Ohio Coal Ass'n v. Public Utilities Commission

164 Ohio St. (N.S.) 108
CourtOhio Supreme Court
DecidedJuly 20, 1955
DocketNos. 34298, 34299 & 34300
StatusPublished

This text of 164 Ohio St. (N.S.) 108 (Ohio Coal Ass'n v. Public Utilities Commission) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ohio Coal Ass'n v. Public Utilities Commission, 164 Ohio St. (N.S.) 108 (Ohio 1955).

Opinion

Stewart, J.

Under Section 4903.13, Revised Code, the only question before us is whether, upon a consideration of the record, the order of the Public Utilities Commission of September 27,1954, is unlawful or unreasonable.

[111]*111As has been stated, the order of the Public Utilities Commission of May 1, 1952, relating to increased rates for all intrastate traffic, except coal, was not appealed from, and the order of May 7, 1953, granting increased rates as to coal was affirmed by this court in Toledo Edison Co. v. Public Utilities Commission, supra.

The order of September 27, 1954, merely extended the expiration date of these increases to December 31, 1955.

Testimony was heard by an attorney examiner who summarized the evidence and made findings of fact and conclusions of law based thereon.

At the outset of the hearing, application was made on behalf of the railroads to have the record made at the previous hearing (Toledo Edison case, supra) considered as a part of the evidence in this cause, and the examiner ruled that, since the application herein is for an extension of temporary rates already in effect and was made as a part of the same proceeding with the same case number, such record automatically is part of this cause.

The railroads introduced evidence which supplemented and extended the exhibits introduced in the previous hearing, bringing them down to date with such information as was available, with reference particularly to the experience of the 10 principal railroads operating in Ohio, only one of which, The Akron, Canton & Youngstown Railroad, has all its operations in this state.

These 10 railroads operate a grand total of 8,725 miles of railroad in Ohio, which is 20.8 per cent of their total mileage.

Evidence adduced at the hearing consists of statistics for the full calendar years of 1952 and 1953, and for the first quarter of 1954. The evidence tends to show that after the previous grant of increased rates, there was an initial improvement in the railroads’ rate of return which amounted to 4.43 per cent on their net investment, but that their earnings were adversely affected by a prolonged strike in the steel industry and by the termination of hostilities in Korea in July 1953, as a result of which carloadings fell off 16.7 per cent in the first 18 weeks of 1954 compared with a similar period in 1953.

The railroads experienced increases in wages and in material prices since July 1952, the evidence tending to show that on December 15, 1953, wages paid by railroads operating in Ohio [112]*112were five per cent higher than they were on July 1, 1952, and that since that time a further increase, which is expected to amount to 7.5 cents per hour, has been granted.

The evidence tends to show increases of 0.8 per cent in prices of fuel to the railroads and of 3.9 per cent in the prices of other railroad materials and supplies.

The decrease in income and increase in expenses have caused a sharp drop in net earnings since July 1953, and this caused net working capital to decline seriously.

The evidence tends to show that in the first three months of 1954 net railroad operating income of the 10 railroads operating in Ohio dropped 49 per cent and as to a similar period in

1953 net income declined 78.7 per cent; and that in the same period the four railroads in Ohio, which are the chief haulers of coal within the state, experienced a drop of 63.1 per cent in net railroad operating income for thé first three months of

1954 as compared with a similar period in 1953. Net income for the four railroads declined from $22,000,000 in the first three months of 1953 to a deficit of $5,000,000 in the same period in 1954.

In his findings of fact and conclusions of law, the attorney examiner points out that “the railroads’ evidence is based entirely upon aggregate figures combining figures for both inter and intrastate operations, giving figures for a region in which the railroads operate and containing no separation of figures as to the Ohio traffic. ’ ’

The examiner found also:

“The applicants are not required by Ohio law or by court interpretation of such law to present figures on Ohio operations only, because of the unavailability of said figures. The figures submitted by the applicants are proper and competent to be considered by this commission in this proceeding.
“This commission is not required by the statutes of Ohio or by the ‘Lindsey case’ to make an evaluation of the applicant’s property used and useful within the state of Ohio before considering in passing upon this request for an extension of existing rate increase.”

As stated by the companies, “the fundamental issue before this court is whether the need for increased revenue from Ohio [113]*113operations can be shown solely by aggregates of system-wide statistics. ’ ’

In considering this question it should first be noted that throughout the statutes relating to the authority of the Public Utilities Commission to fix rates, railroads are clearly differentiated from other public utilities.

Chapter 4909 of the Revised Code contains the statutes applicable to the fixing of rates, and Section 4909.01, Revised Code, contains the definitions applicable thereto and adopts as a definition of the term, “public utility,” the meaning thereof set forth in Section 4905.02, Revised Code. That section defines public utility as including “every corporation, company, copartnership, person, or association, their lessees, trustees or receivers, * * * but excepting such other public utilities as operate their utilities not for profit, such other public utilities as are owned or operated by any municipal corporation, and railroads as defined in Sections 4907.02 and 4907.03, of the Revised Code.”

Section 4907.01, Revised Code, also defines “railroad” as having the meaning set forth in Section 4907.02, Revised Code, which defines “railroad” as “any corporation, company, individual, or association of individuals-, or its lessees, trustees, or receivers appointed by a court, which owns, operates, manages, or controls a railroad or part of a railroad as a common carrier in this state. ’ ’

In the consideration of the statutes hereinafter quoted, this differentiation between railroads and other public utilities must be kept in mind.

Reliance is placed by appellants on Section 4909.04, Revised Code, as authority for the proposition that the Public Utilities Commission is required to make an evaluation of the railroads’ property used and useful in Ohio in considering the application to increase existing rates. That section provides in part as follows:

“The Public Utilities Commission, for the purpose of ascertaining the reasonableness and justice of rates and charges for the service rendered by public utilities or railroads, or for any other purpose authorized by law, may investigate and ascertain the value of the property of any public utility or railroad in this state used or useful for the service and convenience of the public. * * *
[114]

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Related

Lindsey v. Public Utilities Commission
144 N.E. 729 (Ohio Supreme Court, 1924)

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Bluebook (online)
164 Ohio St. (N.S.) 108, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ohio-coal-assn-v-public-utilities-commission-ohio-1955.