Interstate Commerce Commission v. City of Jersey City

322 U.S. 503, 64 S. Ct. 1129, 88 L. Ed. 1420, 1944 U.S. LEXIS 1231
CourtSupreme Court of the United States
DecidedOctober 9, 1944
Docket767
StatusPublished
Cited by332 cases

This text of 322 U.S. 503 (Interstate Commerce Commission v. City of Jersey City) is published on Counsel Stack Legal Research, covering Supreme Court of the United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Interstate Commerce Commission v. City of Jersey City, 322 U.S. 503, 64 S. Ct. 1129, 88 L. Ed. 1420, 1944 U.S. LEXIS 1231 (1944).

Opinions

Mr. Justice Jackson

delivered the opinion of the Court.

This is a direct appeal by the Interstate Commerce Commission, whose orders the District Court of New Jersey has set aside, and by the Hudson & Manhattan Railroad [505]*505Company, whose rates are subject to the enjoined orders. Respondents are the City of Jersey City and the Price Administrator, who intervened under powers duly delegated to him pursuant to the Emergency Price Control Act of 19421 and the Inflation Control or Stabilization Act of 1942.2

The Hudson & Manhattan Railroad Company owns about 8.5 miles of electric railway, of which all but 0.63 mile is underground. It has two double-track lines, one of which, known as the “uptown line,” connects Hoboken, New Jersey, with Christopher Street, New York, by two parallel tunnels under the Hudson River, and runs uptown under Sixth Avenue from Christopher Street to a terminal at 33rd Street. The other line, known as the “downtown line,” crosses under the river by two parallel tunnels between Exchange Place, Jersey City, and Hudson Terminal, New York. It also extends westwardly in Jersey City to Journal Square, where connection is made with the Pennsylvania Railroad. The uptown and downtown lines are connected on the New Jersey side by means of a line paralleling the Hudson River. In conjunction with the Pennsylvania Railroad the Hudson & Manhattan operates a joint rapid-transit service between Hudson Terminal and Newark. It carries only passengers.

The present controversy has its roots in a rate case precipitated by the Company’s effort to establish a 10-cent fare on its downtown line in 1937.3 After full hear[506]*506ings the Interstate Commerce Commission fixed an 8-cent fare effective July 25,1938.4 The 10-cent fare was denied chiefly on the ground that, while the Company might be entitled to the revenue, such a fare would decrease its patronage, and the Commission believed that an 8-cent fare would produce more revenue. Commissioners Miller and Mahaffie dissented from denial of the 10-cent fare on such grounds, holding it had been “amply justified” as “reasonable and lawful for the services performed.” This Court held such grounds of denial to- be sustained by evidence and to be within the Commission’s discretion. Hudson & Manhattan R. Co. v. United States, 313 U. S. 98. The 8-cent fare remained in effect until the carrier on June 27, 1942 filed a petition in the same proceeding for further hearing, alleging changed conditions and increased costs in support of a 10-cent fare on the downtown line. Protests were filed by the City of Jersey City and the Hudson Bus Corporation. The Commission opened the proceeding and extensive hearings were held in September of 1942. Counsel for the Price Administrator appeared, stating that it was not his intention to offer evidence but that he reserved the right to make any motions and to file appropriate briefs. The hearings were concluded on September 19, 1942.

The Inflation Control Act of 1942, passed on October 2d, contained a proviso that “no common carrier or other public utility shall make any general increase in its rates or charges which were in effect on September 15, 1942, unless it first gives thirty days notice to the President, or such agency as he may designate, and consents to the timely intervention by such agency before the Federal, State or municipal authority having jurisdiction to consider such increase.” § 1. Thereafter the Price Administrator [507]*5075 asked permission to and did file a brief opposing any increase in the rates. On January 25,1943, the hearing examiner recommended that the Commission find the rate of 10 cents on the downtown lines to be just and reasonable. Exceptions were filed by Jersey City and the Price Administrator and argued by counsel for each, and on June 8, 1943 the Commission made its decision.6 It reviewed the increases in operating costs since the 8-cent rate had been fixed and the need of the railroad for additional revenue “in order to meet increased operating expenses and the interest on its bonds.” It increased the downtown fare from 8 cents to 9 cents, effective for duration of the war and six months thereafter, with permission to any of the parties to bring to the attention of the Commission additional facts if the revenue results should prove materially different from the Commission’s estimate. The Commission’s opinion considered the arguments of the Price Administrator against any increase, but said, “It seems to us that an increase of 1 cent in respondent’s downtown fare is unlikely to have any inflationary effect, and that the effect thereof upon the cost of living, while a factor to be given consideration, will be so slight, a maximum of about 12 cents a week and 52 cents a month per passenger, as to be negligible. We believe, therefore, that the increased fare herein approved will not be in conflict with the Emergency Price Control Act of 1942, as amended.” Three Commissioners dissented, holding that the Company had established its right to a 10-cent fare.

A month later the railroad filed a petition for reconsideration. Among other things, it alleged that it could [508]*508not avail itself of the 9-cent rate because its fare collection boxes could not handle the volume of coins necessitated by the 9-cent rate and under war conditions could not be replaced. It asked to charge a 10-cent fare until it could secure tokens. Jersey City answered, asking that the petition be denied and the 9-cent fare suspended. The Price Administrator also answered. He advocated what he called a feasible scheme to collect the 9-cent fare through the use of paper tickets. The Price Administrator also asked that the fares go back to 8 cents in view of alleged increased earnings and asked that in any event before the fares were increased on the basis suggested by the Company a further hearing be held. On August 3, 1943 the Commission issued a report and order.7 It found that it would be impossible to collect a 9-cent cash fare, and it authorized an alternative basis of eleven tokens for $1.00 or a cash fare of 10 cents, provided the same alternative basis be put into effect on the uptown line. This resulted, of course, in a rate of 9%i cents to token purchasers on both lines.

Thereupon Jersey City filed a complaint in the District Court, asking that the Commission’s order be enjoined “in so far as such order permits the establishment of any local interstate fare in excess of nine cents for transportation on the downtown line.” It alleged that in authorizing downtown fares “in excess of the nine cent fare” fixed in the order of June 8, the Commission had deprived Jersey City of its full day in court by refusing it opportunity to cross-examine witnesses and present counter-evidence.

The Commission then reopened the proceeding on its own motion, but only “to permit any party hereto to present evidence directed solely to the propriety and lawfulness of the modifications made by the Commission in its report of August 3, 1943, on further consideration of its prior findings and orders of July 11, 1938 and June 8, [509]*5091943” and to afford the right to cross-examine adverse witnesses.

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Bluebook (online)
322 U.S. 503, 64 S. Ct. 1129, 88 L. Ed. 1420, 1944 U.S. LEXIS 1231, Counsel Stack Legal Research, https://law.counselstack.com/opinion/interstate-commerce-commission-v-city-of-jersey-city-scotus-1944.