In re the Director of the Buffalo Frontier Terminal Railroad

Spring, J.: Within a few days after the hearing before the Board of Railroad Commissioners commenced the Buffalo, Lake Erie and Niagara Railroad Company was permitted to intervene. • This company was duly organized and had projected a terminal railroad through the same general territory and following to a considerable degree the course — 506 — of the petitioner, except that its easterly line was nearer the city than that of the petitioner’s. Each company had a like purpose, and a certificate to one would in all probability result in the denial of it to the other. In December, 1902, the Niagara Transfer Company was incorporated as a switching road through the northerly part of this same territory, and designed also for the transmission of traffic and merchandise over certain railroads of the city. It also was organized primarily to bring into availability for shipping and manufacturing purposes a large tract of land with a four-mile frontage on Niagara ' river north of the city. A certificate was granted to it by the Board óf Railroad Commissioners August 10, 1904. The determination of the Board, upon a review by writ of certiorari, was reversed by the Appellate Division, third department (People ex rel. Amm v. Railroad Comrs., 103 App. Div. 123), and its decision was affirmed by the Court of Appeals (184 N. Y. 515). Pending this appeal and in June, 1905, the Buffalo, Lake Erie and Niagara Railroad Companyi was organized and comprised substantially the same stockholders as the Niagara Transfer Company referred to. Upon the hearing of the proceeding now under review a large amount of proof was taken by the Board of Railroad Commissioners bearing, ¿first, upon the propriety of granting any certificate at all; and, second, upon the respective merits of the two applicants appearing before the Board. The railroad companies now operating in the city of Buffalo gave proof tending to show that upon the consummation of the plans already devised and some of which were in'course of fulfillment, adequate facilities would be provided to take care of all the enormous freight business of the city, including whatever was interchanged at that point in order to reach its destination. There are' tracks of thirteen different railroad companies entering the city of Buffalo and they own vast tracts of valuable land and many hundreds of miles of switch and freight trackage in the city. The title to the extensive harbor and water frontage adjacent to the city is in the railroad companies, so that there is no opportunity for the location of a manufacturing plant or business enterprise requiring a large site along the lake or river within the city, and the proof tends to show that industrial organizations of magnitude have been prevented from locating in the city for the reason — 507 — that there was no vacant property available for the operation of their plants. Again, it appears that there has been of late years much congestion of traffic, both of that coming into the city by the lake and also where transshipment from one steam road to another is required and consequent expensive delays have been frequent. One witness, testifying as to the difficulty of disembarking merchandise in the harbor, said that in the fall preceding one hundred and thirty vessels were delayed in unloading from two to twenty-four days. The Buffalo Creek railroad in the city of Buffalo is a connecting terminal railroad four and one-fourth miles in length. The proof tends to show that it is inadequate to take care of the freight business of the connecting roads. It also appears that the land adjacent to its tracks is mainly taken up by elevators and industrial plants and enterprises, and there is little available space for other projects to be developed. It is. the contention of the petitioner and also of the competing Company that a terminal railroad connecting with all the railroad lines devoted principally to the business of interchanging freight and traffic for a small charge would forward the merchandise without delay, and be able to take care of all which Would otherwise be stalled in the city. Evidence was given to fortify this position by men engaged in the railroad business and who testified to similar lines in other cities, and that the effect had been to facilitate the expeditious movement of freight. Again, it was claimed on their behalf that both north and south of Buffalo ample facilities of water frontage would be afforded, and that any large plant might be located with a terminal line connecting with all the trunk lines, so that it would not be at the mercy of one railroad in the shipment of its output; and it is urged that the inability to obtain locations accessible to competing lines has been a great obstacle to the growth of the city.. We do not deem it necessary to go into the evidence in any more detail. Suffice it to say, there was abundant evidence, as conditions then prevailed, to warrant the decision that a terminal road was essential. In fact, there was very little controversy over the conditions which existed. The opposing companies gave proof tending to show that the plans projected, with the concurrence of all the — 508 — various companies, would remedy the congestion of traffic prevailing; and further that neither of the competing terminal roads, if completed, would afford relief to the extent which would result from the consummation of the plans already devised by the existing companies. The members of the Commission were unanimous in the determination that the certificate of public convenience and necessity should be granted to one or the other of the two applicants. ' The difference arose over the merits of the two projected lines. The certificate was finally granted to the Buffalo, Lake Erie and Niagara Railroad Company, three of the Commissioners joining in the decision, while two dissented, favoring the petitioner. Writs of certiorari were sued out and the determination was-reversed (People ex rel. Sawyer v. Board of R. R. Comrs., 128 App. Div. 814) upon the court’s previous decision already adverted to, and for the further reason that the proposed route would interfere with and obstruct improvements which the national government has under way in the vicinity of Black Rock, north of Buffalo. The affidavit of Mr. Bushnell, presented on the argument of this proceeding, shows that on the 31st of December, 1908, the Buffalo Connecting Railway Company was organized in the interest of the Buffalo, Lake Erie and Niagara Railroad Company, and its contemplated route is the same as that of its predecessor south and east of the city, but it is claimed its course north of the city has been changed to obviate the objections assigned for the reversal of the determination of the Board of Railroad Commissioners. Application has been made by this company to the Public Service Commission, second district, for a certificate of necessity in pursuance of section 53 of the Public Service Commissions Law (Laws of 1907, chap. 429). If we were considering the refusal of the Board of Railroad Commissioners to grant the certificate to the petitioner untrammeled by other conditions, some of which have been enumerated, we would set aside that decision and order the certificate to issue. The evidence justifies the determination that in the situation presented to the Board there was a paramount necessity for the issuance of a certificate to one or the other of the two rival companies. If we should review the application as an original one on the record before the Railroad Commissioners, — 509 — as was done in Matter of Rochester, Corning, Elmira Traction Co. (118 App. Div. 521), we should also conclude that the petitioner was entitled to the certificate if there were no competitor for the certificate. There are, however, several influential reasons which deter us from directing the certificate to issue. The decision of the Board of Railroad Commissioners was made in December, 1906. In an affidavit presented on the argument in this proceeding it appears that the Hew York Central and Hudson River Railroad Company is constructing a switching yard of great capacity, and which will in a large measure enable it to handle expeditiously the traffic and merchandise which otherwise would be delayed in transportation. That company already has a passenger belt line extending around the city. It is now engaged in constructing two additional tracks along this line with heavy equipment, which will soon be available in interchanging freight among the various railroad lines. Other improvements are alleged to have been made by other trunk lines, all tending to do away with the necessity of any switches or terminal road of any independent companies to take care of the freight ' business or traffic which are to be distributed or shipped from the city. Again, the certificate was granted to the rival company. Except for the objections which induced the reversal of the determination, that company may have been equally well equipped and located to satisfy the necessity as the petitioner. If the succeeding company has in the location of its route eliminated the objections which operated against its predecessor, it may be entitled to the certificate rather than the petitioner. We allude to these conditions, not for the purpose of passing judgment upon the propriety of granting any certificate as conditions now are, nor to give any intimation as to the relative merits of the competing companies, but in order to explain our decision to, submit the whole matter to the body which is especially delegated with authority to determine applications of this kind. By chapter 429 of the Laws of 1907 the Board of Railroad Com missioners was abolished and the Public Service Commissions created and invested with large power over public service corporations, and the law became effective July 1, 1907. By section 53 of this — 510 — act no railroad corporation is permitted to begin the construction of a railroad without a certificate of public convenience and a necessity granted by the proper . Commission. Nor may any railroad corporation exercise any franchise “ without first having obtained the permission and approval of the proper commission.” In emphasizing and defining its authority, the section proceeds: “ The commission within whose district such construction ■ is to be made * * * shall have power to grant the permission and approval herein specified whenever it shall after due hearing determine that such construction or such exercise of the franchise or privilege is necessary or convenient for the public service.” We do not deem it necessary to determine the question of the power of this court to order the Public Service Commission to issue a certificate of necessity to the petitioner. (As bearing upon this subject see, however, Village of Fort Edward v. Hudson Valley R. Co., 192 N. Y. 139; Matter of Wood, 181 id. 93; Matter of Rochester, Corning, Elmira Traction Co., 118 App. Div. 521; Pub. Serv, Comm. Law, § 85; Railroad Law, § 59.) Passing the question of power we think such an order would be an unwise exercise of discretion in view of the conditions existing. One rival company has already applied to that body for such certificate and if granted it might render permission to the petitioner improper or unnecessary. The Board of Railroad Commissioners, believing a certificate should be granted, issued it to another competing company. The affidavits tend to show that conditions affecting the operation of railroads and the transportation of freight have materially changed since the determination made more than two years ago. It is a matter of current knowledge that the Public Service Commission of the second district has been devoting much time to the consideration of the many problems connected with the operation of the railroads in and about the city of Buffalo. It has the opportunity of frequent inspection of conditions prevailing and is especially equipped for the solution of questions involving railroad construction and operation. W e have no doubt as to the power of this court to relegate this matter to that body for investigation and. determination. The petitioner asks that this court direct the Commission to issue the certificate. Assuming that can be done, the power — 511 — must also be lodged in this court to remit the matter for a rehearing to the body possessing original jurisdiction. The mode in which this court transfers the proceeding to the Commission and what directions it may make relate wholly to the procedure. The power to remit for any purpose must carry with it the authority to determine in what manner and for what purpose the submission is made. In People ex rel. Bath & Hammondsport R. R. Co. v. Public Service Commission the Appellate Division annulled the determination of the Board of Railroad Commissioners (127 App. Div. 480), and this decision was affirmed in the Court of. Appeals, (194 N. Y. 543). Upon application that court modified its order “ so as to award a rehearing before the Public Service Commission,” although the determination reversed was made by its predecessor, the Bail-road Commission. It is urged with much earnestness that the determination of the Board of Bailroad Commissioners is an administrative and not a judicial act, and this court has no power to review its decision. The power has been exercised for so long a time that it is not an open question, and we deem it unnecessary to enter into any discussion of the subject. The determination of the Board of Bailroad Commissioners should be set aside and a rehearing ordered before the Public Service Commission, second district, without costs of this appeal to any party. All concurred, except McLennan, P. J., who dissented in an opinion and voted for granting the application.