s. c. 74 Fed. 79; Bradman v. Atlantic C. L. R. Co., 11 Inters. Com. R. 464; Chicago U. Traction Co. v. City of Chicago, 199 Ill. 579, 65 N. E. 470.

While it is a sound general proposition that railways are entitled to a fair and reasonable return upon the capital invested, it might not justify them in charging an exorbitant mileage in order to pay operating expenses, if the conditions of the country did not permit it. -Minneapolis & St. L. R. Co. v. Minnesota, 186 U. S. 257, 22 Sup. Ct. R. (U. S.) 900, affg. s. c. 80 Minn. 191, 83 N. W. 60.

It is not indispensable to the correction by federal courts of an error of law into which the Interstate Commerce Commission has fallen whereby a specific rate is made unreasonably low, that the aggrieved party prove that the effect of this unreasonably low rate will make its entire business unprofitable. It is enough that the reduced rate is unjust and unreasonable.- Decision of the U. S. Circuit Court of the 8th Circuit June 30, 1908, Fed.

A railway company is entitled to a fair return on its purely domestic business without reference to what it is earning on its interstate business or its business generally.- Central of Ga. R. Co. v. McLendon, 157 Fed. 961.

If a railway is earning less from its existing rates than will pay the proper proportion which its domestic business should bear of its subsisting and legal fixed charges, any attempt to reduce the rates in such way as that the company will sustain further loss of revenue would seem to be violative of its constitutional rights and entitle it to relief.Central of Ga. R. Co. v. McLendon, 157 Fed. 961.

A railroad corporation is not entitled to earn an amount sufficient to provide a sinking fund for the discharge of its indebtedness, in addition to paying the interest thereon.- Houston & T. C. R. Co. v. Storey, 149 Fed. 499.

If a water plant is built for a larger area than it finds itself able to supply or if it does not yet have the customers contemplated, neither justice nor the Constitution require that a portion merely of the contemplated number shall pay the full return on the investment.- Boise City Irr. & Land Co. v. Clark, 131 Fed. 415.

Providing its rates are not discriminative, a railroad is entitled to earn the usual and legal rate of interest in the locality where it operates, on the actual value of the road and its equipment. Upon a showing that during 19 years it has earned much less than such legal interest, and on giving an indemnity bond, it is entitled to a preliminary injunction against reductions in rates ordered by a state railroad commission.- Louisville & N. R. Co. v. Brown, 123 Fed. 946.

Any state law or regulation establishing rates for the transportation of persons or property, which will not admit of the carrier earning such a compensation as is under all the circumstances just and reasonable to it and to the public, operates to deprive the company affected of its property without due process of law and to deny it the equal protection of the laws, and the enforcement thereof will be enjoined.- Wallace v. Arkansas Cent. R. Co., 118 Fed. 422.

If rates fixed by a commission compel a railway company to conduct its operations at a loss or without a fair remuneration for its investment, then the property of the company is taken and used by the public without just compensation and it is deprived of property without due process of law. Matthews v. Board of Corp. Comrs., 106

Fed. 7.

The grant of a charter to a railroad company does not guarantee that it will or can make the investment at all times a paying one.Matthews v. Board of Corp. Comrs., 106 Fed. 7.

Rates to be charged by carriers cannot be fixed by the courts or a commission so as to amount to a taking of the property of the carrier.- Metropolitan Trust Co. v. Houston, T. & C. R. Co., 90 Fed. 683.

It is not a defense to a proceeding to restrain the enforcement of an unreasonable rate that the plaintiff is a foreign corporation, doing business in the state only by sufferance, and may retire if the rates do not permit it to do business at a profit.- Chicago & N. W. R. Co. v. Dey, 35 Fed. 866, 1 L. R. A. 744n.

A state board of railroad commissioners will be enjoined from enforcing a schedule of charges for switching cars in a city, which fixes the charges at less than the actual cost to the railroad company of the work.- Chicago, St. P. M. & O. R. Co. v. Becker, 35 Fed. 883,

An express company is entitled to charge a reasonable amount for the service which it gives; and this service being partly rendered by its own agents and employees, and partly by a railroad, it cannot justify a rate by producing its own contracts with the agents and the railroad. The question still remains what charge is reasonable, not what the company has contracted to make the service cost.- Society Am. Florists v. U. S. Exp. Co., 12 Inters. Com. R. 138.

The Interstate Commerce Commission, in the making of its orders, will strictly respect the right of the railroad corporation to earn a fair return on its investment.-Johnson v. Ch. M. & St. P. R. Co., 9 Inters. Com. R. 221.

The men who have conceived and executed a railway enterprise are entitled to a fair return upon the money which has been actually invested in it, and in addition, a reasonable profit upon the ability to

>

conceive and execute a profit of this sort.- Danville v. So. R. Co., 8 Inters. Com. R. 409.

The right of a railroad to earn a return on its investment, is only the right to do so operating its property according to law.- Brewer v. L. & N. R. Co., 7 Inters. Com. R. 224.

That unless permitted to charge a certain rate, a carrier cannot earn a return upon its investment does not justify such rate, if it contravenes any provision of the Interstate Commerce Act.— Brewer v. L. & N. R. Co., 7 Inters. Com. R. 224.

The law entitles a carrier to fair return upon the property which it necessarily devotes to public use, and ordinarily it must be assumed that such fair return affords means to maintain the property in condition to enable the carrier to provide service which is safe and adequate for the reasonable public needs.- In re Port Jervis Elect. L. P. G. & R. R. Co. Decided by the N. Y. Public Service Commission for the Second District, May 12, 1908.

A public service company may, under some circumstances, be required to perform its services at rates prohibitive of a fair return to its stockholders, considering their property as an investment merely.— Brunswick Water Dist. v. Water Co., 99 Me. 371, 59 Atl. 537.

In fixing rates, there is, on the one hand, the right of the company to derive a fair income, based on the fair value of the property at the time it is being used for the public, taking into account the cost of maintenance or depreciation, and current operating expenses; and, on the other hand, the right of the public to have no more exacted than the services in themselves are worth.- Kennebec Water Dist. v. Waterville, 97 Me. 185, 54 Atl. 6, 60 L. R. A. 856.

A railroad is entitled to fix such tariff of charges as will yield a fair compensation for the transportation of freight and assure that the net profits arising from the entire business, after payment of all the operating expenses, will pay a reasonable interest on the value of its property.-Ala. & V. R. Co. v. R. R. Commission, 86 Miss. 667, 38 So. 356.

A public service corporation is entitled to earn an amount sufficient to provide a sinking fund for the discharge of its indebtedness, in addition to paying the interest thereon.- Brymer v. Butler W. Co., 179 Pa. 231, 36 Atl. 249.

An act requiring a railway to afford all reasonable facilities for the receiving, etc., of traffic, does not require it to maintain a station at a loss.- Darlaston Local Board v. London & N. W. R. Co., 1894, 2 Q. B. D. (Eng.) 694.

[33]

Right to earn profit on every part of road and every service rendered.

The Corporation Commission of North Carolina ordered a railroad to run its trains so as to make connections with those of another line. The railroad objected to the order on the ground, amongst others, that to obey the order would necessitate the running of another train, which could not be done with profit.- Held, that as the primal duty of a carrier is to furnish adequate facilities to the public, that duty may well be compelled, although by doing so as an incident some pecuniary loss from rendering such service may result. The mere incurring of a loss from the performance of such a duty does not, in and of itself, necessarily give rise to the conclusion of unreasonableness.- Atlantic Coast Line R. Co. v. North Carolina Corp. Commn., 206 U. S. 1, 27 Sup. Ct. R. (U. S.) 585, affg. s. c. 137 N. C. 1, 49 S. E. 191.

A state commission may reduce the freight upon a particular article, provided the companies are able to earn a profit upon their entire intrastate business, and the burden of proof to show such unprofitableness is on the carrier:— Minneapolis & St. L. R. Co. v. Minnesota, 186 U. S. 257, 22 Sup. Ct. R. (U. S.) 900, affg. s. c. 80 Minn. 191, 83 N. W. 60.

A railroad cannot claim to earn profit from every mile of its lines, but can only claim a profit upon the operation of its entire line.- St. Louis & S. F. R. Co. v. Gill, 156 U. S. 649, 15 Sup. Ct. R. (U. S.) 484, affg. s. c. 54 Ark. 101, 15 S. W. 18.

While a railroad is not entitled to earn a profit on every mile of its road, nor upon every article carried by it, nevertheless it is entitled to earn a reasonable profit upon its entire intrastate business.— Southern R. Co. v. McNeill, 155 Fed. 756.

It is not a sufficient objection to a regulation compelling a street railroad company to operate its cars all night, that a compliance with the order would be unprofitable.-Mayor v. Dry Dock, E. B. & B. R. Co., 133 N. Y. 104, 30 N. E. 563.

[34] Reasonableness a question of fact.

Reasonableness of classifications,- see ante, note [27].
Reasonableness of through rates,- see ante, note [28].

Discretion of carrier in fixing rates,- see ante, § 26, note [28]. Burden of showing unreasonableness of rates,- see ante, § 26, note [34].

Reasonableness of switching charges,- see ante, § 27, note [14]. Presumption of legality of rates filed and posted,- see ante, § 28, note [14].

The reasonableness of a rate is a question of fact.- Illinois Cent. R. Co. v. Interst. Com. Commission, 206 U. S. 441, 27 Sup. Ct. R. (U. S.) 700; Interst. Com. Commission v. Ch. G. W. R. Co., 141 Fed. 1003.

The only rule that can be laid down for determining the reasonableness of rates, is that each particular rate shall be judged on its particular facts. Minneapolis & St. L. R. Co. v. Minnesota, 186 U. S. 257, 22 Sup. Ct. R. (U. S.) 900, affg. s. c. 80 Minn. 191, 83 N. W. 60.

Whether in a particular case there has been an undue preference or discrimination, is a question of fact depending on the matters proved in each case.- · Interst. Com. Commission v. Ala. Mid. R. Co., 168 U. S. 144, 18 Sup. Ct. R. (U. S.) 45, affg. s. c. 74 Fed. 715, 69 Fed. 227.

[35] Test of reasonableness.

Published rates the standard of reasonableness,- see ante, § 28, note [13].

Lowest rate given should be the standard,- see ante, § 31, note [19].

The equal protection of the laws - the spirit of common justice — forbids that one class should be compelled by law to suffer loss that others may gain. The court will not look with favor on legislation to secure the common benefit at the expense of a single class.- Reagan v. Farmers' Loan & T. Co., 154 U. S. 362, 14 Sup. Ct. R. (U. S.) 1047.

The fundamental question is: Will the rates prescribed by the state pay the expenses of doing the local business and leave to the carrier a reasonable compensation upon the fair value of the property it employs in performing the services.- Northern Pac. R. Co. v. Keyes, 91 Fed. 47.

The test of the reasonableness of a rate is not the amount of profit in the business of the shipper, but whether the rate yields a reasonable compensation for the service rendered.- Central Y. P. Assn. v. Ill. Cent. R. Co., 10 Inters. Com. R. 505; Tift v. So. R. Co., 10 Inters. Com. R. 548.

The reasonableness of rates relates to both consumer and company. Rates must be reasonable to both when possible, but when they cannot be to both, they must be to the customer.- Brunswick Water Dist. v. Water Co., 99 Me. 371, 59 Atl. 537.

[36] When railroad considered independent line.

Merely because a railroad is operated in connection with other roads owned by the same company, but operated under different charters, with the result that its earnings are increased and operating expenses decreased, does not prevent its being considered an independent line, in determining the reasonableness of rates fixed by the state.- Louisville & N. R. Co. v. Brown, 123 Fed. 946.