Court Opinion

ID: 9418763
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:38:37.998412+00
Date Added: 2024-06-11T17:22:09.828951
License: Public Domain

Mr. Justice Cardozo,
dissenting.
Unable to concur in the decision of the Court, I place upon record without extended argument the grounds of my dissent.
The Transportation Act of 1920 was framed with the design of securing to the United States an adequate and *44efficient system of railroad transportation. Everything contained in it with reference to extensions, voluntary and involuntary, is tributary to that end, and unless related thereto, is misconceived and misapplied. On the one hand, the carriers are to be permitted to make voluntary extensions of their lines, but only with the consent of tne Commission, lest waste may otherwise ensue; Texas & Pacific Ry. v. Gulf, C. & S. F. Ry., 270 U. S. 266, 277, 278. On the other hand, they are made subject to a correlative duty, if so ordered by the Commission, to build extensions, even though unwillingly, when transportation will otherwise be inefficient or inadequate. The limits of this duty are not appropriately defined by dividing the field into extensions big and little, with a power of regulation excluded from the one section and admitted in the other. On the contrary, the word extension is to be taken in no forced or artificial sense, but with the meaning attributed to it in the common speech of men. It does not fairly .connote ,a prolongation so vast arid sudden as to work an utter transformation of the character of the road, making what was extended the incident and the extension the principal. The action of the Commission must have a basis in reason, and its order must be viewed with reference to the length ,and other conditions of the line or lines to be enlarged. No doubt there is a point at which the enlargement of a road becomes “ the construction of a new line” (par. 18) rather than the extension of an old one. On the other hand, the power of the Commission is not limited to extensions that are merely trivial. The purpose of the Congress to make the power more than this, to make it an effective instrument for the development of railroad transportation, is revealed at every step. It is revealed in the legislative history of the measure, and particularly in the report of the Commission explaining the mischiefs to be remedied and recommending the fitting *45cure.* It is revealed very distinctly on the face of the statute, which provides that the extension may not be ordered without a certificate of convenience and necessity, nor ordered even then if the expense to be incurred “ will impair the ability of the carrier to perform its duty to the public,” a precautionary-proviso that was omitted in the requirement of adequate facilities for car service contained in the same section, and that would surely have been thought to be superfluous if the subject matter of the extension was to be a short or unimportant spur. In the case at hand, the proposed addition increases only by 1.2 per cent the mileage of the Union Pacific System, and is to be laid across a region which the Oregon-Washington. Railroad & Navigation Company, the subsidiary most directly affected, had marked out in its certificate of incorporation as territory that it planned to serve. An increment thus related to the thing to be increased is not so extraordinary in size, so lacking in proportion, as to remake or transform under the guise of improving or extending. New York & Queens Gas Co. v. McCall, 245 U. S. 345; Woodhaven Gas Light Co. v. Public Service Commn., 269 U. S. 244; United Fuel Gas Co. v. Railroad Commission, 278 U. S. 300, 308, 309.
Another basis of division, in addition to that of size, is put forward in argument as separating the extensions that *46Congress had in view from others so substantial that they are to be taken as excluded. We are to. find the test, so it is said, in the expectation or intention, presumable or actual, of the corporators or stockholders. The test, however, is illusory. If expectation or intention is the measure of the power of the nation, development must always wait upon the pleasure of the carrier affected: By hypothesis, the territory already served is the only territory that the carrier has evinced a willingness to serve. If its road is to be built for a greater distance or between other points, there is a frustration of its purpose that the terminus for construction shall be wherever stockholders and directors have willed that it shall be. In the thought of the lawmakers the power of the Government was not to be conditioned upon consent. It was to operate by compulsion upon whatever came within its sphere. The railroads of the nation had been brought together by the Transportation Act into a system of transportation national in its dimensions and under national control. Not the wishes of the component units, but the needs of the public which they, are organized to serve, were to give the rule and measure for command and for obedience. Let expectation be the test, and cases such as New York & Queens Gas Co. v. McCall, supra, Woodhaven Gas Light Co. v. Public Service Commn., supra, and United Fuel Gas Co. v. Railroad Commission, supra, must have been decided otherwise than they were. In these instances and others, carriers serving a particular territory were compelled to serve another in response to a publie need that the field of service be enlarged. Railroad Commission of California v. Southern Pacific Co., 264 U. S. 331, is cited as pointing another way, but its implications are misread. Its precise holding is that an order of a state commission cannot coerce an interstate carrier to make extensive changes and relocations of its main tracks at great expense in connection with the construction of a *47new union station, but that the consent of the Interstate Commerce Commission is necessary in such circumstances even though the new tracks are short. The case is far from holding, however, that the relevant sections of the Transportation Act apply to short additions to the exclusion of all others. On the contrary, the fact that the additions were “ not great in distance,” ,(p. 346). even though expensive, is recognized as giving color to the argument that no consent is necessary. “Tt is argued,” wrote Chief Justice Taft (p. 344), “ that paragraphs 18 to 21 of § 402 refer only to extensions of a line of railroad having the purpose to include new territory to be served by the interstate carrier and do not refer to an extension of new main track for the mere purpose of rearranging terminals within the same city. We do not think the language of paragraphs 18 to 21 can be properly so limited.” In such words there is surely no suggestion that the power of the federal Commission is inadequate to compel an extension into territory not servéd, nor any acceptance of the test of presumable intention.
If the test proposed were not illusory, it would none the less be inappropriate. The time has gone by when the subjection of a public service corporation to control and regulation by the agencies of government is to have its origin and justification in the terms of a supposed contract between the corporation and the state. The origin of the subjection and its justification are to be found, not in contract, but in duty, a duty imposed by law as ah incident to the enjoyment of a privilege. The discretion of managers and stockholders, at one time nearly absolute, is now subject in countless ways to compulsion or restraint in the interest of the public welfare. No longer may the carrier abandon any portion , of its road without the consent of the Commission, though the portion to be abandoned has been operated at a loss. 41 Stat. 477 (18); 49 U. S. Code, § 1 (18). No longer, without the consent of *48the Commission, may it extend the length of its road by its voluntary act. 49 U. S. Code,- § 1 (18). No longer may securities be issued, in the form either of stock or of evidences of debt, unless the Commission has found the . proposed action of the carrier to be compatible with the public good. 49 U. S. Code, § 20a.. All these limitations upon ancient rights and privileges have had the approval of this court. The new act, 'said the Chief Justice in Dayton-Goose Creek Ry. Co. v. United States, 263 U. S. 456, 478, “ puts the railroad systems of the country more completely than ever under the fostering guardianship of the Commission, which is to supervise their issue of securities, their car supply and distribution, their joint use of terminals, their construction of new lines, their abandonment of old lines, and by a proper division of joint rates, and by fixing adequate rates for interstate commerce, and in case of discrimination, for intrastate commerce, to secure a fair return upon the properties of the carriers engaged.” The argument is not persuasive that alone among all these inroads upon the freedom of managerial discretion the provision for compulsory extensions is to be struck down as ineffective. As long as governmental orders are kept within the range of reason, their operation is unaffected by expectation or desire.
The Fifth Amendment of the Constitution is invoked by the carriers but invoked without avail. Consistently • with that Amendment Congress may delegate to the Commission the power to force upon unwilling carriers an extension-of their lines into fields of old service and of new. Much .of what has been written in this opinion as to the meaning of the statute is pertinent also to an inquiry as to power. Again the thought is to be kept before us that the need of the public, not the acquiescence of the carrier, is the measure of the service, provided only that for such service there is adequate requital. Whether such requital has been assured is a question not susceptible of answer *49except in the setting of the circumstances. Objection that it is lacking is to be viewed in the light of the entire scheme and framework of the. Act of 1920, and of all the relevant provisions for the carriers’ protection. There must be kept in view, the provision whereby rates are to be maintained at such a level as to yield to the carriers of the country, or to the several groups into which they are to be divided, a fair and reasonable return, and whereby the surplus earnings of the strong roads may be recaptured and applied to the use of weaker ones.. True indeed it is that courts are wont to lean to the construction of a statute that will avoid serious doubts of its validity, though they might' hold it to be valid if pressed to á decision. United States v. La Franca, 282 U. S. 568, 574; United States v. Jin Fuey Moy, 241 U. S. 394, 401. Even so, they will not carry hesitation to the point of devitalizing the . essence to preserve the husk alone. When the scheme of the Act is viewed in the totality of its meaning and probable operation, there is a quick end to the objection that in fixing the bounds of duty to render service to the public, the area of the possible must coincide, at least generally and roughly, with that of - the actual and voluntary. Congress does not transcend the limits of the Constitution when it establishes a national system of transportation by rail. It does not transcend those limits when in aid of the system thus established, it lays a duty upon the railroads to furnish the extensions requisite for the attainment of the end in view. The "conclusion is the same whether the immediate purpose of the order is to develop the resources of the country in territory contiguous to roads already built, or to promote the convenience of communities served imperfectly or not at all.
I have said that governmental orders to be valid must be kept within, the range of reason. The record gives no support to a contention that those bounds have been exceeded. The cost of the improvement “ will not impair *50the ability, of the carrier or carriers involved to perform their duty to the public.” So the Commission finds, and the fact is not disputed. The improvement when made will be “ a valuable asset to the Union Pacific System,” and will1 be “ an effective feeder for that system after a reasonable development period.” This finding brings us into the realm of prophecy, and so, not unnaturally, into the field of contention and uncertainty. Much deference is due to the judgment of the Commission, “ a tribunal appointed by law and informed by experience ” (Illinois Central R. Co. v. Interstate Commerce Commn., 206 U. S. 441, 454; Virginian Ry. Co. v. United States, 272 U. S. 658, 665). The conclusion that it has expressed is no arbitrary judgment, but has a basis of fact and reason in the pages of this record. But if doubt were greater than it is, the binding force of the decision would not thereby be defeated. The order of the Commission does not depend for its validity upon the certainty of a prophetic judgment as to all the consequences to follow. Once more we are to keep in mind the changes that have been wrought by the Transportation Act of 1920. In cases unaffected by that Act, two lines of. decisions, following separate and yet neighboring channels, are to be found in the reports. The first, represented by Northern Pacific Ry. Co. v. North Dakota, 236 U. S. 585, 595, and Brooks-Scanlon Co. v. Railroad Commn., 251 U. S. 396, is made up of cases where the return for particular services was considered in isolation without reference to earnings generally. The second, represented by St. Louis & S. F. Ry. Co. v. Gill, 156 U. S. 649; Puget Sound Traction Co. v. Reynolds, 244 U. S. 574; and United Fuel Gas Co. v. Railroad Commission, supra, is marked by the cases where the compulsory enlargement of the range of public service has been held to be permissible if the combined return is adequate for the system-as a whole. By force of the Act of 1920, the zone has be°n narrowed for the application of *51the principle which has illustration in the first group, and correspondingly widened for the application of the prim ciple which has illustration in the second. Irrelévant, or nearly so, are the decisions of this court defining the jurisdiction of the Commission as it stood before the Act of 1920 had brought a new system into being. Irrelevant' also are the decisions of state courts or of the lower federal courts determining the validity of very different stat-"'■('l, under which there are no compensatory guaranteés to mitigate the burden of statutory duties, the carriers affected being viewed as separate units and not as members of a group. See, e. g. Southern Bell Tel. & Tel. Co. v. Calhoun, 287 Fed. 381; Atchison, T. & S. F. Ry. Co. v. Railroad Commission, 173 Cal. 577; 160 Pac. 828; Hollywood Chamber of Commerce v. Railroad Commission, 192 Cal. 307; 219 Pac. 983. For the first time in the history of our railroads a nationalized system of interstate transportation has made it necessary to consider the earnings of the system, or at least the earnings of the group, in determining whether rates or profits have been unreasonably reduced. There is nothing in this record to justify, still less to necessitate, the conclusion that as a result of the proposed extension the appellees, or the group of railroad carriers including them; were to be placed in such a position that it would be impossible thereafter, through any action of the Commission increasing rates or otherwise, to assure to them' “ a fair return upon the aggregate value of the railway property of such carriers held for and used in transportation.” Interstate Commerce Act, § 15 á (2).
This Court has said of the Transportation Act of 1920 that it “ seeks affirmatively to build up a system of railways prepared to handle promptly all the interstate traffic of the country.” Dayton-Goose Creek Ry. Co. v. United States, 263 U. S. 456, 478.
The end is placed in jeopardy by a construction of the statute that debilitates the means.
*52The judgment of the District Court should therefore be reversed and the order of the Commission reinstated.
Mb. Justice Brandéis and Mr. Justice Stone join in this dissent.

Of the four major recommendations made by the Commission in its annual report of December, 1918, the third was as follows: “(3) limitation of railway construction to the necessities and- convenience of the Government and of the public, and assuring construction to the point of these limitations.”
Accompanying these recommendations was a statement of their fundamental aim or purpose..- “ Whatever line of policy is determined upon, the fundamental aim or purpose should be to secure transportation systems that will be adequate to the Nation’s needs, even in time of national stress or peril, and that will furnish to the public safe, adequate and efficient transportation at the lowest cost consistent with that service,”