In General.

Because of the nature of the business they carry on and the public’s interest in it, public utilities and common carriers are subject to state regulation, whether exerted directly by legislatures or under authority delegated to administrative bodies.191 But because the property of these entities remains under the full protection of the Constitution, it follows that due process is violated when the state regulates in a manner that infringes the right of ownership in what the Court considers to be an “arbitrary” or “unreasonable” way.192 Thus, when a street railway company lost its franchise, the city could not simply take possession of its equipment,193 although it could subject the company to the alternative of accepting an inadequate price for its property or of ceasing operations and removing its property from the streets.194 Likewise, a city wanting to establish a lighting system of its own may not remove, without compensation, the fixtures of a lighting company already occupying the streets under a franchise,195 although a city may compete with a company that has no exclusive charter.196 However, a municipal ordinance that demanded, as a condition for placing poles and conduits in city streets, that a telegraph company carry the city’s wires free of charge, and that required that conduits be moved at company expense, was constitutional.197

And, the fact that a state, by mere legislative or administrative fiat, cannot convert a private carrier into a common carrier will not protect a foreign corporation that has elected to enter a state that requires that it operate its local private pipe line as a common carrier. Such a foreign corporation is viewed as having waived its constitutional right to be secure against the imposition of conditions that amount to a taking of property without due process of law.198

Footnotes

191
Atlantic Coast Line R.R. v. Corporation Comm’n, 206 U.S. 1, 19 (1907) (citing Chicago, B. & Q. R.R. v. Iowa, 94 U.S. 155 (1877)). See also Prentis v. Atlantic Coast Line Co., 211 U.S. 210 (1908) ; Denver & R.G. R.R. v. Denver, 250 U.S. 241 (1919). [Back to text]
192
Chicago & G.T. Ry. v. Wellman, 143 U.S. 339, 344 (1892); Mississippi R.R. Comm’n v. Mobile & Ohio R.R., 244 U.S. 388, 391 (1917). See also Missouri Pacific Ry. v. Nebraska, 217 U.S. 196 (1910); Nashville, C. & St. L. Ry. v. Walters, 294 U.S. 405, 415 (1935). [Back to text]
193
Cleveland Electric Ry. v. Cleveland, 204 U.S. 116 (1907). [Back to text]
194
Detroit United Ry. v. Detroit, 255 U.S. 171 (1921). See also Denver v. New York Trust Co., 229 U.S. 123 (1913). [Back to text]
195
Los Angeles v. Los Angeles Gas Corp., 251 U.S. 32 (1919). [Back to text]
196
Newburyport Water Co. v. City of Newburyport, 193 U.S. 561 (1904). See also Skaneateles Water Co. v. Village of Skaneateles, 184 U.S. 354 (1902); Helena Water Works Co. v. Helena, 195 U.S. 383 (1904); Madera Water Works v. City of Madera, 228 U.S. 454 (1913). [Back to text]
197
Western Union Tel. Co. v. Richmond, 224 U.S. 160 (1912). [Back to text]
198
Pierce Oil Corp. v. Phoenix Ref. Co., 259 U.S. 125 (1922). [Back to text]