State ex rel. Railroad Commissioners v. Florida East Coast Railway Co.

Whitfield, C. J. (after stating the facts.) The real purpose of this proceeding is to enforce order No. 357 of the Railroad Commissioners dated May 14th, 1912, requiring the carrier in effect to cease making what may be termed a specific charge of fifteen cents in addition to the regular mileage charge between Jacksonville and St. Augustine for each passenger transported over the respondent’s railroad bridge at Jacksonville, Florida, and of about twenty cents additional between Palatka — 136 — and points south for each passenger transported over the respondent’s railroad bridge at Palatka, Florida, the bridge being a portion of respondent’s railroad lines. It does not affirmatively appear from the pleadings that the same charges are not made for passengers carried over the bridge between Jacksonville and other points than St. Augustine, or for passengers carried over the bridge between Palatka and points north. All trains going south to or from Jacksonville over respondent’s road pass over the Jacksonville bridge and all trains over respondent’s road going north or south to and from Palatka pass over the Palatka bridge. Valid orders of the Railroad Commissioners should be made effective to accomplish the public purpose contemplated by law. The Commissioners have authority to make just and reasonable rates, rules and regulations to prevent unjust discriminations in charges for the transportation of intra-state passengers by railroads in this State, and such orders when duly made are by statute deemed to be prima facie reasonable and just. Until the contrary appears, it will be presumed that in making an order or regulation, the Railroad Commissioners acted not arbitrarily, but upon full hearing or after giving all interested parties a reasonable opportunity to be heard, and upon appropriate evidence duly considered and properly applied. But an arbitrary and unreasonable rate, rule or regulation is not within the authority of the. Railroad Commissioners to make. See State v. Atlantic Coast Line R. Co., 56 Fla. 617, 17 South. Rep. 969, 32 L. R. A. (N. S.) 639. While an unjust discrimination will not be permitted so as to make a service rendered by a common carrier remunerative, yet in determining whether a charge or a regulation is unjustly discriminating, the rights of the carrier are to be considered. — 137 — together with'other facts and circumstances affecting the subject. An order made 'arbitrarily and without due consideration of the rights affected thereby may be illegal. The prima facie effect of an order made by the Eailroad Commissioners may be overcome by admissions in pleadings that clearly show the invalidity of the order, or admit that the order is unreasonable, and was arbitrarily made without evidence or due consideration. Where it appears from the admissions of the pleadings that a regulation prescribed by the Railroad Commissioners is not authorized. by law or is unreasonable or unjust with reference to all the substantial interests directly effected by it, such regulation will not be enforced by the courts. State ex rel. Ellis v. Atlantic Coast Line E. Co., 51 Fla. 578, 41 South. Rep. 705; State ex rel. Morgan v. Louisville & N. R. Co., 51 Fla. 311, 40 South. Rep. 885; State ex rel. Railroad Com’rs. v. Florida East Coast R. Co., 58 Fla. 524, 50 South. Rep. 425; State ex rel. Railroad Com’rs. v. Louisville & N. R. Co., 57 Fla. 526, 49 South. Rep. 39; State ex rel. Railroad Com’rs. v. Louisville & N. R. Co., 62 Fla. 315, 57 South. Rep. 175. In the absence of a rate duly fixed by the Commission, there is no presumption that the rate charged by the carrier is excessive or unjustly discriminating. The statutory presumption that a rate fixed by the Commission is reasonable and just, exists only when the Commission acts within its authority and in due course of law. If the Commission makes a rate, rule or regulation without statutory authority, or without giving the carrier affected by it a reasonable opportunity to be heard, or without obtaining or considering any substantial and pertinent evidence, where investigation, inquiry and evidence — 138 — are necessary as a basis for the action taken, the proceeding is not had in due course of law and there is no statutory presumption that the action taken is reasonable and just. If it is admitted by pleadings or proven by evidence that the Commission has arbitrarily made a rate, rule or regulation without giving the carrier affected by it a reasonable opportunity to be heard upon the subject before action taken, or without any substantial and relevant evidence, or pertinent inquiry, investigation or consideration of matters, conditions, facts, and circumstances directly and materially affecting its reasonableness, such rate, rule or regulation is not duly made and there is no presumption that it is reasonable and just there being no question of emergency or public necessity sufficient to sustain the action taken as matter of law. Where no presumption exists as to the reasonableness of a rate, rule or regulation prescribed by the Commission arising from action duly taken to meet an emergency or public right or necessity or a requirement of law, or taken after giving reasonable opportunity for an adversary hearing and due consideration of pertinent matters, as a basis for the action taken, the rate, rule or regulation will not in general be enforced by the courts at least where there is no complete showing of its reasonableness and appropriateness to justify the action taken without a deliberate hearing or investigation. If the carrier utterly fails or refuses to render a service or perform a duty specifically required by law or arbitrarily and unjustly makes charges for service under conditions that patently and necessarily unjustly discriminate between persons localities or commodities an investigation and a consideration of testimony may not in all cases be necessary in making regulations to enforce the law. But — 139 — where regulations are not necessarily proper as a matter of law, or where the propriety of the regulation may depend upon circumstances, there should be an investigation of the pertinent circumstances before the regulation is made. In this case the charge for transportation of passengers over the railroad lines or the bridges of the carrier is not specifically fixed by law, and a particular charge or regulation prescribed by the Commission is not necessarily legal and proper, therefore a reasonable opportunity to be heard should be afforded the carrier and due investigation and consideration of all the conditions and circumstances affecting the rights of .the carrier and the public, should be had before the regulation is made. See State of Washington ex rel. Oregon & Nav. Co. v. Fairchild, 224, U. S. 510, 32 Sup. Ct. Rep. 535. A demurrer to the return to an alternative writ of mandamus admits as true all well-pleaded averments of fact and all fair and pertinent inferences or conclusions of fact in the return that are not inconsistent with, or repugnant to, accompanying specific detailed averments of facts and circumstances, but it does not admit conclusions of law stated in the return. State ex rel. Railroad Com’rs. v. Louisville & N. R. Co., 62 Fla. 315, 57 South. Rep. 175; Int. Com. Com. v. U. P. R. Co., 222 U. S. 541. The demurrer specifies that nothing appears in the return to justify a discrimination in charges or to show that the action of the Railroad Commissioners in making the order was arbitrary and without evidence, or to show that the order is unjust and unreasonable and will deprive the carrier of property without due process of law or will deny the carrier the equal protection of the laws. This demurrer is framed upon the theory that an unjust discrimination by the carrier was duly found and — 140 — established by the Commissioners and that the order as made is prima facie reasonable and just, thus putting the burden upon the carrier. But the return avers in effect that the order was made without any evidence whatever to support it and sets up facts purporting to show that the order is unjust to the carrier, and these specific averments of facts are admitted by the demurrer. This being so, the order was not made in due course of law and is not prima facie reasonable and just. The mere fact that the Railroad Commissioners cited the carrier to a hearing as to the reasonableness of the charges being made by the carrier, does not establish the unreasonableness of the charges being made by the carrier, or that the charges wnjustly discriminate, even though, there appears to be a discrimination; and as the demurrer in effect admits that the order here complained of was made without any evidence to support it, the want of evidence before the Commissioners cannot be “supplied on judicial review by a presumption arising from the failure of the carrier to disprove what had not been established,” particularly when it is in effect admitted that “there was no evidence whatever warranting a finding that there was any” injustice in the charges being made by the carrier. See State of Washington ex rel. Oregon R. & Nav. Co. v. Fairchild, 224 U. S. 510, 32 Sup. Ct. Rep. 535. An opportunity was given the respondent company to be heard before the order here assailed was made, but the demurrer admits the averments of the return that the order was made without evidence to support it. When a return to an alternative writ of mandamus brought to enforce an order of the Railroad Commission — 141 — ers directly and specifically avers in effect that the order was made arbitrarily and without any evidence to support it, and that the order is illegal and unjust for stated reasons, and that because thereof it deprives the carrier of specified constitutional rights, and the other averments of the return do not negative the ultimate facts and conclusions so stated, the return is sufficient to raise a material issue for the introduction of any pertinent testimony. See State ex rel. Railroad Com’rs. v. Seaboard Air Line Ry. Co., 48 Fla., 129, 87 South. Rep. 814. In effect the demurrer admits the specific averments of the return that “in making the order of the 14th day of May, 1912, the said State Railroad Commissioners utterly failed and refused to consider the condition of the respondent’s road and business, as they were and are required by law to do; that, in addition to the answer herein annexed marked “Exhibit 1,” this respondent requested permission to put in evidence to sustain the allegations of the answer, but the said State Railroad Commissioners utterly failed and refused to accept this offer or to give this respondent an opportunity, by testimony, to show the condition of its road and to prove the matters and things alleged in said answer, but, arbitrarily and without any evidence, issued the order dated May 14, 1912,” and “That the order of the Commissioners of May 14, 1912, was made without one word of evidence before the Commissioners tending to show that the charges made over the bridges at Jacksonville and Palatka were unjust or unreasonable,” and that “without any evidence whatever showing or tending to show that the special rate charged is unjust or unreasonable, or is in any way exacting or oppressive to the traveling public, made said order.” The demurrer also admits the averments of facts in the — 142 — return as -to the unreasonableness and invalidity of the order and of the reasonableness of the charges made by the carrier. The alternative writ alleges that the Commissioners did on March 16, 1912, open up and set aside the former order No. 101, dated June 13, 1906, for further proceedings and gave due notice thereof to the said railroad company, and also gave notice to a meeting at which the Commissioners would hear and consider what, if any, passenger rates they should prescribe on respondent’s line of railway north of Homestead, and after such notice and after a full opportunity to the said Railway company to be heard, Order No. 357 was made of which the carrier had due notice, and the order states a sworn statement was filed by the respondent. The return admits that in response to the notice given to it, an answer set out as “Exhibit 1” was filed with the Commissioners. It must therefore be assumed that the Commissioners did consider said exhibit notwithstanding the averment of the return that 'they acted arbitrarily and without any evidence whatever in making the order complained of. If the exhibit is the only evidence considered by the Commissioners, it did not authorize the making of the order, since it at least tends to show that the charges complained of are not unjust discriminations and that the carrier cannot reduce its revenues without injustice to itself. Before making an order within its authority, the Railroad Commissioners should carefully and duly enquire into and consider the interests of all those who are directly and substantially affected by the order; and appropriate evidence of facts and circumstances should be obtained and considered when the subject of the order re — 143 — quires investigation in the interest of private rights and the public welfare. In view of the specific averments of the return admitted by the demurrer that in making the order sought to be enforced the Commissioners acted “arbitrarily and without any evidence,” and “without one word of evidence before the Commissioners tending to show that the charges made over the bridges at Jacksonville and Palatka were unjust or unreasonable,” and considering the averments of the return as to the reasonableness of the charge now made and the unreasonableness of the order, it must on the demurrer be taken as true that the Commissioners did act arbitrarily and without sufficient evidence or consideration and that the order is on this showing, unjust and illegal. The statute does not forbid discriminating charges by common carriers, but it does forbid charges that unjustly discriminate, as well as charges that are unreasonable and unjust. While it appears from the alternative writ and the return that discriminating charges are made by the carrier, it does not clearly appear from the pleadings that the charges are patently and necessarily unjust discriminations ; and as the demurrer admits that the action of the Commissioners was taken without evidence to support it, the order which in effect requires the carrier to cease charging additional amounts for passage over the mentioned bridges was not made in due course of law, and is not prima facie reasonable and just. See State ex rel. v. L. & N. Ry. Co., 62 Fla. 315, 57 South. Rep. 175. The demurrer to the return is overruled with leave to the relators to take issue on the return as they may be advised. Upon issue joined testimony may be taken upon commission issued by the Clerk of this court, or before — 144 — a Justice of the Peace in accordance with the statutes of the State and the rules goyerning Circuit Courts in the matter of depositions; and the Clerk of this court is directed to issue commissions for the taking of such depositions as may be duly applied for by either party in accordance with such statutes and rules; or the parties by agreement may take testimony before some one authorized to administer oaths. Taylor, Shackleford and Hocker, J. J., concur. Cockrell, J., dissents.