, L. Ed., p. 929). Thus the situation in that ease is not unlike the one in the instant case, except that the Board here considered itself bound not to exercise its discretion because of a court decision rather than a statute. What the United States Supreme Court said in that case when the order was attacked as violative of the "commerce clause" is of special interest here: "In reviewing the decision [of the State Supreme Court upholding the order of the Railroad Commission] we may start with certain principles as established : (1) It is competent for a state to require adequate local facilities, even to the stoppage of interstate trains or the rearrangement of their schedules. (2) Such facilities existing,—that is, the local conditions being adequately met—the obligation of the railroad is performed, and the stoppage of interstate trains becomes an improper and illegal interference with interstate commerce. (3) And this, whether the interference be directly by the Legislature or by its command through the orders of an administrative body. (4) The fact of local facilities this court may determine, such fact being neecssarily involved in the determination of the question whether an order concerning the interstate train does or does not directly regulate interstate commerce, by imposing an arbitrary requirement." (at p. 226, L. Ed. 930). The court proceeded to test the adequacy and reasonableness of the local facilities by the standard established in Atlantic Coast L. R. Co. v. Wharton, 207 U. S. 328, 335, 52 L. Ed. 230, 234, 28 Sup. Ct. 121 (1907), in which it was said: "It [adequate and reasonable facilities] is a relative expression and has to be considered as calling for such facilities as might be fairly demanded, regard being had, among other things, to the size of the place, the extent of the demand for transportation, the cost of furnishing the additional accommodations asked for, and to all other facts which would have a bearing upon the question of convenience and cost." After considering these factors the court felt constrained to strike down the order and the state statute upon which it was based.
If in the cáse before us the order of the Board is tested by these principles, it is apparent at once that the burden placed upon the appellant railroad is an undue interference with its interstate operations. In Colorado v. United States, 271 U. S, 153, 70 L. Ed. 878, 46 Sup. Ct. 458 (1926), an order of the Interstate Commerce Commission was upheld which authorized a railroad to cease operation of a branch located wholly within a state on the grounds that the loss from the operation thereof would burden the railroad's interstate operations and local conditions did not require the service being rendered. It was there stated by the court (at p. 165, L. Ed., p. 884): "The obligation assumed by the corporation under its charter of providing intrastate service on every part of its line within the state is subordinate to the performance by it of its Federal duty, also assumed, efficiently to render transportation services in interstate commerce. There is no contention here that the railroad by its charter agreed in terms to operate this branch regardless of loss. But even explicit charter provision's must yield to the paramount power of Congress to regulate interstate commerce."
In view of the unquestioned absence of local need and the wholly unnecessary financial burden placed upon the appellant railroad's interstate operations, it is difficult to see how it can be held that the order of the Board herein is other than an arbitrary, unreasonable and thereby illegal interference with interstate commerce.
The judgment below is reversed and the order appealed from is vacated.