Missouri v. Chicago, Burlington & Quincy R. Co., 241 U.S. 533 (1916)

Missouri v. Chicago, Burlington

& Quincy Railroad Company
No. 16, Original

Argued May 2, 3, 1916
Decided June 12, 1916
241 U.S. 533

MOTION TO STRIKE A DEFENSE FROM THE ANSWER

Syllabus

In exerting the public ratemaking power, a state cannot, without violating the federal Constitution, make the rates so low as to be confiscatory, and although the state may not be sued without its consent, an individual, even though he be a state officer, may be enjoined from doing an act violating the federal Constitution.

From the power to fix railroad rates there results the duty to provide the opportunity of testing their repugnancy as a unit to the Constitution in case confiscation were charged.

In virtue of the due process provision of the Fourteenth Amendment, a state may not, by mandamus, compel a railroad to comply with rates fixed by a state law unless an opportunity is afforded to test the question of confiscation. Chicago &c. Ry. v. Minnesota, 134 U.S. 418.

This Court has recognized the right of a railroad company to test the rates prescribed by a state statute as a unit and to obtain an injunction, restraining state officers from enforcing the law in its entirety if it is found to be confiscatory.

The right to test a ratemaking law as a unit is not exclusive of the right to test it by resisting in each particular case an individual effort to enforce a single rate prescribed.

The practice which has arisen of qualifying as "without prejudice" the decree in rate cases in which assertions of confiscation have not been upheld, and when the situation justified the qualification, is not so as to leave the controversy open as to the period dealt with by the decree, but so as not to prejudice property rights in the future, if from future operation and changed conditions confiscation in the future should result. Knoxville v. Water Co., 212 U.S. 1.

The qualification of a decree dismissing a bill in a case brought by a railroad company to enjoin state officers from enforcing a rate statute as without prejudice does not leave the matter open so that, in a subsequent individual case brought by the state to recover excess fares paid during the period covered by the company’s suit, the defendant can attack the constitutionality of the law as a whole.

The fact that the state was not a party to the company’s suit in which a decree dismissing the bill without prejudice was entered, and could not have been made a party without its consent, does not make such decree inapplicable in the individual suit of the state to recover excess fares paid during the period covered by the company’s suit, and such defense should be struck from the answer.

Quaere whether a suit by a railroad company against state officers to enjoin enforcement of a ratemaking statute is not a class suit binding upon all.

Quaere as to the ultimate right to recover for excess rates paid pending a stay while the constitutionality of a rate-fixing statute was pending in the absence of a condition to that effect imposed when the injunction was issued.

The facts, which involve the construction and effect of the decision by this Court in the Missouri Rate Cases, 230 U.S. 474, are stated in the opinion.