Court Opinion

ID: 5262594
Source: CourtListenerOpinion
Date Created: 2022-01-06 18:47:42.32639+00
Date Added: 2024-06-11T08:28:06.146442
License: Public Domain

Judge Cardozo,
while he concurred with the majority in upholding the ruling in the Quinby case, said: “ I do not say that it is beyond the power of the Legislature, either directly or through a commission, to abrogate or modify the conditions of a franchise. If such a question were here, I might agree in that respect with Judge McLaughlin.” Judge Elkus concurred in the memorandum of Judge Cardozo, Judge Chase and Judge Collin concurred with Judge McLaughlin and Judge Andrews also concurred in so much of the opinion of Judge McLaughlin as holds that the Legislature has constitutional power to modify rates fixed in a local franchise.
It thus appears that four of the learned judges of the Court of Appeals absolutely and two inferentially sustain the constitutionál power of the Legislature to modify rates fixed in local franchises. With the plain intimations contained in the former decisions cited and the direct ruling and invitation to the Legislature to amend the law if it intended to exercise the power, at its next session it passed the act now under consideration which in “ clear and definite language confers power upon the Commission to increase rates above the amounts fixed in the grants or consents.”
In People ex rel. City of New York v. Nixon (229 N. Y. 356) Judge Cardozo, in alluding to theQuinby and other like cases, said: “We did not hold that there was any constitutional restraint upon the grant of such a power. Restraint under the *226Federal Constitution, there certainly was none. [Citing cases.] We left open the question whether there was any under the Constitution of the State.”
It seems to us that the question is now settled beyond reasonable doubt.
Article 6 of the Public Service Commission Law (as added by Laws of 1921, chap. 134), being sections 105 to 111, inclusive, thereof, is also attacked. It provides in brief that after making the necessary studies and investigation the Transit Commission shall prepare a plan of readjustment for the relief of the emergency declared to exist, and for the improvement of transit in the city. Upon the completion of the plan and before adopting the same it shall hold a public hearing, shall transmit a copy to the local authorities of the city and to each of the railroads included therein, with a request for the statement of the views of such local authority and such railroad companies. There are provisions for full and due hearings and opportunity for approval of the complete plan and contracts, and on failure of the city authorities to approve, further public hearings are to be had and if changes are made again the plan and contracts are to be submitted to the city for its approval, and if there is final disapproval the Commission is authorized to execute and deliver such contract or contracts in the name and behalf of the city. The respondents again invoke the contract clause of the Federal Constitution (Art. 1, § 10, subd. 1) alleging that the proposed action would result in violation of their existing contract rights.
The question here presented is not now ripe for decision. No action has been taken. No plan has been prepared or submitted. No contracts have been drawn. It is a matter of common knowledge that intra mural transportation matters are in a deplorable condition. It may be that the plan devised will be so sound, so safe, so .conservative, so fair and reasonable, that it will be willingly accepted by all parties. There is no question but that the city has the power to approve of modifications of existing contracts. The existing contracts between the city and the Interborough and Brooklyn Union Elevated Railroad Companies came under judicial scrutiny in Admiral Realty Co. v. City of New York (206 N. Y. *227110). At page 130 Judge His cock for the court said: “ The question whether the city may make this arrangement with the Interborough Company seems to resolve itself into the fundamental inquiry whether a municipality having made a contract may subsequently bargain under full legislative authority for a modification of that contract so that it will be adjustable to altered and then existing circumstances, paying an adequate consideration either for what the other party gives up or for what it secures under the modifications. It seems to me obvious that a municipality has such power. It is an ordinary incident to the power to make a contract that one who has made such a contract which through inadvertent provisions or change in conditions becomes undesirable may bargain for a modification or cancellation thereof. The power to make a contract begets the right to procure its amendment or rescission. I can see no reason why this principle applicable to an individual should not be applied to a municipality in such a case as the present one and why we should not hold even without guiding authority that a municipality which had the power to make a contract for the operation of subways may secure modifications thereof when it has become inadequate to meet existing conditions.”
The respondents have argued almost every conceivable question that could be raised in opposition to this application. Many have no relevancy at the present time. We have considered the vital ones and reach the conclusion that the applications should be granted.
Dowling, Smith, Page and Greenbaum, JJ., concur.
Applications granted. Settle orders on notice.