Compellable Services.

A state may require that common car-riers such as railroads provide services in a manner suitable for the convenience of the communities they serve.205 Similarly, a primary duty of a public utility is to serve all those who desire the service it renders, and so it follows that a company cannot pick and choose to serve only those portions of its territory that it finds most profitable. Therefore, compelling a gas company to continue serving specified cities as long as it continues to do business in other parts of the state does not constitute an unconstitutional deprivation.206 Likewise, requiring a railway to continue the service of a branch or part of a line is acceptable, even if that portion of the operation is an economic drain.207 A company, however, cannot be compelled to operate its franchise at a loss, but must be at liberty to surrender it and discontinue operations.208

As the standard for regulation of a utility is whether a particular directive is reasonable, the question of whether a state order requiring the provision of services is reasonable could include a consideration of the likelihood of pecuniary loss, the nature, extent and productiveness of the carrier’s intrastate business, the character of the service required, the public need for it, and its effect upon service already being rendered.209 An example of the kind of regulation where the issue of reasonableness would require an evaluation of numerous practical and economic factors is one that requires railroads to lay tracks and otherwise provide the required equipment to facilitate the connection of separate track lines.210

Generally, regulation of a utility’s service to commercial customers attracts less scrutiny211 than do regulations intended to facilitate the operations of a competitor,212 and governmental power to regulate in the interest of safety has long been conceded.213 Requirements for service having no substantial relation to a utility’s regulated function, however, have been voided, such as requiring railroads to maintain scales to facilitate trading in cattle, or prohibiting letting down an unoccupied upper berth on a rail car while the lower berth was occupied.214

Footnotes

205
Atchison, T. & S. F. Ry. v. Public Utility Comm’n, 346 U.S. at 394–95 (1953). See Minneapolis & St. L. R.R. v. Minnesota, 193 U.S. 53 (1904) (obligation to establish stations at places convenient for patrons); Gladson v. Minnesota, 166 U.S. 427 (1897) (obligation to stop all their intrastate trains at county seats); Missouri Pac. Ry. v. Kansas, 216 U.S. 262 (1910) (obligation to run a regular passenger train instead of a mixed passenger and freight train); Chesapeake & Ohio Ry. v. Public Serv. Comm’n, 242 U.S. 603 (1917) (obligation to furnish passenger service on a branch line previously devoted exclusively to carrying freight); Lake Erie & W.R.R. v. Public Util. Comm’n, 249 U.S. 422 (1919) (obligation to restore a siding used principally by a particular plant but available generally as a public track, and to continue, even though not profitable by itself, a sidetrack); Western & Atlantic R.R. v. Public Comm’n, 267 U.S. 493 (1925) (same); Alton R.R. v. Illinois Commerce Comm’n, 305 U.S. 548 (1939) (obligation for upkeep of a switch track leading from its main line to industrial plants.). But see Missouri Pacific Ry. v. Nebraska, 217 U.S. 196 (1910) (requirement, without indemnification, to install switches on the application of owners of grain elevators erected on right-of-way held void). [Back to text]
206
United Gas Co. v. Railroad Comm’n, 278 U.S. 300, 308–09 (1929). See also New York ex rel. Woodhaven Gas Light Co. v. Public Serv. Comm’n, 269 U.S. 244 (1925); New York & Queens Gas Co. v. McCall, 245 U.S. 345 (1917). [Back to text]
207
Missouri Pacific Ry. v. Kansas, 216 U.S. 262 (1910); Chesapeake & Ohio Ry. v. Public Serv. Comm’n, 242 U.S. 603 (1917); Fort Smith Traction Co. v. Bourland, 267 U.S. 330 (1925). [Back to text]
208
Chesapeake & Ohio Ry. v. Public Serv. Comm’n, 242 U.S. 603, 607 (1917); Brooks-Scanlon Co. v. Railroad Comm’n, 251 U.S. 396 (1920); Railroad Comm’n v. Eastern Tex. R.R., 264 U.S. 79 (1924); Broad River Co. v. South Carolina ex rel. Daniel, 281 U.S. 537 (1930). [Back to text]
209
Chesapeake & Ohio Ry. v. Public Serv. Comm’n, 242 U.S. 603, 607 (1917). [Back to text]
210
“Since the decision in Wisconsin, M. & P.R. Co. v. Jacobson, 179 U.S. 287 (1900), there can be no doubt of the power of a state, acting through an administrative body, to require railroad companies to make track connections. But manifestly that does not mean that a Commission may compel them to build branch lines, so as to connect roads lying at a distance from each other; nor does it mean that they may be required to make connections at every point where their tracks come close together in city, town and country, regardless of the amount of business to be done, or the number of persons who may use the connection if built. The question in each case must be determined in the light of all the facts and with a just regard to the advantage to be derived by the public and the expense to be incurred by the carrier. . . . If the order involves the use of property needed in the discharge of those duties which the carrier is bound to perform, then, upon proof of the necessity, the order will be granted, even though ‘the furnishing of such necessary facilities may occasion an incidental pecuniary loss.’ . . . Where, however, the proceeding is brought to compel a carrier to furnish a facility not included within its absolute duties, the question of expense is of more controlling importance. In determining the reasonableness of such an order the Court must consider all the facts—the places and persons interested, the volume of business to be affected, the saving in time and expense to the shipper, as against the cost and loss to the carrier.” Washington ex rel. Oregon R.R. & Nav. Co. v. Fairchild, 224 U.S. 510, 528–29 (1912). See also Michigan Cent. R.R. v. Michigan R.R. Comm’n, 236 U.S. 615 (1915); Seaboard Air Line R.R. v. Georgia R.R. Comm’n, 240 U.S. 324, 327 (1916). [Back to text]
211
Due process is not denied when two carriers, who wholly own and dominate a small connecting railroad, are prohibited from exacting higher charges from shippers accepting delivery over said connecting road than are collected from shippers taking delivery at the terminals of said carriers. Chicago, M. & St. P. Ry. v. Minneapolis Civic Ass’n, 247 U.S. 490 (1918). Nor are railroads denied due process when they are forbidden to exact a greater charge for a shorter distance than for a longer distance. Louisville & Nashville R.R. v. Kentucky, 183 U.S. 503, 512 (1902); Missouri Pacific Ry. v. McGrew Coal Co., 244 U.S. 191 (1917). Nor is it “unreasonable” or “arbitrary” to require a railroad to desist from demanding advance payment on merchandise received from one carrier while it accepts merchandise of the same character at the same point from another carrier without such prepayment. Wadley Southern Ry. v. Georgia, 235 U.S. 651 (1915). [Back to text]
212
Although a carrier is under a duty to accept goods tendered at its station, it cannot be required, upon payment simply for the service of carriage, to accept cars offered at an arbitrary connection point near its terminus by a competing road seeking to reach and use the former’s terminal facilities. Nor may a carrier be required to deliver its cars to connecting carriers without adequate protection from loss or undue detention or compensation for their use. Louisville & Nashville R.R. v. Stock Yards Co., 212 U.S. 132 (1909). But a carrier may be compelled to interchange its freight cars with other carriers under reasonable terms, Michigan Cent. R.R. v. Michigan R.R. Comm’n, 236 U.S. 615 (1915), and to accept cars already loaded and in suitable condition for reshipment over its lines to points within the state. Chicago, M. & St. P. Ry. v. Iowa, 233 U.S. 334 (1914). [Back to text]
213
The following cases all concern the operation of railroads: Railroad Co. v. Richmond, 96 U.S. 521 (1878) (prohibition against operation on certain streets); Atlantic Coast Line R.R. v. Goldsboro, 232 U.S. 548 (1914) (restrictions on speed and operations in business sections); Great Northern Ry. v. Minnesota ex rel. Clara City, 246 U.S. 434 (1918) (restrictions on speed and operations in business section); Denver & R.G. R.R. v. Denver, 250 U.S. 241 (1919) (or removal of a track crossing at a thoroughfare); Nashville, C. & St. L. Ry. v. White, 278 U.S. 456 (1929) (compelling the presence of a flagman at a crossing notwithstanding that automatic devices might be cheaper and better); Nashville, C. & St. L. Ry. v. Alabama, 128 U.S. 96 (1888) (compulsory examination of employees for color blindness); Chicago, R.I. & P. Ry. v. Arkansas, 219 U.S. 453 (1911) (full crews on certain trains); St. Louis I. Mt. & So. Ry. v. Arkansas, 240 U.S. 518 (1916) (same); Missouri Pacific R.R. v. Norwood, 283 U.S. 249 (1931) (same); Firemen v. Chicago, R.I. & P.R.R., 393 U.S. 129 (1968) (same); Atlantic Coast Line R.R. v. Georgia, 234 U.S. 280 (1914) (specification of a type of locomotive headlight); Erie R.R. v. Solomon, 237 U.S. 427 (1915) (safety appliance regulations); New York, N.H. & H. R.R. v. New York, 165 U.S. 628 (1897) (prohibition on the heating of passenger cars from stoves or furnaces inside or suspended from the cars). [Back to text]
214
Chicago, M. & St. P. R.R. v. Wisconsin, 238 U.S. 491 (1915). [Back to text]