Milwaukee Electric Railway & Light Co. v. Railroad Commission

Citations

• 238 U.S. 174
• 35 S. Ct. 820
• 59 L. Ed. 1254
• 1915 U.S. LEXIS 1612

Syllabus

<p>Where the fixing of rates does not impair the obligation of contracts, the exercise by a municipality of a lawful power to fix rates does not deprive the public utility company of its property without .due process of law where it does not appear that the rates fixed are confiscatory.</p> <p>The fixing of rates, which may be charged by public service corporations — in this ease a street ear corporation — is a legislative function of the State.</p> <p>While the.State may enter into contracts preventing it for given periods from exercising the function of rate making, such a renunciation must be so clear and unequivocal as to permit no doubt of its construction. Home Telephone Co. v. Los Angeles, 211 U. S. 265.</p> <p>While it is the duty of this court to determine for itself whether there was a contract and the extent of a binding obligation, and the parties are not concluded by the decision of the state court, in so determining this court gives much consideration to the decisions of the state court construing the statutés of the State under which the contract is alleged to have been created.</p> <p>In this case, as this court cannot say that the state statute.involved in this action unequivocally grants to municipalities the power to deprive the legislature of the right to exercise the rate-making function in the future, and as the state court in other cases has held that the statute did not indicate an intention to surrender such right, this court affirms the judgment of the state court, holding that no irrevocable contract was created by an ordinance establishing rates of fare of a street car company, notwithstanding that a majority of the members of the highest court of the State did not concur in that view in this case.</p> <p>153 Wisconsin, 502, affirmed.</p>