Court Opinion

ID: 5579335
Source: CourtListenerOpinion
Date Created: 2022-01-11 01:34:17.471954+00
Date Added: 2024-06-11T08:36:02.500066
License: Public Domain

Beck, J.,
dissenting. Upon the back of the mileage books and penny scrip books which are dealt with by the rule of the railroad commission (hereinafter referred to as the commission) are certain conditions and stipulations These are signed by the purchaser at the time of the purchase, and thus between him and the railroad company selling the tickets, whether for scrip or interchangeable mileage, is created an express contract. Under that contract and by virtue of it the purchaser obtains certain advantages which are not enjoyed by one who, about to become a passenger, buys the ordinary ticket to be used for his passage and taken up on the train. The advantages secured by the purchaser of the books of coupons in question constitute a valuable consideration. The purchaser of the coupon books (and in the use of the expression “coupon books” I include both the interchangeable mileage books and the penny scrip) obtains his transportation at a rate that is considerably less than that paid by the purchaser of the ordinary ticket, the reduction amounting in some cases to twenty per cent, of the’cost of transportation at the rates fixed by the railroad commission. The commission had, previously to the passage of the order in question, fixed the maximum rates for carriage between points in this State over the various lines of railroad therein; and the order which they have passid is not in the nature of one rearranging or creating a passenger tariff, but it affixes certain new and material conditions to the ’¡erms of the contract between the railroad company selling the *838coupon tickets and the purchaser thereof. This contract entered into by the carrier and its patron is one voluntarily entered into by both parties thereto; by the carrier, no doubt, because it tends to increase the volume of its business, and by the purchaser for a valuable consideration. It is not contended, nor even suggested in argument, that the contract violates the policy of the law. The regulations as to the manner of the use of the coupon tickets were held by the trial court to be reasonable; and in view of the evidence submitted at the trial, tending to show the reasonableness of all the regulations in the regard just referred to, it can scarcely be denied that this holding was clearly authorized, so far as relates to the regulations themselves, without reference to the effect which other regulations sought to be imposed by the action of the commission had upon, them. They are not .violative of any public policy of the State; they do not adversely affect the safety of the passenger; nor do they diminish in any .way the care due nor the diligence owing him by the carrier. The passenger’s rights to safe transportation, to every comfort and facility guaranteed by the law or voluntarily provided for other passengers, are as complete as if he were travelling on a full-fare ticket. Consequently the carrier had the right, in order to facilitate the transaction of its business and to safeguard its income, to make these regulations, if in its opinion they were such as to accomplish the ends proposed, whether others agreed with it as to the necessity and effectiveness of these regulations in this regard or not. In Perry v. Railroad Co., 9 Ga. App. 260 (70 S. E. 1122), the Court of Appeals says: “There is no law or regulation of the railroad commission which prevents a carrier from making with the members of the general public a contract by which the carrier sells to a member of the public at a reduced rate a mileage book, which shall not be good for passage on trains except from non-agency stations, or from agency stations not kept open for the sale of tickets, unless it is first exchanged for a ticket.” In Mason v. Seaboard Air-Line Railway, 159 N. C. 183 (75 S. E. 25), the Supreme Court of North Carolina said: “The consensus of all the authorities, without a single exception so far as we have been able to find, is that by accepting such a contract at a reduced rate, when he has the opportunity to purchase the usual and ordinary ticket, the passenger enters into a contract with the carrier different. from that implied by law upon the purchaser of an ordinary icket *839at full rate of fare. The purchaser is bound in such eases by the terms of the contract, and is entitled to its advantages of reduced fare.” In Eschner v. Penn. Railroad Co., 18 I. C. C. E. 60, the Interstate Commerce Commission held: “If a carrier may extend or withhold the privilege of mileage, excursion, and commutation tickets, it would seem to follow that it may attach to them, as an integral part of the contract, conditions of the kind involved in this proceeding; and since we can not compel carriers to issue such tickets, we see no grounds upon which we may compel them to modify the conditions which they attach to them, so long, at least, as these conditions result, as heretofore stated, in no discrimination nor in violation of any other provision of the act. . . In a word, the right to use exchange orders and mileage books is in the nature of •a privilege voluntarily accorded by carriers under their tariffs, and must be accepted by those who use such special fares with all lawful and non-discriminatory liinitations that may be attached to them.” And supporting this view there is abundant authority to be found in the decisions of many courts, which have been collated in the opinion of the chairman of the commission (concurred in by another member of the commission), dissenting from the action of the majority in passing the order in controversy.
I have referred to the contract between the carrier and the purchaser of the coupon books as voluntary, and it is purely so.' It may be further said that the placing of the coupon books upon sale by the carrier is also voluntary, in that neither the legislature nor the commission has passed any act, or adopted any order, requiring the issuance and sale of such coupon books, and it may well be doubted whether the commission could compel the issuance of such mileage tickets while the order already passed by the commission fixing maximum rates remains of force and unchanged. In the case of Lake Shore & Mich. Railroad Co. v. Smith, 173 U. S. 684 (19 Sup. Ct. 565, 43 L. ed. 858), the Supreme Court of the United States had before it the question of the compulsory issuance of mileage tickets like those in question here, and the question of the constitutionality of an act of the legislature of the State of Michigan, which provided that thousand-mile tickets should be kept for sale at’ the principal ticket offices of all railroads in the State, or carrying on business partly within and partly without the State, at a price not exceeding $20 in one part, and $25 in another part of *840the State; that such tickets should be made non-transferable, “but whenever required by the purchaser they shall be issued in the names of the purchaser, his wife and children, designating the names of each on the ticket, and that such tickets shall be made valid for two years from the date of purchase.” The court sustained the contention of the railroad company to the effect that the act was unconstitutional because violative of that part of the constitution of the United States which forbids the taking of property without due process of law, and requires the equal protection of the laws. This ease has been followed by the courts of last resort in a number of the States — reluctantly by some, and without question or hesitation in others. State v. Bonneval, 128 La. 902 (55 So. R. 569, 24 Ann. Cas. (1912C) 837).
It appearing, then, that the sale of the mileage tickets, and the assent of the purchaser to the conditions and stipulations entered thereon and evidenced by his signature attached thereto, constitute a contract voluntarily entered into by both parties, and that the contract was not violative of the public policy of the State, how could the commission attach new terms or conditions to the contract, which in substance would have the effect of making a different contract from that into which the parties had entered? It is not necessary to' consider here whether the commission could prohibit entirely the issuance of the mileage books, on the ground that it would be discriminatory in favor of a certain class of the public; but the question is, whether, without attempting to abolish the use of the mileage books, they could change the contract which was entered into in connection with the sale and purchase thereof. We recognize the principle that the right to contract is not absolute and universal. It was well said by the Supreme Court of the United States in Frisbie v. United States, 157 U. S. 165, 166 (15 Sup. Ct. 586, 39 L. ed. 657) : “It is within the undoubted power of government to restrain some individuals from all contracts, as well as all individuals from some contracts. It may deny to all the right to contract for the purchase or sale of lottery tickets; to the minor the right to assume any obligations, except for the necessaries of existence; to the common carrier the power to make any contract releasing himself from negligence, and, indeed, may restrain all engaged in any employment from any contract in the course of that employment which is against public policy. The possession of this *841power by government in no manner conflicts with the proposition that, generally speaking, every citizen has a right freely to contract for the price of his labor, services, or property.” The same principle is stated in the case of Chicago &c. R. Co. v. McGuire, 219 U. S. 549 (31 Sup. Ct. 259, 55 L. ed. 328), and in numerous cases there cited. But it is equally true, as was said by the same court in the case of Allgeyer v. Louisiana, 165 U. S. 578, 589 (17 Sup. Ct. 427, 41 L. ed. 832), that “The liberty mentioned in that amendment [fourteenth] means not only the right of jhe citizen to be free from the mere physical restraint of his person, as by incarceration, but the term is deemed to embrace the right of the citizen to be free in the enjoyment of all his faculties; to be free to use them in all lawful ways; to live and work where he will; to earn his livelihood by any lawful calling; to pursue any livelihood or avocation, and for that purpose to enter into all contracts which may be proper, necessary, and essential to his carrying out to a successful conclusion the purposes above mentioned.” It can certainly be said that freedom in the exercise of the right to contract is the general rule, subject always to interference therewith by the State in the exercise of its police power, where it can be properly invoked to preserve or safeguard the health, safety, or welfare of the public. But before an interference with the freedom of contract can be justified upon the ground that it is resorted to in the exercise of the police power by the State, it must appear that the exercise of this power has a clear relation to the purpose in view and is necessary to the accomplishment of the ends for which that power can be exercised. In the use of the mileage tickets under -the conditions which form a part of the stipulations assented to by the purchaser, there is, as we have said before, the same care for the welfare, the comfort, and the .protection of the user thereof as if he had bought the usual and ordinary ticket good for passage at the rates prescribed by the railroad commission. Consequently, the exercise of the police-power in case of the purchase and use by passengers of the mileage books can not be justified on the ground that it is necessary to safeguard or to insure the health, comfort, or welfare of the passenger.
Now, if it be insisted that in addition to the exercise of the police power for the purpose of securing and protecting the health, comfort, and welfare of the members of the public, it may be invoked *842also to afford him greater convenience and to diminish inconvenience incurred in traveling, that contention can well be met in the present case by calling attention to the fact that the inconvenience to which the holder of one of these mileage tickets is subjected can be only slightly greater than the inconvenience every traveler by railway, who seeks to buy the usual and ordinary ticket, is subjected to, when in a limited time the traveler seeks to purchase a ticket at stations where one agent must wait upon a considerable number of customers. But whether the inconvenience of the user of the mileage ticket is only slightly greater than that of the purchaser of the ordinary ticket, this inconvenience is one of the things which he contracted, for a valuable consideration, to undergo; and it is optional on his part whether the advantage to him secured in the decrease of the amount to be paid for his transportation is compensation to him for the inconvenience which he contracts to undergo. The holder of the coupon book buys his transportation, it might be said, at a bargain. Has he not, and should he not have, the right to bargain that he will exercise some degree of patience and undergo some degree of inconvenience for the advantage and profit which he secures from the bargain? In consideration also of the greater trouble, inconvenience, and labor incurred by the railway selling the mileage ticket, has it not the right to adopt the method of handling and keeping accounts with respect thereto which the court below found, under the evidence, to he reasonable in view of its being a cheek against loss of revenue derived from the sale of this class of tickets? If the holders of the coupon tickets were entitled .to have the coupons taken up just as tickets are taken up, and the coupons by the order of the commission be thus converted into an ordinary ticket, then the railroad loses part of the consideration which was the inducement for the issuance of such coupon books at a reduced rate, and the purchaser of a mileage ticket good for 1,000 miles, would secure for $20 that for which other members of the public would have to pay $25. To hold that a ticket voluntarily sold at a reduced price by the railroad, and purchased by a prospective passenger in consideration of the reduction, can by the order of the railroad commission be stripped of the reasonable conditions which were attached to the sale thereof at such reduced price, and be made to serve all of the purposes of a regular passage ticket, without having been exchanged for a *843passage ticket, would be to give to the purchasers of the coupon books an advantage merely because they bought transportation in larger quantities than did the purchaser of the usual ticket. I do not think the commission can confer upon a purchaser of transportation in large quantities such an advantage over the purchaser in less quantities, especially while the order fixing maximum rates remains of force.
It will be observed that I have several times spoken of the exercise of the police power. In doing so I have, for the sake of the argument, treated the order of the railroad commission under consideration as upon the same plane, and as having the same effect and authority, as a legislative enactment; but I do not intend for it to be inferred that I am of the opinion that the railroad commission could exercise that great power, reserved to the State, as completely as the legislature may do in proper cases.
The authority to adopt and to put into effect the order of the commission is sought to be upheld under the provisions of the Civil Code, § 2638. That section provides, that all contracts and agreements between railroad companies doing business in this State, as to rates of freight and passenger tariffs, shall be submitted to the railroad commission for inspection and correction, that it may be seen whether or not they are a violation of the law or of the provisions of the constitution, or of article 6 of chapter 2 of the Civil Code, or of the rules or regulations of the railroad commission; and that said commissioners may make such rules and regulations as to said contracts 'and agreements as may be deemed necessary and proper. It may well be doubted whether or not contracts such as are to be affected by the order of the commission under consideration, that is, terms and stipulations annexed to the sale of these mileage books, which become a contract between the railroad company and the purchaser of the book, upon the written agreement of the purchaser thereof and the payment of the purchase-price, fall within the provisions of this section; but even if they did, it is clear, if I am right in the conclusion which I have announced above, that the order amounted to an unlawful interference with the right to contract, and that any such regulation as that embodied in this order of the commission would not be embraced within the authority to make necessary and proper rules and regulations; for, as I have pointed out,.it could only be justified *844as a proper exercise of the police power, and that power could not be exercised for the purpose sought to be accomplished by this order, in view of the object with respect to which it is invoked. And this is said without reference to the power of the commission — an administrative body — to exercise the police power.
For these reasons I am of the opinion that the order of the commission under attack should have been adjudged illegal and void, and that the judgment granting the injunction should be affirmed.