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BRIEF AND ARGUMENT OF PLAINTIFF. Before the Honorable Board of Railroad Commissioners of the State of California, R. G. SNEATH, Plaintiff, SOUTHERN PACIFIC COMPANY, Defendant.S

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BRIEF OF PLAINTIFF.

The defendant claims that Section 489 of the Civil Code, and every part thereof, was repealed and rendered inoperative by the adoption of the new Constitution, while the plaintiff maintains that the provisions of the said section and of the new Constitution may readily be so harmonized that they may stand together as the law of the State.

Section 1 of the schedule of the new Constitution provides that all laws "in force at the adoption of this Constitution," not inconsistent therewith, shall remain in full force and effect until altered or repealed by the Legislature. Only such laws as were inconsistent with its provisions were repealed by its adoption.

In Re Stuart, 53 Cal. 745. This is simply a statement of the rule applicable to changes in statutory law by subsequent enactments. The true meaning of this rule will be shown by a brief examination of leading authorities.

A statute can be repealed only by an express provision of a subsequent law, or by necessary implication through a positive repugnancy between the provisions of the latter and former enactments to such an extent that they cannot stand together, or be consistently reconciled.

Connors vs. Carp River Iron Co., 54 Mich. 168. In the case now presented to your honorable body there is no repeal in express terms; and, if any exists, it must

be because of inconsistency and repugnancy between the provisions of Section 489, C. C., and Section 22 of Article XII of the new Constitution. It must be, in short, a repeal by implication. But repeals by implication are not favored, and the presumption always is that both the former and the latter enactments remain in full force. The burden of proof is always on those who claim the repeal.

" Repeals by implication are never favored; on the contrary, if prior and subsequent legislative enactments may well subsist together, Courts are bound to uphold the former, is a principle too well established to require comment."

People vs. Gerke, 37 Cal. 228, 232.
Estate of Beech, 63 Cal. 459.
People vs. S. F. & S. J. R. R. Co., 28 Cal. 254.
State vs. Green, 3 Hill, 472.

Johnson vs. Hahn, 4 Neb. 140. Where two Acts are seemingly repugnant, they must, if possible, be so construed that the latter may not operate as a repeal of the former.

Blain vs. Baitey, 25 Ind. 165. In Croxby vs. Patch, 18. Cal. 439, Chief Justice Field says that “repeals by implication are not favored." Such is the universal doctrine of the authorities. “Whenever two Acts," says the Supreme Court of Pennsylvania,“ can be made to stand together, it is the duty of the Judge to give both of them full effect. Even when they are seemingly repugnant, they must, if possible, have such a construction that one may not be a repeal of the other, unless the latter one contains negative words, or the intention to repeal is made manifest by some intelligible form of expression." Brown vs. County Commissioners, 21 Penn. 43. The following from the Supreme Court of New York is also quoted with approval by the learned Chief Justice: "The invariable rule of construction in respect to the repealing of statutes by implication is that the earliest Act remains in force, unless the two are manifestly inconsistent with and repugnant to each other; or unless in the latest Act some express notice is taken of the former, plainly indicating an intention to abrogate it. As laws are presumed to be passed with deliberation and with full knowledge of all existing ones on the same subject, it is but reasonable to conclude that the Legislature, in passing a statute, did not intend to interfere with or abrogate any former law relating to the same matter, unless the repugnancy between the two is irreconcilable."

Bowen ys. Lease, 5 Hill, 226.
See also in this connection:

Dwarris on Statutes, 674.
Western Savings Fund Society vs. Philadelphia, 31 Penn. State 175; S.C. 72, Am. Dec. 730.

Sedgwick on Statutory and Constitutional Law, 98 and following. The case of Crosby vs. Patch, 18 Cal. 439, is very instructive in connection with the present inquiry, because it answers one of the principal arguments presented in the brief of learned attorneys for the defendant, founded upon a revision of the subject-matter. In that case it was held that Article VI of the Revenue Act of 1854 was not repealed by the Revenue Act of 1857, although it was admitted that the latter Act declared all property in the State subject to taxation, with certain specified exceptions, among which consigned

goods (the property to which the said article of the Act of 1854 referred) were not designated, and although the definition of "personal property" given in the Act of 1857 was sufficiently comprehensive to include goods of that class. Notwithstanding its comprehensive character, the Court says, in conclusion, that "such a construction must be given to the general language of the Act of 1857 as will leave the provisions as to consigned goods of Article VI of the Act of 1854 in full force."

The rule of interpretation thus laid down has been recently affirmed by the California Supreme Court, in two important cases:

Bank of British North America vs. Cahn, 21 Pac. Rep. 863.

In re Yick Wo, 68 Cal. 304. Again, the general rule is well settled that Acts are not to be deemed inconsistent, when both may stand and effect be given to each.

Chew Heong vs. United States, 112 U. S. 545.
In re Kiernan, 62 N. Y. 457.

State vs. Wilson, 43 N. A. 415.
The inconsistency must be plain and unavoidable.

Foster's Case, 11 Coke, 56, 63 a.
People vs. Palmer, 52 N. Y. 83.

Brown vs. McCormick, 28 Mich. 215. "If the two statutes, on any reasonable construction, can stand together, and if the latter enactment has scope to operate and an apparent purpose of its own without working a repeal of the earlier provision, both must be upheld and harmonized."

Matter of Curser, 89 N. Y. 403.
United States vs. Langston, 118 U. S. 389, 393.
Fowler ys. Perkins, 77 Ill. 271.

Iverson vs. State, 52 Ala. 170. The rule is very neatly and concisely stated in the New York case of Matter of Curser: " A repeal by implication must be the necessary solution of an inconsistency not otherwise to be solved.

Let us now apply these principles to the case in hand. Section 489 of the Civil Code provides that rates of charges on the various railroad lines in this State shall be graduated in a certain manner. Under this section the railroad companies were to fix the charges. The main object of the section seems to have been, however, to secure uniform rates throughout the State, and to prevent discrimination. One rate of charges is established for a distance of one hundred miles or over; one rate for a distance of seventy-five and less than one hundred miles, to be not more than 10 per cent in excess of the first rate, etc. The section, therefore, has an object of its own, which is distinct from that of any section in the new Constitution. Now, using the rule laid down in the foregoing cases, have the sections of the new Constitution, and particularly Sections 22 and 23 of Article XII, "scope to operate, and an apparent purpose of their own, without working a repeal of" Section 489, Civil Code? The answer seenis plain. By the new Constitution, the work of fixing rates and charges was taken from the railroad companies and conferred upon your honorable body, but your action should be subject, as that of the companies was before 1879, to the rules laid down in Section 489. Your honorable body have the most important dnties to perform under the rew Constitution, even if the limitation prescribed by said section remain in force. On the other hand, there is reason for the section, which is not covered by the provisions of the new Constitution referred to. This construction of Section 489 and of the new Constitution is "reasonable,” and it is possible to reconcile and harmonize the prior and subsequent enactment in this way. It is to be presumed that the Constitutional Convention and the people, in framing and in ratifying the new Constitution, had the former law in view, and, no express repeal having been made, and the former and later enactment being susceptible to such interpretation as we have given, both must stand together as the law of the State.

It is not true that the constitutional provisions cover the entire ground. We have shown sufficient reason for the enactment of the section outside of any purpose which actuated the framers of that instrument. The following from the United States Supreme Court is in direct point: “A repeal by implication must be by necessary implication, for it is not sufficient to establish that subsequent laws cover some, or even all, the cases provided for by it, for they may be merely affirmative, or cumulative, or auxiliary."

Wood vs. U.S., 16 Peters, 342.

Chicago, M. and St. P. R. R. vs. U. S., 127 U. S. 406. Section 489 and the new Constitution are not, then, inconsistent. The repugnancy is not plain and manifest, the conflict is not irreconcilable. On the contrary, reconciliation and harmony are possible, and that upon a reasonable construction.

Again, the rule established by the cases is that “when a later statute is absolutely repugnant to a former in part only, it repeals the former only in so far as the repugnancy extends and leaves the remainder of the former Act in force."

Connors vs. Carp River Iron Co., 54 Mich. 168.
Wood vs. U. S., '16 Peters, 342, 362.
Hawkins vs. Mayor, 64 N. Y. 22.
Mongeon vs. The People, 55 N. Y. 613.

That part of Section 489 requiring the railroad companies to fix and publish rates was abrogated by the adoption of the new Constitution; but the limits regarding the graduation of the rates apply to your honorable body with as much force as if they had been made a part of Section 22 of Article XII of the Constitution. That part of the statute has plainly not been abrogated.

To use another class of cases, laws special in their application “are not deemed repealed by general legislation, except upon the clearest manifestation of an intent of the Legislature to effect such repeal, and ordinarily an express repeal by some intelligible reference to the special Act is necessary to accomplish that end."

People vs. Quigg, 59 N. Y. 88. Section 489, C. C., has a special object, viz.: to prevent discrimination and to insure uniformity in rates. A general enactment, establishing a Commission to fix charges, does not abrogate the special limitations imposed by the prior statute.

The only argument in the brief of the learned counsel for defendant which remains to be considered, is that founded upon the cases holding that a former statute is repealed by a later, which imposes a different penalty or punishment. But these cases do not apply to the matter under inquiry. In the case before your honorable body the offenses forbidden are not the same. The rates established by your honorable body may be, and probably always are, less than the extreme limit of 15 cents per mile per ton of freight laid down in the Code, and were no penalty provided in the new Constitution the railroad companies might disobey those rates with perfect impunity, so long as the limit of the Code was not passed. And thus we see again that Section 489 of the Civil Code has a scope and purpose of its own, not covered by the provisions of the new Constitution, and that no repeal of the former has been worked by necessary implication upon the adoption of the latter.

Plaintiff therefore respectfully submits to your honorable body that the provisions of Section 489 of the Civil Code, providing that rates and charges be graduated in a certain manner, as therein laid down, are still in force, and must be followed by your honorable body in performing the duties imposed upon you by the new Constitution in fixing railroad rates and charges. Respectfully submitted.

SHELDON G. KELLOGG,

Attorney for Plaintiff.

ARGUMENT.

The defendant avers that the rate of $1 per ton per carload lots from San Francisco to San Bruno (shipper loading and unloading) cannot be reduced and leave defendant any margin of profit for the service-distance fourteen miles.

It has been proved conclusively by letters in your possession from the Superintendant and attorney of the defendant, that freight cars generally go empty from San Francisco southward and past San Bruno. It would, therefore, be greatly to the interest of the defendant to secure more freight by reducing rates on freight southward from this city, as well as to leave off cars at San Bruno in coming north, and thus be relieved from transporting freight over the only heavy grade on their Coast Division road, and for which no allowance is now made.

We can ascertain the relative value of the service of this company's Coast Division road by comparing the service and charges of other roads of our country with its charges, and thus approach the question as to what defendant can do profitably. The average charge per ton per unile of all the roads in the United States, according to Poor's Manual, our best authority, is less than 1 cent, viz.: .907 of 1 cent, which includes all classes of freight, and small as well as large quantities, with warehousing and handling, while many roads charge much less, or as follows: New York Central, .77 of 1 cent; Pennsylvania, .f3; New York, Lake Erie, and Western,.66; Philadelphia and Erie, .51; Lake Shore and Michigan, .63; Michigan Central, .69; Chicago, Rock Island, and Pacific, .93; Pittsburg and Fort Wayne, .66; or an average for the above eight roads of about .68 of a cent for all kinds and quantities of freight.

The cost of moving freight by rail is stated by the Interstate Commission, on those roads mentioned in their report for 1888, to be .63 of a cent per ton per mile, while the st:itistician of the Atchison, Topeka, and Santa Fe makes the cost from this city to the Missouri River, on carload lots of sugar, to be .475, or less than one half cent per ton. This difference between .475 and .63 of a cent is accounted for by the fact that the lower cost is for carload lots and long hauls, as compared with every class and quantity of freight, as well as short and long hauls, and amounts to less than 50 per cent on the lower

From Calgary to Port Arthur, on the Canadian Pacific Railroad, their charges on local freight, where there is no competition, ranges on farmers' produce of various kinds from .52 to .91 of a cent per ton per mile, according to distance; and yet, notwithstanding the unsettled condition of that country, severe winters, and heavy grades, they report their earnings for the past year to be 35 per cent on their capital stock.

The combination rate on grain from Chicago to New York, about one thousand miles, is $5 per ton, or one half cent per ton per mile, and appears to give entire satisfaction to the eastern roads, for the reason, no doubt, that the rate has generally ruled lower.

cost.

With these facts it may be safely assumed that the following, furnished by the Interstate Commerce Commission for the year 1888, and relating to the operations of 136,883.53 miles of road, is measurably correct, but, perhaps, higher in average than if the whole number of miles in operation were reported: Averge cost carrying one ton of freight one mile

$0 0063 Average cost running passenger train per mile.

84 Average cost running a freight train one mile..

1 03 Average cost running all revenue trains one mile

96 Average cost running freight train in California one mile

1 17 Your Secretary, Mr. Gaskill, shows that the coal used in a mile run of defendant's train is sixty-seven and twenty-eight one hundredths pounds, which, at $6 72 per ton, the cost to that company would be, at two thousand two hundred and forty pounds per ton, about 20 cents per mile for a full train of cars.

These figures are instructive, especially to the people of California, whose experience in railroading is limited. That freight could be carried at a cost of one half cent per ton per mile seems incredible, and yet from the best authorities we have on the subject, there is a fair profit to many roads at that rate.

The rate of freight to San José, according to the defendant's schedule, on grain, carload lots, loaded by shipper, is $1 75 per ton, or 3} cents per ton per mile for fifty miles to this city, or more than seven times the average cost to them. This portion of defendant's road is almost a dead level, except the grade from San Bruno north, and yet the same charge is made to San Bruno from San José, a distance of thirty-six miles on a dead level, and which equals 4.86 cents per mile, or nearly ten times the probable cost of the service.

A few years ago the orchardists of Santa Clara County, in order to utilize the ground in their young orchards, planted many acres of squash and raised hundreds of tons more than could be used in their county. They sought a market for the surplus at San Bruno and this city, and could have sold many hundred tons that rotted in the field had the freight been reduced to 3 cents per ton per mile to San Bruno.

From defendant's report to the Interstate Commission the cost of running a freight train one mile is $1 17, and on such a level road as that to San José, two hundred tons should not be rated as a heavy load for one locomotive. Now, the distance being fifty miles, the total cost would be $58 50 for a train load, and the net profit would be $291 50 each trip. Estimating the cost per ton per mile at one half cent, which is liberal, or 25 cents per ton to San José, fifty miles, the cost of a train load would be $50, and the receipts $350, or just $300 profit on grain. And if we add 50 per cent more for classified goods, the profit would be $475 over cost on one train load.

Now, applying this condition to the thirty-six miles between San José and San Bruno, we have two hundred tons at $1 75 per ton equals $350 for grain, cost to defendant; two hundred tons at 18 cents, or one half cent per ton, $36, leaving a profit of $314, or $489 for classified goods over operating cost. The charges, therefore, are on classified goods $10 50 per train per mile, or ten times as much as the average cost of the roads of the United States for a like service, and within a portion of nine times as much as the cost is admitted to be by defendant on its Pacific system of roads, which includes, of course, its heavy mountain grades.

The rate on grain, you will notice, from San José to San Bruno, is $1 75 per ton; for thirty-six miles of service, is at the rate of 419 cents per ton per mile, or nearly ten times the cost of the service; and the rate froin San Francisco to San Bruno-$1 for fourteen miles-equals over fourteen times the cost. A:1d when you consider the charge of $1 per ton to Ocean View, a distance of seven miles from the city, you will no doubt be surprised to find the rate is nearly twenty-nine times the average cost of railway freight service.

The average annual net earnings, as set forth in Poor's Manual, of the railroads of the United States is $2,015 per mile; the net earnings of defendant's Pacific System, $3,050 83; those of the Central Pacitic alone being $1,561 86, and of the Union Pacific, $4,451 89. The net earnings of defendant's Pacific System is 50 per cent greater than the average of the United States, and is about 6 per cent on a cost of $50,000 per mile of road. The earnings of the Central Pacific are 125 per cent more than the average of other roads, and equals about 5 per cent on a cost of $90,000 per mile of road. The figures for the Coast Division are not given separately, but we may safely estimate that its earnings per mile are fully an average of the whole system, or $3,050 83 per mile; and as the roadbed is nearly level, the cost of the road and equipment at $20,000 per mile wouid no doubt be a full figure. These figures would show that the net earnings would be about 15 per cent on cost of road, but judging from their schedule rates, and the rate of 3 cents per ton per mile, which the defendant admits, we can fairly say that the actual rates collected on the Coast Division line are far greater than reported. You will find the average of their schedule rates within the first hundred miles south from this city, for the nineteen principal stations, to be 47% cents on grain per ton per mile, or on all goods at a 50 per cent higher rate, 77 cents per mile, or two and one half times as much as the mile rate defendant admits in their report to the "Manual.” Now if the amount they admit, $3,050 83 per mile, be increased two and one half times to correspond with their schedule rates, we would have $7,627 06 per mile, or a profit of over 33} per cent per mile net on cost of road over operating expenses.

The schedule rates of defendant are lower for the second hundred miles than for the first, and the cost is less, but compared with other roads defendant charges about five times as much per mile on the long haul.

Poor's Manual says the advantages of a railroad over earth roads in transportation is twenty to one, but as defendant charges from fourteen to twenty-nine times the cost by rail for the first fourteen miles out of the city, it fails to get much of the business, as teams can do better.

The defendant has not undertaken to furnish any proof to your honorable body as to what the cost is of transportation by their Coast Division road-you have simply its dictum-and the plaintiff has absolutely nothing to reply to in this respect, and has therefore been compelled to seek such information as was needed from the experience of other roads. The interest of the plaintiff in this matter coincides with that of the public generally, as his business extends over nearly all of defendant's roads to some extent, although more largely over the Coast Division road. The public have an undoubted right to inquire into the matter of freight rates, and no company has the legal right to refuse disclosing its operations, or to keep its books in such a manner as to prevent the public, or your honorable body, from obtaining such knowledge as may be necessary for a reasonable judgment as to the fairness of their charges.

It does not appear that the business of defendant's Coast Division is kept separately or in such a manner as to allow a reasonable judgment in relation to their charges. While it cannot be contended to be fair or just to saddle the people along said lines with the short coming of other roads, or the expenses of various enterprises having no connection with its operations, it is self-evident that the producers of hay and grain are being impoverished by low market prices and high transportation charges, and it is your duty to see that our people are protected from excessive charges and allowed to live and prosper. Plaintift does not seek any personal advantage over other shippers, or over any other shipping point, but claims that the defendant has not complied with the law as laid down in Section 489 of the Civil Code, as to what is proper and legal discrimination, and is thereby doing a great injustice to plaintiff and to all others situated in like manner.

Plaintiff also claims that the excessively high rates of charges on defendant's road are impoverishing the farming class and greatly retarding the general prosperity of the State, and that a rate of 2 cents per ton per mile on grain and hay for a hundred-mile rate or over, which plaintiff asks for, is but a slight concession in favor of the producers, and plaintiff submits, that in the establishment of this

maximum rate, that your honorable body would prevent improper discrimination as to persons and places, and give entire satisfaction to the public; and by accepting Section 489 as the law of discrimination for distances under one hundred miles, that your honorable body would be relieved from an endless amount of trouble that naturally arises from a want of system in the matter of fixing rates.

You will bear in mind that the rate suggested, viz.: 2 cents per mile, is for the long haul, carload lots, shippers loading and unloading, and for farmers' produce and other heavy freight, while classified freight at 50 per cent additional, and 25 per cent more for short hauls, would make a general rate for all classes of goods about 3 cents per ton per mile, or just what defendant says the charge is now, and about six times the cost of operating expenses.

California is unfortunate in not having sufficient railroad competition to insure reasonable rates of transportation. The people have been compelled to provide in their Constitution and laws a method that has proved acceptable in other States, in the form of a Commission that would stand between the people and the extortionate aggressions of railroad corporations. We are before your honorable body to-day, asking that our people may be released from the discriminating and extortionate demands of the defendant. The proof is absolute that our people are being charged from five to ten times more than citizens of the Eastern States are paying for the same service. The despotic effrontery of the defendant in publicly proclaiming that its rule is to charge all the traffic will bear without regard to the cost of the service, or the fact of its being your duty under the Constitution to fix the rate of charges instead of theirs, shows clearly their entire absence of respect for the laws of our country, the people, or the power delegated to your honorable body.

It is only a few years since our people have been released from bondage to the defendant in their transcontinental business. The lowering of rates brought new people and capital, and gave us a living market for our produce, and a degree of prosperity to our State never seen before. The fruits of our orchards and vineyards had previously rotted upon the ground for many years, because of excessive railroad charges, and to-day it is an established fact, that by reason of high charges for railroad transportation and low market prices for grain and hay, the farmer is not able to make a living on land owned and paid for. The railroad is thus a curse in place of a blessing, and, unless your honorable body come to the rescue, cattle will roam again over the beautiful valleys of the coast, as in days of yore, while grim, hollow-eyed poverty, and wild, unclad children will be seen among the wrecks of uncared-for tenements along the line of defendant's road. Unthrift and destitution lead to barbarity, socialism, and anarchy. The integrity, social order, destiny, and prosperity of a million people lies in your hands. Should you allow the defendant to use its unmerciful power in discriminating against persons and places, and taxing the people out of their homes and into the poorhouses and prisons of the State, through its principle of all the traffic will bear, there will in time come a retribution which may not be just, but will faithfully serve as an example of the power of the masses, under unjust infliction, through despotic power.

You have the power to make Section 489 of the Civil Code your rule of action, and it is not claimed by the defense that the discrimination allowed by that section, of 25 per cent

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