Market Street R. Co. v. Railroad Commission,
324 U.S. 548 (1945)

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U.S. Supreme Court

Market Street R. Co. v. Railroad Commission, 324 U.S. 548 (1945)

Market Street Railway Co. v. Railroad Commission

No. 510 and 511

Argued February 26, 1945

Decided March 26, 1945

324 U.S. 548


1. For the purpose of appeal to this Court, the judgment of the Supreme Court of California here involved became final upon that court's denial of a petition for rehearing, and an appeal was not premature though taken before expiration of the 30-day period in which, under the state law and practice, the state court could have modified the judgment. P. 324 U. S. 551.

2. An order of the state commission requiring the appellant street railway company to reduce its base cash fare from seven to six cents held, under the Fourteenth Amendment of the Federal Constitution, not a deprivation of property without due process of law. Pp. 324 U. S. 553, 324 U. S. 569.

(a) There is no foundation in the record for the company's contention that, in the proceedings before the Commission, it was given no adequate notice that its rates were under attack, and therefore no opportunity for a hearing on the reasonableness of its rates. P. 324 U. S. 558.

(b) The order was not unsupported by evidence, and was not rendered invalid by the fact that the Commission evaluated the company's experience for itself, without the aid of expert testimony. P. 324 U. S. 559.

(c) The order was not invalid as based on matters outside the record. The Commission's incidental reference to the company's

Page 324 U. S. 549

own reports, although they were not formally in evidence in the proceeding, did not deny due process in the absence of any showing of error or prejudice. P. 324 U. S. 561.

(d) As the rate prescribed by the Commission is not here found to be confiscatory, it is unnecessary to determine whether "value of service" would justify a rate which does not yield a fair return. To the extent that the Commission was influenced by considerations of the value of the service in this case, there was no denial to the company of any constitutional right. P. 324 U. S. 562.

(e) In view of the company's economic plight, the order was not invalid even though under the prescribed rate the company would operate at a loss. That the Commission used as a rate base the price at which the company had offered to sell its properties to the municipality, and disregarded theoretical reproduction costs, did not vitiate the order. P. 324 U. S. 564.

The due process clause does not insure values, nor require restoration of values that have been lost by the operation of economic forces.

(f) That the test of experience which the order contemplated was unavailable cannot affect its constitutional validity where the company itself, by litigation and subsequent sale of the property, had frustrated such test. P. 324 U. S. 568.

24 Cal.2d 378, 150 P.2d 196, affirmed.

Appeals from a judgment affirming an order of the state commission which directed the railway to reduce its fares from seven to six cents. Because of uncertainty as to whether the first appeal was premature, a second appeal was taken; the second appeal is here dismissed, and the first heard on the merits.

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