Court Opinion

ID: 3252047
Source: CourtListenerOpinion
Date Created: 2016-07-05 16:22:37.58863+00
Date Added: 2024-06-11T13:59:24.928284
License: Public Domain

An examination of the argument of counsel for appellee on the application for rehearing discloses two misconceptions of fact, which permeate and invalidate his conclusions.
1. The record does not show that "on or about the 13th day of August, 1914, the Louisville  Nashville Railroad Company submitted to the Railroad Commission a proposed new schedule of tariffs," as asserted in brief. On the contrary, it shows a citation to the carrier to show cause why the Commission should not establish a just and equitable scale of freight rates on its line, upon the hearing of which, on the date named, the Commission made an order that the carrier put into effect a schedule of rates thereto attached, with instructions as to their application. To confuse that initial order, which merely propounded a new tariff to the carrier, with the order of approval contemplated by section 5525 of the Code, after the carrier has filed its tariff, is to utterly misconceive the purpose and effect of our system of regulatory laws. Obviously it can make no difference what rates or rules the Commission may have initially proposed to the carrier, or ordered into operation. If thereafter the carrier, whether intending to conform to that order, or otherwise, filed with the Commission a tariff covering the designated field, but not in harmony with the original requirements of the Commission, and the Commission chose to approve that tariff as filed, its order of approval was ipso facto a cancellation of its previous order in so far as it was inconsistent with the approved tariff; and, by force of the statute (Code, § 5525), the rates thus approved, including every rate designated therein, and not excepted from the order of approval, became the lawful rate, binding upon carrier and shipper alike until discontinued and superseded by a valid order of the Commission made under its statutory powers.
We of course understand that a tariff is a schedule of itemized rates, and that the Commission might have approved some of the rates included in G. F. O. No. 2229, and disapproved others. But the record shows no such discrimination. The order of approval is of the tariff as a whole; and that order, to which we have been constrained to give decisive effect, has been entirely ignored throughout the argument of counsel for appellee.
2. Counsel's alternative theory of the case is that, even though the rate here in question was published and went into operation with the approval of the Commission, nevertheless the Commission afterwards found (June 7-9, 1915) that said rate was unreasonable and unlawful, and that the previous rate of 18 cents was reasonable, and remained the only lawful rate. *Page 258 
With all due deference to the claims of counsel, no such findings appear. What the Commission did find, as shown on page 34 of the record, was "that the tariff of the [carrier] in effect on its intrastate business at the time of said citation [viz. August 13, 1914] was not just and reasonable," and "that the rates put into effect by the defendant company by its tariffs G. F. O. 2229 and 2230, under the influence of rule 1 as therein embodied, were not in accord with the letter or spirit of the order of the commission that established those rates." The order thereupon made was:
That "said rule 1 be annulled and disallowed, and that in lieu thereof the following rules are prescribed as being in compliance with the said order of August 13, 1914, viz."
This order does not show upon its face any intention that it should be retroactive in its operation. Its only proper and legitimate effect is to thenceforth apply the tariff in question exclusively to mileage rates, and to exclude its application to other commodity rates in force prior to August 13, 1914.
But, even if it were conceded that the Commission intended its order to be retroactive, it is clear that our statutes give the Commission no such power. Section 5678 provides that, whenever, upon an investigation made under the provisions of chapter 130 of the Code, the Commission shall find any existing rate or rates unreasonable or unjustly discriminatory —
"it shall so determine, and by order fix a reasonable rate, * * * to be imposed, observed, and followed in the future in lieu of that found to be unreasonable, or unjustly discriminatory. * * * (Italics supplied.)
That section seems to relate to proceedings by the Commission ex mero motu, but section 5669, which relates to proceedings on the complaint of a shipper or other individual, also provides for a like order establishing a reasonable rate or rates "which shall be charged, imposed, and followed in the future. * * *" (Italics supplied.)
Section 5527 provides, as already noted, that the printed and published schedules "shall be the lawful rates when approved by the Railroad Commission." Such schedules cannot be made unlawful for and during the period of their approved operation by any subsequent retroactive finding and order of the Commission. Such a practice would be odious to the generally established notions of justice, and would, moreover, be utterly subversive of the policy and utility of any system of rate regulation; for no rate could be relied upon as stable, and neither carrier nor shipper could ever be certain of the basis upon which business was being conducted. For it must be observed that, under such a practice, the Commission would just as well find that a rate approved and imposed by it years before was in fact unreasonably low, and give retroactive operation to the higher rate later found to have been reasonable. Of course no such practice was contemplated, and no such power was vested in the Commission.
Manifestly, whether we consider the reason and policy of the statutes, or their express language, the Commission may not nullify the operation and validity of any tariff or rate which it has previously approved by a statutory order, made under the provisions of sections 5525-5527 of the Code, except as to its future operation.
Counsel draws analogies from the federal system of rate regulation and procedure, and pungently criticizes the original opinion, supra, because it ignores the principles declared in such cases as T.  P. R. Co. v. Abilene Cotton Oil Co.,204 U.S. 426, 27 Sup. Ct. 350, 51 L. Ed. 553, 9 Ann. Cas. 1075, Nat. Pole Co. v. C.  N.W. Ry. Co., 211 Fed. 65, 127 C.C.A. 561, and others, cited by counsel in brief.
In reply we wish merely to call the learned counsel's attention to the fact that the federal cases have been decided under a regulatory system quite different from our own, and are therefore wholly inapt. Indeed, it should be unnecessary for us to point out that, under the federal system, the carrier files and publishes its tariffs sua sponte, and they go into operation without any judgment or order of approval by the Interstate Commerce Commission, and are subject to review and condemnation as unreasonable, in which event the law itself provides for restitution to complaining shippers of all charges collected in excess of the rate thereafter found by the Commission to be the reasonable rate, and established by it as such. When the carrier files its rates it is fully understood that they are provisional only, and subject to disallowance, with retroactive effect. In this respect, as will be seen from our previous discussion, the Alabama system is radically different; and counsel's failure to perceive the difference seems to be the source of all of the fallacious reasoning upon which the criticism of our opinion has been grounded.
Counsel likens the initial order of the Commission, dated August 13, 1914, to a corporate charter, under the limitations of which the inconsistent provisions, if any, found in G. F. O. 2229, are null and void. But that analogy is worthless here, for the simple reason that the chartering power — the Commission — is authorized by law to approve such tariff as the carrier may file, not-standing any previous order inconsistent therewith; and, when it enters its order of approval, as it did in this case, it thereby gives legal sanction to every rate named in the tariff in question, and renders it conclusively the lawful rate until it is duly set *Page 259 
aside and superseded in some proceeding prescribed by the statute. In the recent case of E. L. Young Heading Co. v. Payne (Miss.) 89 So. 782, the Supreme Court of Mississippi has reached the same conclusion, under a regulatory system substantially like our own, and the opinion contains an interesting and convincing exposition of the subject.
We have given very thorough consideration to this case, and we think that we fully understand the record, the theories of counsel, and the principles of law that are applicable, and, with that understanding, we unhesitatingly reaffirm the correctness of our original conclusions.
Rehearing denied.
ANDERSON, C. J., and McCLELLAN and THOMAS, JJ., concur.