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the libelant presented a license which it had | considered as earned on shipment of the procured from the British government. On Au- goods and is to be retained by the vessel's gust 27, 1917, the President made a further owners, vessel or cargo lost or not lost." The proclamation, effective August 30, 1917, where- declaration is clear, and, in anxiety of purby shippers of varnish and all other cargo destined for Gothenburg, Sweden, were required pose, uses some tautology. The words "preto procure licenses before the same could be paid freight is to be considered as earned" exported. The libelant thereupon made appli- declare a completed right and carried the cation for such a license, and the claimant held power of retention without the expression of its vessel in port until October 8th, to see if the latter. And the expression of the right such licenses could be procured, before begin- and the power cannot be put aside. Counsel, ning the discharge of the cargo. Unless ship- however, would make them purposeless and ments were accompanied by the aforesaid li- would consider the bill of lading as if they censes they were not allowed by the men-of-war belonging to the Allies to proceed to destina- were not contained in it, and urges that the tion. On or about October 8th the United only effect of the refusal of clearance to the States, acting through the Exports Adminis- ship was the "commercial frustration of the trative Board, refused the application for a li- adventure" working a dissolution of the concense to transport the goods mentioned in the tract, absolving from performance but relibel, and other cargo destined for Gothenburg, quiring the restitution of the payments that and claimant thereupon began to unload the were made as the consideration of performcargo of the Bris and concluded the discharge on October 22, 1917. The claimant continued ready and willing to carry said cargo forward if a license therefor were obtained by libelant. The libelant took redelivery of the cargo at the port of shipment and made a demand upon the claimant that the claimant should return the freight paid, which demand was refused. The question aforesaid is as follows:
“1. Did the bill of lading contract justify the carrier, under the facts stated, in refusing to refund the prepaid freight?"
We are not insensible to the appealing force of the contentions nor to the strength of the argument advanced *to support them, but the contract determines against them and the reasons for assigning to it that effect we have given in our opinions in the other cases.
We, therefore, answer the questions certified in the affirmative. So ordered.
Clause 6 of the bill of lading is as follows: "*** Prepaid freight is to be considered as earned on shipment of the goods and is to be retained by the vessel's owners, vessel or cargo lost or not lost, or if there be a forced interruption or abandonment of the voyage at DETROIT UNITED RY. CO. v. CITY OF a port of distress or elsewhere. *
The material parts of clause *7 are as fol- (Argued Dec. 9 and 10, 1918. lows:
"Also, in case the ship shall be prevented from reaching her destination by *
or the hostile act of any power," the master may wait until the impeding obstacle be removed "or discharge the goods into any depot or at any convenient port or bring her cargo back to port of shipment where the ship's responsibility shall cease.
(248 U. S. 429)
1. MUNICIPAL CORPORATIONS 696 - ExPIRATION OF STREET RAILROAD FRANCHISEREMOVAL OF TRACKS.
A city may compel a street railway company to remove its tracks from streets, its franchises for which have expired.
CHARGES ORDINANCES-CONNECTING LINES.
Clause 2 should be considered. It exempts 2. CARRIERS the carrier from loss by certain causes or "by arrest and restraint of princes, rulers or peoples."
1918, as to street car fares and transfers held to apply to entire street railway system, consisting of several lines, franchises for some of which were still in force, while those for others had expired.
We think the case is within the principle of the decision of the cases submitted with it. In this case, however, it is urged that the clause relied on by the ship to justify the retention of the advance of freight does not 3. CARRIERS 12(10)—STREET RAILROADS— contain the word "irrevocable" and that upCHARGES ORDINANCES-CONNECTING Lines. on that word stress was put by the Circuit A section of an ordinance, explicitly fixCourt of Appeals and presumably by this ing fares for trips over two or more street car court. The word undoubtedly is one of in-lines, whether or not franchise lines, and limittensity but its absence does not remove the meaning or intention of its associates. Their declaration is that "prepaid freight is to be
ing maximum charge, without charge for transfers, held, in view of definition in another section of a continuous trip as a journey from one point to another in the city, whether on one
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
-ORDINANCE REQUIRING SERVICE.
For a city after the franchise of some of the lines of a street railway company have expired to pass an ordinance to continue in force for a year unless sooner repealed, with penalties for its violation, for continued operation of the company's system, with fares and transfers over the various lines, whether or not having a franchise, amounts to a grant to the company for further operation of the system, during the life of the ordinance.
6. CARRIERS 12(9)-CONSTITUTIONAL LAW 135-OBLIGATION OF CONTRACT-STREET RAILROAD FRANCHISE-ORDINANCE.
The obligation of the franchise contract for a line of a street railway company, fixing the fare on such line at five cents without transfer, is impaired, in the case of a continuous trip be'ginning on a non-franchise line and extending over it and a franchise line, by an ordinance requiring all such service for five cents.
ordinance was passed August 9, 1918. It is printed in the margin.1
The bill attacks the ordinance upon two constitutional grounds: First, that it impairs the obligation of the company's existing contracts; second, that it is confiscatory and hence deprives the company of its property without due process of law. The suit came on for hearing before the district judge upon the judge denied the application and-upon an application for a temporary injunction,
his own motion dismissed the bill.
The question upon this appeal is: Did the
1 An ordinance to fix and establish maximum rates of fares and charges which may be exacted and received by persons, corporations or partnerships operating street railways for the carriage of passengers within the city of Detroit, and to fix a penalty for the violation thereof.
It is hereby ordained by the people of the city of Detroit:
Section 1. No person, partnership or corporation operating a street railway on the streets of the city of Detroit, for the carriage of passengers for hire, shall charge more than five cents for a single ride, or six tickets for twenty-five cents, per person for one continuous trip within the city over any line which is now operated or shall hereafter be operated without a franchise fixing the rate of fare.
Sec. 2. No such person, partnership or corporation shall charge a higher rate of fare upon any line now or hereafter operated under a franchise contract than is fixed by such franchise.
Sec. 3. Between the hours of 5 and 6:30 a. m. and
4:45 and 5:45 p. m. tickets in strips of eight for twenty-five cents shall be sold on all cars on all lines except where such sale would be contrary to the terms of a franchise contract, which tickets shall entitle the holder to the same rights between said hours as the payment of a five-cent fare would.
Sec. 4. Where a trip is over two or more lines,
whether franchise lines or not, the maximum fare acted which raises the total charge to more than
shall be five cents, and no transfer fee shall be ex
five cents or six for twenty-five cents.
Sec. 5. A continuous trip means one journey from
Mr. Justice Clarke, Mr. Justice Holmes, and point to point within the city, whether the same is Mr. Justice Brandeis dissenting.
Appeal from the District Court of the United States for the Eastern District of Michigan.
Suit by the Detroit United Railway Company against the City of Detroit, Application for temporary injunction was denied, and bill dismissed, and complainant appeals. Reversed.
made upon one car or one line or by means of transferring from car to car or from line to line. Each such person, partnership or corporation, and the officers, agents, servants and employés thereof, shall, upon demand, furnish proper transfers to carry into effect the provisions of this section. The provisions of this ordinance shall not be construed as an attempt to impair the obligation of any valid contract, but shall apply to and govern all such street railway passenger traffic in the city, except where the same is governed by the provisions of such contract.
Sec. 6. Any such person, partnership or corporation which shall violate the provisions of this ordi
Mr. Elliott G. Stevenson, of Detroit, Mich., nance, or shall attempt to do so, and any officer, for appellant.
Messrs. Allan H. Frazer and Richard I. Lawson, both of Detroit, Mich., for appellee.
agent, servant or employé who shall order or direct any such violation or attempted violation of the provisions of this ordinance, shall be guilty of an offense, and upon conviction shall be fined not to exceed five hundred dollars, or imprisoned in the Detroit House of Correction for not to exceed ninety
"Mr. Justice DAY delivered the opinion of days, or shall be both fined and imprisoned in the the Court.
The Detroit United Railway Company brought this action in the United States District Court for the Eastern District of Michigan to enjoin the city of Detroit from enforcing the provisions of an ordinance regulating street railway fares in that city. The
discretion of the court, for each violation.
welfare in the case of an emergency involving the Sec. 7. This ordinance is passed for the public peace, health and safety of the people of the city. and it is ordered to take immediate effect. It may be amended or repealed at any time by the common council of the city of Detroit. Unless so amended or repealed it shall remain in force for one year from August 9, 1918.
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
bill, taking its allegations to be true, state Į tem was the only means of transportation of grounds for relief to which the company was entitled upon the facts set forth? The action of the District Court was equivalent to sustaining a demurrer to the bill.
such employés from their homes to their places of employment; and that the interruption of the operation of the company's system, or the separation in operation of the franchise from the non-franchise lines, would paralyze the industrial and business life of the city, throw thousands of its residents out of employment, and result in shutting down its industrial plants and factories. Allegations follow, setting forth the value of the company's property, and stating that the effect of the ordinance, if enforced, will be to require the operation of the company's system at a deficit, and, consequently, with no return on the investment.
[1, 2] The learned District Judge answered the contention of the company by holding, in substance, that as to the non-franchise lines the remedy of the company was to abandon the service and take its property from the city streets, and that as to the franchise lines the exception of the fifth section of the ordinance saved the company's contract rights from impairment. There can be no question that it was within the city's power to compel the company as to its non-fran
*The bill alleges that the complainant company is the owner of all the street railways in the city of Detroit, constituting a system of tracks of upwards of 270 miles. The sources of title of the company are set forth in the bill, and shown by many exhibits. It is sufficient for the present purpose to say: That the system consists of a considerable mileage of tracks upon which the franchises have expired; upon other portions of the system there are unexpired franchises, some of them derived from villages in which the roads were constructed, which villages were subsequently incorporated into the city. That from December 1, 1917, its system was operated, except the so-called three-cent lines, upon terms as follows: Five-cent cash fares for each passenger carried on or over its lines, including so-called universal transfers, with workingmen's tickets, eight for twenty-five cents, between certain hours, and on the so-called three-cent lines a cash fare of five cents, with eight tickets for twenty-five cents between certain hours; good only on such three-cent lines with the privilege of a transfer on payment of a five-troit United Railway Co. v. Detroit, 229 U. cent cash fare, and also with the privilege S. 39, 33 Sup. Ct. 697, 57 L. Ed. 1056. The of purchase of six tickets for twenty-five city did not do so. Instead of taking such accents, also good between certain hours. It is tion it passed the ordinance in controversy, averred that afterwards it became necessary providing for the continued operation of *the 'to increase rates of fare. The bill recites the company's system. This ordinance has apdemand of the employés of the company for plication to the entire street railway sysincreased wages, which was refused; that tem. In section 1 it provides that no more a submission of the controversy was made than five cents shall be charged for a single to the War Labor Board; that the board ride, or six tickets for twenty-five cents, for after a hearing awarded a substantial in- one continuous trip through the city over any crease of wages, and recommended an in-line operated without a franchise. crease in passenger fares to enable the company to meet this cost. The bill alleges that the increase made by the War Labor Board amounted to about $2,000,000 per annum. The company petitioned the city for an increase of rates of fare, and this petition was denied.
On August 7, 1918, the company put in force a schedule of its own, making single fares six cents, with ten tickets for fifty-five cents, cash fare or tickets good on connecting or intersecting lines within the city. It is contended that this action of the company was without legal authority. Whether this was authorized or not, is not an issue involved in this case, and we express no opinion concerning it. The matters involved in this bill concern the validity of the ordinance passed August 9, 1918.
It is further alleged that Detroit is a city of a population exceeding 750,000; that it is an industrial city with much the larger part of its male population employed in industrial plants within and adjacent to the city; that the operation of the company's railway sys
chise lines to remove its tracks from the
streets of the city. This was settled in De
2 purports to preserve the right to charge franchise rates when fixed by contract. Section 3 provides for fares, eight tickets for twenty-five cents, except when such fares are contrary to contract rights. Section 4 provides that where a trip is over two or more lines, whether franchise or not, the maximum
fare shall be five cents, or six tickets for twenty-five cents, and no transfers shall be exacted which raise these rates of fare. Section 5 defines a continuous trip to mean a journey from one point in the city to another, whether on one car line or by means of transfers, and the company is required to furnish transfers to carry the provisions of the ordinance into effect. It is further provided that the ordinance is not to be construed as an attempt to impair the obligation of any valid contract, but shall apply to all street railway passenger traffic in the city except when the same is governed by the provisions of a contract. Section 6 provides for fines or imprisonment for violations of the provisions of the ordinance. Section 7 provides that the ordinance shall be in effect for
the term of one year from August 9, 1918, unless sooner amended or repealed.
[3, 4] The allegations of the bill, which for the present purposes must be taken as true, are ample to the effect that the enforcement of this ordinance will result in a deficit to the company. We cannot construe the exception of section 5, having reference to existing franchise contracts, in such way as to modify the requirements of section 4 which in explicit terms fixes the fares for trips over two or more lines whether franchise lines or not, and limits the maximum fare without charge for transfers. This must be read in view of the definition of a continuous trip in section 5 as meaning a journey from one point to another point in the city whether the same is made on one car line or by means of transfers from car to car or from line to line. The exception in section 5 can have no further effect consistently with the other provisions of the ordinance, particularly those of section 4, than to regulate fares where trips are wholly upon franchise lines. A principal ground upon which the bill was dismissed by the District Court was the view of the learned judge that the power to compel the company to remove its tracks from the streets involving the non-franchise roads included the right to fix terms of continued operation upon such lines, whether remunerative or not. We cannot agree with this view. In our opinion the case in this respect is ruled in principle by Denver v. Denver Union Water Co., 246 U. S. 178, 38 Sup. Ct. 278, 62 L. Ed. 649. In that case the franchise of a water company had expired, and the city might have refused the further use of the streets to the company. Instead of doing this it passed an ordinance fixing rates and requiring certain duties of the company. We held that in that situation the company was entitled to make a reasonable return upon its investment. So here, the city might have required the company to cease its service and remove its tracks from the non-franchise lines within the city. Instead of taking this course the city enacted an ordinance for the continued operation of the company's system, with fares and transfers for continuous trips over lines composing the system whether the same had a franchise or not. This action contemplated the further operation of the system, and fixed penalties for violations of the ordinance. By its terms the ordinance is to continue in force for the period of one year, unless sooner amended or repealed. This was a clear recognition that until the city repealed the ordinance the public service should continue, with the use of the streets essential to carry on further service. Within the principles of the *Denver Case this service could not be required without giving to the company, thus affording it, a reasonable return upon its investment. In the Denver Case we said:
"The very act of regulating the company's rates was a recognition that its plant must continue, as before, to serve the public needs. The fact that no term was specified is, under the existing circumstances, as significant of an intent that the service should continue while the need existed as of an intent that it should not be perpetual."
In the present case the service upon the terms fixed in the ordinance is continued for a year, the city reserving the right to repeal the ordinance at any time.
 It is clear that the city might have taken a different course by requiring the company to remove its tracks from the nonfranchise lines; it elected to require continued maintenance of the public service; doubtless because it was believed that it was necessary in the existing conditions in the city to continue for a time at least the right of the railway company to operate its lines. This amounted to a grant to the company for further operation of the system, during the life of the ordinance. For this public service it was entitled to a fair return upon its investment. Elements to be taken into consideration in valuing the property of the company in estimating a fair return are not involved in this case. If the allegations of the bill are true, and for present purposes eration of the railroad system of the comthey must be so regarded, the continued oppany upon the fares fixed in the ordinance will result in a deficit, and deny to the company due process of law within the meaning of the federal Constitution.
 As rates of fare are fixed on some of the existing franchise lines at five cents without transfers, it would follow as to continuous trips over such franchise and non-franchise lines, such trips comprehending much of the trans*portation required, the latter lines would be without compensation for the service rendered. Furthermore, when a continuous trip begins on a non-franchise line and is over a franchise line and a non-franchise line, the former having the right to charge five cents for a trip over it, the effect would be to impair the obligation of the franchise contract. Detroit United Railway v. Michigan, 242 U. S. 252, 37 Sup. Ct. 87, 61 L. Ed. 268.
In our view the allegations of this bill for the purposes of the demurrer sufficiently alleged violations of the Constitution of the United States in the action of the city in passing and enforcing the ordinance in controversy. The District Court should have entertained the bill, heard the application for a temporary injunction, and proceeded to a hearing and determination of the case in due course.
Mr. Justice CLARKE dissenting.
The relation between the city and the railway company, when the ordinance which the
court tolds unconstitutional was passed, was and in December, *1917, the company did witlethis: draw from it and thereafter was allowed to
The company owned three classes of tracks, charge, on other than its three-cent franchise viz.:
(a) Those in the business and residence streets most productive of traffic, constituting the greater part of the lines of the company. Its authority to maintain these tracks expired in 1909-1910, and they are designated in the record as "non-franchise lines." It will be convenient to refer to the streets in which these lines are located as "non-franchise streets."
(b) Tracks designated as "three-cent franchise lines" (Exhibit T), also largely in business and important residence streets. The company had franchises for these lines under which it was obliged to sell eight tickets for twenty-five cents good from 5:45 a. m. to 8 o'clock p. m. and six tickets for twenty-five cents good during the *remainder of the twenty-four hours. Such tickets entitled the holders to transfer privileges only on all three cent lines.
(c) Disconnected sections of track, of small mileage, in streets remote from the business parts of the city. For these lines the company had unexpired franchises granted by villages and townships before the extension of the city limits included them, which allowed a fare of five cents, in some places, in others five cents with transportation to the City Hall. The mileage of these grants varied from five miles to "six blocks" in length; they are described in the bill as lying, some to the north, others to the south, others to the east and others to the west of the city, as it was when the grants were made and, thus widely separated, they had no connection one with the other, except over non-franchise or three cent franchise tracks. These are designated
as "five-cent franchise lines."
It was stated at the bar by counsel for the city, and not questioned, that there were about 150 miles of non-franchise lines, about 65 miles of the three-cent franchise lines, and only 55 miles of five-cent franchise lines. In their brief counsel for the company say that the larger part of the company's lines had been operated for several years prior to December, 1917, on what was known as the "day-to-day agreement" (and see Detroit United Railway v. Detroit, 229 U. S. 39, 42, 33 Sup. Ct. 697, 57 L. Ed. 1056), under which a rental was paid to the city for the use of the streets and the company was allowed to charge a cash fare of five cents or seven tickets for twenty-five cents, except during an hour and a half in the morning and one hour in the evening, when tickets sold eight for twenty-five cents were accepted. For these fares transfers were given over the entire lines of the company. Either party could withdraw from this arrangement at any time,
lines, a cash fare of five cents, but with eight tickets for twenty-five cents, good for one and a half hours in the morning and for one hour in the evening. Universal transfers were allowed for these fares.
This arrangement continued until August 2, 1918, when, not satisfied, the company proposed to the city a five-cent fare with a charge of one cent for a transfer over all lines in the city one-fare zone, or, in the alternative, a six-cent fare with ten tickets for fifty-five cents and universal transfers, the franchise rates on the three-cent lines to continue, except that for the fares last named universal transfers would be given.
This proposal the city rejected, and thereupon the company, without any authority from the city, put into operation the second proposal above stated, allowing transfers over any connecting or intersecting line within the city limits. In response to this action of the railway company the city passed the ordinance which, for two reasons, the court has held invalid, viz.:
(1) Over certain of the franchise lines a five-cent rate of fare without transfers was provided for in the grants, and because section 4 of the ordinance required transportation "where the trip is over two or more lines, whether franchise lines or not," without transfer charge, it is held that, if this provision were enforced, the effect would be to impair such five-cent franchise contracts and that the ordinance is therefore void.
(2) Interpreting the ordinance as a grant to the company of the right to operate its lines, franchise and non-franchise, at rates which the bill alleges to be non-compensatory,
the court holds it invalid because it would
deprive the company of its property without due process of law.
The case must be considered on the allegations of the *bill as if on demurrer and my clusions of the court are as follows: reasons for dissenting from both of these con
As to the first. It is not anywhere alleged in the bill that the "five-cent franchise lines" (no complaint is made as to the three-cent lines) can be operated separately and profitably or that less income would be realized from them
if operated under the terms of section 4 in conjunction with the non-franchise lines than if they were operated as separate properties, if such thing be possible, charging the fivecent franchise rate without transfers. Without such an allegation it is pure conjecture to say that the company would suffer loss and that its contract would be impaired by giving effect to section 4. He who would strike down a law must show that the alleged unconstitutional feature injures him and operates to deprive him of rights protected by the