Texas & New Orleans Railroad v. Railroad Commission

200 S.W.2d 626, 145 Tex. 541, 1947 Tex. LEXIS 109
CourtTexas Supreme Court
DecidedMarch 12, 1947
DocketNo. A-1098
StatusPublished
Cited by41 cases

This text of 200 S.W.2d 626 (Texas & New Orleans Railroad v. Railroad Commission) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Texas & New Orleans Railroad v. Railroad Commission, 200 S.W.2d 626, 145 Tex. 541, 1947 Tex. LEXIS 109 (Tex. 1947).

Opinion

Mr. Justice Simpson

delivered the opinion of the Court.

The Texas and New Orleans Railroad Company sued the Railroad Commission of Texas and its members in a Travis County district court, to set aside a Commission order denying the company’s application for leave to discontinue passenger train service on its branch line between Wharton and Palacios. The district court set the order aside and enjoined the,Commission from requiring passenger train service on this line so long as either (1) the operation is not necessary in the rendition of adequate service to the public, or (2) the passenger traffic offered and reasonably to be expected does not and will not pay the cost of the service plus a reasonable return upon the property employed in its rendition. Upon an appeal from that judgment, the Court of Civil Appeals construed Article 6479, Revised Statutes, as amended, to mean that the Railroad Commission was without power to allow a discontinuance of passenger train service as sought by the railroad company, the court being of the opinion that the Commission “did not have the authority to authorize complete abandonment thereof.” 197 S. W. (2d) 176.

Before 1927, enactments which had been in effect since 1891 required substantially that the Railroad Commission see to it that every railroad should run at least one train a day, Sundays excepted, upon which passengers should be transported, and further, that “the commission shall have no power to relax this provision.” Acts 1891, ch. 51, p. 55; Art. 4580, R. S. 1895; Acts 1903, ch. 117, p. 183; Art. 6676, R. S. 1911; Acts 1925, ch. 154, p. 365; Art. 6479, R. S. 1925. These and other statutes (notably Arts 6349, 6357 and 6358, R. S. 1925) had been construed to mean that- the Commission had no power to authorize the complete abandonment of a railroad or of train operations over it once the railroad had been located and.established. State v. Sugarland Ry. Co. (Tex. Civ. App.), 163 S. W. 1047, error refused. In 1927, however, the legislative policy by which the Railroad Commission had been so strictly enjoined to require a minimum of passenger train service was changed so that the Commission was authorized to “relax” these requirements as to certain short lines whose gross annual passenger revenues were [544]*544less than $3,600.00 (Acts 1927, ch. 198, p. 283). A still more sweeping change in legislative policy occurred in 1933 when the act under consideration was amended to include the following provisions:

“It shall be the duty of the Commission to see that upon each railroad in this State carrying passengers for hire there shall be run at least one train each day, Sundays excepted, upon which passengers shall be hauled, provided, however, the Commission may, in its discretion, upon application filed and after notice and hearing, relax such requirement as to any railroad, or part, portion or branch thereof, when in its opinion public convenience permits of such relaxation, and shall relax such requirement when it appears upon such hearing that the running of one train each day, Sundays excepted, is not necessary in the rendition of adequate service to the public, or that on any railroad, or part, or portion or branch thereof, passanger service as frequent as one train each day, Sundays excepted, with the passenger traffic offered and reasonably to< be expected, does not and will not pay the cost of such service plus a reasonable return upon the property employed in the rendition of such service; * * Acts 1933, ch. 111, p. 281. (Emphasis supplied.)

Experience which culminated in the 1927 and 1933 amendments to Article 6479 apparently had demonstrated that the rigid rule under which the Commission could in no case relax the requirement of daily except Sunday passenger service was working to the detriment of both the railroad and the public.

Since the Railroad Commission could grant no relief when heavy and continued losses were incurred from such passenger train service as that under consideration here, many applications were made to the Interstate • Commerce Commission, which did have power to grant the relief (Colorado v. United States, 271 U. S. 153, 46 S. Ct. 452, 70 L. Ed. 878), for authority to abandon altogether nonpaying- lines of railroad, and some of those applications had been granted, with a resulting- loss to many communities not only of passenger train service but railroad freight service as well. The emergency clause of the 1933 enactment significantly reads:

“Sec. 2. The fact that numerous applications have been made by Texas railroads to the Interstate Commerce Commission for authority to abandon lines of railroad in this State because the earnings of same are materially less than their expenses, some [545]*545of which applications have been granted (see footnote) and others of which are still pending before said" Commission, and that unless the expenses of other lines of railroad are reduced to amounts not in excess of their earnings, applications for authority to abandon same will probably be made to said Interstate Commerce Commission and granted, whereby numerous communities in this State will be deprived in some cases of all railroad service and in others of competitive railroad service, creates an emergency * *

Obviously to avert these imminent abandonments and to preserve for the communities affected at least the advantage of continued rail freight transportation, the legislature sought by its 1933 enactment to give to railroads, as a matter of right, relief from continued deficit operations of intrastate passanger trains. And so the 1933 amendment provided not only that the Commission should have the discretion to relax these requirements in certain situations, but also that where the rendition of daily except Sunday passenger train service did not yield a profit, the Commission shall relax the requirement in respect of the rendition of that service.

The Court of Civil Appeals held, as had the trial court, that the railroad company has fully met the burden of showing that the passenger service in question did not and could not reasonably be made to pay within the meaning of the statute. The record shows without dispute that in 1936, because of an operating loss, the Railroad Commission authorized the railroad company to discontinue passenger service between Palacios and Bay City, and in 1938, for the same reason, to discontinue the service on the remainder of the line extending from Bay City to Wharton. In September, 1940, because of increased activities at a military camp at Palacios, the railroad company voluntarily resumed these operations upon a temporary basis. In September, 1942, the company applied for authority to discontinue the service on the ground that it was no longer needed and was being operated at a loss. This application was denied without prejudice. [546]*546Subsequently, when it was renewed, the Commission on December 21, 1945, denied it upon the grounds of “public convenience and necessity.” This application was urged a third time, and on May 21, 1946, yet again denied, no reason then being assigned by the Commission for its action.

The books of the railroad company, kept in accordance with Interstate Commerce Commission accounting regulations, showed an operating loss of $88,200.00 on this train service between May 17, 1941 and June 30, 1946, of which $8,828.00 was sustained during the first six months of 1946.

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Bluebook (online)
200 S.W.2d 626, 145 Tex. 541, 1947 Tex. LEXIS 109, Counsel Stack Legal Research, https://law.counselstack.com/opinion/texas-new-orleans-railroad-v-railroad-commission-tex-1947.