Kenny v. United States

103 F. Supp. 971, 1952 U.S. Dist. LEXIS 4607
CourtDistrict Court, D. New Jersey
DecidedMarch 26, 1952
DocketCiv. 1153-51
StatusPublished
Cited by9 cases

This text of 103 F. Supp. 971 (Kenny v. United States) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kenny v. United States, 103 F. Supp. 971, 1952 U.S. Dist. LEXIS 4607 (D.N.J. 1952).

Opinion

SMITH, District Judge.

This is a civil action under Sections 2321 to 2325, inclusive, of Title 28 U.S.C., 28 U.S.C.A. §§ 2321 to 2325. The jurisdiction of the Court is based upon the provisions of Section 1336 of Title 28 U.S.C., 28 U.S. C.A. § 1336. The plaintiffs seek: first, to set aside and annul an order heretofore entered by the Interstate Commerce Commission; and second, to enjoin the operation of a tariff filed by the Hudson & Manhattan Railroad Co., and the collection of fares thereunder. The action is before the *973 Court on the record made at the hearing before the Commission.

The defendants challenge the right of the plaintiffs to maintain this action. It appears from the record that several, if not all, of the plaintiffs have a real interest in the controversy and have a right to maintain the action; the others have a right to intervene therein. 28 U.S.C.A. § 2323. We, therefore, believe it unnecessary to discuss the question. It is our opinion that the case can, and should, be decided on the merits.

The Hudson & Manhattan Railroad Co., hereinafter identified as the Railroad, is engaged exclusively in the transportation of passengers; it handles no package, freight or express matter, except certain mail. It operates a rapid transit system between terminals in the cities of New York, N. Y., and Jersey City and Hoboken, N. J., and maintains stations at intermediate points between these terminals. The service which it renders may be described as a “local interstate service.” 1 The lines and basic services of the Railroad are fully described in the Report of the Commission.

Pursuant to the provisions of the “Interstate Commerce Acts” 49 U.S.C.A. § 1 et seq., and the regulations promulgated thereunder, the Railroad filed with the Commission a passenger tariff establishing a fare of twenty cents, an increase of five cents, for interstate transportation between points in the cities of New York, N. Y., and Jersey City and Hoboken, N. J. The tariff was published and filed on April 11, 1951, and by its terms was to become effective ■on May 13, 1951; this procedure was in compliance with Section 6(3) of the said Act. Thereafter the City of Jersey City and twelve other municipalities filed a formal protest.

Pursuant to the authority vested in it by Section 15(7) of the Act, 49 U.S.C.A. § 15(7), the Commission suspended the operation of the tariff for a period of seven months, the maximum permitted by statute, .and initiated an investigation “concerning the lawfulness” of the fares established ■therein. (Suspension Orders entered on May 11 and May 25, 1951). Thereafter the proceeding was assigned for hearing before a designated examiner. The hearings, conducted on June 26, 27, 28 and July 46, 17, 18 and 19, were finally concluded on July 20, 1951. The proceeding was assigned for oral argument and was heard by the Commission on October 31, 1951 on the record made before the examiner. The decision of the Commission was reported and filed on December 3, 1951, and on that date it entered an order vacating the suspension and discontinuing the proceeding. The present action followed.

The principal grounds urged by the plaintiffs in support of this action are stated in Point One and Point Two of their brief. It is charged in the former that “the Commission has failed so manifestly in the exercise of its powers and responsibilities as to present a case of arbitrariness and statutory ultra vires.” It is charged in the latter that the Commission’s order “is arbitrary and ultra vires because it rests upon a total misconception by the Commission of the regulatory tasks which faced it in this case.”

A careful study of the arguments advanced under Point One discloses that the principal complaint is that the Commission “made a determination of justness and reasonableness without proper findings, and on the basis of findings which, are inadequate both on the face of its report and as tested by the record.” The contention appears to be that the Commission failed to make the basic findings essential under the law to support its order and that its approval of the tariff was therefore arbitrary and not in accordance with the law. This contention is without merit.

We concede that the law imposes upon the Commission a duty to find and adequately state the basic facts upon which it has proceeded. United States v. Chicago, M., St. P. & P. R. Co., 294 U.S. 499, 504-506, 55 S.Ct. 462, 79 L.Ed. 1023; United States v. Baltimore & O. R. Co., 293 U.S. 454, 463, 55 S.'Ct. 268, 79 L.Ed. 587; Florida v. United States, 282 U.S. 194, 215, 51 S.Ct. 119, 75 L.Ed. 291. An adequate state *974 ment' of fact is essential to the proper and intelligent review by the court of a proceeding conducted by the Commission; the sufficiency of such a statement, however, should be measured by the limits of the statutory power invoked, here the jurisdiction “to prescribe just and reasonable” rates and fares. Ibid. This jurisdiction is defined in Sections 15 and 15a of the Act, 49 U.S.C.A. §§ 15 and 15a, particularly subdivisions (1) and (7) of the former and subdivision (2) of the latter.

The statutory standards which the Commission must apply in the exercise of its jurisdiction are defined by Section I5a(2), supra, as follows: “In the exercise of its power to prescribe just and reasonable rates the Commission shall give due consideration, among other factors, to the effect of rates on the movement of traffic by the carrier or carriers for which the rates are prescribed; to the need, in the public interest, of adequate and efficient railway transportation service at the lowest cost consistent with the furnishing of such service; and to the need of revenues sufficient to enable the carriers, under honest, economical, and efficient management to provide such service.” A proposed tariff may be approved as lawful only if it is determined to be “just and reasonable” in the light of these factors. It should be noted, however, that the statute does not exclude the consideration of “other factors.”

The statute reserves to the carrier a primary right to establish tariffs but vests in the Commission the authority to determine their “lawfulness.” United States v. Chicago, M., St. P. & P. R. Co., supra, 294 U.S. 506 and 510, 55 S.Ct. 462; Skinner & Eddy Corp. v. United States, 249 U.S. 557, 564, 565, 39 S.Ct. 375, 63 L.Ed. 772; Interstate Commerce Commission v. Louisville & Nashville R. Co., 227 U.S. 88, 92, 33 S.Ct. 185, 57 L.Ed. 431. This power is specifically defined by Section ’15(7), supra. The burden is upon the carrier to prove not only that the proposed tariffs are “just and reasonable” 'but also that they are lawful. Ibid. The proposed tariffs may be approved as “just, reasonable and not unlawful” only if they meet the statutory requirements.

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Bluebook (online)
103 F. Supp. 971, 1952 U.S. Dist. LEXIS 4607, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kenny-v-united-states-njd-1952.