Hyperlawhypertext legal databasebeta Chicago, Milwaukee & St. Paul Railway Co. v. Minnesota 134 U.S. 418

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Chicago, Milwaukee & St. Paul Railway Co. v. Minnesota

134 U.S. 418 Court SCOTUS Decision date 1890-03-24 Docket No. 762 English

Decision Majority — Blatchfoed J. · Concurring — Millek J. · Dissent — Bbadley J.

Contents

Majority — Blatchfoed J.

p. 418
CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY v. MINNESOTA.

Syllabus

ERROR TO THE SUPREME COURT OE THE STATE OE MINNESOTA.
No. 762.
Argued January 13, 14, 1890.
Decided March 24, 1890.
The act of the legislature of Minnesota, approved March 7, 1887, General Laws of 1887, c. 10', establishing a railroad and warehouse commission, being interpreted by the Supreme Court of that State as providing that the rates of' charges for the transportation of property, recommended and published by the commission shall be final and conclusive as to what are equal and reasonable charges, and that there can be no judicial inquiry as to the reasonableness of such rates, and a railroad company, in answer to an application for a mandamus, contending that such rates, in regard to it, are unreasonable, and not being allowed by the state court to put in testimony on the question of the reasonableness of such rates; Held, that the act is in conflict with the Constitution of the United . States, as depriving the company of its property without due process of law, and depriving it of the equal protection of the laws.
The State had made no irrepealable contract with- the company that it should have the right for all future time to prescribe its rates of toll, free from all control by the legislature of the State.
This was. a writ of. error to review a 'judgment of the Supreme Court of the State of Minnesota, awarding a writ of mandamus against the Chicago, Milwaukee ;& St. Paul Railway Company.
■The case arose on proceedings taken by the, Railroad and Warehouse Commission of the State of Minnesota, under an act of the legislature of that State, approved March 7, 1887', General Laws of 1887, c. 10, entitled “ An act to regulate common carriers, and creating the Railroad and Warehouse Commission of the State of Minnesota, and defining the duties of such commission in relation to common carriers.” The act is set forth in full in the margin.[1]
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Tbe ninth section of that act creates a commission to be known as tbe “ Railroad and Warehouse Commission of tbe
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State of Minnesota,” to consist, of three, persons to be appointed by the governor by and with the advice and consent of the senate.
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The first section of the act declares that its provisions shall apply to any common carrier “ engaged in the transportation
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of passengers or property wholly by railroad, or .partly by railroad and partly by water, when both are used under a
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common control, management or arrangement, for a carriage or shipment from one place or station to another, both being within the State of Minnesota.”
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The second section declares “ that all. charges made by any common carrier, subject to the provisions of this- act, for any
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service rendered or to be rendered in the transportation of passengers or propertju as aforesaid, or in connection there
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with, or for the receiving, delivering, storage or handling of such property, shall be equal and reasonable; and every un
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equal and unreasonable charge for such service is prohibited and declared to be unlawful.”
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The eighth section- provides that every common carrier subject to the provisions of the act shall print and keep for
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public inspection schedules .of the charges which it has established for the transportation of property ;• that it shall make
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no change therein except after ten days’ public notice, plainly stating the changes proposed to be made, and the time when
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they will go into effect; that it' shall be unlawful for it • to charge or receive any greater or less compensation thp,n that
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so established and published, for transporting property; that it shall file copies of its schedules with the commission, and
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shall notify such commission of all changes t- .oposed to be made; that in case the commission shall find at any timé that
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any part of the tariffs of charges so filed and' published is in any respect unequal or unreasonable, it shall have the power, and it is authorized and directed, to compel any common carrier to change the same and adopt such charge as the
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commission “ shall declare to be equal and reasonable,” to which end the commission shall, in writing, inform such carrier in what respect such tariff, of charges is-unequal and unreasonable, and shall recommend what tariff shall be .substituted therefor; that in case the carrier shall neglect for ten days after such notice to adopt such tariff of charges as the commission recommends, it shall be the duty of the latter, to immediately publish such tariff as it has declared , to be equal and reasonable, and cause it to be posted at all the regular stations on the line of such carrier in Minnesota, and it shall be unlawful thereafter for the carrier to charge-a, higher or lower rate than that so fixed and published by the. commission; and that, if any carrier subject to the provisions of the act shall 'neglect to publish or file its schedules - óf charges, or to carry out such recommendation made and published by the commission, it shall be subject to a writ of mandamus “ to be issued by any judge bf the Supreme Court or of any of the District Courts ” of the State, on application of the commission, to compel compliance with the requirements of section 8 and with the recommendation of the' commission, and a failure to comply with the requirements of the mandamus shall be punishable, as and for contempt,. and the commission may apply also to any such judge for an injunction against the carrier from receiving or transporting property or passengers within the State until it shall have complied with the requirements of section 8 and with the recommendation of the commission, and for any wilful violation or failure to comply with such requirements or such-recommendation of the commission, the court may award such costs, including counsel fees, by way of penalty, on the return of said writs and after due deliberation thereon, as may be just.'
On the 22d of June, 1887, The Boards-of-Trade Union of Farmington, Northfield, Faribault, and Owatonna, in' Minnesota, filed with the commission a petition in writing, complaining that the Chicago, Milwaukee & St. Paul Pailwáy Company, being a common carrier engaged in the transportation of property wholly by railroad, for carriage or shipment from' Owatonna, Faribault, Dimdas, Northfield, and Farmington,
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to the ,cities of St. Paul and Minneapolis, all of • those places being within the State of Minnesota, made charges for its services in the transportation of milk from said Owatonna, Paribault, Dundas, Northfield and Farmington' to St. Paul and Minneapolis, which; were unequal' and unreasonable; in that it charged four cents per gallon for the transportation of milk from Owatonna to St. Paul and Minneapolis, and three cents per gallon from Faribault; Dundas, Northfield and, ■Farmington,, to the said cities; and that such charges, were unreasonably high, and subjected the traffic in milk between said points to unreasonable prejudice and disadvantage. The prayer of the petition was .that such rates be declared unreasonable, and the carrier be compelled to change the same and adopt such rates and charges as the commission should declare to be equal and reasonable.
A statement of the complaint thus made was forwarded by the commission, on the 29th of. June, 1887, to the railway company, and it was called upon by the commission, on the 6th of July, 1887, to satisfy the.complaint or answer it in writing at the' office of the commission in St. Paul, on the 13th of July, 1887.
On tfye 30th of June, 1887, Mr. J. F. Tucker, the assistant general'manager of the railway company, addressed a letter from Milwaukee to the secretary of the commission, saying: “I have your favor of the'29th, with complaint as to milk rates being unreasonable and unequal. They may be unequal if unreasonable.' They are unreasonably low for the service performed — by passenger train — and are 25 per cent less than the same commodity is charged into New York, with longer distances and hundred times larger volume in favor of New York. I am .frank to say it is hard ta appreciate complaints from boards of trade that one-tenth of a cent per gallon on milk handled on passenger train one mile is unreasonable. "With what is the comparison made that enables such a conclusion? It’s not. first-class rates by freight ■ train, and was made low to encourage the trade, under the hope and promise that, when the trade were fostered, it would be advanced. This, as usual, has been forgotten.”
■' O.n.the 13th of July, 1887, ajt the office of. the commission
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in St. Paul,- the company -appeared by J. A. Chandler, its duly authorized attorney, and The Boards-of-Trade Union by its attorney, and the commission proceeded to investigate the. ■complaint. An investigation of the rates charged by the company for its services in transporting milk from Owatonna, Faribault, Dundas, Northfield and Farmington, to St. Paul and Minneapolis, was made by the commission, and it found that the charges of the company for transporting milk from Owatonna and Faribault to St. Paul and Minneapolis were three cents per gallon in ten-gallon cans; that such charges were unequal and unreasonable; and that the company’s tariff of rates for transporting milk from Owatonna and Faribault to those cities, filed and published by it as. provided by chapter .10 of the Laws of 1887, was unequal and unreasonable; and' the commission declared that a rate of 2^ cents per gallon in ten-gallon cans-was an equal and reasonable rate for such services. .
On the 4th of August, 1887, the commission made a report in writing, which included the findings of fact upon which its conclusions were based, its recommendation as to the tariff which should be substituted for the tariff so found to be unequal and unreasonable,- and also a specification of the rates and charges which it declared to be equal and reasonable. This paper was in the shape of a communication, dated at St. Paul, August 4, 1887, signed by the secretary of the commission and addressed to the company. It said: “ It appearing from your schedule of rates and charges for- the transportation of milk over and upon the Iowa and Minnesota Division of your road, that you charge, collect, and. receive for the transportation of milk over and upon said line from Owatonna and Faribault to the cities of St.JPaul and Minneapolis thrée cents per gallon, in ten-gallon cans, and from Dundas, Northfield and Farmington to said cities of St. Paul and Minneapolis two and one-half cents' per gallon, in cans of like capacity, and complaint having-1 been made that such rates and charges.are unequal and-unreasonable, and that the services performed by you in such transportation are not reasonablv worth .the said sums charged therefor; and this commission! having there
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upon, pursuant to the provisions of section eight of an act entitled ‘An act'to regulate common carriers, and creating the Railroad and Warehouse Commission of the State of Minnesota, and defining the duties of such commission in relation to common carriers,’ approved .March 7, 18.87, examined the cause and reasonableness of said complaint, and finding, pursuant to subdivision (e) of said section, that your said tariff of rates, so far as appertains to the transportation of milk to the cities of St. Paul and Minneapolis from the other places above named, and insomuch as said tariff provides for or requires the charging or collection of a greater compensation than two and oné-half cents per gallon, is unreasonable and excessive. Therefore said commission recommends and directs that you, the said Chicago, Milwaukee & St. Paul Railway Company, shall alter and change your said schedule by the adoption and substitution of a rate not to exceed two and one-half cents per gallon for the services aforesaid from the cities of Owatonna and Faribault, or either of them, to said St. Paul and Minneapolis. The commission, as at present advised, approves of the custom and arrangement which, it is informed, has been adopted and is now' in use by the Minnesota & Northwestern R. R. Co., of collecting two and one-half cents per gallon on all milk transported by it, regardless of distance; but this expression of opinion is no part of the decision, notice, or order in this case.”
This report was entered of record, and a copy furnished to the Boards-of-Trade Union, and a copy was also delivered, on the 4th of August, 1887, to the company, with a notice to it to desist from charging or receiving such unequal and unreasonable rates for such services. The^ commission thus informed the company in writing in what respect such tariff of rates and charges was unequal and unreasonable, and recommended to it in writing what tariff should be substituted therefor, to wit, the tariff so found equal and reasonable by the commission.
The company neglected and refused, for more than ten days after such notice, to substitute or adopt such tariff of charges as .was recommended by the commission. The latter
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thereupon published the tariff of charges which it had declared to be equal and reasonable, and caused it to be posted at the station of the company in Faribault on the 14th of October, 1887, and at all the regular stations on the line of the company in Minnesota prior to. November 12, 1887, and in all things complied with the statute. ■
The tariff so made, published and posted, was dated October 13, 1887, and was headed: “ Chicago, Milwaukee and St. Paul Railway Company. (Iowa and Minnesota división.) Freight Tariff on Milk from O.watonna. and Faribault to St. Paul and Minneapolis, taking effect October 15, 1887; ” ahd prescribed a charge of 2-J- cents per gallon in ten-gallon cans from either the Owatonna station or the Faribault station to either St. Paul or Minneapolis, to be the legal, equal and reasonable maximum charge and compensation for such service, and declared that the same was in force and effect in lieu and place of the charges and compensation theretofore demanded and received therefor by the company.
On .the 6th of December, 1887, the commission, by the attorney general of the State, made an application to the Supreme Court of the State for a writ of- mandamus to compel the company to comply with the recommendation made to it by the commission, to change its tariff of rates on milk from Owatonna and Faribault .to St. Paul and Minneapolis, and ■ to adopt the rates declared by the commission to be equal and reasonable. The application set forth the proceedings hereinbefore detailed; that the company had refused to carry out the recommendation so made, published and posted by the commission; that it continued to charge three cents per gallon for the transportation of milk in ten-gallon cans from O.watonna and Faribault to St. Paul and Minneapolis; tha* said charge was unequal, unreasonable and excessive; that 2J cents per gallon for the transportation by it of milk in ten-gallon cans from Owatonna and Faribault to St. Paul and Minneapolis was the maximum reasonable charge for the ■service; that any rate therefor in excess of 2|- cents per gallon in ten-gallon cans was unequal, unreasonable and excessive; that three- cents per gallon in ten-gallon cans was a higher rate
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than, was charged for the same distances on passenger trains by any express company or by any other railroad company in Minnesota, engaged in transporting milk to St. Paul or Minneapolis; that 2£ cents per gallon in ten-gallon cans was the highest rate charged for like distances on passenger trains by any such company; that the milk transported by the company to St. Paul and Minneapolis, over its Iowa and Minnesota division, (extending from Calmar, in Iowa, to LePoy, in Minnesota, and from LePoy, through Owatonna and Faribault, to St. Paul and Minneapolis,) large quantities of which milk were shipped from Faribault, was so transported by the company on a passenger train which ran daily from Owatonna to St. Paul and Minneapolis; and that the company, by means of such excessive charges, subjected the traffic in milk at Faribault and Owatonna to undue and unreasonable prejudice and disadvantage.
Thereupon, an alternative writ of mandamus was issued by the court, 'returnable before it on the 14th of December,. 1887.
On the 23d of December, 1887, the company filed its return to the alternative writ, in which it set up:
(1) That it was not competent for the legislature of Minnesota to delegate to a commission a power of fixing rates for .transportation, and that the act of March 7, 1887, so far as it. attempted to confer upon the commission power to establish rates for the transportation of freight and passengers, was. void under the constitution of the State;
(2) That the company, as' the owner of its railroad, franchises, equipment and appurtenances, and entitled to the possession and beneficial use thereof, was authorized to establish, rates for the transportation of freight and passengers, subject only to the provision that such rates should be fair and reasonable; that the establishing of such rates by the State against the will of the company was pro tanto a taking of its property, and depriving it thereof, without due process of law, in violation of section 1 of Article 14 of the Amendments to the Constitution of the spited States; and that the making of the order of October 13, 1887, was pro tanto a
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taking, and depriving the company, of its property without due process of law, in violation of said section 1. and therefore void and of no effect;
(3) That the rate of three cents per gallon, as a freight for carrying milk in ten-gallon cans on passenger trains from Owatonna and Faribault respectively to St. Paul and Minneapolis was a reasonable, fair and just rate; that the rate of 2% cents per gallon, in ten-gallon cans, so fixed and established by the commission, was not a reasonable, fair or just compensation to the company for the service rendered ; and that the establishing of such rate by the commission, against ■ the will of the company, wasjpro tanto a taking of its property without due process of law, in violation of said section 1.
The case came on for hearing upon the alternative writ and the return, and the company applied for a reference to take testimony on the issue raised by the allegations in the application for the writ and the return thereto, as to whether the rate' fixed by the commission was reasonable, fair and just. The court denied the application for a reference, and rendered judgment in favor of the relator and that a peremptory writ of mandamus issue. An application for a reargument was made and denied. The terms of the peremptory writ were directed to be, that the company comply with the requirements of the recommendation and order made by the commission on the 4th of August, 1887, and change its tariff of rates and charges for the transportation of milk from Owatonna and Faribault to St. Paul and Minneapolis, and substitute therefor the tariff recommended, published and posted by the commission, to wit, the rate of cents per gallon of milk in ten-gallon cans from Owatonna and Faribault to St. Paul and Minneapolis, being the rates published by the commission and declared to be equal and reasonable therefor. Costs were also adjudged against* the company. To review this judgment, the company brought a writ of error.
Mr-. John W. Gary for plaintiff in error.
I. The court erred in holding that the legislature of Minnesota, either by positive statute or acting through a railroad
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commission, is authorized to make, fix and establish the rates and charges for the transportation of persons and property over lines of railway owned, by this company and in denying the right of the company, under the Constitution of the United States, to make, fix and establish its rates and charges over its railway, subject, only, to the provision that such rates and charges shall, be fair, just and reasonable:
First. Because the exercise of such a power would impair the obligation of the contract contained in the charter under which said road was constructed.
The charter granted in 1856 was a contract between the Territory of' Minnesota and the company organized by said charter ; and the State of Minnesota, succeeding to the Territory on its admission to statehood, was. subject to its provisions.
The road was constructed in pursuance of the charter. The plaintiff in error has succeeded to the ownership of the property and all the rights, franchises and privileges granted by the charter under the laws of the State of Minnesota. Any legislation of the State impinging upon the rights, franchises and privileges granted thereby, is ap impairment of the obligation of the contract so made, which the plaintiff in error may lawfully resist.
There is no provision in the charter or in any general statute reserving to the Territory or State of Minnesota the right to alter, amend or repeal said charter, and it remains in full force according to the terms of the grant.
The language in the Dartmouth, College Case, 4 "Wheat. 518, conferring upon the board of trustees -power to fill vacancies in their own number, is no more explicit than is the language of this charter; yet this court held that it was a contract that could not "be violated or impaired by the legislature fifty , years subsequently, and held it an affirmative grant of power for all time, that could not be interfered with. _
The cases cited by the Chief Justice in Stone v. Farmers' Loam, <& Trust Co., 116 U. S. 307 , on pages 326 and 327, are not authorities to justify the court ih holding the language of the charter in this respeqt not a contract.
p. 443
The case of Providence Bank v. Billings, 4 Pet. 514 , was a contention-, that a state bank chartered by a legislature was not subject to taxation. There was no provision of any kind in the charter upon that subject, and it was claimed that such an institution could not be taxed on general principles.
Charles Rimer Bridge v. Warren Bridge, 11 Pet. 419 , was a contention that the legislature, having chartered one bridge, was not authorized to charter another over Charles River, between Boston and Cambridge, because it would injure the property interests of the first. There was no claim that the first charter contained any such restriction, or any affirmative grant that it should have a monopoly of the business. ■
In. Minot v. Philadelphia, Wilmington & Baltimore Railroad, 18 Wall. 206 , the court held, that the provision of the charter, requiring the railroad company to pay annually into the treasury of the State a tax of one quarter of one per cent on its capital stock, without any words indicating the intent of the legislature, that such payment should be in lieu of all óthér taxation, and that no further or different tax should be subsequently levied for any purpose, was not sufficient to show a contract binding the State not to levy-any other taxes for any other purpose.
In Bailey v. Magwire, 22 Wall. 215 , the Missouri Pacific Railroad was exempted from taxation until completed, and it was provided that after its completion, it should be subject to taxation at the rate assessed by the. State on other real and personal property of like value. The contention was that under this statute only a state tax could be levied upon the road; but the court held that the provision had no such effect, that it could be taxed as other property for all purposes. ■
In Fertilizing Company v. Hyde Park, 97 U. S. 659 , the majority of the court held, that the charter of a company authorized to carry on business at a certain place did not allow it to carry on and continue that business after it became a nuisance:'
In Newton v. Commissioners, 100 U. S. 548 , this court held, that the term “permanently established,” used in statutes of Western States, relating to establishing county seats, did not
p. 444
mean that the county, seat where' it was so “permanently established ” should forever remain;, but only that it. was permanently instead of temporarily established as provided in-said statutes. •
In no oftjs. of- these cases, unless it be that of the Fertilizing. Company in 97 TJ. S., was there any affirmative grant of power to the company by. the legislature in question. They were cases in which it was claimed that by inference or construction such affirmative grant or contract was implied, and in the case of the Fertilizing Company, Mr. Justice Swayne, on page 666, states the rule as follows: “The rule of construction in this class of cases is that it shall be most strongly against the' corporation. Evéry reasonable doubt is to be resolved adversely to the corporation. Nothing is to be taken as conceded except what is given in unmistakable terms or by an implication equally clear. The affirmative. must lie shown. Silence is negation and doubt is fatal to the claim.”
Applying this most stringent rule of - construction to this charter, and it must still be held that it affirmatively creates a contract between the Territory and the company*.
Second. The judgment of the court violates the natural right which belongs to every'one to fix the price of his services' arid of his property or its use. Under our form of constitutional government it has ever been held to be the unquestionable' right of every freeman to^íhave a perfect and entire property in his goods and estate. 1 Kent Com. 613.
' As was said by Lord Ellenborough in Aldnut V. Inglis, 12 East, 527, in speaking of the right of an owner to charge ,an unreasonable amount for the use of his warehouse : “ There is no doubt that the general principle is favored, both in law arid justice,- that every man may fix what price he pleases upon his own property or the use of it.”
. In the case of The- State Freight -Tax, 15 Wall, 232 , 277, 278, Mr. Justice Strong, in delivering the opinion of the court, says: “¥e concede the right and power . ’. . of the owners óf artificial highways, .whether such owners be the State or grantees of franchises from the State, to exact what they please for the use of their ways. - That right is an attri
p. 445
bute of ownership. '. . . The right to make terms for the usé of the roadway’is in the grantee of the franchises, not in the grantor.”
. The State has no more right to assume the control or management. of one of these classes of property than it has of the other, and .the right to fix the price .of the use of each, inheres in the owner' thereof the same in one case as the other, except as above stated,.and within the bounds of reasonable compensation, the right of the owner to fix the charges for the use of property clothed by law with a public interest cannot be questioned any more than his right to property not so clothed.
By the authorities cited in the opinion of the Chief Justice in Munn v. Illinois, ■ 94 IT. S., it appears, that the only limitation upon the right of the owner of this sort of property to make his own rates was, that he should charge only a reasonable price for the use of such property, and no claim was made that the legislature had a right to fix such charges. But see Aldnut v. Inglis, 12 East; 521Bolt v. Stennett, 8 T. B. 606.
The Granger Cases, so called, reported in 94 IT. S., arose on statutes passed in Illinois in 1873, and in Wisconsin, Iowa and Minnesota in 1874. The Wisconsin and Iowa acts were statutes fixing a maximum tariff. The Illinois- and Minnesota statutes provided that commissioners should make schedules which should be prim,a facie reasonable rates.
The particular questions involved-in the present record aside from the general question of power of the legislature, were not in any of the cases then before the court, except that of Chicago, Milwamkee dec. Railroad Corrvpomy v. Ackley, whiqh, it would appear from the opinion, received but slight attention from the coürt. '
. Euliy admitting the right of the legislature to take such proper action as. may be necéssary to secure to the people •reasonable charges for transportation thereon, we deny its right to arbitrarily and finally fix or determine such charges by positive statute, and- most respectfully ask this court to again review the decisions made in the cases of Munn, Peik and Ackley in this respect.
p. 446
That the police power of the State, founded upon the maxim sic uiere tuo ut alienum non laedas, is proper authority for statutes regulating the management, operation and control of a railroad so far as it affects the protection of the lives, limbs, comfort, safety and quiet of all persons, and the protection of all property in the State, is admitted.
But we - deny that this power gives to the legislature .the right to limit or fix the tolls or charges for transportation • which the company would' otherwise have the right to make.
Thorpe v. Rutland & Bwrlington Railroad Co., 27 Vermont, 140; S. C. 62 Am. Dec. 625 ; Hale’s De Portibus Maris ; Cooley’s Const. Lim. 88, 91; People v. Draper, 15 N. T. 532; Wynehamer v. People, 13 N. Y. 378 ; Aldnut v. Inglis, ubi sup.j Tiedman’s Limitation of Police Powers, 231; Parker v. Metropolitan Railway, 109 Mass. 506 ; 1 Bl. Com. 160; Newland v. Marsh, 19 Illinois, 376; Ervinds Appeal, 16 Penn. St. 256 ; 8. C. 55 Am. Dec. 499 ..
II. The court erred in holding that the schedules of rates fixed by said commission were final and conclusive as to what were lawful, equal and reasonable rates, and that they “ are the only ones that are lawful, and therefore, in contemplation of law, the only ones that are equal and reasonable,” instead of simply holding them as advisory and prima facie or presumptively equal, and subject to review by the court,,
III. The' court erred in holding that the rate fixed by said commission, which is not a fair or reasonable rate or just compensation to the owner for the service required, was a lawful rate which the owner was bound to submit to and obey, and in granting a peremptory writ of mandamus compelling the owner to transport freight over its line of railway at the rate so fixed.,.
IY. The court erred in holding that the State of Minnesota, since the, passage by Congress of an act entitled “ An Act to regulate Commerce,” approved February 4, 1887, has the power to regulate, fix, or establish the tariff rates for the transportation of freight and passengers over the lines of the Chicago, Milwaukee & St. Paul Railway, it being an interstate railway engaged in interstate traffic.
p. 447
Mr. Moses E. Clarpjp and Mr. II. W. Childs, for defendant in error, after discussing a question concerning the jurisdiction of the court below, continued:
It remains to inquire whether the law in question, as interpreted by the Supreme Court of Minnesota; is in conflict' with the Fourteenth Amendment to the Federal Constitution, and in considering this law, as interpreted by the state court we should keep in mind that, while the Supreme Court of the State held that the reasonableness of the rates as fixed by the commission, could not be the subject of judicial review, yet it did-not leave the commission an irresponsible body, answerable in no. case to the courts, but on the contrary limited its power to the exercise of an honest judgment.
It will relieve the discussion of this case from some embarrassment, if it is borne in mind that, in the case made by plaintiff in error to the alternative writ, no allegations are made that the enforcing the rate established by the board would so affect- the earnings' of the road as to impair its ability to meet any of its obligations or to seriously affect its revenues,
Neither is it claimed by plaintiff in error that it is protected by any express contract or charter exemption 'from legislative interference in the matter of fixing rates, the company contenting itself as above stated, with the allegation that the commission “ unjustly, unreasonably and oppressively ” fixed the rate, and that the establishment of such rate was a jpro tcmto taking of the property of the plaintiff in error.
This case then involves a determination of the question, can the legislature prescribe what is a reasonable rate for transr portation of freight and passengers by a common carrier, when unrestrained by any. provision in the charter of the company ?
/In view of the repeated adjudications of this court sustaining the right of legislatures to establish the rates which com: mon carriers may charge, and to declare by legislative action what are reasonable rates, we confess to some hesitation in entering upon an extended discussion of the question.
In Mwm v. Illinois, 94 U. S. 113 , 133,134, in the opinion of
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the late Chief Justice "Waite, is to be found a history of legislative control of property clothed with public interest, as well as also an exhaustive discussion of the principles upon which such legislative control rests.
In the consideration of the questions involved in that case, the court, afteir reviewing the history of the subject and supporting the position contended for by ample and pertinent illustrations, says:
“ It is insisted, however, that the owner of property is entitled to a reasonable compensation for its use, even though it be clothed with a public interest, and that what is reasonable, is a judicial and not a legislative question.
“ As has already been shown, the practice has been otherwise. In countries where the common law prevails, it has been customary from time immemorial for the legislature to declare what shall be a reasonable compensation under' such circumstances, or, perhaps more properly speaking, to fix a maximum beyond which any charge made would be unreasonable. Undoubtedly in .mere' private contracts, relating to matters in which the public has no interest, what is reasonable must be ascertained judicially. But this is because the legislature has no control over such a contract. So, too, in matters which do affect the public interest, and as to which legislative control may be exercised, if there are no statutory regulations' upon the subject, the courts must determine what is reasonable. The controlling fact is the power to regulate at all. ■ If that exists, the right to establish the maximum ■ of charge, as one of the means of regulation, is implied. In fact, the common-law rule, which requires the charge to be reasonable, is itself a regulation as to price. Without it, the owner could make his rates at will, and compel the public to yield to his terms, or forego the use.
“ But a mere common-law regulation of trade or business may be changed by statute. A person has no property, no vested interest, in any rule of the common law. That is only one of the forms of municipal law, and is no more sacred than the other. Bights of property which have been created by the common law cannot be taken away without due process; but
p. 449
the law itself, as a rule of conduct, may be changed at the will, or even at the whim, of the legislature, unless prevented' by constitutional limitations. Indeed, the great office of statutes is to remedy defects in the common law as they are developed, and to adapt it to the changes of time and circumstances. To limit the rate of charge for services rendered in a public employment, or for the use of property in which the public has an interest, is only changing a regulation which existed before. It establishes no new principle in the law, but only gives a new effect to ah old one.
“We know that -this is a power which may be abused; but this is no argument against its existence. For protection against abuses by legislatures the people must resort to the polls, not to the courts.”
See, also, Chicago, Burlington dé Quincy RaAl/road v. Iowa, 94 U. S. 155 ; Peih v. Chicago dé Northwestern Railway, 94 IT. S. 164; Chicago, Milwaukee dé St. Paul Rail/road v. Ackley, 94 U. S. 179 ; Winona dé St. Peter Railroad v. Blake, 94 IT. S. 180.
In Ruggles v. Illinois, 108 IT. S. 526, 531, the court, citing and referring to the Granger Cases, says: “ It was determined that a £ State may limit the amount of charges by railroad companies for fares and freights unless restrained by some contract in the charter.’ . . . The company by its original charter was authorized to transport passengers and property and to receive compensation therefor. This, if there had been nothing more,, would, under the rule stated in Munn v. IlUnois, 94 U. S. 113 , and the several railroad cases decided at the same time, require the company to carry at reasonable rates and léave the legislature at liberty to fix the maximum of what would be reasonable.”
Discussing the effect of a provision of its charter, as amended, which empowered the board of directors to fix rates, the court says, page 533 : “ When, therefore, in a section of the charter which expressly declares that no by-law shall be made that is in conflict with the laws of the State, we -find that the rates of charge to be levied and collected for the conveyance of persons and property are to be regulated by by
p. 450
laws, the conclusion is irresistible that only such charges can ' be collected as ate allowed by the laws of the State. This implies that, in the .absence of direct legislation on the subject; the power of the -directors ovér the rates is subject only to the common law limitation of reasonableness; for in the absence of a statute or other appropriate indication of .the legislative .will, the common law forms part of .the la-ws of the State, to ■which the -corporate by-laws must conform. But since, in ' the absence.of some restraining contract, the State may establish a maximum of rates to be changed by railroad companies- for the transportation .of persons .and property, it follows that when a maximum is so established the rates fixed by the directors imist conform to its requirements, ptherwise the bylaws will be repugnant to the laws.” - Instead of Buggies v. Illinois niodifying the rule- laid down in the Granger Cases, we insist1 that it is a plain affirmance of that-rule.
Another case which it was urged-'modified the rule in -the Granger Gases is the. case of Stone ,v. Farmers' Loan ¡& Trust ■Co., 116’ IT. S.„:307; after referring to the Granger Oases, the' court says:.
“ From what has been said, it is not to be inferred that this power of limitation or regulation is itself without limit. This power- to regulate is not a power to destroy, and limitation is not the' equivalent of confiscation.x Under .pretence'of regulating fares and freights; the State cannot require a railroad-corporation to carry persons or property without reward; neither can it do that which in law amounts to a taking of private property for public use without just compensation, or without due process of. law. What would have this effect we need not now say, because no- tariff has yet been fixed by the commission, .and the statute of-Mississippi expressly provides ‘that in all trials of cases brought for a violation of ■ any tariff of charges, ¿s fixed by the commission, it may be shown in defence that sucjj. tariff so fixed' is unjust.’ ”
The principles here expressed will-doubtless be pressed upon, the court with great force, it being insisted that in the case at bar. the rates have been fixed,, but it-may be said in reply that-in nearly all- the Granger Oases, the court was called upon to pass upon a law which had in fact fixed a rate.
p. 451
However, as stated in the outset, the return to the writ of mandamus in the case at bar contains no allegations that could support a claim that the operation of the law would require the carrier to transport persons or property without reward, or would amount to a taking of private property -for public use Avithout just compensation. The most that is alleged is that the rate so established is unjust and unreasonable, and the statement in general terms that it amounts to a jpro tanto taking of thé property of the company without due process of law. But as was said by the court in the ease last cited:
“ General statutes regulating the use of railroads in a State, or fixing maximum rates, of charges for transportation, when not forbidden by charter contracts, do not necessarily deprive the corporation, owning or operating a railroad within the State, of its property without due process of law, within the meaning of the Fourteenth Amendment of the Constitution of the United States, nor take away from the corporation the equal protection of the laws.” 'Munn- v. Illinois, 94 U. S. 113 , 134, 135; Railroad Go. v. Richmond, 96 0. S. 521, 529; ./Spring Valley Water Works v. Schottler, 110 U. S. 347 , 354.
In Dow v. Beidelman, 125 U.' S. 680 , the court says, concerning a, law. of Arkansas fixing a maximum rate for carrying passengers: “ Without any proof of the sum invested by the reorganized corporation, or its trustees, the court has no means, if it would under any circumstances have the power, of determining that the rate of three cents a mile fixed by the legislature is unreasonable. Still less does it appear that there has been any such confiscation as amounts, to a taking of property without due process of law.” ■
In Georgia Banking Co. v. Smith; 128 TJ. S. 174, the prim' ciple contended for again received judicial sanction. ,
Thus we have an unbroken, line of decisions of this court commencing with the-' case of Munn v. Illinois,- decided in 1876, and terminating with the cáse, of Georgia Railroad, <&' Banking Go, v. Smith, decided in 1888, to support the proposition that when unrestrained -by contraht or chatter stipulation, the legislature of a State may determine what is a just
p. 452
and reasonable rate for a common carrier to charge for the transportation of freight and passengers; that the question of the reasonableness of the rate is a question for legislative determination, and when so determined, ceases to be the subject of judicial inquiry;
' Mr. .W. O. Gaudy closed for appellant. •

after 'stating the cáse as above1 reported, delivered the opinion of the court.

The .opinion of the Supreme Court pf, Minnesota is reported in 38 Minnesota, 281. In it the court in the first place , construed the statute on . the question as'to whether the court itself-had jurisdiction to entertain tpe proceeding, and held, that it had. Of course, w¿ óannot revie# this decision.

It next proceeded to consider the question as to the nature and extent of the powers granted to the . commission by the statute in the matter of fixing, the rates of charges. On-that subject it said : “ It seems to us that, if language means anything, it is perfectly evident that. the expressed intention of .the legislature is that-the rates recommended and published by the commission (assuming that they have proceeded in the jmanner-pointed out by the act) should be not simply advisory, nor merely jjrima fade' equal and reasonable, but final and conclusive as to what are lawful or equal' and reasonable charges; that, in proceedings to compel compliance with the rates thus published, the law neither contemplates nor allows any issue to be made or inquiry-had as to- their equality and1 reasonableness in fact. Under the provisions of the act, the rates thus published are the only ones that are lawful, and •therefore, in contemplation of law, the only ones that are equal and reasonable;' and, hence, in proceedings like thé present, there' is, as said -before, no fact to traverse, except the-•violation of the law in refusing compliance with the recpm--mendations of the commission. Indeed, the language of the act is so plain on that point that argument can add •'nothing' to its force.”

p. 453
It then proceeded to examine the question of the validity of the- act under the constitution of Minnesota, as to whether the legislature'was authorized to confer upon the commission the powers given to the latter by the statute. It held that,' as the legislature had the power itself to regulate charges by railroads, it could delegate to a commission .the power of fixing such charges, and could make the judgment or determination, of the commission as to what were reasonable charges final and conclusive.

The Chicago, Milwaukee and St. Paul Railway Company is a corporation organized under the laws of Wisconsin. The line of railroad owned and operated by it in the • present case extends-from Calmar, in Iowa,'to LeRoy,"m Minnesota, and from Leroy, through Owatonna and Faribault, to St. Paul and Minneapolis, the line from Calmar to St. Paul and Minneapolis being known as the “Iowa and Minnesota Division,” and being wholly in Minnesota from the point where it crosses the state line between Iowa and Minnesota. It was constructed under a charter granted by' the Territory • of Minnesota to the Minneapolis arid Cedar Valley Railroad.Company, by an act approved March 1, 4856, Laws of 1856, e. 166, p. 325,.to construct á railroad from the Iowa line, at or near the crossing of said line by the Cedar River, through the valley -of Strait River to, Minneapolis. Section 9 of that act provided that the directors of the corporation, should have power to make all needful, rules, regulations and by-laws touching “the rates of. toll and the manner of collecting the same; and section 13, that the company should have power to unite its railroad with any'other, railroad which was. then, -or thereafter might be, constructed in the’Territory of Minnesota, or adjoining States- or Territories, and should have power to consolidate it's, stock with any other company or companies.

• By an .act passed"' March :3, 1857, c. 99, ( 11 Stat. 195 ,) the Congress of the United States made a grant of land to the. Territory of Minnesota to aid in constructing certain railroads. By an act of the legislature of' the Territory, approved May ■22, 1857, (Lavds of 1857, extra session, p. 20,) a portion' of such grant was conferred upon the Minneapolis ¡énd Cedar Valley

p. 454
Railroad Company. .Subsequently, in 1860, the State of Minnesota, by proper proceedings, became the owner of the rights, franchises and property of that company. By an act approved March .10,1862, c. 17, (Special Laws of 1862, p. 226,) the State incorporated' the Minneapolis, Faribault and Cedar Yalley Railroad Company, and conveyed to it all the franchises and 'property of the Minneapolis and Cedár Yalley Railroad Company which the State had so acquired ; and by an act approved February 1, 1864, (Special Laws of 1864, p. 164,)-the name of the Minneapolis, Faribault and Cedar Yalley Railroad Company was changed to that of the Minnesota Central Railway Company. . That company constructed the rpad from Minneapolis and St. Paul to LeRoy, in Minnesota; and the road from LeRoy to Calmar, in Iowa, and thence to McGregor, in the latter State, was consolidated with it. In August, 1867, the entire road from McGregor, by way of Calmar, LeRoy, Austin, Owa-tonna and Faribault, to St. Paul and Minneapolis, was conveyed to the Chicago, Milwaukee and St. Paul Railway Company, which succeeded to all the franchises so granted to the Minneapolis and Cedar Yalley Railroad Company.

It is contended for the railway company1 that the - State of Minnesota is bound by the contract made by the - Territory in the charter granted to the Minneapolis and Cedar Yalley Railroad Company; that a contract existed' that the company .should have the power of regulating, its rates of toll; that any legislation .by the State infringing upon that right impairs the ■obligation of the contract; that there was no provision in the charter or in any general. statute reserving to the Territory or to the 'State ■ the right to alter or amend the charter; an'd that no. subsequent legislation of the Territory or of the State could deprive the directors of the qómpanyof the power to fix-its rates of. toll,, subject only to the general provision of law. that such rates should be reasonable.

But we áre of opinion that the' general language of, the ninth section of the chartér of the Minneapolis and Cedar Yal-ley Railroad Company cannot be held to constitute an irrepealable contract With that company that it should have the right for all future time to prescribe its rates of toll, free from all control by the legislature.of the State.

p. 455
It was held by this court in Pennsylvania Railroad Co. v. Miller, 132 U. S. 75 , in accordance with a long course of decisions both in the state -courts and-in this court, that a railroad corporation takes its charter, containing a kindred provision with that in question, subject to the' general law of the State,- and to such changes as may be made in such general law, and subject to future constitutional provisions and future general legislation, in the absence of any-prior-contract with it exempting it from liability to such future general legislation in respect of the subject matter involved; and that exemption from future general legislation, either by a constitutional provision or by an act of the legislature, cannot-be admitted to exist.unless it is given expressly, or unless it.follows by an implication equally clear with express words.

There is nothing in the mere grant of power, by section-9 of the charter, to the directors of the company, to make needful rules and regulations touching the rates of toll and the manner of collecting the same, which can be properly interpreted as authorizing us to hold that the State parted .with its general authority itself to regulate, at any time in the future when it. might se^ fit to do. so, the rates of toll to be collected by the company.

In Stone v. Farmers' Loan and Trust Co., 116 U. S. 307 , 325, the whole subject is fully .considered, the authorities are-cited, and the conclusion is arrived-at, that the right of a. State reasonably to limit the amount of charges.' by a railroad company for the transportation of persons and propertywithin its jurisdiction cannot be granted away by its legislature, unless by words of positive grant or words equivalent in law; and that a statute which grants to a railroad company the right “■ from time to time to fix, regulate and receive the tolls- and charges by them tó be received for transportation,” does not. deprive .the State of its power, within the limits of. its general authority, as controlled by the Constitution-..of- the TTnited States, to act upon the reasonableness of the tolls and charges so fixed'.’and regulated. But, after reaching this'conclusion, the court said (p; 331): “From what has thus been said, it is not to- be inferred that this power of limitation or

p. 456
regulation is itself without limit. This power to regulate is not a power to destroy, and limitation is not the équiyalent of confiscation. Under pretence of regulating fares and freights, the State cannot require a railroad corporation to carry persons or property without reward; neither can it do that which in law amounts to a taking of private property for public use •without just compensation, or without due process of law.”

There being, therefore, no contract or chartered right in the railroad company which can prevent the legislature from regulating in some form the charges of the company for transportation, the question is whether the form adopted in ' the present case is valid.

The construction put upon the statute by the Supreme Court of Minnesota must be accepted by this court, for the purposes of the present case, as conclusive and not to be reexamined here as to its propriety or accuracy. The Supreme Court authoritatively declares that it is the expressed-intention of the legislature of Minnesota, by the statute, that the rates recommended and published by the commission, if it proceeds in the manner pointed out by the act, are not simply advisory, nor merely prima, facie equal and reasonable, but final and conclusive as to what are equal and reasonable charges; that the law neither contemplates nor allows any issue to be made or inquiry to be had as to their equality or reasonableness in fact; that, under the statute, the rates published by the commission are the only ones that are lawful, and, therefore, in contemplation of law the only ones that are equal and reasonable; and that, in a proceeding for a mandamus under the statute, there is no fact to traverse except the violation of law in not complying with the recommendations of the commission. In other words, although the railroad company is forbidden -to establish rates that are not equal and reasonable, there is no power'in the. courts to stay the hands of the commission, if it chooses to establish ■ rates that are unequal and unreasonable.

This being the construction of the statute by which we are bound in considering- the present case, we are of opinion that, so construed, it conflicts with the Constitution of the United

p. 457
States in the particulars complained of by the railroad company. It deprives the company of its right to a judicial investigation, by due process of law, under the forms and with the machinery provided by the wisdom of successive ages for the investigation judicially of the truth of a matter in controversy, and substitutes therefor, as au absolute finality,’ the action of a railroad commission which, in view of the powders conceded to it by the state court, cannot be regarded as clothed ;with judicial functions or possessing the 'machinery of a court of justice.

Under section 8 of the statute, which the Supreme Court of Minnesota says is the only' one which relates to the matter' of the fixing by the commission of general schedules of rates, and which section, it says, fully and exclusively provides for that subject, and is complete in itself, all that the commission •is required to do is, dn the filing with it by a railroad.company of copies of its schedules of charges, to “ find ” that any part thereof is in any respect unequal or unreasonable, and-then it is authorized and directed to compel the' company to change the same and adopt such charge’ as the commission “ shall declare to .be equal and reasonable,” .and, to that end, it is required -to inform the company in writing in what respect its charges are unequal and unreasonable. No. hearing is provided for, no summons or notice to the company before the commission has found what it is to find and declared what it is to declare, no opportunity provided for the company to introduce witnesses before the commission, in fact, nothing which; has the semblance of due process of law ; and although, in the present case, it appears that, prior to the decision' of the commission, the company appeared before it by its agent, and the comnj'ssion investigated the rates charged by the company for transporting milk,- yet it does not appear what the character 'of the investigation was or how the result was arrived at.

By the second section of .the statute in .question,' it is provided' that all charges made by a common carrier for the transportation of passengers or property shall be equal and reasonable. Under this provision, the carrier has a right to make equal and reasonable charges for such transportation.

p. 458
In the present ease, the return alleged that the rate of charge fixed by the commission was not equal or reasonable, and the Supreme Court held that the statute deprived the company of the right to show that judicially. The question of the reasonableness of a rate of charge for transportation by a railroad ■.company, involving as it. does the element of reasonableness both'as regards the company and as regards the public, is eminently a question for judicial investigation, requiring due process of law for its determination. If the' company is deprived of the power of charging reasonable rates for the use •of its property, and such deprivation takes place in the absence of an investigation by judicial machinery, it is deprived of the lawful use of its property, and thus,' in substance and effect, .of the property itself, without due process of law and in violation of the Constitution of the United States; and in' so far as it is thus deprived, while other persons are permitted to receive.reasonable profits upon their invested capital, the company is deprived of the equal protection of the laws.

It is provided by section 4 of article 10 of the constitution of Minnesota of 1857, that “lands may betaken for public way, for the. purpose of granting to any 'corporation the franchise of way for public use,” and that “ all corporations, being common carriers, enjoying .the-right of way in pursuance to the provisions of this section, shall be bound to carry the mineral, agricultural and other productions and manufactures on equal and reasonable terms.” . It is thus perceived that 'the provision of section 2 of the statute in-question is one enacted in conformity with the constitution of Minnesota.

The issuing of the peremptory writ of mandamus in this case was, therefore, unlawful,- because in violation of. the Constitution of the United States; and it is necessary ttat the relief administered in favor of the plaintiff in error should be a reversal of the judgment of the Supreme Court awarding that-writ, and an instruction for further proceedings by it not-inconsistent with the opinion of this coui't.

• In view Of the opinion delivered by that court, it may be ’impossible' for any further proceedings to be taken other than to dismiss the proceeding - for a mandamus, if the

Concurrence — Millek J.

p. 459
court should adhere to .its opinion that, under the statute, it cannot investigate judicially the reasonableness of the rates •fixed by the commission. Still, the question will be ooen for review; and

The judgment of this court is, that the judgment of the /Supreme Qourt of Minnesota, entered May j, 1888, award--ing a peremptory writ of mandamus in this case, be reversed, and the case be remanded to that court, with an ■ instruction for further proceedings not inconsistent with the opinion of this cowrt.

concurring.

I-concur with some hesitation in the judgment of the court, but wish to make a few suggestions of the principles which I think should govern this.class of questions in the courts. Not desiring to make á dissent, nor a prolonged argumént in favor of any views I may have, I will state them in the form of propositions. •

1. In regard.to the business of .common carriers limited "to points within a single State, that State has the legislative power to establish the rates of compensation, for such carriage.

2. The power which .the legislature has to do this can be exercised through a commission which-it may authorize to act in the matter, such ¿s the one appointed by the legislature of Minnesota by the act .now under consideration:

- 3, Neither the legislature nor such commission acting under the authority, of the, legislature, .can establish arbitrarily and without regard to '’justice and right a- tariff of rates, .-ior such transportation, which is so unreasonable as-to practically destroy the valúe of property 'of persons engaged in the carry:-ing business on the one hand, nor so exorbitant and extravagant as to be in' utter disregard of the rights of the public for the úse of such transportation on the other.

4. In either of ■‘these classes of cases there is an ultimate remedy by the parties' aggrieved, in the courts,, for relief against such oppressive legislation, and especially in the court's of the United States, where the tariff of rates established

p. 460
either by the legislature or by the commission is such as to deprive a party of his property without due process of law’.

5. But until the judiciary has been appealed to to declare the regulations made, whether by the legislature or by the commission, voidable for the reasons mentioned, the tariff of rates so fixed is the law of the land, and must be submitted to both by the carrier and the parties with whom he deals.

. 6. That the'proper, if not the only, mode of judicial relief against the tariff of rates established by the legislature or by its commission, is by a bill in chancery asserting its unreasonable character- and its conflict with the Constitution of the United States, and asking a decree of court forbidding the corporation from exacting such fare as excessive, or establishing its right to collect the rates as being within the limits of a just compensation for the service rendered.

7. That until this is done it is not competent for each individual having dealings with the carrying corporation, or for the corporation with regard to each individual who demands its services, to raise a contest in the courts over the questions which ■ ought to be ■ settled in this general and conclusive method.

8.- But in the present dase, where an application is made to the Supreme Court of the State to compel the common carriers, namely, the railroad companies, to perform the services which their, duty requires them to do for the general public, which is equivalent to establishing by judicial proceeding the reasonableness of the charges fixed by ‘the commission, I •think the court has the same right and duty to inquire into ‘the reasonableness of. the tariff of rates established by the •commission' before granting such relief, that it would have if •called upon so to do by .a bill in chancery.

9. I do not agree that it was necessary to the validity of the-action of the commission that previous notice should have been given to all common carriers -interested in the rates to be established, nor to any particular one of them, any. more than it would have been necessary, which I think it is not, for the legislature to have given such notice if it. had established such :rates by .legislative enactment.

Dissent — Bbadley J.

p. 461
10. But when the question becomes a judicial one, and the validity and justice of these rates are to be established or rejected by the judgment of a court, it is necessary that the railroad .corporations interested in the fare to be considered should have notice and have -a right to be heard on the question relating to such fare, which I have, pointed out as judicial questions. For the refusal of the Supreme Court of Minnesota to receive evidence on-this subject, I think the case ought to be reversed on the ground that this.is a denial.of due process of law in a proceeding which takes the property of the company, and if this-be a just construction of the statute of Minnesota it is for that reason void.

(with whom concurred Mb. Justice Gbay and Mb. Justice Lam:ab) dissenting.

I cannot agree to the decision of the court in this case. It practically overrules Munn v. Illinois, 94 U. S. 113 , and the several railroad cases that were decided at the same time. The governing principle of those cases was that the regulation and settlement of the fares of railroads and other public accommodations is a legislative prerogative and not a judicial one. This is a principle which I regard as of great importance. When a railroad company is chartered, it is for the .purpose of performing a duty which belongs to the State itself. It is chartered as an agent of the State for furnishing public accommodation. The State might' build its railroads if it saw fit. It is its duty and its prerogative to provide means of intercomipunication between one part of its territory and another. And this duty is devolved upon the legislative department. If the legislature commissions private parties, whether corporations or individuals, to perform this duty, it is its prerogative to fix the fares and freights' which they may charge for their services. When merely a road or a canal is to be constructed, it is for the legislature to fix the tolls to be paid .by those who use it ; when a company is chartered not* only to build a road, but to carry on public transportation upon it, it is for' the legislature to fix the charges for such transportation:

p. 462
But it is said' that all charges should be reasonable, and that none but reasonable charges can be exacted; and it is urged that what is a reasonable charge is a judicial question. On the contrary, it is preeminently a legislative one, involving considerations of policy as well as of remuneration; and is usually determined by the legislature, by fixing a maximum of charges in the charter of the company, or afterwards, if its hands are not tied by contract. If this maximum is not exceeded, the courts cannot interfere. When the rates are not thus determined,, they are left to the discretion of the company, subject to ,the express or implied cpndition that they shall1 be reasonable; express, when so declared by statute ; implied, by the common law, when the statute is silent; and the common law has effect by virtue of the legislative will.

. Thus, the legislature either fixes the charges at rates which it deems reasonable; or merely declares that they shall be reasonable;' and it is only in the latter case, where what is reasonable is left open, that the courts have jurisdiction of the subject. I repeat: .When the legislature declares that the charges shall be reasonable, or, which is the same thing, allows the common law rule to that effect to prevail; and leaves the matter there; then resort may be had to the courts tó inquire judicially whether the charge's are reasonable. Then, and not till then, is it a judicial question. But the legislature has the right, and it is its prerogative, if it chooses. to exercise it, tó declare- what is reasonable.

■ This is just where I differ from the majority of the court. .They say in effect, if not in terms, that the final tribunal of arbitrament is the judiciary; I say it is the legislature. I hold that it is a legislative question, not a judicial one, unless the legislature or the law, (which is the same thing,) has made it judicial, by-prescribing the rule that the charges shall be reasonable, and leaving it there. ;

It is always a delicate thing for the courts to make an issue' with the legislative department of the government, and they should never do so if .it is possible to avoid it. By the decision now made we declare, in effect, that the judiciary, and not the legislature, is the final arbiter in the regulation of fares and '

p. 463
freights of railroads and the charges of other public accommodations. It is an assumption of authority on the part of the judiciary- which, it seems to me, with all due deference to the judgment of my brethren, it has no right to make. The assertion of jurisdiction by this court makes it the duty of every. court of general jurisdiction, state or federal, to entertain complaints against the decisions of the boards of commissioners appointed by the States to regulate their railroads; for all courts are bound by the Constitution of the United States, the same as we are.. Our jurisdiction is merely appellate.

The incongruity of this position will.appear more distinctly' by a reference to the nature of the cases under consideration. The question presented before the commission in each case was one relating simply to the reasonableness of the rates charged by the companies, — a question of more or less. In the one case the company charged three cents per gallon for carrying milk between certain points. The commission deemed this to be unreasonable, and reduced the charge to 2-£ cents. In the other case the company charged $1.25 per car for .handling and switching empty cars over its lines within the city of Minneapolis, and $1.50 for loaded cars; and the commission decided that $1.00 per car was a sufficient charge in all cases. The companies complain that the charges as fixed by the commission áre unreasonably -low,"and that they are deprived of their property without due process of law; that they are- entitled to a trial by a court and jury, and are not barred by the decisions of a legislative commission. The state court held that the legislature had the right to establish such a commission, and that its determinations are binding- and final, and that-the courts cannot review them.- This court now reverses that decision, and holds the contrary. In • my judgment the state- court was right, and the establishment - of the commission, and its proceedings, were -no violation of the constitutional prohibition against depriving persons - of their property without due process of law.

I think it is perfectly clear, and well settled by the decisions of this court, that the legislature might have fixed'the rates in question. If it had done so, it would have done it through

p. 464
the aid of committees appointed to investigate the subject, tó acquire information, to cite parties, tó get all the facts before them, and finally to decide and report. No one could have said that this was not due process of law. And if .the legislature -itself could do this, acting by its committees, and pror ceeding according to the usual forms adopted by such bodies, I can see- no good reason why- it might not delegate the duty to a board of commissioners, charged, as the board in -this case, was, to regulate and fix the charges, so as to be equal and rear sonable. ■ Such a board would .have at its command all the means of getting at the truth and ascertaining the reasonableness of. fates and freights, which a legislative committee has. It. might, or it might not, swear witnesses and examine parties. Its duties being of an administrative character, it would have the- widest scope for examination and inquiry.' •' All means of knowledge and information would be at its command, — just as'they would be at the command of -the legislature which created it. . Such a body, though not a court, is a proper tribunal for the duties imposed-upon it.

. In the case of Davidson v. City of New Orleans, 96 U. S. 97 , we decided that the appointment of a boai’d- of assessors' for assessing damages was not only dué process of law, -but the proper method for making assessments .to distribute the burden of a public work amongst those who are benefited by it. No one questions the constitutionality or propriety of boards for assessing property for. taxation, or for the improvement of streets,- sewers and the like, or of commissions to establish county seats, and for doing many other things appertaining' to the administrative management of public affairs; Due process of law does not always require, .a court. It merely requires such tribunals and proceedings as are proper to the subject m hand. In the Railroad Commission Cases, 116 U. S. 307 , we held that a board of commissioners is a proper tribunal for determining the proper rates of fare and freight on the railroads of a state. It seems to me, therefore, that the law of Minnesota did not prescribe anything that -was not in. accordance with .due pi’ocess of law in creating such a board, and investing it- with the powers in question.

p. 465
It is complained that the. decisions of the board are final and without appeal. . So are the decisions of the courts in matters within their jurisdiction. There must be a final tribunal somewhere for deciding every question in the world. Injustice may take place in all tribunals. All human institutions are imperfect — courts as well as commissions and legislatures. Whatever tribunal has jurisdiction, its decisions are final and conclusive unless an appeal is given therefrom. The important question always is, what is the lawful tribunal for' the particular case ? ' In my judgment, in the present case, the proper tribunal was the legislature, or the board of commissioners which it created for the purpose.

If not in terms, yet in effect, the present cases are treated as if the constitutional prohibition was, that no state shall take private property for public use without just compensation, —- and as if it' was our duty to judge of the compensation. But there is no such clause in the constitution of the United States. The Fifth Amendment is prohibitory upon the federal government only, and not upon the state governments. In this matter, — just compensation for property taken for public use,— the states make their own regulations, by constitution, or' otherwise. They are only required by the federal Constitution to provide “ due process of law.” It was alleged in Davidson v. New Orleans, 96 U. S. 97 , that the property assessed was -not benefited by the improvement; but we he’d that that was a matter with which we would not interfere; the question was, whether there was due process of law. p. 106. If a state court renders an unjust judgment, we cannot remedy it.

I do not mean to say that the legislature, or its constituted board of commissioners, or other legislative agency, may not so act- as to deprive parties of their property without due pi’ocess of law. The Constitution contemplates the possibility of such an invasion of rights. But, acting within their jurisdiction, (as in these cases they have done,) the invasion should be clear and unmistakable to bring the case within that category. Nothing of the kind exists in the cases, before us. The legislature, in establishing the commission, did not exceed its power; and the commission, in acting upon the cases, did not

p. 466
exceed its jurisdiction, and was not chargeable with fraudulent behavior. There was merely a difference of judgment as to amount, between the commission and the companies, without any indication of intent on the part of the former to do injustice. The board may have erred; but if they did, as the matter was within their rightful'jurisdiction, their decision was final and conclusive -unless their proceedings could be impeached for fraud. Deprivation of property by mere arbitrary power on the part of the legislature, or fraud on the part of the commission, are the only grounds on which judicial relief may be sought against' their action. There was, in truth, no deprivation of property in these cases at all. There was merely a regulation as to the enjoyment of propertjb made by a strictly competent authority, in a matter entirely within its jurisdiction.

It may be that our legislatures are invested with too much-power, open, as they are, to influences so dangerous to the interests of individuals, corporations and society. But such is the Constitution of our republican form of government; and we are bound to abide by it until it can be corrected in a legitimate way. If our legislatures become too arbitrary in the exercise of their powers, the people always have a remedy .in their hands; they may at any time restrain them by constitutional limitations. But so long as they remain invested with the powers that ordinarily belong to the legislative branch. of .government, they are entitled to exercise those powers, amongst which, in my judgment, is that of the regulation of railroads and other public means of intercommunication, and the burdens and changes which those' who own them are authorized to impose upon the public.

. I am authorized to say that Mr. Justice G-ray and Mr. Justice Lamar agree with me in this dissenting opinion.

Cases cited

Statutes and regulations cited