163 P. 600 | Or. | 1917
Lead Opinion
delivered the opinion of the court.
We desire to express our obligations to counsel who have appeared in this case for the clarifying arguments and the able and exhaustive briefs with which we have been assisted in our investigation of the important questions suggested by this record.
It was formerly necessary to secure an act of Congress in order to authorize a railroad company to bridge a navigable stream. The policy of Congress in adopting legislation of this character was to require the builder of the bridge to permit the common user thereof by other railway companies: Union Pacific Co. v. Chicago, Rock Island & P. R. Co., 163 U. S. 583 (41 L. Ed. 265, 16 Sup. Ct. Rep. 1173); Union Pacific R. Co. v. Mason City etc. R. Co., 199 U. S. 160, 161 (50 L. Ed. 134, 26 Sup. Ct. Rep. 19). In 1899 Congress passed a general act on the subject (30 Stats, at Large, 1151, 4 U. S. Comp. Stats. 1913, § 9971, 6 Fed. Stats. Ann. 805), giving general authority to the Secretary of War and to the several states to act in all cases involving the bridging of navigable streams lying wholly within the boundaries of one state. Pursuant to this statute and the construction placed thereon by the Federal Supreme Court in Montgomery v. Portland, 190 U. S. 89 (47 L. Ed. 965, 23 Sup. Ct. Rep. 735), plaintiff secured authority to construct the bridge in question, subject to certain conditions, one of which was the common user clause above quoted.
It has been held that a common user clause, such as that involved in the case at bar, is entitled to a liberal construction: Joy v. St. Louis, 138 U. S. 1, 38, 50 (34 L. Ed. 843, 11 Sup. Ct. Rep. 243). If we are to give a liberal construction to the common user clause we think we must hold that the defendant- is entitled to the benefit of its terms. The purpose in view in inserting a common user clause in a bridge franchise is twofold. It is important that navigation shall not be impeded by the construction of bridges over navigable streams except as such bridges are needed, and it is also important that public service corporations shall not be required to expend money unnecessarily in providing facilities for which the public must pay in the form of transportation charges. The use which the defendant desires to make of the bridge in question is a legitimate railroad use and would probably have justified the Secretary of War and the Port of Portland in granting the defendant a franchise for the construction of an additional bridge across the Willamette Eiver. It is much better from every point of view that the present bridge should be used by both of these parties. The equal rights and privileges relative to the passage of railway trains and cars over the bridge, provided for in the ordinance; and for which plaintiff is entitled to compensation, are the right to pass trains
It is true, as contended, that the defendant’s right to use the bridge grows out of the franchise ordinance and is not dependent on a judgment of condemnation. It has been held that the parties are not entitled to a trial by jury for the purpose of fixing the compensation to be paid in such a case as this: Union Depot R. Co. v. Southern Ry. Co., 105 Mo. 562 (16 S. W. 920). The proceeding is nevertheless somewhat analogous to a condemnation proceeding. The payment to the senior company of adequate compensation is a condition to the exercise of the right demanded by the junior company: Grand Avenue Ry. Co. v. People’s Ry. Co., 132 Mo. 34, 38 (33 S. W. 472, 475). It is therefore pertinent that the courts have held that in a condemnation proceeding a limited easement may be condemned: St Louis etc. R. Co. v. Postal Tel. Co., 173 Ill. 508, 535 (51 N. E. 382). It is also well established that the condemnor may by proper proceedings had in the condemnation action limit the right demanded, with a view to the reduction of the damages to be assessed: 2 Lewis on Eminent Domain, 1247, and note; Oregon Ry. & Nav. Co. v. Owsley, 3 Wash. Ter. 38 (13 Pac. 186, 188); State ex rel. Kent Lumber Co. v. Superior Court, 46 Wash. 516, 520 (90 Pac. 663); Spokane Valley etc. Co. v. Arthur D. Jones & Co. 53 Wash. 37, 45-48 (101 Pac. 515); Tacoma Eastern R. Co. v. Smithgall, 58 Wash. 445, 451 (108 Pac. 1091).
We therefore reach the conclusion that the defendant is entitled to avail itself of the common user clause
At the inception of the trial in the court below, plaintiff called as its witness Mr. Clyde B. Aitchison, one of the members of the Eailroad Commission, who participated in the arbitration and the award. Plaintiff called this witness merely for the purpose of identifying the testimony which was before the arbitrators and on which they acted. The defendant thereupon proceeded further to examine him, over the objection of plaintiff, as follows:
“Q. As a matter of fact, the Commission in making this award of reasonable compensation allowed something for profits, did it not?
“A. I do not have the exact details in mind of the manner in which the award was made up. I do recall that after considering items of expense as best we could determine, an additional sum was estimated and included.
“Q. Included as profit, was it not, allowed to the owner of the bridge ?
“A. Well, it was included over and above every item of expense we could figure on, and it was going to the owner of the bridge.
“Q. Do you remember what percentage it was?
“A. I do not, without having access to the papers that were used at the time.”
On redirect examination plaintiff followed up this line of proof and the witness testified as follows:
*540 “A. All I can say to that is that to the best of our ability wé considered every fragment of evidence that was introduced by either party, and gave it such weight as we thought proper. But, as far as being able at this time to recall the state of that voluminous record, I cannot, except in a very general way.
“Q. Well, you said you made an allowance of profit?
“A. I recall that. I did not say that it was profit. I say that after we had figured out every item of expense that we could, then, in order to be certain that we were dealing fairly, as we considered it, with the parties, and had not overlooked anything, and to make sure there was a return, I remembered we figured a return on the investment, and when we came to deliberate, we added still an additional amount, so you can call it profit or what you please.
“Q. Do you mean to say $500 would make any return on the value of this bridge — $6,000 a year?
“A. I don’t undertake to say anything about that now. I am simply telling you that we passed on this to the best of our ability from the records that were here, and we intended to give a profit and thought we were doing it.
“Q. You intended to make a fair return on the investment to the owner, and something in the way of profit?
“A. Yes, on the theory on which we made the award.”
“If it appears from this testimony that the appraisers misconceived their duty under the submission, and that this misconception led them to an entirely erroneous conclusion, we cannot disregard that testimony, although it should result in an impeachment of the award. ’ ’
There was no dispute in the court below as to the testimony which was before the arbitrators and on which they acted. This testimony was transcribed and extended and on proper identification was received in evidence in this case. Except as to the value of the real estate occupied by the abutments and approaches of the bridge there was but little conflict in the testimony taken before the arbitrators. There are two decks to the bridge, the upper deck being adapted to foot and vehicle travel, and the lower deck devoted exclusively to railway service. The testimony of the defendant showed that the cost of the railway portion of the bridge was $882,980.47; that the approach tracks which the defendant would of necessity use cost $43,960.25. The testimony also showed that the safe and convenient operation of trains over the bridge demanded the construction of an interlocking plant, at a cost of about $40,000, and that $26,750.80 of this sum was properly chargeable to the tracks which the defendant would use. The testimony as to the value of the real estate occupied by the abutments of the bridge and by the tracks leading thereto was very conflicting and is in unsatisfactory shape. We have examined it with care and given the defendant the benefit of every disputed piece of testimony and every inference legitimately to be drawn therefrom. We do not see how this real estate could be appraised at less than $150,000. The arbitrators may have charged a part of this value to the upper deck of the bridge, but they could not have failed to charge at least half of it to the portion of the bridge used exclusively for railway traffic. The total of these investments of capital chargeable to the railway portion of the bridge is $1,028,691.52. The
WTien Mr. Aitchison testified that the board intended to allow to plaintiff a legitimate and proper share of the above expenses, and also a fair return on the capital invested he must of necessity have referred to that portion of the award which charges the defendant with-a minimum payment of $500 a month. The fact that the arbitrators attached to this award a provision assuring plaintiff that its compensation should not fall
Testimony was offered in the court below to the effect that in twenty months’ operation under the award the defendant had paid the plaintiff the sum of $12,-876.15. This return is equivalent to $7,725.60 per annum, but little in excess of the minimum provided for by the board. The lower court founds
*545 “That the car tolls which the defendant is required to pay under the award applied to the number of cars which the defendant will pass or switch over said bridge, produces an annual sum which is so disproportionate to a reasonable annual interest charge upon the value of the bridge, and necessary operation and maintenance charges, as to deprive the plaintiff of any compensation for the use of the bridge, and that said award so entirely disregards, mistakes and misapplies the evidence introduced at the hearing as to deprive the plaintiff of its rights in said bridge and of the rights in said ordinance and resolution and order of the Secretary of War.”
The decree of the lower court setting aside the award is right and is affirmed. The findings, of the lower court, adjudging that the defendant is not entitled to use the bridge for the transportation of freight-cars thereover, are set aside.
The cause will be remanded to the lower court for further proceedings in accordance with this opinion.
Modified and Remanded.
Further Modified on Petition foe Rehearing and Rehearing Denied.
Rehearing
On Petition eor Rehearing.
(163 Pac. 989.)
On petition for rehearing. Original opinion withdrawn in one particular and otherwise adhered to. Rehearing denied.
Messrs. Carey & Kerr, for the petition.
Mr. William W. Cotton, Mr. Arthur C. Spencer, Mr. Charles E. Cochran and Mr. Ralph E. Moody, contra.
In Banc.
delivered the opin-
ion of the court.
The evidentiary value of the other contracts offered by the defendant is impaired by the circumstance that they are contracts made by the defendant with the Northern Pacific and the Great Northern, and the evidence shows that these latter companies own the stock of the defendant, share and share alike. The contracts are therefore little more than a convenient form of bookkeeping which the common owners have elected to adopt.
Plaintiff, on the other hand, has offered in evidence seven contracts all providing for the use of railway' facilities by competing lines, and in all these cases the junior company makes a substantial contribution to the charge for interest on the investment, regardless of the volume of its traffic. In most of these cases the junior company pays a share of the interest charge based wholly on the number of users and without regard to the relative volume of traffic. In one of the contracts, that under which the plaintiff secures access to a traffic-producing territory in West Seattle by use of the facilities of the Northern Pacific, the conditions are closely akin to those in this case. All these contracts have to do with facilities in this part of the union; plaintiff or one of its subsidiary companies is a party to all of them and some part of the Hill system of roads to which defendant belongs is also a party to each of them.
It appeared by the testimony offered before the arbitrators that plaintiff had pnt in effect a tariff for the switching of cars from the west to the east side of the Willamette at Portland and that a number of defendant’s cars had been so switched. Exhibit 16 was a table showing that in the two years ending March 31, 1913, 21,395 cars had been’so switched by plaintiff for the Hill lines, of which defendant is one; Exhibit 17 segregated the loaded cars in this list from the empty cars and segregated the loaded cars switched for defendant from the loaded cars switched for the Northern Pacific. There was no such segregation of the empty car's. Exhibit 25 was a table showing the engines and trains of plaintiff and the Southern Pacific using the bridge from May 4, 1912, to July 25, 1912. Exhibit 26 was a table of the Hill line cars switched across the bridge from July, 1912, to March, 1913. This table showed that 8,780 of. defendant’s cars had been so switched during this period. Some of the cars tabulated in these exhibits had been switched over the bridge with which we are concerned in this case, but most of them used' the old bridge- which it replaced.
The evidence showed that a large part of the traffic switched across the bridge was destined to. Albina. We are not concerned with that traffic in this case because the defendant has no terminal in Albina and could not avail itself of a common user of the bridge to reach Albina. The testimony further shows that the period covered by these tabulations was the period when the defendant was acquiring its terminal facilities in East Portland. Defendant’s expenditures for this purpose during the two-year period covered by
The evidence further shows that the defendant was unable to move certain classes of its traffic under these switching tariffs. Freight in less than carload lots and team freight could not be so handled. We think it clear that these tabulations are no basis on which to figure the probable traffic of the defendant under the common user clause involved in this case, and that the arbitrators could not have come to a different conclusion. It appears upon the face of the award that they were uncertain as to the volume of the defendant’s traffic. The testimony in the Circuit Court shows that the tabulations used before the arbitrators throw no light on the volume of defendant’s traffic under the common user clause because of the large share of defendant’s business which is destined to Albina, which is still handled under plaintiff’s switching tariff and which nevertheless entered into these tabulations.
In examining Mr. J. D. Farrell, president of plaintiff, counsel for the defendant suggested that defendant’s traffic would be possibly one tenth of the entire use of the bridge. This suggestion was of course not evidence, but if it were accepted as such it would convincingly prove the mistake in the award. The annual charge for operating and maintaining the bridge could not have been figured by the arbitrators at less than $90,000; the minimum rental, to which alone Mr. Aitchison’s testimony is referable, was $6,000. It is apparent therefore that if the arbitrators figured on these lines their award did not insure to plaintiff a profit over and above defendant’s share of the annual charges and did not conform to their decision.
The petition argues that the award contains no mistake, but the argument is based wholly on the assumption that there was evidence before the arbitrators as to the volume of defendant’s business which would move over the bridge under the award. There being no such evidence, the argument is not convincing.
The same courts which announce these doctrines hold that it is the duty of courts of equity to set aside awards for fraud or mistake. One of the best established branches of the jurisdiction is that which requires the
Defendant is entitled to use the bridge for the purpose desired and plaintiff is entitled to reasonable compensation for such use. The award being set aside, the machinery provided for the determination of the compensation has failed. It would be a reproach to the law if the rights of the parties should thereby lapse. It is the province of courts of equity to provide remedies in such cases and it is in this view of the case that we have fixed a measure of reasonable compensation for the use of the bridge sought by the defendant.
Modified and Remanded.
Further Modified on Petition for Rehearing and Rehearing Denied.