Court Opinion

ID: 6424719
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:02:57.093968+00
Date Added: 2024-06-11T15:51:56.092304
License: Public Domain

Knowlton, J.
I concur in everything contained in the opinion of the Chief Justice except the discussion of the two points on which the decision is made to turn, but I do not agree with him in that, and I do not think the statute unconstitutional. In his opinion the question whether the statute is void as impairing the obligation of contracts contained in the several charters under which the railroads were organized was somewhat considered, but not decided. In the view which I take of other parts of the case, it becomes necessary to consider this question further. I need not go over the ground traversed by the Chief Justice. It is obvious that the object of St. 1830, c. 81, (Rev. Sts. c. 44, § 23,) was to prevent charters afterwards granted by the Legislature from being held to be contracts; and all subsequent charters must be deemed to have been granted subject to that general law, except in cases where the Legislature saw fit plainly to abrogate it. If a charter was afterwards granted which expressly professes to bind the Commonwealth by a contract, doubtless the Commonwealth is bound; but in interpreting subsequent charters this general law must be given effect so far as it can be without coming in direct conflict with express contracts, plainly intended as such by the Legislature. If we assume that in some of the charters of railroad corporations now included in the Old Colony Railroad Company there was an express contract that the' Legislature should not reduce the fares and charges so as to leave an income of less than ten per cent on the cost of the railroad, and that the general law above cited does not apply to these contracts, so far as they have been executed on either side, it must still be held that the Legislature could at any time amend or repeal these provisions of the charters so as to prevent future action on the faith of them, leaving them in effect only so far as rights had accrued by the execution of them. It would be very unreasonable to hold that by such a provision the Legislature was bound for all time to allow rates and charges *95which would produce an income of ten per cent, not only on the cost of the railroad as first built and completed under the charter, but also on every extension, enlargement, or improve, ment of it after it had been completed according to the original plan. By St. 1870, c. 325, § 1, re-enacted in St. 1874, c. 372, §§ 4, 179, which last sections are still in force, the Legislature terminated the right of these railroad corporations to go on expending money and increasing the cost of their railroads under a contract which permitted them, without the possibility of legislative interference, to charge fares which would give them an income of ten per cent on the cost of the road, if such a right had previously existed. As I understand the report, the Old Colony Railroad Company did not contend at the hearing that the statute under consideration would reduce its income below ten per cent on the cost of the road at the time its right to build a road or to increase the cost of it under the provisions of the original charters was terminated by the St. of 1870. Moreover, I am of opinion that the Old Colony Railroad Company, by accepting the benefit of legislation subject to general laws which gave the Legislature the right to revise its fares, rates, and charges, has lost the right, if it ever had it, to interpose the provisions of the original charters against a statute which assumes in a reasonable way to regulate or reduce its fares.
In the suit against the Boston and Albany Railroad Company, nothing appears in the record which opens this defence, or requires consideration of the numerous statutes under which the corporation is acting. I am therefore of opinion that the peti-, tians should not be dismissed on the ground that the statute impairs the obligation of contracts securing to the defendants immunity from reduction of fares.
The only grounds on which the statute is held unconstitutional by the majority of the court are, first, that it seeks to compel the transportation of passengers by one railroad on the credit of another, to which money for payment of the fare has been advanced by the purchaser of a mileage ticket; and, secondly, that a mileage ticket is to be “ accepted and received for fare and passage ” upon other railroads “ under like conditions as upon the line or lines of the corporation issuing such ticket.”
The property of railroad corporations is devoted to a public use. *96The truth of this proposition is nowhere questioned. Such corporations may exercise the right of eminent domain by taking lands for their roads against the will of the owners. The business of providing highways and arranging conveniences to enable people easily to pass from place to place is a part of the public business which may be done by the State. If the State grants franchises, and delegates the transaction of this business to corporations, it retains the right to regulate the business for the public good in any reasonable way. It may do this in the exercise of the police power, which is a power inherent in every well ordered system of government. It is the power which is granted in terms to our Legislature by article 4 of chapter 1 of the Constitution of Massachusetts, which gives the General Court full power and authority “ from time to time to make, ordain, and establish all manner of wholesome and reasonable orders, laws, statutes, and ordinances, directions and instructions, either with penalties or without, so as the same be not repugnant or contrary to this Constitution, as they shall judge to be for the good and welfare of this Commonwealth, and for the government and order thereof and of the subjects of the same, and for the necessary support and defence of the government thereof,” etc. Moreover, most of the charters of railroad corporations have been granted and accepted subject to a reserved right in the Legislature to alter or repeal them. It is settled that this right to regulate the business of railroad corporations extends so far as to authorize the Legislature to fix the rates and charges for the transportation of passengers and freight. The principle is established by decisions, not only of this court, and of the Supreme Court of the United States, but of courts in most of the other States. Parker v. Metropolitan Railroad, 109 Mass. 506. Chicago, Burlington, & Quincy Railroad v. Iowa, 94 U. S. 155. Peik v. Chicago & Northwestern Railway, 94 U. S. 164. Munn v. Illinois, 94 U. S. 113. Ruggles v. Illinois, 108 U. S. 526. Chicago & Grand Trunk Railway v. Wellman, 143 U. S. 339. Budd v. New York, 143 U. S. 517. People v. Boston & Albany Railroad, 70 N. Y. 569. People v. Budd, 117 N. Y. 1. Chesapeake & Potomac Telephone Co. v. Baltimore & Ohio Telegraph Co. 66 Md. 399, 414. Lake Shore & Michigan Southern Railway v. Cincinnati, Sandusky, & Cleveland Railway, 30 Ohio St. 604. Hockett v. State, 105 Ind. 250, 258. Central Union Telephone *97Co. v. Bradbury, 106 Ind. l; Central Union Telephone Co. v. Stale, 118 Ind. 194, 207. Baker v. State, 54 Wis. 368, 373. Nash v. Page, 80 Ky. 539, 545. Mayor, &c. of Mobile v. Yuille, 3 Ala. 137, 140. Stone v. Yazoo Mississippi Valley Railroad, 62 Miss. 607, 639. A minority of the justices of the Supreme Court of the United States dissent from decisions of the majority extending the doctrine to the regulation of charges for the use of grain elevators, (Munn v. Illinois, 94 U. S. 113, and Budd v. New York, 143 U. S. 517, 549,) making a distinction between what they consider a public use of property and a public interest in the use of property. But they agree with the majority that railroad corporations are subject to regulation. Mr. Justice Field, one of this minority, in giving the opinion of the court in Georgia Railroad Banking Co. v. Smith, 128 U. S. 174, 179, says: “The incorporation of the company, by which numerous parties are permitted to act as a single body for the purposes of its creation, or, as Chief Justice Marshall expresses it, by which ‘ the character and properties of individuality ’ are bestowed ‘ on a collective and changing body of men,’ Providence Bank v. Billings, 4 Pet. 514-562; the grant to it of special privileges to carry out the object of its incorporation, particularly the authority to exercise the State’s right of eminent domain that it may appropriate needed property, a right which can be exercised only for public purposes; and the obligation, assumed by the acceptance of its charter, to transport all persons and merchandise upon like conditions and upon reasonable rates, — affect the property and employment with a public use; and where property is thus affected, the business in which it is used is subject to legislative control. So long as the use continues, the power of regulation remains, and the regulation may extend not merely to provisions for the security of passengers and freight against accidents, and for the convenience of the public, but also to prevent extortion by unreasonable charges, and favoritism by unjust discriminations. This is not a new doctrine, but old doctrine, always asserted whenever property or business is, by reason of special privileges received from the government, the better to secure the purposes to which the property is dedicated or devoted, affected with a public use.” In Budd v. New York, 143 U. S. 517, 549, Mr. Justice Brewer, another of this minority, says: “ The use is pub-*98lie, because the public may create it, and the individual creating it is doing thereby andyiro tanto the work of the State. The creation of all highways is a public duty. Railroads are highways. The State may build them. If an individual does that work, he is pro tanto doing the work of the State. He devotes his property to a public use. The State doing the work fixes the price for the use. It does not lose the right to fix the price because an individual voluntarily undertakes to do the work.” This is equivalent to saying, what is undoubtedly the law, that it does not lose the right to make any reasonable regulation for the benefit of the public in regard to the transaction of any or of all the railroad business in the State.
The Legislature’s determination of what is reasonable is also conclusive, subject only to the limitation that its enactment shall not conflict with any expressed or clearly implied provisions of the Constitution either of the State or of the United States. I am not aware of anything in either Constitution which forbids the State in regulating the public business of transporting passengers within its borders, when the business is carried on by its own creatures, whose financial ability it is supposed to know, from requiring these corporations to issue tickets, which when paid for shall be received for transportation on a line of railroad other than that issuing it, and which shall entitle the carrying railroad to receive its pay from the railroad which issued and sold the ticket. It seems to me plain that this is not within the express provision of our State Constitution, which forbids the taking of private property without compensation, or for other than a public use. I think it is not a taking of property without due process of law within the meaning of that language in the Constitution of the United States, nor an interference with the right “ of acquiring, possessing, and protecting property ” which is secured by the Declaration of Rights in the Constitution of Massachusetts. It is merely a regulation of public business which the Legislature has a right to regulate. Its apparent object is to promote the convenience of persons having occasion to travel on different railroads, and to reduce for them the cost of transportation. The risk of pecuniary loss to a corporation from carrying a passenger on the credit of another corporation to which the money has been advanced for carriage, instead of *99having payment at the time, is almost infinitesimal. In the first place, all railroad corporations are required to make annual reports to the Commonwealth, (Pub. Sts. c. 112, § 81,) and the Legislature is presumed to know that all or nearly all of them are of ample financial ability, and that their obligation to pay a small debt is as good as that of any city or town in the State. Secondly, if there are any now, or if hereafter there should be any, which are not financially sound, it would be the duty of the railroad commissioners, on application, to 'relieve all other corporations from the obligation to take their tickets. In the natural course of business there would be frequent settlements of accounts between the different railroads, as there are now, and the most that any railroad could owe another under this statute would be the difference between the cost of the other’s mileage tickets held by itself, and the cost of its own tickets held by the other, which would ordinarily be but a trifling sum. It would be impossible for any railroad to harm its neighbors by issuing and selling a large number of mileage tickets in the anticipation of becoming insolvent, for if it were possible to sell them, the railroad commissioners, at any time, on application, would exclude it from the provisions of the act, and other railroads could not afterward be required to accept its mileage tickets, and the loss, if any, would fall on the purchasers of the tickets, whose contracts would be with it alone. The risk of loss from inability of one railroad to collect of another under mileage tickets taken from passengers seems to me too small to be seriously considered, and I regard the objections to the statute in this particular as theoretical and speculative rather than substantial or practical. It is a matter of common knowledge that every railroad does business on the credit of other railroads to a much larger amount than would ever be done under a statute of this kind; but suppose there is a possibility of trifling loss in a case which might arise under the statute, that does not render the statute unconstitutional. The question is rather whether there is a probability of losses so large as to make such a requirement plainly unjust and unreasonable, as an interference with the right “ of acquiring, possessing, and protecting property.” I think nobody can contend that there is such a probability. Moreover, the very idea of the exercise of the police power necessarily implies a greater or less interference with the acquisition, use, and enjoy*100ment of property. Sawyer v. Davis, 136 Mass. 239. Miller v. Horton, 152 Mass. 540. Every statute affecting property, enacted in the exercise of this power, illustrates the proposition. The reduction by the Legislature of fares upon railroads is an illustration which in my opinion touches much more closely the acquisition, possession, and protection of property, than does a requirement that railroads shall trust each other during short intervals for the payment of fares for which interchangeable tickets have been taken. In determining whether the statute is so unreasonable as to be against common right, real conditions and probable results, and not remote possibilities, are to be considered.
It will hardly be contended that every statute enacted for the regulation of the railroad business of the Commonwealth, which contemplates the giving of a short credit by one railroad company to another in the convenient transaction of their business, is for that reason unconstitutional. There are many general and special laws which require railroads to render services, to furnish station accommodations, and permit the use of tracks and the like to another corporation, for a reasonable compensation to be agreed upon, or, in the absence of agreement, to be fixed by the railroad commissioners. In many cases it would be difficult, if not impracticable, to provide for these payments in advance, and some at least of the statutes seem to contemplate that payments will be made upon short credits, as the practice is, after the services are rendered or the benefits received. Pub. Sts. c. 112, §§ 216-218. St. 1866, c. 126. St. 1871, c. 343. St. 1872, c. 180. Some of these statutes require the payment of rent for the use of a station built and owned by one railroad and used by others. The rent must either be paid in advance, or there must be some credit for it; it could hardly be paid daily. A requirement that the rent should be paid in advance would be quite as objectionable on constitutional grounds as a provision for a reasonable credit. The building might be destroyed, and the company that had paid rent in advance might get no equivalent for its payment. It seems to me that a regulation which may require a short credit for trifling sums, arising in the regular course of business between great corporations, most of which have property amounting to many millions of dollars in value, is not for that reason unconstitutional.
*101Similar considerations apply to the objection that the tickets are to be received by the different railroads in the state under like conditions. It may be that in favor of the constitutionality of the law this language might be construed to mean something less than that the provisions of a contract in regard to the amount of baggage which may be carried, and the like, made by the railroad issuing the ticket, are to be applicable when the ticket is used on the railroad of another company; but if we assume in favor of the defendants that this is the meaning of the language, the difficulty does not seem to me great. In the first place, it is a familiar fact that upon railroads generally there is no such difference in their contracts as to create any practical difficulty in issuing tickets to be used over many different lines of connecting railroads. Everybody knows that one may buy, at any important railroad station in the State, a ticket to go thousands of miles over numerous railroads, whose owners will all receive the ticket under like terms and conditions. The reasonableness and constitutionality of the statute are to be determined in view of the existing facts in the management of railroad business, and not in view of the legal possibility that some corporation would insert in its mileage ticket an unusual or absurd provision. If such an unexpected event should occur, that would be a reason for the intervention of the railroad commissioners under the statute to relieve other corporations by excluding or exempting the railroad from the provisions of the act, and it would be in the power of the Legislature at the earliest opportunity to compel it to issue mileage tickets with reasonable provisions in regard to the transportation of baggage and other similar matters. • No material harm could come to any person or corporation in the mean time. In view of the way in which railroad corporations do their business, which must be presumed to have been known to the Legislature, and which must be considered in passing upon the statute, this objection, like the other, seems to me speculative and theoretical rather than real. The statute in these two particulars, which are now made the ground of objection to it, conforms to the well known voluntary practice of railroad corporations in the transaction of similar business.
These objections would seem to be removable by a provision that each corporation shall deposit with the State Treasurer, or *102with some otheió responsible officer, a sufficient fund to guarantee the redemption of all mileage tickets issued by it, and by a requirement that all mileage tickets shall be in a form prescribed by the Legislature; but if the statute contained such provisions, is it probable that the people of the Commonwealth or the railroad corporations would think it more reasonable, or better for practical operation, or more conducive to the best interests of the community ? I am of opinion that the statute is a regulation of the business of the railroad corporations of the Commonwealth, which does not involve such probable loss from carrying passengers on credit, or such practical difficulty from the terms and conditions on which tickets would be issued, as to be an interference with the rights of those who undertake to do this public business, and I therefore think the statute constitutional.
I am authorized to say that Mr. Justice Holmes concurs in this opinion.