1. In a suit to set aside an order of the Interstate Commerce
Commission requiring a railroad extension, that Commission and
commissions representing interested states having intervened to
defend the order, are entitled as "aggrieved parties" to appeal to
this Court from a decree annulling it, even though the United
States, as represented by the Attorney General, will not join in
the appeal. Urgent Deficiencies Act, Oct. 22, 1913; Commerce Court
Act, §§ 2, 5. P.
288 U. S.
22.
2. Upon such an appeal, a decree may be obtained enforcing the
rights of the United States. P.
288 U. S.
25.
3. An official may be designated to stand in judgment on behalf
of the United States so that a decree against him binds the
Government; Congress had power, in naming the United States as the
defendant in such suits, to give the Commission, and others having
an interest, authority to litigate the validity of such orders,
and, regardless of joinder by the Attorney General, to obtain by
appeal a review effective as to the United States. P.
288 U. S.
27.
4. That part of par. 21 of § 1 of the Interstate Commerce Act
which authorizes the Commission to require a carrier "to extend its
line
Page 288 U. S. 15
or lines," provided the Commission find that such extension is
reasonably required in the interest of public convenience and
necessity and that the expense involved therein will not impair the
ability of the carrier to perform its duty to the public refers to
extensions within the carrier's undertaking, and does not empower
the Commission to compel the building of what is essentially a new
line to reach new territory which the carrier never agreed to
serve. Pp.
288 U. S. 35
et seq.
5. This provision of par. 21 is in contrast with that part of
par. 18 of the same section which provides that no company shall
undertake "the extension of its line, or the construction of a new
line of railroad," without having first obtained a certificate of
present or future public convenience and necessity from the
Commission. P.
288 U. S.
36.
6. The Act distinguishes between three sorts of facilities --
new lines, or extensions, voluntarily undertaken (§ 18), compulsory
extensions within the area which the carrier has bound itself to
serve (§ 21), and spur, industrial, team, switching or side tracks
located wholly within one state, which are left within state
control (§ 22). Pp.
288 U. S.
38-40.
7. A statute should be construed, if fairly possible, so as to
avoid grave doubt of its constitutionality. P.
288 U. S.
40.
8. Having charter authority to build a line of railroad does not
commit the company to an obligation to build. P.
288 U. S.
43.
47 F.2d 250 affirmed.
Appeal from a decree of the District Court of three judges which
set aside and enjoined the execution of an order of the Interstate
Commerce Commission requiring the Oregon-Washington Railroad &
Navigation Co. (a subsidiary of the Oregon Short Line, which in
turn is a subsidiary of the Union Pacific Co.) to build an
"extension" from a point on its railroad in Oregon, 185 miles
across an arid, sparsely settled and unproductive country, to a
point on one of the lines of the Southern Pacific System, west of
the Cascade Range. The report of the Commission is 159 I.C.C. 630.
See also 111
id. 3.
Page 288 U. S. 21
MR. JUSTICE ROBERTS delivered the opinion of the Court.
The Public Service Commission of Oregon filed a complaint with
the Interstate Commerce Commission against eleven railroads,
including the Oregon-Washington Railroad & Navigation Company,
asserting they had failed and refused to provide reasonable and
adequate transportation facilities to an area of some 33,000 square
miles within the state. The prayer was that one or more of them be
required to extend or build a line of railroad from a point near
Crane to Crescent Lake or some adjacent point. Several
municipalities and commercial organizations, and the Public
Utilities Commission of Idaho, were given leave to be heard in
support of the petition. The respondents answered that public
necessity and convenience
Page 288 U. S. 22
would not be served by the proposed construction, and that there
was no authority in law for granting the requested relief. After
hearing, the Commission entered an order requiring
Oregon-Washington Railroad & Navigation Company to
"extend its line of railroad, now terminating near Burns, Oreg.,
from or near a station thereon designated as Crane, Oreg., to a
connection with the Cascade line of the Southern Pacific Company at
or near Crescent Lake, Oreg. [
Footnote 1]"
The Oregon-Washington Company thereupon filed a petition against
the United States, in the District Court, to set aside, annul, and
suspend the order and to enjoin the government, its officers and
agents, from enforcing the Commission's mandate. The Southern
Pacific Company intervened in support of the petition, and the
Interstate Commerce Commission, the Public Utilities Commissioner
(the successor of the Public Service Commission) of Oregon, and the
Public Utilities Commission of Idaho were permitted to intervene
and participated in the defense of the suit. From a decree setting
aside the order and granting an injunction the three intervening
defendants appealed. The United States refused to join in the
appeal, and a summons and severance was duly served upon it. The
appellees insist that, if we should reverse the decree as to the
appellants, the United States would remain bound by its terms; that
we may not pass upon the merits in the absence of the government, a
necessary party, and should therefore dismiss the appeal for want
of jurisdiction. We shall first dispose of the question thus
presented.
Before the Commerce Court was established, suits to enjoin
orders of the Commission were brought against that body, and
appeals from the judgments rendered were
Page 288 U. S. 23
prosecuted by it in its own name. [
Footnote 2] The Act of June 18, 1910, [
Footnote 3] created the Commerce Court, defined
the jurisdiction, and regulated the procedure of that tribunal, and
authorized a direct appeal to this Court. The Urgent Deficiencies
Act, [
Footnote 4] under which
this suit was instituted, abolished the Commerce Court, transferred
the jurisdiction theretofore vested in it to the several district
courts, and made the procedure therein the same as that previously
followed in the Commerce Court. Existing statutes were repealed
only insofar as inconsistent with the new jurisdiction conferred on
district courts. [
Footnote
5]
Section 4 of the Commerce Court Act directed:
"That all cases and proceedings in the commerce court [now
district court] which, but for this Act, would be brought by or
against the Interstate Commerce Commission shall be brought by or
against the United States, and the United States may intervene in
any case or proceeding in the commerce court (district court)
whenever, though it has not been made a party, public interests are
involved."
Other sections permit the Commission, or complainants before the
Commission, or any party in interest in a proceeding before that
body, or any other interested party to become parties to a suit
involving the validity of an order of the Commission; forbid the
Attorney General
Page 288 U. S. 24
to control, dispose of, or discontinue the suit against the
objection of anyone as becoming a party; allow the intervener to
prosecute, defend, or continue the proceeding unaffected by the
action or nonaction of the Attorney General, and accord to any
aggrieved party the right of appeal to this Court. [
Footnote 6]
The Commission, by entering its appearance in the District
Court, became a party defendant, as did the two state utilities
commissions. The court below decided adversely to all these bodies.
They are aggrieved parties granted a review by § 2, the Interstate
Commerce Commission for the reason that the decree set aside its
order,
Page 288 U. S. 25
the state commissions because they officially represent the
interest of their states in obtaining adequate transportation
service.
Though the present appellants were parties in the court below as
of right, and not by grace or favor, were aggrieved by the decree,
and have a right of appeal, the appellees maintain this Court may
not hear and decide the case in the absence of the United States.
While admitting interveners' right to be heard as to the substance
of the decree the District Court entered against the government,
the appellees assert the appellants have no standing in this Court
to ask modification or reversal of the decree as it affects the
United States when the latter seeks no review.
We may concede that, unless the Act so directs, a reversal at
the suit of the appellants will not affect the judgment as respects
the United States. The injunction will stand as against the United
States and its agents because unchallenged by that defendant.
Summons and severance does not cure the defect, for, though the
United States has been severed by that process, if this Court
should reverse the decree as to other parties, but allow it to
remain in force against the government, the appeal would be a vain
thing. The appellants, however, contend that the legislation
creates an exception to the ordinary rule governing our
jurisdiction. They assert that the purpose of Congress is to permit
proper parties in the District Court to carry the litigation to a
final conclusion in this Court.
The statute clearly provides that, in the trial of the case, the
intervening parties shall not be foreclosed by the action or
nonaction of the Attorney General. Even though he concludes not to
defend, they are permitted to do so. If, notwithstanding their
defense, a decree goes against them and the United States, can it
have been the purpose of Congress that the failure of the
Attorney
Page 288 U. S. 26
General to prosecute an appeal concludes such interveners? We
think not. So to hold would render meaningless and superfluous § 2
of the Act, which permits a review of the Action of the court below
"if appeal to the Supreme Court be taken by an aggrieved party. . .
." The section can be given effect only by holding that an
aggrieved party may challenge the decree not only to vindicate his
own rights, but those of the United States as well. Congress
evidently intended the Attorney General should represent and
protect the interests of the United States as such, but should not
at any stage control the litigation against the objection of the
other parties and to their disadvantage, and that any aggrieved
party might obtain a decree which the United States could have
secured had it defended the Action or prosecuted an appeal.
This conclusion is confirmed by comparing the form of § 5 of the
Commerce Court Act as first presented and as subsequently altered
by amendment. The section as originally introduced precluded the
Commission and its attorneys from taking any part in suits brought
to review its orders. This provision was stricken out in committee.
The clause giving the Attorney General control of such cases was
also modified. The stated purpose of the amendments was to prevent
his forestalling the Commission or any other interested party
desiring to litigate the questions involved. [
Footnote 7] The movers of the amendments which
were ultimately incorporated in the Act insisted that a party
affected by the order should have the right to follow the case
"through the Commerce Court and Supreme Court," and that "[a] party
litigant should always have the right to follow his case to final
judgment."
Page 288 U. S. 27
An official may be designated to stand in judgment on behalf of
the United States, so that a decree against him binds the
government. [
Footnote 8] As has
been stated, this was the accepted practice in suits by and against
the Commission prior to the adoption of the Commerce Court Act. The
new legislation might have left the rights of the United States
arising out of orders of the Commission to be thus determined in
the court of first instance and on appeal. But Congress had
undoubted power, in naming the United States as the defendant in
such suits, to give the Commission, and others having an interest
authority to litigate the validity of such orders, and, regardless
of joinder by the Attorney General, to obtain by appeal a review
effective as to the United States. The Act plainly exhibits this
purpose. Should a reversal be required, the mandate may vacate the
judgment against the United States though it did not join in the
appeal. We think that review may not be denied for want of a
necessary party, and we are therefore brought to a consideration of
the merits of the cause.
The Oregon Short Line owns all of the capital stock of the
Oregon-Washington Company, and the Union Pacific owns all the
capital stock of the Short Line; these three companies, with the
Los Angeles and Salt Lake, make up the Union Pacific System. The
main lines of the Union Pacific Railroad extend from Council
Bluffs, Iowa, and Kansas City, Missouri, to Ogden, Utah. The Short
Line runs from a connection with Union Pacific at Granger, Wyoming,
to Huntington, Oregon. From Huntington, the Oregon-Washington
follows a northwesterly direction to the Columbia River, thence
along the south bank of that stream to Portland. Branches extend
southerly and westerly from the main line between Huntington and
Portland, east of the Cascade Mountains, but the company
Page 288 U. S. 28
operates no lines south of Portland and west of the Cascade
Range. Crane, just beyond which the required extension would begin,
is in Eastern Oregon on a line known as the Ontario-Burns Branch,
which connects with the Oregon Short Line at Ontario, 40 miles
south of Huntington, and runs westward to Crane, 127 miles, and
thence northwest 30 miles to Burns. The extension would run west
from Crane across Central Oregon a distance of 185 miles to
Crescent Lake, which is on the Cascade Line of the Southern
Pacific. The latter operates lines from Ogden, Utah, and New
Orleans, Louisiana, to San Francisco, and from Roseville,
California, on the Ogden-San Francisco Line, to Sacramento and
Portland. To Portland it has two alternate main lines between Black
Butte, California, and Eugene, Oregon, that, on the west, the
original main line, passing through Medford, Grants Pass, and
Roseburg, and a newer line to the east, known as the Cascade or
Natron cut-off, passing through Klamath Falls, Kirk, Chemult,
Paunina, Crescent Lake, the western terminus of the required
extension, and Natron.
Prior to 1913, the railways of the Union Pacific and Southern
Pacific were jointly operated under control of the Harriman
interests. A cross-state line was then planned to run from Malheur
Junction, just south of Ontario, Oregon, to Eugene. The Natron
cut-off between Eugene and Weed was also in contemplation. In 1911,
construction of the cross-state road was begun at both ends. 73.6
miles were completed from Ontario to Juntura, and eastward from
Eugene 40 miles were built as far as Oakridge. Work on the Natron
cut-off was begun and proceeded through Klamath Falls to Kirk, 127
miles. The line would have joined with the Natron cut-off at Odell
Lake, just north of Crescent Lake, the present proposed
terminus.
In January, 1913, this Court, in
United States v. Union
Pacific R. Co., 226 U. S. 61,
226 U. S. 470,
declared control of Southern
Page 288 U. S. 29
Pacific by Union Pacific through stock ownership offensive to
the Sherman Anti-Trust Act, and the combination was dissolved. All
work on the Oregon projects ceased, and was not resumed, except
that, in 1915, the Ontario-Juntura line was extended to Riverside,
92.7 miles, and in 1916 to Crane, an additional 34 miles.
After the passage of the Transportation Act, the Oregon Public
Service Commission applied to the Commission under paragraph 21 of
§ 1 of the Interstate Commerce Act, as amended, asserting that the
cross-state line was needed, and asking that some one or more of
the respondents named in the complaint be ordered to build it, and
further requesting that the Commission require completion of the
Natron cut-off and order certain other railroad construction in
central Oregon. The Southern Pacific voluntarily assumed the
completion of the Natron cut-off, and to that end was granted a
certificate of public convenience and necessity under § 1 (18). The
Oregon-Washington also applied for and obtained a certificate for
construction of the branch from Crane to Burns. Other applications
by various carriers were granted. The Commission then dismissed the
complaint, holding that the record was not adequate to support the
requested order. [
Footnote
9]
On May 24, 1927, the Oregon Commission filed the present
complaint against eleven railroads, including the
Oregon-Washington, the Oregon Short Line, the Southern Pacific, and
others serving the state, and also the Union Pacific. The failure
and refusal to provide railroad facilities to a large area of
Central Oregon was the gravamen of the complaint. Consequences of
the neglect to build this line were enumerated as prevention of the
development of a vast area, hindrance of exploitation of the
natural resources of the state, unreasonably circuitous routes,
with consequent delays, and car shortages, all causing
Page 288 U. S. 30
losses to the people of Oregon. The relief prayed was an order
that one or more of the respondents be required to construct the
cross-state line from Crane to Crescent Lake.
This line, 185 miles in length, after leaving Crane, would
traverse about 20 miles of swampy area and 15 miles of alkali
flats, and would then pass over the Great Sandy or High Desert for
115 miles. The region is in part sparsely settled and in part
wholly uninhabited, and contains no towns except Crescent and
Crescent Lake at the western extremity, neither of which has a
population of 100. There is no town within 20 miles north or south
of the proposed line. Certain of the lands have possibilities of
cultivation through irrigation, and the evidence for complainants
is that, if the railroad were built, such activity would be
stimulated. There seems to be no dispute that traffic to be
obtained from the region will fall far short of supporting the
line. The appellants are of opinion that sufficient traffic for
this purpose may be secured by diverting to the new line freight
originating west of the Cascade Range, and now moving east on the
Southern Pacific through Ogden. In the total haul between Crescent
Lake and Granger, Wyoming, the route via the cross-state line would
be some 214 miles, or 11%, shorter. Neither the Oregon-Washington
nor any other portion of the Union Pacific System serves the
territory south of Portland and west of the Cascade Mountains. The
Southern Pacific lines cover this area. Freight may, however, be
routed either over the Southern Pacific via Ogden or over the Union
Pacific via Portland and Granger, Wyoming. The latter furnishes a
reasonably short route with adequate and quick service. Inasmuch,
however, as the freight originates in Southern Pacific territory,
very little is sent over the Union Pacific, the Southern Pacific
routing it so as to obtain the long haul. The contention is that,
even if the proposed line were constructed, the same condition
Page 288 U. S. 31
would obtain, and that the Union Pacific System could get little
or none of the traffic from Western Oregon unless, in addition to
the cross-state line, the Oregon-Washington should build across the
Cascade Range into the agricultural counties now served by the
Southern Pacific. [
Footnote
10]
The Union Pacific System, composed as above stated, has a total
trackage of 15,045.17 miles. The required extension would add 1.2%
to the existing mileage, and can be constructed at a cost of
between $9,900,000 and $11,700,000. The finding of the Commission
is that operation of the line will not seriously affect the ability
of the Union Pacific System adequately to serve the public.
Recognizing that the Oregon-Washington has not the necessary funds,
and perhaps cannot borrow them, the order permits the financing of
construction by advances from the Union Pacific Railroad, which is
found to be in position to make them. Union Pacific and the
Oregon-Washington consider the venture unprofitable and wasteful,
and have refused to make the investment. In the Commission's
judgment, if constructed, the railroad, while not profitable at
first, will ultimately obtain valuable traffic for the Union
Pacific System, will aid the Ontario-Burns Branch, which now
operates at a serious deficit, and consequently prove a
remunerative investment. The court below held [
Footnote 11] as we must, that these findings,
based upon evidence, may not be disturbed.
Page 288 U. S. 32
The appellees' challenge of the order as beyond the power of the
Commission was sustained by the District Court, and this decision
is assigned as error. The Commission thought its authority to order
extension of existing lines was without limitations, save the two
which are expressed in paragraph 21 -- that public necessity and
convenience require the construction and that the building and
operation of the road will not impair the ability of the carrier to
render adequate public service. Having determined that the
requested extension complied with both conditions, the Commission
ordered the road built.
Prior to the adoption of the Transportation Act, 1920, the
Commission had no authority to authorize or to compel extensions of
existing lines of railroad. Such power as existed in that behalf
rested in the states. In a number of cases, this Court passed upon
and defined the authority of a state to require extensions of
existing service and facilities. [
Footnote 12] Orders made were attacked as compelling the
companies, against their will and judgment, to devote property to
the public service without compensation, contrary
Page 288 U. S. 33
to the guaranty of due process. They were sustained, however,
upon the express ground that the railroads had undertaken the
service, and must supply facilities adequate and reasonably
necessary to its performance. The requirements were found not to
involve the rendition of a new or different service from that to
which the owners had agreed when they dedicated their property to a
public use. Where, however, the state's mandate involved the
rendition of a service beyond the agreement of the carrier, the
order was annulled. [
Footnote
13]
The regulations adopted by the states were not uniform;
statutory authority to order additions and extensions existed in
some states and not in others. Congress was informed of this
condition, and urged to exercise the federal power to promulgate a
uniform system of regulation of interstate commerce. [
Footnote 14] Legislation to
effectuate this purpose was enacted.
Page 288 U. S. 34
By Act of May 29, 1917, [
Footnote 15] new paragraphs were added to § 1 of the
Interstate Commerce Act, and by the Transportation Act, 1920,
[
Footnote 16] these were
amended and others inserted. As a result, paragraphs 10 to 17,
inclusive, all dealing with car service, were given their present
form. Paragraphs 18 to 20, inclusive, first appear in the
Transportation Act. They regulate voluntary extensions of lines or
building of new lines, require a certificate of convenience and
necessity therefor, and prescribe the procedure for obtaining it.
The paragraph with which we are here concerned, numbered 21, was
also added by the Transportation Act, § 402. It is:
"The commission may, after hearing, in a proceeding upon
complaint or upon its own initiative without complaint, authorize
or require by order any carrier by railroad subject to this
chapter, party to such proceeding, to provide itself with safe and
adequate facilities for performing as a common carrier its car
service as that term is used in this chapter, and to extend its
line or lines:
Provided, That no such authorization or
order shall be made unless the commission finds, as to such
extension, that it is reasonably required in the interest of public
convenience and necessity, or as to such extension or facilities
that the expense involved therein will not impair the ability of
the carrier to perform its duty to the public. Any carrier subject
to this chapter which refuses or neglects to comply with any order
of the commission made in pursuance of this paragraph shall be
liable to a penalty of $100 for each day during which such refusal
or neglect continues,
Page 288 U. S. 35
which shall accrue to the United States and may be recovered in
a civil action brought by the United States."
The appellants maintain that, if the Commission finds the
conditions stated in the proviso exist, the power given to compel a
carrier "to extend its line or lines" is unlimited, and the way is
open for an order to extend for any distance at any cost, for the
purpose of developing virgin territory hitherto unreached by
railroads or for supplying competition in a remote region served by
other carriers.
The phrase "and to extend its line or lines" is part of a single
sentence committing to the Commission the power to require carriers
to provide safe and adequate facilities for car service as defined
in the Act. The reasonable conclusion is therefore that the
extensions mentioned have to do with car service, and are not
intended to create a wholly independent subject of jurisdiction. In
the proviso, the furnishing of facilities and extension of lines
are blended as belonging in a single class. We should expect, if
Congress were intending to grant to the Commission a new and
drastic power to compel the investment of enormous sums for the
development or service of a region which the carrier had never
theretofore entered or intended to serve, the intention would be
expressed in more than a clause in a sentence dealing with car
service. As said in
Interstate Commerce Comm'n v. Los
Angeles, 280 U. S. 52,
280 U. S.
70:
"If Congress had intended to give an executive tribunal
unfettered capacity for requisitioning investment of capital of the
carriers and the purchase of large quantities of land and material
in an adverse proceeding, we may well be confident that Congress
would have made its meaning far clearer and more direct than in the
present meager provisions of the Transportation Act."
Moreover, if the purpose were that claimed by the Commission,
support should be found in legislative history. But none has been
called to our attention. In the
Page 288 U. S. 36
report to Congress for 1919, the Commission reiterated an
outline of the policies previously suggested for legislative action
in view of the approaching termination of federal control.
[
Footnote 17] No intimation
is given that carriers should be required to build into territory
they had not undertaken to serve. The scope of the recommendation
was not enlarged in the testimony before the committee of the
Senate having the Transportation Act in charge. [
Footnote 18]
The terms of paragraph 18, by contrast, throw light on the
meaning of paragraph 21. The former presupposes voluntary action by
a carrier, and provides that no company shall undertake
"the extension of its line of railroad,
or the construction
of a new line of railroad . . . unless and until there shall
first have been obtained from the commission a certificate that the
present or future public convenience and necessity require or will
require"
the construction and operation thereof. The difference of
phraseology in the two paragraphs emphasizes the distinction
between extensions and new lines. The diversity is significant.
The purpose of Congress in enacting paragraph 18, as repeatedly
explained by this Court, was that, though a carrier should desire
to extend existing facilities or to construct new ones in territory
not previously served, the free
Page 288 U. S. 37
exercise of discretion should not be permitted, but the
Commission must be convinced that the proposed venture would not
drain the railroad's resources and disable it from performing those
duties of public service under which it then rested, with
consequent detriment to the public in the matter of service and
rates. [
Footnote 19] If a
railroad company can prove that the proposal either presently or in
the reasonably near future will be self-sustaining, or so nearly so
as not unduly to burden interstate commerce, the Commission may
issue a certificate authorizing the proposed line. Paragraph 21, on
the other hand, contains no provision whatever for new lines. If
the power be as broad as contended by the Commission, there seems
to be no good reason for the omission. The same principles and the
same needs might equally require the building of a new line as the
extension of an existing one, unless, indeed, Congress recognized a
radical difference between compelling embarkation in a new venture
and ordering a mere extension of facilities required as the natural
concomitant and complement of those presently used for the
rendition of the service to which the carrier has committed
itself.
That paragraph 21 refers to the service the carrier has bound
itself to render is further emphasized by the omission to make the
future public convenience a factor to be considered. A presently
existing public need is expressly stated as prerequisite to the
compulsory extension of a line. On the other hand, paragraph 18,
which covers voluntary construction, conditions approval on present
or future convenience or necessity. Congress therefore drew a
distinction between what might be permitted and what compelled.
These differences in the two sections were
Page 288 U. S. 38
disregarded by the Commission, and are overlooked by the
appellants.
We are told that, if paragraph 22 be given due weight, the word
"extend" in 21 must have a broader connotation than we attribute.
This paragraph enacts that the powers conferred upon the Commission
by paragraphs 18 to 21, both inclusive, are not to "extend to the
construction or abandonment of spur, industrial, team, switching,
or side tracks, located or to be located wholly within one state. .
. ." The argument is that, if the phrase "to extend its line" be so
limited as to apply only to existing commitments of the carrier, it
becomes synonymous with the matters excluded from the Commission's
jurisdiction by paragraph 22, with the result that the one becomes
contradictory of the other in the matter of line extension. The
practice in the application of paragraphs 18 and 21 negatives this
view. In
Alabama & Vicksburg Ry. Co. v. Jackson & E.
Ry. Co., 271 U. S. 244, an
order of the Commission made under paragraph 21 was sustained which
directed the building of a connection between two railroads for
interchange of traffic near the outskirts of Jackson, Mississippi.
In
Railroad Commission v. Southern Pacific Co.,
264 U. S. 331,
283 U. S. 283 U.S.
380, it was held that, under paragraphs 18-21, a certificate was
required for the necessary rearrangement of main tracks to comply
with an order of the Railroad Commission of California that the
interstate carriers entering Los Angeles should combine in the
construction and use of a union depot. The court called attention (
264 U. S. 264
U.S. 345) to the palpable distinction between the main line tracks
of an interstate carrier and its spur, industrial, switching, or
side tracks, and declared the Act exhibited the legislative intent
to retain within the control of the Commission any substantial
change in the former. Although, under the station plan, the
proposed extensions of lines and main tracks were not great in
distance, they involved a new intramural destination
Page 288 U. S. 39
for each railway, attended by great expense. As was said, the
necessary outlay might well be such as to cripple the railroads and
hamper their service. Such an extension was held to require the
finding of the Interstate Commerce Commission that the changes
would not impair the ability of the carriers to perform their
public duties.
Compare Texas & Pac. Ry. Co. v. Gulf, C.
& S.F. Ry., 270 U. S. 266.
From what has been said, it is plain that an extension, though
something other than a team, switching, industrial, or side track,
need not, in order to be distinguished therefrom, be a building
into a new and previously unserved locality.
The cases above cited, dealing with the powers of state
authorities in the matter of extensions of lines and service,
furnish a background which must have been in the minds both of the
Commission and of the Congress at the time of the passage of the
Transportation Act. Those decisions show that due process is denied
by requiring service which goes beyond the undertaking of the
carrier. Orders for extensions of line were sustained whenever
reasonably required in the interest of car service and for
interchange of traffic. No extension ordered for the service of new
territory had been approved. [
Footnote 20] Wherever the state attempted to enforce a
regulation or demand extension of
Page 288 U. S. 40
facilities outside the company's undertaking to serve the
public, the power was negatived for the very reason that the
attempted exercise called on the railroad company for something
beyond its agreement. [
Footnote
21]
The Act, reasonably construed, distinguishes between three sorts
of facilities -- new lines, or extensions, voluntarily undertaken
(paragraph 18); compulsory extensions within the area which the
carrier has bound itself to serve (paragraph 21), and spur,
industrial, team, switching, or side tracks located wholly within
one state, which are left within state control (paragraph 22). The
second class is distinct from the others, and embraces, as the
decisions show, a substantial field. But this field is not, as the
Commission holds, coterminous with that created by paragraph 18. If
it were, power would exist to compel a carrier having lines
reaching Chicago and St. Louis, but none connecting those cities,
to build a railroad between them. Though in truth a new line, the
appellants would call this an extension of the existing lines. If
the grant of authority is broad enough to support the order in the
present case, it would also justify such a hypothetical requirement
as we have supposed. We cannot so read the statute, but think the
power granted by paragraph 21 is confined to extensions within the
undertaking of the carrier to serve, and cannot be extended to
embrace the building of what is essentially a new line to reach new
territory.
There is another consideration which supports the construction
adopted. Our duty is to construe the statute, if fairly possible,
so as to avoid not only the conclusion that it is unconstitutional,
but also grave doubts upon that score. [
Footnote 22] The views advanced by the appellants, to
say the least, raise serious questions in this respect. The
railroads,
Page 288 U. S. 41
though dedicated to a public use, remain the private property of
their owners, and their assets may not be taken without just
compensation. [
Footnote 23]
The Transportation Act has not abolished this proprietorship. State
courts have uniformly held that to require extension of existing
lines beyond the scope of the carrier's commitment to the public
service is a taking of property in violation of the Federal
Constitution. [
Footnote 24]
The decisions of this Court will be searched in vain for the
announcement of any principle of constitutional interpretation
which would support the order of the Commission. The statements in
New England Divisions Case, 261 U.
S. 184, and
Dayton-Goose Creek Ry. Co. v. United
States, 263 U. S. 456, in
respect of the purposes of the Transportation Act, on which
appellants rely, must be read having in mind the situations there
presented and the nature of the orders approved. Care was taken in
those cases to demonstrate that the sections upheld did not, in
application, go beyond the regulation of rates and the disposition
of the excess over a fair return collected by a carrier, and it was
shown that no taking or confiscation of property resulted. Those
decisions are far from sustaining the validity of an order which
seeks to require the investment of millions of dollars in a new
venture in undeveloped areas. Such a compulsion imposes upon the
carrier and its property "burdens that are not incident to its
engagement."
Northern Pacific Ry. Co. v. North Dakota, 236
U.S. at
236 U. S. 595.
The
Page 288 U. S. 42
construction we adopt makes it unnecessary to pass upon the
grave questions of constitutional validity raised by appellants'
argument.
It is urged that, as the order involved trackage amounting to
only 1.2% of that now maintained by the Union Pacific System, the
requirement may properly be considered an extension, rather than a
new line, though a different view might prevail if the
Oregon-Washington alone be considered. But whether the order be
treated as a command to the Oregon-Washington Company as a separate
corporate entity or as an injunction to the Union Pacific System,
it is an attempted exertion of a power not conferred. Assuming,
without deciding, that the Commission was entitled to treat the
Oregon-Washington Company as an instrument of the Union Pacific
System, and the required extension therefore as one adding only a
small percentage to the present mileage of the system, still the
purpose is to compel a new investment for the development of a new
area at the request and in the interest of the State of Oregon,
whose desire is that its natural resources shall be exploited.
[
Footnote 25]
Finally it is claimed that, however narrowly the power to compel
extensions be construed, the order was justified by the facts
developed before the Commission. They are said to disclose an
undertaking by the Oregon-Washington Company to serve the region in
question. Much
Page 288 U. S. 43
is made of the circumstance that, when the complaint was filed,
the company had a charter under which it was authorized to build a
line on the location of that which the order describes. The
possession of the franchise is said to give rise to an implied
agreement to serve the district. The company's having in
contemplation the building of the road would, in this view, render
the Commission's action unassailable. But authority to build the
line, if the company were so minded, involved no commitment to
construct it. [
Footnote 26]
Though, by appropriate legislation, the state might forfeit the
charter for nonuser, the continued existence of the franchise
imposed no obligation to exercise the charter powers. The
Oregon-Washington Company chose not to serve the territory which
the cross-state line would reach; has not desired and does not now
desire to enter upon the project. The possession of a charter which
would have made the building of a railroad legal is insignificant
as to the company's actual undertaking. Whether the railroad held
itself out to serve the region in question must be decided in the
light of all the facts. The record demonstrates that the territory
to be traversed was one the company had neither actually nor
impliedly agreed to serve with transportation facilities.
The decree is
Affirmed.
[
Footnote 1]
Public Service Comm'n v. Central Pac. R. Co., 159 I.C.C. 630.
The order contained ancillary provisions which it is unnecessary
here to recite.
[
Footnote 2]
Interstate Commerce Comm'n v. B. & O. R. Co.,
145 U. S. 263;
Interstate Commerce Comm'n v. C., R. & P. Ry. Co.,
218 U. S. 88;
Interstate Commerce Comm'n v. Goodrich Transit Co.,
224 U. S. 194;
Interstate Commerce Comm'n v. B. & O. R. Co.,
225 U. S. 326.
[
Footnote 3]
Chap. 309, 36 Stat. 539, §§ 1-6.
[
Footnote 4]
Act of October 22, 1913, c. 32, 38 Stat. 208, 219, 220.
See U.S.C. Tit. 28, §§ 47 and 48.
[
Footnote 5]
Those portions of the Commerce Court Act which remained in
force, and the new provisions substituted for those superseded, may
be found in the U.S.Code, Tit. 28, §§ 41(27) and (28), and 43-48,
inclusive, as amended by Supplement 5, Tit. 28, §§ 41 (27), 44, 45,
45a, 46, 47, 47a, and 48.
[
Footnote 6]
Section 5 enacted:
"That the Attorney General shall have charge and control of the
interests of the Government in all cases and proceedings in the
commerce court, and in the Supreme Court of the United States upon
appeal from the commerce court: . . .
Provided, That the
Interstate Commerce Commission and any party or parties in interest
to the proceeding before the commission in which an order or
requirement is made may appear as parties thereto of their own
motion and as of right, and be represented by their counsel, in any
suit wherein is involved the validity of such order or requirement
or any part thereof, and the interest of such party [for 'Commerce
Court' read 'District Court']."
And further:
"That communities, associations, corporations, firms, and
individuals who are interested in the controversy or question
before the Interstate Commerce Commission, or in any suit which may
be brought by anyone under the terms of this Act, or the Acts of
which it is amendatory or which are amendatory of it, relating to
action of the Interstate Commerce Commission may intervene in said
suit or proceedings at any time after the institution thereof, and
the Attorney General shall not dispose of or discontinue said suit
or proceeding over the objection of such party or intervenor
aforesaid, but said intervenor or intervenors may prosecute,
defend, or continue said suit or proceeding unaffected by the
action or nonaction of the Attorney General of the United States
therein."
36 Stat. 542, 543.
By section 2, it was ordained:
"That a final judgment or decree of the Commerce Court [District
Court] may be reviewed by the Supreme Court of the United States if
appeal to the Supreme Court be taken by an aggrieved party within
sixty days after the entry of said final judgment or decree. . .
."
36 Stat. 542.
[
Footnote 7]
House Report No. 923, 61st Cong., 2d Sess., p. 158; Cong.Rec.
vol. 45, pt. 5, p. 5524; Senate Report 355, pt. 2, pp. 5-7, 61st
Cong., 2d Sess. Cong.Rec. vol. 45, pt. 5, pp. 4604, 4607; pt. 6,
pp. 6406, 6445, 6451, 6462.
[
Footnote 8]
See Minnesota v. Hitchcock, 185 U.
S. 373,
185 U. S.
387-388;
Johnson v. Fleet Corporation,
280 U. S. 320,
280 U. S.
326-327.
[
Footnote 9]
Construction of Railroad Lines in Eastern Oregon, 111 I.C.C.
3.
[
Footnote 10]
The court below found:
"5. The proposed line in large part would extend through a
sparsely settled desert waste which the petitioner has not
undertaken or professed to serve. One of the dominant purposes of
the order complained of was to provide for the construction of a
new east and west line of railroad whereby lumber traffic
originating hundreds of miles from petitioner's present line may
find a shorter route to eastern markets and traffic from
southwestern Idaho may find a shorter route to northern California
points."
[
Footnote 11]
The court below said:
"If we were at liberty to review this testimony independently of
the findings made by the Commission, we might find no little
difficulty in reaching the same conclusion."
Oregon-Washington R. & Nav. Co. v. United States,
47 F.2d 250, 252.
[
Footnote 12]
Wisconsin, Minnesota & Pacific R. Co. v. Jacobson,
179 U. S. 287;
Michigan Central R. Co. v. Michigan R. Comm'n,
236 U. S. 615
(requirement of track connections and facilities for interchange of
traffic);
Minneapolis & St. Louis R. Co. v. Minnesota,
193 U. S. 53
(erection and maintenance of depots);
Missouri Pac. Ry. Co. v.
Kansas, 216 U. S. 262;
Atlantic C.L. R. Co. v. North Carolina Corp. Comm'n,
206 U. S. 1;
Chesapeake & O. Ry. Co. v. Public Service Comm'n,
242 U. S. 603
(orders relating to passenger service to be rendered and train
schedules to be maintained);
Phoenix Ry. Co. v. Geary,
239 U. S. 277
(requirement that a street railway company double track a portion
of its lines);
Chicago & N.W. Ry. Co. v. Ochs,
249 U. S. 416
(extension of a side track as a public track and as part of the
railroad's property and system for the service of a private plant);
Norfolk & Western Ry. Co. v. Public Serv. Comm'n,
265 U. S. 70
(requirement that railroad provide certain facilities for removal
of freight from its premises).
[
Footnote 13]
Missouri Pacific Railway Co. v. Nebraska, 164 U.
S. 403,
164 U. S. 417;
Oregon R. & N. Co. v. Fairchild, 224 U.
S. 510;
compare Northern Pac. Ry. Co. v. North
Dakota, 236 U. S. 585,
236 U. S.
595.
[
Footnote 14]
See 33d Annual Report of the Interstate Commerce
Commission, 1919, p. 3, where the following quotation is given from
a statement furnished by the Commission to the Senate Committee on
Interstate Commerce:
"In some of the states, the state officers are authorized to
require such extensions, but in such cases they are necessarily
primarily concerned with, if not confined to, a consideration of
state traffic. Some of the states have not vested such authority in
any state official. Ordinarily, such extensions would be desired
for the purpose of facilitating or making possible the
transportation of interstate traffic. The desirability of
uniformity is obvious. The exercise of federal authority should not
depend upon whether or not the state has acted, and should not be
different as to the state that has legislated on the subject and
the state that has not so legislated. It therefore seems desirable
that the Congress should exercise its jurisdiction in this regard
in a plenary way, and that, where such extensions are desired in
connection with the movement of presently existing or prospective
interstate traffic and the carrier is unwilling to construct them,
it may, upon proper showing and after full hearing, be required to
do so by the federal tribunal."
Compare Alabama & Vicksburg Ry. Co. v. Jackson &
Eastern Ry. Co., 271 U. S. 244,
271 U. S.
248-250.
[
Footnote 15]
Chap. 23, 40 Stat. 101.
[
Footnote 16]
Chap. 91, § 402, 41 Stat. 456, 476.
[
Footnote 17]
In that report, the Commission says, at p. 2:
"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. . . . The thought
underlying the second part of this suggestion is that, a railroad
having been permitted, by public franchise and the powers that go
with it, to build into a given territory, it should be required to
properly serve and develop that territory. And, in developed
territory, it is important to provide for the extension of short
branch or spur lines or spur tracks to communities and industries
that should be served and that can furnish sufficient traffic to
justify such extension."
[
Footnote 18]
Hearings before the House Committee on Interstate and Foreign
Commerce, in H.R. 4378, vol. 1, p. 53, 66th Cong., 1st Session.
[
Footnote 19]
See Texas & Pac. Ry. Co. v. Gulf, Colorado & S.F.
Ry. Co., 270 U. S. 266,
270 U. S. 277;
Chesapeake & O. Ry. Co. v. United States, 283 U. S.
35,
283 U. S. 42.
Compare Transit Commission v. United States, 284 U.
S. 360.
[
Footnote 20]
See the cases passing on state commission orders, cited
supra, notes
12 and
|
12 and S. 14fn13|>13;
also those cited in
12 and
S. 14fn24|>note 24,
infra. The same rule has been
applied in the case of other public service corporations. Gas or
electric light or telephone companies may be compelled to extend
their facilities within the territory covered by the franchises
granted them.
New York & Queens Gas Co. v. McCall,
245 U. S. 345;
New York ex rel. v. Public Service Comm'n, 269 U.
S. 244. But they may not be compelled to extend their
lines beyond these limits or to serve other communities.
Southern Bell Tel. Co. v. Calhoun, 287 F. 381;
State
v. Pub. Serv. Comm'n, 287 Mo. 522, 229 S.W. 782;
Oklahoma
Nat. Gas Co. v. Corp. Comm'n, 88 Okl. 51, 211 P. 401;
United Fuel Gas Co. v. Pub. Serv. Comm'n, 105 W.Va. 603,
144 S.E. 723.
[
Footnote 21]
See note 13
supra; note 24
infra.
[
Footnote 22]
Carey v. South Dakota, 250 U.
S. 118,
250 U. S. 122;
Russian Volunteer Fleet v. United States, 282 U.
S. 481,
282 U. S. 492;
United States v. La Franca, 282 U.
S. 568,
282 U. S.
574.
[
Footnote 23]
Interstate Commerce Comm'n v. Chicago Great Western Ry.
Co., 209 U. S. 108,
209 U. S. 118;
Missouri Pac. Ry. Co. v. Nebraska, 217 U.
S. 196,
217 U. S. 206;
Northern Pac. Ry. Co. v. North Dakota, 236 U.
S. 585,
236 U. S. 595;
Great Northern Ry. Co. v. Minnesota, 238 U.
S. 340,
238 U. S. 346;
Banton v. Belt Line Ry., 268 U. S. 413,
268 U. S.
421.
[
Footnote 24]
Atchison, T. & S.F. Ry. Co. v. Railroad Comm'n, 173
Cal. 577, 160 P. 828;
Hollywood Chamber of Commerce v. Railroad
Comm'n, 192 Cal. 307, 219 P. 983;
Public Service Comm'n v.
United Railways & Electric Co., 126 Md. 478, 95 A. 170;
Morgan Run Ry. Co. v. Public Utilities Comm'n, 98 Ohio St.
218, 120 N.E. 295.
[
Footnote 25]
The Commission said:
"It is urged that Oregon's development, as compared with other
states, has been held back and seriously hampered due to the lack
of direct routes to the markets for her products, and that the
construction of the proposed extension is an important part of
anticipated development of adequate rail transportation facilities
within the state. The evidence of complainant and defendants brings
out clearly and forcibly that no section can develop without
transportation. The major portion of the State of Oregon is without
adequate transportation facilities, and this is particularly true
with respect to the portion which would be served by the proposed
construction."
159 I.C.C. 635.
[
Footnote 26]
Northern Pac. R. Co. v. Dustin, 142 U.
S. 492,
142 U. S. 499,
and cases cited;
Bentler v. Cincinnati, C. & E. Ry.
Co., 180 Ky. 497, 203 S.W. 199;
State v. Public Service
Comm'n, 287 Mo. 522, 229 S.W. 782.
Compare Railroad
Commission v. Eastern Texas R. Co., 264 U. S.
79,
264 U. S.
85.
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 (41 Stat. 456) was framed with
the design of securing to the United States an adequate and
Page 288 U. S. 44
efficient 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 the Commission, lest waste may otherwise
ensue.
Texas & Pacific Ry. Co. v. Gulf, C. & S.F. Ry.
Co., 270 U. S. 266,
270 U. S.
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 and 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
Page 288 U. S. 45
cure.
* 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% 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 Comm'n,
269 U. S. 244;
United Fuel Gas Co. v. Railroad Commission, 278 U.
S. 300,
278 U. S.
308-309.
Another basis of division, in addition to that of size, is put
forward in argument as separating the extensions that
Page 288 U. S. 46
Congress 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, New York ex
rel. Wood-haven Gas Light Co. v. Public Service Commission,
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 public 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
Page 288 U. S. 47
new 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.
264 U. S.
346), even though expensive, is recognized as giving
color to the argument that no consent is necessary. "It is argued,"
wrote Chief Justice Taft (p.
264 U. S.
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 served, nor any acceptance of the test of presumable
intention.
If the test proposed were not illusory, it would nonetheless 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 an 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, §
402(18); 49 U.S.Code § 1 (18). No longer, without the consent
of
Page 288 U. S. 48
the 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 R. Co. v. United States, 263 U.
S. 456,
263 U. S.
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
Page 288 U. S. 49
except 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 a decision.
United States v. La
Franca, 282 U. S. 568,
282 U. S. 574;
United States v. Jin Fuey Moy, 241 U.
S. 394,
241 U. S. 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
Page 288 U. S. 50
the 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 will 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 Comm'n, 206 U. S. 441,
206 U. S. 454;
Virginia Ry. Co. v. United States, 272 U.
S. 658,
272 U. S. 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 Ray.
Co. v. North Dakota, 236 U. S. 585,
236 U. S. 595,
and
Brooks Scanlon Co. v. Railroad Comm'n, 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,
156 U. S. 667,
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 been narrowed for
the application of
Page 288 U. S. 51
the principle which has illustration in the first group, and
correspondingly widened for the application of the principle which
has illustration in the second. Irrelevant, 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
statutes under which there are no compensatory guaranties 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. Town of
Calhoun, 287 F. 381;
Atchison, T. & S.F. Ry. Co. v.
Railroad Commission, 173 Cal. 577, 160 P. 828;
Hollywood
Chamber of Commerce v. Railroad Commission, 192 Cal. 307, 219
P. 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, § 15a(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,
263 U. S.
478.
The end is placed in jeopardy by a construction of the statute
that debilitates the means.
Page 288 U. S. 52
The judgment of the District Court should therefore be reversed,
and the order of the Commission reinstated.
MR. JUSTICE BRANDEIS 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) limitations 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."