government of the United States, in buying transportation on a railroad for its soldiers in lots of ten or more, is not entitled to the benefit of a reduced ten party rate given by a railroad company's schedule to theatrical, operatic, or concert companies, hunting and fishing parties, glee clubs, brass or stringed bands, and to baseball, polo, or tennis clubs, football, and other parties of like character.46

Who may regulate fares. The rates of fare need not be established by the board of directors and proved by a record of their action; agents other than the directors may be empowered to regulate such matters.47

Reduced rate. To constitute a reduced rate, the rate must be one which is lower than another rate which is offered to the public,18 and the sale of a return trip ticket at a price less than two single trip fares is not a sale at a reduced rate.49 A custom of allowing a reduced rate on particular days or occasions or to particular persons imposes no obligation on the carrier to continue such custom;50 and where such custom has been abandoned, one is not entitled to be carried, on tendering the reduced rate of fare;51 but where, during the continuance of such custom or offer, a passenger is unable to procure a ticket through the fault of the carrier, he is entitled to be carried on a tender of the reduced fare.5 52 Where under a constitutional provision a railroad company, for the purpose of competing with another common carrier, reduces its rate of fare

46. U. S. v. Chicago, etc., R. Co., 127 Fed. 785, 62 CCA 465.

in

[a] Not unjust discrimination or undue prejudice.-The refusal to give the government the same rates does not constitute an unjust discrimination against it or subject it to undue prejudice or disadvantage, in violation of the Interstate Commerce Act, where it is shown that the purpose and effect of the party rate given by the schedule is to increase the company's business and that tickets sold thereunder are closely limited time and are paid for in cash in advance, while those furnished to the government are not so limited, are furnished on a requisition, and are paid for only after indefinite delay in the auditing and allowance of the claim by the war and treasury departments; in such case the conditions and circumstances under which the service is rendered are essentially different and justify the making of different rates. U. S. v. Chicago, etc.. R. Co., 127 Fed. 785, 62 CCA 465.

47. Jeffersonville R. Co. v. Rogers, 28 Ind. 1, 92 AmD 276. 48.

Robert v. Chicago, etc., R. Co., 148 Mo. A. 96. 127 SW 925.

49. Robert v. Chicago, etc., R. Co., 148 Mo. A. 96. 127 SW 925.

50. Johnson v. Georgia R., etc., Co., 108 Ga. 496, 34 SE 127, 46 LRA 502; Illinois Cent. R. Co. v. Dunnigan, 95 Miss. 749, 50 S 443, 24 LRÄNS 503, AnnCas1912A 159 and note.

a

[a] Illustration.-Permitting minister of the gospel, or any person, to travel at a rate lower than that given to the general public, by a carrier, is a mere gratuity which the carrier can withhold at its pleasure. Illinois Cent. R. Co. v. Dunnigan, 95 Miss. 749, 50 S 443, 24 LRANS 503, AnnCas1912A 159.

51. Johnson v. Georgia R., etc., Co., 108 Ga. 496, 34 SE 127, 46 LRA 502.

[a] Reasons for rule.-"Railroad companies in this State are required by law to sell tickets to persons desiring to become passengers for three cents per mile, and it is made their duty to provide a place at which these tickets can be procured. they fail in this, such persons may nevertheless board the train and insist upon being carried upon tendering the amount which they would be

If

from one point to another, such rate cannot again be raised without the consent of the governmental authority in which is vested the power to regulate fares.53

Increasing rates. Where by reason of a change in conditions, or otherwise, the established rates are not compensatory, the carrier may make a reasonable increase in its passenger rates;54 and the fact that it is impolitic for the carrier to make the increase is immaterial and no ground for setting the increase aside.55

Length of trip. In the absence of legislative régulation, a street railroad company operating a belt line may by a reasonable regulation define the length of trip to which a passenger is entitled for his fare,56 and beyond which he cannot ride without paying an additional fare;57 and this is true even where a person, by taking a car on the same street going in an opposite direction, may reach his destination and have by that route a continuous one fare ride before reaching the end of the line.58

Passenger remaining on train; journey by stages. It has been held that, where a passenger pays his fare to a certain station and then remains on the train and demands transportation from that station to a still further station, he stands in the same situation, so far as paying for his further passage is concerned, as if he had boarded the train at the intermediate station;59 and that a passenger is entitled to make his journey by stages to obtain the benefit

29 NE 170, 50 AmSR 256 and note.

53. Edson v. Southern Pac. R. Co., 144 Cal. 182, 77 P 894 (under Const. art 12 20).

[a] In ascertaining whether a rate has been lowered within the meaning of such provision, (1) the court will scrutinize the terms of the ticket and the conditions surrounding the traffic, to determine whether what purports to be a special contract for inferior services is not in reality a lowered rate for the same, or substantially the same, services. Edson v. Southern Pac. R. Co., 144 Cal. 182, 77 P 894. (2) The mere restriction of privileges by a limited ticket, coupled with the lowering or a rate, will not prevent the act of lowering the rate from falling within the provision, unless the privileges withdrawn represent a service actually rendered on the one side or claimed by the other. Edson v. Southern Pac. R. Co.. supra. (3) Nor is a rate lowered within the qualification "for the purpose of competing with any other common carrier,' when lowered in self-defense to meet a lower rate inaugurated by a rival carrier. Edson v. Southern Pac. R. Co., supra.

54. Peo. v. Public Service Commn., 215 N. Y. 241, 109 NE 252 [aff 159 App. Div. 546. 145 NYS 5131..

Advance of rates by carrier generally see supra § 626.

55. Peo. v. Public Service Commn., 215 N. Y. 241, 109 NE 252 [aff 159 App. Div. 546, 145 NYS 513].

Power of commission to set aside increased rates see infra § 1082. 56.

Com. v. Doe, 44 Pa. Super. 331. 57. Com. v. Doe, 44 Pa. Super. 331. 58. Com. v. Doe, 44 Pa. Super. 331. 59. Perry v. Atlantic Coast Line R. Co., 9 Ga. A. 260, 70 SE 1122; Atchison, etc., R. Co. v. State, (Okl.) 150 P 108.

[a] Thus a person boarding a train as a passenger has a right to pay for his passage to any point on the line of the railroad company, and to remain on the train and demand transportation from that point to a still further point on complying with the usual terms relating to transportation from the point to which he pays for his passage; and this is true notwithstanding he may have had in mind all the time to make a continu

63

64

The

60. Brown V. Terre Haute, etc., Tract. Co., (Ind. A.) 110 NE 703, 113 NE 313.

61. London, etc., R. Co. v. Hinchcliffe, [1903] 2 K. B. 32.

62. Filing, publication, and posting of rates generally see supra §§ 670-673.

63. U. S. v. Grand Trunk R. Co., 225 Fed. 283.

[a] Rates through foreign country. -Although the Interstate Commerce Act does not specifically provide for the publication of passenger rates where the journey is through a foreign country to another point in the United States, yet in view of the entire provision for the publication of freight rates for shipments over such a route, a carrier must publish passenger rates. U. S. v. Canada Grand Trunk R. Co., 225 Fed. 283.

64. Louisville, etc., R. Co. v. Maxwell, 237 U. S. 94, 35 SCt 494, 59 L. ed. 853, LRA1915E 665; Illinois Cent. R. Co. v. Holman, 106 Miss. 449, 64 S 7; Ligon v. St. Louis, etc., R. Co.. 184 Mo. A. 187. 168 SW 647; Saunders v. Atlantic Coast Line R. Co., 101 S. C. 11. 85 SE 167.

65. Louisville, etc., R. Co. v. Maxwell, 237 U. S. 94, 35 SCt 494, 59 L. ed. 853, LRA1915E 665.

66. Louisville, etc., R. Co. v. Maxwell, 237 U. S. 94, 35 SCt 494, 59 L. ed. 853, LRA1915E 665; Ligon v. St. Louis, etc., R. Co., 184 Mo. A. 187, 168 SW 647: Saunders V. Atlantic Coast Line R. Co., 101 S. C. 11, 85 SE 167.

"It is well settled, too, that under the act of Congress and the decisions of the Supreme Court of the United States construing it, no liability of a carrier can be predicated upon the misrepresentations or mistakes of its agents as to the rates applicable, or privileges or facilities to be afforded under the tariffs filed with the Commission. Passengers and shippers are conclusively presumed to know them, as well as the agents of the carriers. This question has been so recently and frequently considered and decided both by the Supreme Court of the United States and by this Court that it is not deemed necessary to state the reasons therefor, or even to cite the decisions." Saunders v. Atlantic Coast Line R. Co., 101 S. C. 11. 16. 85 SE 167.

[a] Illustration.-Under the Inter

a

67. Delaware, etc., R. Co. v. Board of Public Utility Comrs., 84 N. J. L. 619, 87 A 801.

[a] An order of the public utility commission, requiring all railroads affording commutation service at certain points to publish and file schedules of such rates, is constitutional. Delaware, etc., R. Co. v. Board of Public Utility Comrs., 84 N. J. L. 619, 87 A 801.

68. Louisville, etc., R. Co. v. Maxwell, 237 U. S. 94, 35 SCt 494, 59 L. ed. 863, LRA1915E 665.

69. Constitutionality of statutes regulating rates of fare generally see Constitutional Law [8 Cyc 695]. Rates and rate making generally see supra §§ 624-692.

Regulation of rates on commerce generally see Commerce [7 Cyc 449]. 70. U. S.-Portland R., etc., Co. v. Oregon R. Commn., 229 U. S. 397, 33 SCt 820, 57 L. ed. 1248; Chicago, etc., R. Co. v. Wellman, 143 U. S. 339, 12 SCt 400, 36 L. ed. 176; Georgia R., etc., Co. v. Smith, 128 U. S. 174, 9 SCt 47, 32 L. ed. 377; Dow v. Beidelman, 125 U. S. 680, 8 SCt 1028, 31 L. ed. 841 [aff 49 Ark. 325, 5 SW 297]; Stone v. Farmers' L. & T. Co., 116 U. S. 307, 6 SCt 334, 338, 1191, 29 L. ed. 636; Shields v. Ohio, 95 U. S. 319, 24 L. ed. 357; Stone v. Wisconsin, 94 U. S. 181, 24 L. ed. 102; Winona, etc., R. Co. v. Blake, 94 U. S. 180, 24 L. ed. 99; Chicago, etc., R. Co. v. Ackley, 94 U. S. 179, 24 L. ed. 99; Peik v. Chicago, etc., R. Co., 94 U. S. 164, 24 L. ed. 97; Chicago, etc., R. Co. v. Cutts, 94 U. S. 155, 24 L. ed. 94; Munn v. Illinois, 94 Ú. S. 113, 24 L. ed. 77; Arkansas Rate Cases, 187 Fed. 290 [rev on other grounds 230 U. S. 553, 33 SCt 1030, 57 L. ed. 1625]; U. S. v. Chicago, etc.. R. Co., 163 Fed. 114 [aff 219 U. S. 486, 31 SCt 272, 55 L. ed. 3051; Metropolitan Trust Co. v. Houston. etc., R. Co., 90 Fed. 683.

Ark. Clark v. Jonesboro, etc., R. Co., 87 Ark. 385, 112 SW 961; St. Louis, etc., R. Co. v. Ryan, 56 Ark. 245. 19 SW 839.

Cal-Buswell v. Southern Pac. Co., 114 Cal. 445, 46 P 291 (construing Act May 20, 1861); Suydam v. Los Angeles R. Co., 27 Cal. A. 157, 149 P 55.

70

LRA1915E 902, AnnCas1915A 1018.

Ill. Chicago Union Tract. Co. v. Chicago, 199 Ill. 484, 65 NE 451, 59 LRA 631; Peo. v. Suburban R. Co., 178 Ill. 594, 53 NE 349, 49 LRA 650. Ind.-Indianapolis v. Navin, 151 Ind. 139, 47 NE 525, 51 NE 80, 41 LRA 337.

Mass.-Atty.-Gen. v. Old Colony R. Co., 160 Mass. 62, 35 NE 252, 22 LRA 112; Parker v. Metropolitan R. Co., 109 Mass. 506.

Mich. Chamberlain v. Lake Shore, etc., R. Co., 122 Mich. 477, 81 NW 339. Minn. State v. Chicago, etc., R. Co.. 128 Minn. 25, 150 NW 172.

Nebr.-Chicago, etc., R. Co. v. Anderson, 72 Nebr. 856, 101 NW 1019.

N. J.-Raritan River R. Co. v. Middlesex, etc., Tract. Co., 70 N. J. L. 732, 58 A 332.

N. M.-Seward v. Denver, etc., R. Co., 17 N. M. 557, 131 P 980, 46 LRA NS 242.

N. Y.-Buffalo East Side R. Co. v. Buffalo St. R. Co., 111 N. Y. 132, 19 NE 63, 2 LRA 284; Moneypenny v. Sixth Ave. R. Co., 30 N. Y. Super. 328, 4 AbbPrNS 357, 35 HowPr 452; Topham v. Interurban St. R. Co., 42 Misc. 503, 86 NYS 295 [rev on other grounds 96 App. Div. 323, 89 NYS 2981.

Oh.-Cleveland, etc., R. Co. V. Wells, 61 Oh. St. 268, 55 NE 827.

Pa.-Western Maryland R. Co. v. Adams County, 21 Pa. Dist. 766.

Tex.-San Antonio Tract. Co. v. Altgelt, (Civ. A.) 81 SW 106 [aff 200 U. S. 304, 26 SCt 261, 50 L. ed. 491].

[a] Basis of power.-(1) "The power to require a public service to be performed for a limited rate is but a branch of the power to regulate, in the public interest, property that is devoted to the public use." Raritan River R. Co. v. Middlesex, etc., Tract. Co., 70 N. J. L. 732, 744, 58 A 332. (2) "Railroad corporations hold their property and exercise their functions for the public benefit, and they are therefore subject to legislative control. The legislature which has created them may regulate the price which they shall charge for transportation of freight and passengers." Buffalo East Side R. Co. v. Buffalo St. R. Co., 111 N. Y. 132, 140, 19 NE 63, 2 LRA 284.

[b] Does not depend on right to amend or repeal.-The right of the legislature to regulate the fares on street railroads organized under a statute does not depend on a reservation in such statute of the right to amend or repeal the statute. Indianapolis v. Navin, 151 Ind. 139. 47 NE 525, 51 NE 80. 41 LRA 337. 344.

74

[1082] (2) Delegation of Power. Powers of commission. Although a railroad or public service commission has power to make an order only as far as authorized by the legislature, it may, as far as the legislature can grant, regulate all transportation charges within the state, in the absence of specific legislation thereon.75 A public service commission may also have authority to compel observance, by the carrier, of a statute fixing rates,76 or to annul unjust and unreasonable rates established by the carrier;" but only after it has determined on satisfactory evidence that the rates are unjust and unreasonable, where the carrier has a statutory right to a hearing,78 although it may be authorized to suspend an increase in rates by the carrier pending the hearing and determination of their reasonableness, without notice to the carrier.79. But it cannot annul rates which are not unjust and unreasonable,80 nor can it annul rates merely because a lesser rate would be to the advantage of the public.s In proceedings before a commission to annul increased rates, in the absence of a showing that the lower rates were reasonable and compensatory, the fact that such rates had been in force for some years raises no presumption that an increase therein is unreasonable;82 and the carrier is entitled to have the commission pass on the merits of the question

by them, subject to the provisions of the fourteenth constitutional amendment, prohibiting deprivation of one's property without due process of law, and other constitutional provisions, rests on the police power of the state. Arkansas Rate Cases, 187 Fed. 290 [rev on other grounds 230 U. S. 553, 33 SCt 1030, 57 L. ed. 16251.

[d] Charges to passengers getting on at "flag stations."-A railroad station is a "flag station," and not a "regular station," within a statute authorizing railroad companies to make special charges to passengers boarding or alighting at other than regular stations, where the company has no depot there and no joint agency with the railroad which it crosses and does not use the other company's depot, although trains stop at the crossing opposite the depot, and passengers are received and discharged there on signal, and freight, express, and mail matter is received there, no tickets, bills of lading, nor baggage checks being issued, and such stations being designated as "flag stations" by the railroad, as distinguished from regular stations at which tickets are sold, baggage checked, bills of lading issued, and station houses and agents maintained. Clark v. Jonesboro, etc.. R. Co., 87 Ark. 385, 112 SW 961 (construing Kirby Dig. § 6612). [e] Repealed statute.-Cal. (1877-1878) p 18 § 1, relating to passenger fares, was repealed by implication by Civ. Code § 501, as amended and reenacted in 1903 (St. [19031 D 172), and hence is not applicable to street car fares in the city of Los Angeles. Suydam v. Los Angeles R. Co., 27 Cal. À. 157, 149 P 55.

St.

[f] Laws construed together.

The New York Public Service Commission Law, and the Railroad Law as amended in 1910, are to be construed as one act, in the light of policy prompting the legislation, giving appropriate meaning to every part of both acts, and not emasculating any portion of either. Peo. v. Second Dist. Public Service Commn., 171 App. Div. 607, 156 NYS 1065.

Power of state to fix or regulate

81

.83

84

whether the increased rates are unreasonable under the conditions then existing; and where in such proceedings the commission does not find that the increased rates are unreasonable or unjust, it is erroneous for it to vacate them and to require the restoration of the preëxisting lower rates merely on the ground that the carrier has failed to overcome the presumption that the increase was unreasonable,8 since in view of the regulations imposed on railroad companies and the public reports required of them it is improper to assume that they have peculiar and hidden knowledge of their affairs, and so should have the burden of justifying an increase of rates, instead of those objecting having the burden of proving that the increase was not required.85 Under a provision that any person or corporation may file a written complaint with the commission, a railroad commission has jurisdiction to establish a through route and joint rate on a railroad to a city on petition of incorporated navigation companies, the fact that it has no jurisdiction over their business, or over water rates, being immaterial.86 That part of a taxicab company's business which consists in furnishing automobiles from its central garage on individual orders, generally by telephone, cannot be regarded as a public utility, and the rates charged for such service are therefore not open to inquiry by a public utilities commission.87

Delegation of power to carrier. A railroad company may be granted an uncontrolled discretion to establish such rates of fare as its own interest from time to time may require,88 subject only to the maxi

[a]

75. State v. Clarke, 98 Nebr. 566, 153 NW 623.

[a] Power not exclusive.-Nebr. Const. art 5 § 19a, did not give the state railway commission exclusive power to fix transportation rates, and it can fix such rates only in the absence of specific legislation. State v. Clarke, 98 Nebr. 566, 153 NW 623. 76. State v. Baltimore, etc., R. Co., (W. Va.) 85 SE 714.

Proceedings to enforce compliance by carriers with rates fixed by statute or railroad commission see generally supra §§ 676, 677.

77. Peo. v. Public Service Commn., 159 App. Div. 531, 145 NYS 503 [aff 215 N. Y. 689 mem, 109 NE 1089 mem]. 78. Peo. v. Public Service Commn., 159 App. Div. 531, 145 NYS 503 [aff 215 N. Y. 689 mem, 109 NE 1089 mem].

79. Trenton, etc.. Tract Corp. v. Trenton, 227 Fed. 502 [aff 229 Fed. 140, 143 CCA 416] (under P. L. [1911] p 374).

80. Peo. v. Public Service Commn., 159 App. Div. 531, 145 NYS 503 [aff 215 N. Y. 689 mem, 109 NE 1089 mem]. 81. Peo. v. Public Service Commn., 159 App. Div. 531, 145 NYS 503 [aff 215 N. Y. 689 mem, 109 NE 1089 mem]. 82. Peo. v. Public Service Commn., 215 N. Y. 241, 109 NE 252 [aff 159 App. Div. 546, 145 NYS 513].

83. Peo. v. Public Service Commn., 159 App. Div. 546, 145 NYS 513 [aff 215 N. Y. 241. 109 NE 2521.

84.

Peo. v. Public Service Commn., 159 App. Div. 546, 145 NYS 513 [aff 215 N. Y. 241, 109 NE 242].

85. Peo. v. Public Service Commn., 215 N. Y. 241, 109 NE 252 [aff 159 App. Div. 546, 145 NYS 513].

86. Grand Rapids, etc., R. Co. v. Michigan R. Commn., 188 Mich. 108, 154 NW 15 (Railroad Act [Pub. Acts (1909) No. 3001 § 22).

87. Terminal Taxicab Co. v. Kutz, 241 U. S. 252, 36 SCt 583, 60 L. ed. 984. AnnCas1916D 765.

88. Raritan River R. Co. v. Middlesex, etc., Tract. Co., 70 N. J. L. 732, 58 A 332.

97

commerce.95 The action of the state, through the legislature or a public service commission, in establishing a single fare rate does not exhaust its power to regulate transportation charges; 96 and after establishing such rate it may make a reasonable regulation affecting mileage or commutation rates.9 Regulation must be reasonable and fair.98 The legislature's power to regulate rates is subject to the limitations that the rates established by it must be reasonable and fair, both to the carrier and to the public,99 and that they must not be such as amount in law to the taking of private property for public use without just compensation or without due process of law. It has been said that rates can go no higher than the service is reasonably worth to the public requiring the service, and that the reasonable value of the service to the public may be insisted on, even though charges so limited would fail to produce a fair return to the carrier on its investment.2 But on the other hand, it has been said that if a reasonable and just rate will be prejudicial to a community it is unfortunate, but 98. Determination of reasonableness of rate see infra § 1084.

94

Delegation of state's power generally see supra § 630. 89. Raritan River R. Co. v. Middlesex, etc., Tract. Co., 70 N. J. L. 732, 58 A 332. 90. Raritan River R. Co. v. Middlesex, etc., Tract. Co., 70 N. J. L. 732, 58 A 332.

91. U. S.-Georgia R., etc., Co. v. Smith, 128 U. S..174, 9 SCt 47, 32 L. ed. 377; Stone v. Farmers' L. & T. Co., 116 U. S. 307, 6 SCt 334, 388. 1191, 29 L. ed. 636; Portland R., etc.. Co. v. Portland, 201 Fed. 119; Union Pac. R. Co. v. U. S., 20 Ct. Cl. 70 [aff 117 U. S. 355, 6 SCt 772, 29 L. ed. 920]. Ill-Illinois Cent. R. Co. v. Peo., 95 111. 313.

Ind.-Indianapolis V. Navin, 151 Ind. 139, 47 NE 525, 51 NE 80, 41 LRA 337.

Mich.-Pingree v. Michigan Cent. R. Co., 118 Mich. 314, 76 NW 635, 53 LRA 274.

N. J.-Raritan River R. Co. v. Middlesex, etc.. Tract. Co., 70 N. J. L. 732, 58 A 332.

[a] To exempt a street railroad company from legislative control over its rates of fare, it must appear that the exemption was made in its charter in clear and unmistakable language. Indianapolis v. Navin, 151 Ind. 139, 47 NE 525, 51 NE 80, 41 LRA 337.

[b] Power of directors.-A charter provision that the "directors shall have power to establish such rates

as they shall, from time to time, by their by-laws direct and determine" does not confer unlimited power, but merely the right to charge reasonable rates, and what is a reasonable maximum rate may be fixed by statute. Illinois Cent. R. Co. v. Peo., 95 Ill. 313, 314; Ruggles v. Peo., 91 III. 256.

[c] A grant in the charter of "the exclusive right" of transportation of passengers, provided the charges shall not exceed a certain specified rate, is not a contract between the state and company that the latter may charge such rates as it pleases, within the limits named, and the company is subject to the provisions of subsequent acts establishing a commission to regulate railroad rates. Georgia R., etc., Co. v. Smith, 128 U. S. 174, 175, 9 SCt 47, 32 L. ed. 377. 92. Portland R., etc., Co. v. Portland. 201 Fed. 119.

93. Chicago, etc., R. Co. v. Cutts. 94 U. S. 155. 24 L. ed. 94.

94. Buffalo East Side R. Co. v. Buffalo St. R. Co., 111 N. Y. 132, 19 NE 63, 2 LRA 284.

95. See Commerce [7 Cyc 449]. 96. Pennsylvania R. Co. v. Towers. 126 Md. 59, 94 A 330.

97. Pennsylvania R. Co. v. Tow

ers, 126 Md. 59. 94 A 330.

Reasonableness of rates generally see supra §§ 633-665.

99. U. S.-Chicago, etc., R. Co. v. Wellman, 143 U. S. 339, 12 SCt 400. 36 L. ed. 176 [aff 83 Mich. 592, 47 NW 489]; Georgia R., etc., Co. V. Smith, 128 U. S. 174, 9 SCt 47, 32 L. ed. 377; Dow v. Beidelman, 125 U. S. 680, 8 SCt 1028, 31 L. ed. 841; Stone v. Farmers' L. & T. Co., 116 U. S. 307, 6 SCt 334, 388, 1191, 29 L. ed. 636; Central of Georgia R. Co. v. Alabama R. Commn., 209 Fed. 75; East St. Louis, etc., R. Co. v. Belleville, 193 Fed. 95; Arkansas Rate Cases, 187 Fed. 290 [rev on other grounds 230 U. S. 553, 33 SCt 1030, 57 L. ed. 1625]; Wallace v. Arkansas Cent. R. Co., 118 Fed. 422, 55 CCA 192.

N. H.-State v. Maine Cent., R. Co., 77 N. H. 425, 92 A 837.

N. Y.-Peo. V. Public Service Commn., 159 App. Div. 531, 145 NYS 503 [aff 215 N. Y. 689 mem, 109 NE 1089 mem]; Blume v. Interurban St. R. Co., 41 Misc. 171, 83 NYS 989.

Tex.-San Antonio Tract. Co. v. Altgelt, (Civ. A.) 81 SW 106 [aff 200 U. S. 304, 26 SCt 261, 50 L. ed. 491].

Wash.-Puget Sound Electric R. Co. v. State R. Commn., 65 Wash. 75, 117 P 739, AnnCas1913B 763.

"In determining the reasonableness of railway rates, consideration must be given, not only to the carrier, but to the individual requiring the service. The carrier is entitled to adequate recompense for the service it performs. The individual is entitled to a rate that he can reasonably afford to pay for the service he requires. Upon this point, both judicial and economic authority agree." Puget Sound Electric R. Co. v. State R. Commn., 65 Wash. 75, 84, 117 P 739, AnnCas1913B 763.

[a] Development of territory"If the increased revenue under the lower rate is due to the development of the territory served, the carrier and the public served by it should each share in the benefit. The pioneer carrier frequently operates its road through a sparsely settled territory at a loss, and for that reason should share in the advantages due to the subsequent higher development of the country. On the other hand, the community served should also profit by the increased population. It is universally true that passenger rates are lowered as traffic increases in density. The benefit of the increment due to stimulation of the lower rate should go entirely to the public, and that due to the growth of the tributary territory should be divided between the carrier and its patrons.' Central of Georgia R. Co. v. Alabama R. Commn., 209 Fed. 75, 80.

Reciprocal rights of public and carrier in respect to service and rate of compensation see generally supra § 632.

1. Norfolk, etc., R. Co. v. Conley, 236 U. S. 605, 35 SCt 437, 59 L. ed. 745; Dow v. Beidelman, 125 U. S. 680, 8 SCt 1028, 31 L. ed. 841; Chicago, etc., R. Co. v. Smith, 210 Fed. 632; Louisville, etc., R. Co. v. Alabama R. Commn., 208 Fed. 35; Arkansas Rate Cases, 187 Fed. 290 [rev on other grounds 230 U. S. 553, 33 SCt 1030, 57 L. ed. 1625]; Atty.-Gen. v. Boston, etc., R. Co., 160 Mass. 62, 35 NE 252, 22 LRA 112; Oklahoma R. Co. v. St. Joseph's Parochial School, 33 Okl. 755, 127 P 1087; State v. Great Northern R. Co., 43 Wash. 658, 86 P 1056, 117 AmSR 1084, 6 LRANS 908. See also cases supra note 99.

[a] The fares fixed must not reduce the earnings of the carrier below what reasonable rates would produce so as to deprive it of its property without due process of law, or deny it the equal protection of the laws. Metropolitan Trust Co. v.

Houston, etc.. R. Co., 90 Fed. 683.

[b] Impairing franchise contract. -A commission has no authority to regulate rates when it has the effect of impairing the franchise contract as ratified by the legislature. Minneapolis v. Minneapolis St. R. Co., 215 U. S. 417, 30 SCt 118, 54 L. ed. 259; Oklahoma R. Co. v. St. Joseph's Parochial School, 33 Okl. 755, 127 P 1087. 2. Puget Sound Electric R. Co. v. State R. Commn., 65 Wash. 75, 117 P 739, AnnCas1913B 763. See generally supra & 632.

[a] Reasons for rule.-"Such a rule, as applied to these great public service corporations, is based upon reason and justice. because of their exercise of governmental powers and assumption of the functions of the state in their acquisition of their property, compelling the individual to yield and surrender his own that it may be devoted to the greater service of the general public; benefits that cannot be enjoyed without corresponding burdens. If they seek to exercise the function of the state in one particular, they cannot deny it in another. If they can take property from the individual because it is to be devoted to a public use, then they must recognize such public use as the first law affecting such property, and subordinate the interests of stockholders to the interest of the public. irrespective of the effect upon the question of profits. In this respect they differ from other corporations in whose property there is only an incidental public use." Puget Sound Electric R. Co. V. State R. Commn., 65 Wash. 75, 87, 117 P 739, AnnCas1913B 763.