itself a regulation. If, then, rates are and always have been regulated by law, that law, like any other, may be changed by the legislature, since no one has a vested interest in any rule of the common law. A legislative regulation of rates is therefore a mere instance of a change in the common law, which it is entirely within the power of the legislature to make; and in doing so it is not exercising judicial functions. This view of the question has been universally followed, 10 The distinction between legislative and judicial functions is a vital one, and cannot be altered either by legislative act or by judicial decree.11 Legislation prescribes rules for the future; litigation determines rights and wrongs for the past. To prescribe a tariff of rates for the future is therefore not a judicial act; to determine whether existing or prescribed rates and charges are unreasonable, on the other hand, is a judicial act.12 § 1305. Power to fix rates not strictly legislative. But while the power to fix rates may be exercised directly by the legislature, it is not, strictly speaking, a legislative power; but rather a so-called administrative function. Mr. Justice Brewer in the Circuit Court, in Chicago & N. W. Ry. v. Dey, 13 used on this point language which has often been quoted: "While, in a general sense, following the language of the Supreme Court, it must be conceded that the power to fix rates is legislative, yet the line of demarkation between legisla 10 Interstate Commerce Commission v. Cincinnati, N. O. & T. P. R. R., 167 U. S. 499, 42 L. Ed. 243, 17 Sup. Ct. 896 (1897); Louisville & N. R. R. v. Brown, 123 Fed. 946 (1903); State v. Wilson, 121 N. C. 472, 28 S. E. 553 (1897). 11 Western Union Tel. Co. v. Myatt, 98 Fed. 335 (1899). 12 Reagan v. Farmers' L. & T. Co., 154 U. S. 362, 38 L. Ed. 1014, 14 Sup. Ct. 1047 (1894); Smyth v. Ames, 169 U. S. 466, 42 L. Ed. 819, 18 Sup. Ct. 418 (1898); Wheeler v. No. Col. Irr. Co., 10 Colo. 582, 17 Pac. 487 (1888); Brush E. I. Co. v. Consolidated T. & E. Co., 15. N. Y. Supp. 811 (1891). 13 35 Fed. 866, 874 (1888). tive and administrative functions is not always easily discerned. The one runs into the other. The law books are full of statutes unquestionably valid, in which the legislature has been content to simply establish rules and principles, leaving execution and details to other officers. Here it has declared that rates shall be reasonable and just, and committed what is, partially at least, the mere administration of that law to the railroad commissioners. Suppose, instead of a general declaration that rates should be reasonable and just, it had ordered that the rates should be so fixed as to secure to the carrier above the cost of carriage 3 per cent. upon the money invested in the means of transportation, and then committed to the board of railroad commissioners the fixing of a schedule to carry this rule into effect, would not the functions thus vested in such a board be strictly administrative? While, of course, the cases are not exactly parallel, yet the illustration suggests how closely administrative functions press upon legislative power, and enforce the conviction that that which partakes so largely of mere administration should not hastily be declared an unconstitutional delegation of legislative power." The difficulty felt in this passage in distinguishing legislative and administrative functions is a real one; but it is usually not necessary to make a sharp distinction; and for the present it is enough to point out that the function, while not judicial, is not in the strict sense legislative.14 § 1306. Power to fix rates executive or administrative. Where it is necessary to find a place for the rate-fixing power in one of the three departments into which government is commonly divided, it undoubtedly forms part of the executive department. We have seen that the power is neither judicial nor legislative; it does not involve the power to make laws, or to 14 Western Union Tel. Co. v. Myatt, 98 Fed. 335 (1899). interpret and apply them, but to aid in carrying the laws into effect. 15 TOPIC B-METHOD OF EXERCISING THE POWER TO FIX RATES. § 1307. Fixing rates by statute. In the United States, where the division of powers is strictly enforced, it is well settled that the legislature has power to limit the amount of charges by railroad companies for the transportation of persons and property within its own jurisdiction, unless restrained by some contract or other in the charter of the railroad.1 15 In re Railroad Comrs., 15 Neb. 679, 50 N. W. 276 (1883); Nebraska Tel. Co. v. Cornell, 59 Neb. 737, 82 N. W. 1 (1900). 1 UNITED STATES: (1876), Munn V. Illinois, 94 U. S. 113, 24 L. Ed. 77 affirming Munn v. Peo., 69 Ill. 80; Chicago, B. & Q. R. R. v. Iowa, 94 V. S. 155, 24 L. Ed. 94 (1876); Peik v. Chicago & N. W. Ry., 94 U. S. 164, 24 L. Ed. 97 (1876); Winona & S. P. R. R. v. Blake, 94 U. S. 180, 24 L. Ed. 98 (1876); Ruggles v. Illinois, 108 U. S. 526, 531, 27 L. Ed. 812, 2 Sup. Ct. 832 (1883), affirming Ruggles v. Peo., 91 Ill. 256; Railroad Commission Cases, 116 U. S. 307, 29 L. Ed. 636, 6 Sup. Ct. 334 (1886); Dow v. Beidelman, 125 U. S. 680, 31 L. Ed. 841, 8 Sup. Ct. 1028 (1888); Chicago, M. & S. P. Ry. v. Minnesota, 134 U. S. 418, 33 L. Ed. 970, 10 Sup. Ct. 462 (1889); Chicago & G. T. Ry. v. Wellman, 143 U. S. 339, 36 L. Ed. 176, 12 Sup. Ct. 400 (1892), affirming s. c. 83 Mich. 592, 47 N. W. 489; Budd v. New York, 143 U. S. 517, 36 L. Ed. 384, 12 Sup. Ct. 468 (1892), affirming People v. Budd, 117 N. Y. 1, 22 N. E. 670, B. & W. 79; Chesapeake & P. Tel. Co. v. Manning, 186 U. S. 238, 46 L. Ed. 1144, 22 Sup. Ct. 881 (1902). FEDERAL COURTS: Atlantic & P. Co. v. United States, 76 Fed. 186 (1896). STATE COURTS: Arkansas-Missouri Pac. Ry. v. Smith, 60 Ark. 221, 29 S. W. 752 (1895). Indiana-Hockett v. State, 105 Ind. 250, 5 N. E. 178 (1885). Michigan-Pingree v. Michigan Cent. R. R., 118 Mich. 323, 76 N. W. 635 (1898). § 1308. Legislation must be general. In Lake Shore & Michigan Southern Railway v. Smith,2 the court considered the constitutionality of a statute which compelled the railroad to sell 1,000-mile tickets at a reduced rate. The majority of the court held that the legislature having already adopted a schedule of maximum rates it could not make statutory exceptions. Mr. Justice Peckham said: "We cannot regard this exceptional legislation as the exercise of a lesser right which is included in the greater one to fix by statute maximum rates for railroad companies. The latter is a power to make a general rule applicable in all cases, and without discrimination in favor of or against any individual. It is the power to declare a general law upon the subject of rates beyond which the company cannot go, but within which it is at liberty to conduct its work in such a manner as may seem to it best suited for its prosperity and success. This is a very different power from that exercised in the passage of this statute. The act is not a general law upon the subject of rates, establishing maximum rates, which the company can in no case violate. The legislature, having established such maximum as a general law, now assumes to interfere with the management of the company while conducting its affairs pursuant to and obeying the statute regulating rates and charges, and notwithstanding such rates it assumes to provide for a discrimination—an exception in favor of those who may desire and are able to purchase tickets at what might be called wholesale rates; a discrimination which operates in favor of the wholesale buyer, leaving the others subject to the general rule. And it assumes to regulate the time in which the tickets purchased shall be valid, and to lengthen it to double the period the railroad company has ever before provided. It thus invades the general right of a company to conduct and manage its own affairs, and compels it to give the use of its property for less than the general rate to those who come 2173 U. S. 684, 43 L. Ed. 858, 19 Sup. Ct. 565 (1899). within the provisions of the statute; and to that extent it would seem that the statute takes the property of the company without due process of law." To make it clear that this language applied only to the case of an attempted statutory exception to the general schedule of charges, the learned judge added: "We speak of the general right of the company to conduct and manage its own affairs; but, at the same time, it is to be understood that the company is subject to the unquestioned jurisdiction of the legislature in the exercise of its power to provide for the safety, the health, and the convenience of the public, and to prevent improper exactions or extortionate charges from being made by the company." § 1309. Fixing rates by subordinate body. It is much more convenient for the legislature to confer on a subordinate administrative body the power to fix rates than to do so itself. This has been done in England by placing the power in the Board of Trade, one of the executive or rather administrative departments of the government. In this country, the power has, in the last quarter century, not infrequently been referred to an administrative commission. The reason for delegating the power of fixing rates in detail to a commission has never been better expressed than by Mr. Justice Brewer:3 "The reasonableness of a rate changes with the changed condition of circumstances. That which would be fair and reasonable to-day, six months or a year hence may be either too high or too low. The legislature convenes only at stated periods; in this State once in two years. Justice will be more likely done if this power of fixing rates is vested in a body of continual session than if left with one meeting only at stated and long intervals. Such a power can change rates at any time, and thus meet the changing conditions of circumstances. While, 3 Chicago & N. W. Ry. v. Dey, 35 Fed. 866, 875 (1888). |