rates, but upon the possibility of its arising. What the fourth section of the act to regulate commerce has reference to is an actual dissimilarity of circumstances and conditions, not a conjectural one. Of course, if by agreements or combinations among carriers it were found that at a particular point rates were unduly influenced by a suppression of competition, that fact would be proper to consider in determining the question of undue discrimination and the reasonableness per se of the rates at such competitive points.5

Sec. 573. Joint rates under section four.-In making joint rates, two connecting carriers in effect form a new and independent line, and their joint rate may be less than the sum of the local rates without violating the long and short haul clause found in the fourth section. But it would seem that in making a joint rate a railroad cannot violate the long and short haul clause and discriminate against shippers on a connecting line by making the joint rate for the long haul less than the local rate for the short haul.7

State Regulation of Rates.

Sec. 574. Discrimination in rates-State statutes.-Legislation of the same general character as the Interstate Commerce Act has also been had in many of the states, and the question of the power of the state legislatures over the subject has been much considered. Entire unanimity does not exist, but it is well settled that it is within the power of the state legislatures to prevent unjust and unreasonable discrimination by the carriers operating within the state, and 5. Interstate Commerce Com- 8. Illinois Cent. R. Co. t. Peomission v. Louisville & N. R. Co., 190 U. S. 273, 23 Sup. Ct. R. 687, 47 L. Ed. 1047, affirming 108 Fed. 988, 46 C. C. A. 685, reversing 102 Fed. 709 and 101 Fed. 146.

6. Railway Co. v. Osborne, 52 Fed. 912, 3 C. C. A. 347, 10 U. S. App. 430, reversing Osborne Railway, 48 Fed. 49.

V.

ple, 121 Ill. 304; Chicago, etc. R. Co. v. People, 67 Ill. 11; Railroad Co. v. Jones, 149 Ill. 361, 37 N. E. Rep. 247, 24 L. R. A. 141, 41 Am. St. Rep. 278; Osborn v. Railroad Co., 123 Mich. 669, 82 N. W. Rep. 526; State v. Railroad Co., 22 Neb. 313; Dillon v. Railroad Co., 43 N. Y. Supp. 320, 19 Misc. 116; Gulf,

7. Junod v. Railway Co., 47 Fed. etc. Ry. Co. v. Dwyer, 75 Tex. 572.

290.

A state legislature has the gen

that, except where the power has been clearly renounced in the charter of the carrier, it is competent for the legislature to regulate, within reasonable limits, the rates that may be charged by common carriers for the transportation of passengers and property within the state. That the legislature has

deprived itself of the power will not be presumed, and it will only be held to have done so where it appears by "words of positive grant or words equivalent to law."10 And even where the power has been renounced, the state may still supervise the rates charged by the carrier and keep them within the limits of its power.11 But "it is not to be inferred that the power of limitation or regulation is itself without limit. This power to regulate is not a power to destroy, and limitation is not the equivalent of confiscation. Under pretense of regulating fares and freights, the state cannot require a railroad corporation to carry persons or property without reward; neither can it do that which in law amounts to a taking of

private property for public use without just compensation or without due process of law.'12

Where the state may regulate the rates to be charged, it is competent to establish a board or commission to carry the regulations into effect; but an act which makes the action of such a board or commission final and exclusive of judicial review is void, as depriving the carrier of the equal protection of the law and depriving him of his property without due process of law. 13

Rates in excess of those authorized by the law which have been exacted by the carrier and paid by the shipper to secure transportation may be recovered back.14

But an agreement made between a railroad company and a competitor that during a limited time the former company "will not reduce its present rates of fares, unless required by law," has been held to be not contrary to public policy.15

12. Stone v. Trust Co., 116 U. S. 307; Chicago, etc., Ry. Co. v. Minnesota, 134 U. S. 418; Smyth v. Ames, 169 U. S. 466, 18 Sup. Ct. R. 418, affirming Ames v. Railway Co., 64 Fed. 165; decree modified, 171 U. S. 361, 18 Sup. Ct. R. 888, 43 L. Ed. 197; Wallace . Railroad Co., 118 Fed. 422, 55 C. C. A. 192; Metropolitan Trust Co. v. Railroad Co., 90 Fed. 683; Southern Pacific Co. v. Board of Railroad Commissioners, 78 Fed. 236; s. c. 95 Fed. 572.

The terms "unreasonable" and "unjust" are not to be restricted to mean that a regulation complained of is a taking of property without proper compensation, or without due process of law. Railroad Commission v. Houston & T. C Railroad, 90 Tex. 340, 38 S. W. 750; Railroad Commission v. Weld & Neville, 96 Tex. 394, 73 S. W. Rep. 529, reversing s. c. 68 S. W. Rep. 1117.

13. Chicago, etc. Ry. Co. v. Min

nesota, 134 U. S. 418; State v. Johnson, 61 Kan. 803, 60 Pac. Rep. 1068, 49 L. R. A. 662.

The provision of the California constitution making rates fixed by the board of railroad commissioners conclusive is not equivalent to directing them to be made unreasonable. Southern Pacific Co. v. Board of Railroad Commissioners, 78 Fed. 236; s. c. 95 Fed. 572.

A state board of railroad commissioners is usually vested with quasi judicial powers, but is not a state court within the meaning of section 720 of the Revised Statutes of the United States (U. S. Compiled St. 1901, p. 581) which prohibits any court of the United States from issuing an injunction restraining proceedings in any court of a state. Railroad Co. v. Brown, 123 Fed. 946.

14. Transportation Co. v. Sweetzer, 25 W. Va. 434.

15. Railroad Co. v. Middlesex &

Penal statutes regulating rates must, of course, be construed strictly.16

Sec. 575. Power of a state railroad commission to establish rates. The presumption is that the rates fixed by a state legislature or state railroad commission are reasonable, and the burden of proof is upon the railroad companies to show the contrary.17 But when a state railroad commission is authorized to make a schedule of rates, and their schedule is merely given the force and effect of prima facie evidence as to the reasonableness of the rates in a suit involving the question of such reasonableness, there is no delegation to the state railroad commission of the legislative power to establish rates. The legislature thereby merely refrains from the exercise of its constitutional power to fix reasonable maximum rates of charges, and by leaving the question as to the reasonableness of the rates open, makes room for the exercise by the courts of their jurisdiction upon the subject.18 The legislature, however, may deprive railroad companies of the power to make rates, and confer that authority upon a railroad commission.19 In either event the extent of judicial interference is protection against unreasonable rates.20 The rates must also first

S. Traction Co., 70 N. J. L. 732, 12 L. R. A. 436, 31 Am. St. Rep. 58 Atl. Rep. 332. 477; Steenerson v. Railway Co., 69 Minn. 353, 72 N. W. Rep. 713.

16. Hall v. Railroad, 44 W. Va. 36, 28 S. E. Rep. 754, 41 L. R. A. 669, 67 Am. St. Rep. 757.

17. Railroad Co. v. State of Minnesota, 186 U. S. 257, 22 Sup. Ct. R 900, 46 L. Ed. 1151, affirming 80 Minn. 191, 83 N. W. Rep. 60; Railway Co. v. Smith, 173 U. S. 684, 43 L. Ed. 858, 19 Sup. Ct. 565, reversing Smith v. Railway Co., 114 Mich. 460, 72 N. W. Rep. 328; Matthews v. Board of Corporation Commissioners, 106 Fed. 7; s. c. 97 Fed. 400; Barris r. Railroad Co., 102 Iowa, 375, 71 N. W. Rep. 339; Railway Co. r. Dey, 82 Iowa 312, 48 N. W. Rep. 98,