United Traction Co. v. Public Service Commission

Per Curiam. Prior to 1921, subdivision 1 of section 49 of the Public Service Commission Law (as amd. by Laws of 1911, chap. 546), which conferred jurisdiction upon the Commission to fix, by decrease or increase, “ the just and reasonable rates, fares and charges to be thereafter observed ” by common carriers, including street railroad corporations, read as follows: “1. * * * the Commission shall * * * determine the just and reasonable rates, fares and charges to be thereafter observed and in force as the maximum-to be charged for the service to be performed, notwithstanding that a higher rate, fare or charge has been heretofore authorized by statute, and shall fix the same by order to be served upon all common carriers, railroad corporations or street railroad [104] corporations by whom such rates, fares and charges are thereafter to be observed By chapter 134 of the Laws of 1921 the material part of subdivision 1 of section 49, above quoted, which was changed, was made to read as follows: “notwithstanding that a higher or lower rate, fare or charge has been heretofore prescribed by general or special statute, contract, grant, franchise condition, consent or other agreement, and shall fix the same by order to be served upon all common carriers, railroad corporations or street railroad corporations by whom such rates, fares and charges are thereafter to be observed. Any such change in rate, fare or charge shall be upon such terms, conditions or safeguards as the Commission may prescribe.” The foregoing was embodied without change in the amendments to said subdivision made by chapter 335 of the Laws of 1921. By chapter 891 of the Laws of 1923, subdivision 1 of said section 49, in the particulars above quoted, was so amended as to read as follows: “notwithstanding that a higher rate, fare or charge has been heretofore authorized by general or special statute, and shall fix the same by order to be served upon all common carriers, railroad corporations or street railroad corporations by whom such rates, fares and charges are thereafter to be observed.” Such is the law to-day. The statute of 1923 did nothing more than to excise the amendment of 1921 by striking out the language inserted in 1921. The Legislature was silent as to rates which had been “ changed ” and “ fixed ” by the Commission during the period when the Legislature had expressly authorized the Commission to “ change ” and “ fix ” rates notwithstanding franchise agreements. It is urged that the Legislature in 1923 intended to repeal such orders of the Commission as had been made, under the 1921 statute, allowing increases over franchise rates and to leave the situation exactly as it had been prior to the act of 1921. In other words, the contention is that the order of the Commission made June 29, 1922, fixing the rate of fare of the petitioner in the cities of Troy and Rensselaer above the franchise rate in those cities, has been repealed by the Legislature and that the legal rate of the petitioner is now the franchise rate. This seems to us to violate the long-established rule that a construction of a statute which will give it a retroactive operation is not favored and that it will not be given such a construction unless its language, either expressly or by necessary implication, requires that it be so construed. If the Legislature of 1923 had intended to undo the changes made by the Commission during the period of its undoubted jurisdiction and to refix those rates at the original franchise rates, suitable language of annulment [105] could have been used. No such language was used and an attempt to inject it into the law in the 1924 session of the Legislature was unsuccessful. The bill failed of enactment iiito law. Our conclusion is that the legal rates of the petitioner became those fixed by the Commission by its order of June 28, 1922. (Matter of Village of Brownville v. Pub. Serv. Comm., 209 App. Div. 640; affd., sub nom. People ex rel. Village of Brownville v. Pub. Serv. Comm., 240 N. Y. 586.) Any franchise rates in Troy and Rensselaer became no longer binding. There cannot be two inconsistent legal rates. The rates fixed by the Commission are the legal rates, under the terms of the Commission’s order,. “ until otherwise ordered by this Commission.” Its order was in effect the act of the Legislature, with which the Legislature has not seen fit to interfere expressly or by necessary implication. Whether the Legislature of 1923 by necessary implication withheld from the Commission the power to increase or decrease the legal rates fixed by its orders pursuant to the statute as amended in 1921, is a further question to answer. If the Commission has the power to decrease them it has the power to increase them. No more authority exists for the one than the other. Its power to regulate at all is a purely delegated power. Its express power to regulate rates, “ notwithstanding that a * * * lower rate, fare or charge has been heretofore prescribed by * * * franchise condition, consent or other agreement,” as the 1921 amendment read, has been withdrawn. The reasonable if not the necessary implication was that in the above provision the Legislature referred to franchise conditions, consents or agreements which at the time of contemplated action by the Commission would be binding agreements. The mere fact that they had previously existed would be of no importance, if they had been waived or had been superseded by later agreement or statute. In such cases the Commission already had jurisdiction and has it to-day. When the Legislature repealed the above provision in 1923, any Troy and Rensselaer franchise conditions were not binding agreements. They had been superseded by the legal order of the Commission pursuant to statute. We think it is not going too far to say that since the Legislature in its repeal did not interfere with such statutory rates, it did not revive the former franchise rates which had been superseded by them, but intended that only binding franchise agreements should preclude the Commission from exercising jurisdiction. Matter of Village of Mamaroneck v. Public Service Commission (208 App. Div. 330; affd., 238 N. Y. 588) is not to the contrary. n that case the franchise agreement had not been changed by the Commission during the period when power to do [106] so had been delegated to it. Its delegation of power had been withdrawn before any new rate could be fixed. Assuming, however, that we have not properly interpreted the legislative intent in our analysis thus far, we think that the determination of the Commission in this case must be annulled for the reason that Troy and Rensselaer franchise agreements containing fare provisions were superseded prior to the order of the Commission of June 29, 1922. They are not binding agreements which interfere with the present jurisdiction of the Commission, irrespective of that order. Chapter 358 of the Laws of 1905, the effect of which has been fully set forth in the statement of facts herein, clearly superseded the Rensselaer franchise agreements and it has been so held. (People ex rel. Cohoes Railway Co. v. Pub. Serv. Comm., 143 App. Div. 769; affd., 202 N. Y. 547.) Several times since the United Traction Company came into existence on December 31, 1899, and twice since the Public Service Commissions Law was passed in 1907, the city of Troy has passed ordinances consenting to the extension of the United Traction Company lines in that city. The restriction contained in each of these franchises, and the only one, was the following provision: “ This consent is granted upon the express condition that the provisions of Article IV of the Railroad Law of the State of New York pertinent thereto shall be complied with.” Much that might be stated here, as to diverse franchise rates which existed in the city of Troy prior to the time when the United Traction Company obtained the franchises containing the above provision, appears in the statement prefiminary to this opinion and need not be repeated. When the city of Troy granted the later franchises upon the sole and express condition that the provisions of article IV of the Railroad Law should be complied with, we think it was clearly its purpose to apply that condition to every part of the United Traction Company’s system operating in that city. It was advantageous for it to do so. One of the earlier franchises authorized a ten-cent fare on one of the company’s lines. Another authorized a seven-cent fare. A number of separate zones each carrying a separate five-cent fare might possibly have been established in the city under separate franchises. All such possibility of confusion, annoyance and expense could be fairly eliminated in the interest of the city and the company by agreeing to a general five-cent rate throughout the city under the provisions of article IV of the Railroad Law, which is now article 5 of the Railroad Law. We think the parties intended to accomplish that result. In that article of the Railroad Law the Legislature expressly reserved the right to regulate rates of fare. The city of Troy thus consented to [107] such regulation even in 1912 and 1913, when two of these consents were granted, which was after the Legislature had delegated its power to'fix rates to the Public Service Commission. It follows that none of the local fare restrictions in the earlier franchises remained in force and that the only restriction was that of the general rule of the State, which restriction is subject to the general authority of the Commission. (Pub. Serv. Comm. v. Westchester St. R. R. Co., 206 N. Y. 209; Matter of International Railway Co. v. Pub. Serv. Comm., 226 id. 474; People ex rel. City of New York v. Nixon, 229 id. 356; People ex rel. Garrison v. Nixon, Id. 575; Matter of Evens v. Pub. Serv. Comm., 214 App. Div. 122.) For these reasons the determination of the Public Service Commission should be annulled and the matter remitted to the Commission. Cochrane, P. J., Van Kirk, Hinman, McCann and Davis, JJ., concur. Determination annulled and matter remitted, with fifty dollars costs and disbursements.