C. & NWR CO. v. Pub. Serv. Comm.

45 N.W.2d 520, 329 Mich. 432
CourtMichigan Supreme Court
DecidedJanuary 8, 1951
Docket50, Calendar No. 44,890
StatusPublished

This text of 45 N.W.2d 520 (C. & NWR CO. v. Pub. Serv. Comm.) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
C. & NWR CO. v. Pub. Serv. Comm., 45 N.W.2d 520, 329 Mich. 432 (Mich. 1951).

Opinion

329 Mich. 432 (1951)
45 N.W.2d 520

CHICAGO & NORTH WESTERN RAILWAY COMPANY
v.
PUBLIC SERVICE COMMISSION.

Docket No. 50, Calendar No. 44,890.

Supreme Court of Michigan.

Decided January 8, 1951.

Bell & Davidson, Drennan J. Slater and Edward Warden, for plaintiff.

Stephen J. Roth, Attorney General, Edmund E. Shepherd, Solicitor General, and Charles M.A. Martin *435 and Albert J. Thorburn, Assistants Attorney General, for defendant.

BOYLES, J.

This is an appeal by the Chicago & North Western Railway Company from a decree in chancery entered in the circuit court of Ingham county affirming an order of the defendant Michigan public service commission and dismissing plaintiff's bill of complaint. The bill of complaint was filed as a statutory method[*] of review of certain proceedings before the defendant commission and to set aside and enjoin the enforcement of the order entered by the commission in pursuance thereof. The decree and the order which appellant now seeks to have reversed grants plaintiff permission to discontinue passenger trains 10 and 15 operating daily between Escanaba and Powers, Michigan, but denies plaintiff's request for leave to discontinue passenger trains 9 and 14 operating daily between Powers and Iron River. Michigan. Only that part of the order which denies appellant the right to discontinue trains 9 and 14 between Powers and Iron River is now involved in the appeal in this Court. Said trains, operating on a 1-a-day schedule between Powers and Iron River, consist of a steam locomotive, a baggage car and 1 passenger coach. The locale and distance of said operations are shown on the following map:

*436

Appellant is a common carrier of goods and passengers by rail with operations extending throughout 9 States north and easterly from Wyoming, including Wisconsin and the Upper Peninsula of Michigan. In 1946, appellant was authorized by the defendant commission, in pursuance of general order No 47 (1945) of the (Federal) office of defense transportation to discontinue passenger trains Nos 10, 201, 202 and 11 between Escanaba and Iron River, provided plaintiff should substitute trains 9-14 and 10-15 between said points, such substitute trains to be operated for at least 6 months for the purpose of determining whether their operation would be profitable. Trains 10 and 15 were to run between Escanaba and Powers. Trains 9 and 14 were to run between Powers and Iron River. That substitution *437 was made and said trains were operated accordingly. Plaintiff kept a record of all direct revenues and direct movement expenses in connection with the substitute trains and found that a very substantial loss resulted from the operation of said trains. The loss for a period of approximately 9 1/2 months during 1946 was in excess of $40,000. However, appellant has continued to run said trains and the annual loss has increased since that time to about $80,000. Plaintiff's railroad between Escanaba and Iron River is paralleled to a great extent by highway US-2 upon which are operated various bus lines serving the communities from Escanaba to Iron River. Claiming that the operation of trains 9-14 and 10-15 was a waste of transportation, was not required for public convenience and necessity, and that unless plaintiff should be permitted to discontinue the trains it would be unjustly and unconstitutionally deprived of its property, appellant filed an application with the Michigan public service commission for authority to discontinue the operation of said trains. The commission conducted public hearings, evidence was submitted on behalf of plaintiff and certain interveners, and in January, 1950, the commission issued an order granting plaintiff permission to discontinue trains 10 and 15 between Escanaba and Powers, but denying plaintiff permission to discontinue trains 9 and 14 between Powers and Iron River. The instant bill of complaint was thereupon filed, to enjoin the enforcement of said order as to trains 9 and 14 between Powers and Iron River.

Northland-Greyhound Bus Lines Company maintains and operates 3 buses daily each way upon US-2, serving substantially the same communities as trains 9 and 14, and all cities and villages now served by said trains are served by Northland-Greyhound buses with the exception of Stager, having a population of 8 people, and Scott Lake, having *438 a population of 50 people. At the hearings before the commission no one from Hermansville, Waucedah, Vulcan, Quinnesec, Spread Eagle, Florence, Stager or Scott Lake, small communities on said railroad route, made any protest against the proposed discontinuance of trains 9 and 14. The Chicago, Milwaukee, St. Paul & Pacific Railroad operates 2 daily buses each way between Iron River and Iron Mountain, such buses connecting with Milwaukee Road trains at Iron Mountain. Also, the Iron Mountain-Kingsford Transit Lines operate 5 buses each way weekdays between Iron Mountain and Vulcan, and 2 buses each way on Sundays between Iron Mountain and Vulcan.

At the hearing before the circuit judge, no testimony was taken on behalf of the plaintiff, counsel stipulating that the testimony taken and exhibits received by the Michigan public service commission be admitted as part of the record. That evidence showed the out-of-pocket loss in operation of trains 9 and 14 for 3 test periods. These exhibits included only direct movement expenses, such as actual wages and vacation allowances paid the crews operating the trains, payroll taxes, fuel, water, lubricants and other train and engine supplies and repairs. Nothing was included for maintenance of right of way, yards or other similar facilities. For the first period, from February 18, 1946, to May 31, 1947, a total of 450 days, the revenue was $17,867, the expenses $95,459, leaving a net loss of $77,592, or an average loss per day of $172.20. The second test period, for 30 days, from June 8 to July 7, 1949, showed revenue of $1,789, out-of-pocket expenses $8,609, making net loss $6,820. On a 12-month basis, such figures would produce an annual loss of $81,840. The third test period, from August 1, to August 15, 1949, showed revenue of $801, expense $4,260, net loss $3,459. On this basis, the yearly loss *439 would be $83,016. Said evidence further showed that the total revenue derived from all sources in the operation of these trains was only about one half the wages of the employees required to operate the trains, and that the revenue from all sources on these trains fell annually over $2,000 short of paying for the coal consumed in operating the trains. There was no substantial disagreement before the commission as to the amount of appellant's losses resulting from the operation of the 2 trains in question. The evidence also showed that at one time mail was carried on these trains, but that the United States government cancelled its contract for carriage of mail on the trains because the revenue derived from the mail was insufficient to meet the wages of a mail clerk. It was further shown that gross receipts from express amount to $5 or $6 per day.

The extent of the use of said trains by passengers was also shown. During the first test period, the average number of passengers carried on said trains 9-14 and 10-15, both ways, was about 43 per day.

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Bluebook (online)
45 N.W.2d 520, 329 Mich. 432, Counsel Stack Legal Research, https://law.counselstack.com/opinion/c-nwr-co-v-pub-serv-comm-mich-1951.