Court Opinion

ID: 3506016
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:16:15.715842+00
Date Added: 2024-06-11T14:16:49.696567
License: Public Domain

I think that there was no credible or competent evidence of confiscation.
1. The finding of confiscation was based exclusively upon the testimony of Glen F. Vivian. There was no evidence of valuation, cost, expense of operation and maintenance, or other factors entering into the fixing of a rate.
Vivian's testimony should be rejected as a matter of law because of the absence here of the factors which he says are requisite to give it validity. He used the so-called Saur-Coverston formula. According to his testimony, the formula is a means for computing a rate by applying cost, maintenance, expense, and other factors entering into a rate to the facts of a particular case, which can be determined only by "field" tests; that such tests can be made only by first determining costs of service and engine production of the particular carrier for the particular service by tests of at least a week's duration; that after that had been done it is "necessary" that the costs be applied to actual movements of traffic; and that without such tests there was no way of knowing what a particular rate *Page 331 
should be. Here, there were no actual movements of traffic to which the formula could be applied. The rates fixed were, therefore, to be prospective in operation. Mr. Vivian testified:
"Now that the costs and engine production had been found, it was necessary that there be some actual movements of traffic to which the costs could be applied. Investigation showed that there had been practically no movement of traffic between industries in St. Paul and the Port Authority of St. Paul.In other words, the carriers were faced with a complaint as toswitching rates with respect to traffic which did not exist. Accordingly, in an effort to present to the Minnesota Railroad and Warehouse Commission data which might be of assistance to them in arriving at their decision, an effort was made to find actual movements of traffic which would most nearly represent the service required in Port Authority movements, if they hadexisted." (Italics supplied.)
To supply this obvious lack of any basis for his testimony, Mr. Vivian said that he made a study of rates for comparable services by railroads in switching for the Federal Barge Line, which he characterized as almost "Identical" with those here involved. That assertion was false as a matter of law, for the obvious reason that, while according to his testimony there were actual traffic movements to the Federal Barge Line, there were none to the Port Authority.
That being true, there was absolutely no factual basis for the application of the formula, and consequently there was no basis for a finding of confiscation.
2. While I do not deem it necessary to consider the matter of the per diem charge for the use of cars, I think the matter is entirely immaterial here. Per diem charges are made by carriers against each other and not by carriers against shippers. Demurrage charges are made by carriers against shippers to cover delays in unloading cars. No claim was made here that demurrage charges permitted by our statute are not adequate. *Page 332 
3. Where evidence based upon actual experience has not demonstrated a rate to be confiscatory, the court should not set it aside. As said in New York v. United States,331 U.S. 284, 340, 67 S.Ct. 1207, 1236, 91 L. ed. 1492, 1532:
"Where the result of a rate order is not clearly shown to be confiscatory but its precise effect must await operations under it, the Court has refused to set it aside despite grave doubts as to its consequences."
The commission in the exercise of its rate-making function adopted rates fixed by the interstate commerce commission for comparable services. These rates were but a fraction of those which the carriers contended should be established. The rates established by the interstate commerce commission are at least fair, reasonable, and compensatory. They are clothed with every presumption of validity.
There can be no doubt from what was said by the carriers upon the argument here that they do not want to render the switching services in question if they can avoid doing so.
Under the circumstances, we should be guided by the rule of the New York case, supra. When it appears from actual experience that the rates fixed are confiscatory, it will be time enough to set them aside. *Page 333