§ 4556. Definiteness of orders. The orders of the commission must be definite and specific, in order to be enforceable.29

§ 4557. Review by courts in general-Statement of questions involved. The question of review by the courts of governmental regulations of corporations has been a much litigated question. First, the question whether the courts have any power to review such regulations, while at one time denied so far as the reasonableness of rate regulations was concerned, is now well settled in the affirmative not only as to other regulations but also as to rate regulations.30 Second, conceding there is a remedy in the courts, what is the particular remedy to be employed? This is generally regulated by statutory provisions.31 Third, how far may the court go in reviewing the regulation? Can it hear new evidence, are the findings of the commission binding on it as to the facts, may it substitute its judgment for that of the commission, and like questions are presented, many of which are answered by the provisions of the governing statute.

The courts, independently of statute, have power to enforce or set aside an order of the commission.32 However, the remedy may be fixed by statute, and sometimes the statutory remedy is exclusive.33 In considering the right to review, and the scope of review, it is always necessary to keep in mind whether the review is governed by a statute. Generally, the same rules apply without regard to whether the order reviewed is one regulating rates or is some other regulation, and, so far as the right to attack the order is concerned and the scope of the review, without regard to whether the proceeding is one brought by the state or commission to enforce the order or is one brought by the corporation or others to set aside or enjoin the order. However, the scope of the review sometimes is affected by whether the proceeding to review is in the nature of an original action (although perhaps designated by the statute as an appeal), or is merely in the nature of an appeal without any trial de novo, or is an appeal from a decision of a court reviewing the order.

The statutes, so far as they authorize a review of orders of the commission, vary greatly in the different states so that it is almost impossible to lay down more than a very few governing rules which are generally applicable. Some of these statutes provide for an action in the nature of a suit in equity, in a trial court, to set aside the order

242, 131 Pac. 980, and see § 4560, infra.

29 State v. Chicago, M. & St. P. R.

Co., 16 S. D. 517, 94 N. W. 406.

30 See 4558, infra.

31 See § 4558, infra.
32 See § 4562, infra.
33 See § 4562, infra.

H

of the commission, with the findings of facts by the commission conclusive until rebutted by new evidence, and some statutes designate this statutory action as an appeal.34 Other statutes provide for a review of the order in the first instance by the supreme court, either solely upon the evidence introduced before the commission or with the right to introduce other evidence.35 Other statutes provide still different methods of review. Moreover, even where the statutes of particular states agree upon the method of review, the scope of the review is differently provided for. The result is that only by a careful study of the governing statute (or constitutional provision) in the particular jurisdiction can the question of judicial review be solved, aided by a few general rules set forth herein. Generally, the orders of a commission cannot be collaterally attacked.36

§ 4558. Power to review. There is no right, independently of statute, to resort to the courts where the commission denies the relief sought.37 Otherwise, it is well settled not only that courts have power to review governmental regulations of corporations although there is no statute providing therefor, in an injunction suit 38 or other appropriate form of action, but also that the legislature cannot constitutionally cut off the right of the courts to review such regulations by making them conclusive or otherwise. If a statute makes the orders of a commission conclusive, so as to preclude judicial review, it is unconstitutional as depriving the company regulated of property without due process of law. This was decided as to rate regulations in 1889 in a leading case in the Supreme Court of the United. States,39 and is also laid down as the rule in other courts; 40 and in a recent case in the Federal Supreme Court, affirming the rule, it is said: "And this right to a judicial determination exists whether the deprivation is by a rate statute-passed without a hearing or by administrative orders of a Commission made after a hearing.

For rates made by the General Assembly, or administrative orders made by a Commission are both legislative in their nature [citing cases], and any party affected by such legislative action is entitled, by the due process clause, to a judicial review of the question as to whether he has been thereby deprived of a right protected by the Constitution."41 Moreover, the right to a judicial review is denied if the party to be affected can appeal to the courts only at the risk of having to pay penalties, imposed by statute, so great that it is better to yield to orders of uncertain legality than to ask for the protection of the law. However, the failure to expressly provide for an appeal to any court from the final order of the commission, or for a judicial review of the order, does not invalidate a statute, where it does not deny right of access to the courts for the purpose of determining any matter which would be the appropriate subject of judicial inquiry, since the right to resort to the courts exists independently of statute.

At one time, however, the power of the courts to review the reasonableness of rates fixed by law was denied, and while this rule laid down in Munn v. Illinois that the reasonableness of rates fixed by law was a question for the legislative department rather than the judicial department and therefore not subject to review by the courts, was followed by the federal courts as well as the state courts for a few years, the contrary rule was soon suggested by the Supreme. Court of the United States as the proper one, 45 and in later cases the Munn case was overruled on this point by the Federal Supreme Court by holding that the reasonableness of rates is a judicial question,46 which is now the well settled law. The following propositions as

41 Wadley Southern R. Co. V. Georgia, 235 U. S. 651, 660, 59 L. Ed.

405.

42 Wadley Southern R. Co. V. Georgia, 235 U. S. 651, 661, 59 L. Ed. 405, and see § 4427, supra.

43 Louisville & N. R. Co. v. Garrett, 231 U. S. 298, 310, 58 L. Ed. 229.

44 94 U. S. 113, 133, 24 L. Ed. 77. 45 Stone v. Farmers Loan & Trust Co., 116 U. S. 307, 331, 29 L. Ed. 636, 644.

46 Reagan v. Farmers Loan & Trust Co., 154 U. S. 362, 397, 38 L. Ed. 1014; Chicago, M. & St. P. R. Co. v. Minnesota, 134 U. S. 418, 461, 33 L. Ed. 970, 983.

47 United States. San Diego Land & Town Co. v. National City, 174 U. S. 739, 43 L. Ed. 1154, aff'g 74 Fed. 79; Spring Valley Water Co. v. San Francisco, 165 Fed. 667; Palatka Waterworks v. Palatka, 127 Fed. 161.

California. San Diego Water Co. v. San Diego, 118 Cal. 556, 38 L. R. A. 460, 62 Am. St. Rep. 261, 50 Pac. 633.

Illinois. Chicago v. Rogers Park Water Co., 214 Ill. 212, 73 N. E. 375, aff'g 116 Ill. App. 200.

Iowa. Cedar Rapids Water Co. v. Cedar Rapids, 118 Iowa 234, 91 N. W. 1081.

to the power of courts to review rates fixed by law are so clearly settled at the present time as to be beyond dispute, viz.:

1. The courts will review the reasonableness of rates fixed by the legislature, commission or municipality, to determine their reasonableness, at least to the extent of ascertaining if such rates deprive the corporation complaining of its property without due process of law.48

2. Such rates so fixed are presumed to be reasonable and hence the burden of proving the contrary is on the complaining party.49 3. Rates will not be set aside as unreasonable unless in a clear case where they are palpably and grossly unreasonable.50

4. The courts cannot themselves, upon finding the rates fixed by law to be unreasonable, fix other rates.51

In order to

§ 4559. Compliance with conditions precedent. authorize a review as provided for by statute, it is necessary that all conditions precedent required by the statute shall be fully complied with. For instance, in some states, by statute, the acts of the commission cannot be reviewed in the courts unless an application to the commission for a rehearing is made within a specified time.52 And in some states it is expressly provided by statute that no ground not set forth on a motion for rehearing before the commission can be urged in any court.58

If the rates are confiscatory, and fixed arbitrarily and without investigation they will be set aside by the court. Spring Valley Water-Works v. San Francisco, 82 Cal. 286, 6 L. R. A. 756, 16 Am. St. Rep. 116, 22 Pac. 910, 1046.

The board of supervisors may not, under the guise of regulation, establish rates which will deprive the water company of the whole or any portion of that which under the circumstances is a just and reasonable return for the use of its property devoted to public service. The use and profits of property are themselves property, and are alike under the protection of the Federal Constitution. Spring Valley Waterworks v. San Francisco, 192 Fed. 137, 142.

A federal circuit court cannot de

cline to take jurisdiction of a suit
to enjoin the enforcement of alleged
unreasonable rates fixed by statute or
ordinance where asserted to violate
the Federal Constitution. Willcox v.
Consolidated Gas Co., 212 U. S. 19,
53 L. Ed. 382, 48 L. R. A. (N. S.)
1134, 15 Ann. Cas. 1034.

48 See preceding note.
49 See § 4560, infra.
50 See § 4562, infra.

51 See § 4484, supra.

52 Clemmons v. Railroad Commission of California, 173 Cal. 254, 257, 159 Pac. 713.

53 State v. Atkinson, 269 Mo. 634, 647, L. R. A. 1918 A 46, Ann. Cas. 1917 E 987, 192 S. W. 86, followed in State v. Public Service Commission, 272 Mo. 627, 199 S. W. 962.

§ 4560. Presumptions and burden of proof. In reviewing governmental regulations of corporations, the courts start out with a presumption in favor not only of the validity and reasonableness of the regulations,54 but also of the findings (in case of regulation by a commission) being supported by the evidence 55 and also that the order was based on a hearing and proper evidence.56 A fortiori, rates established by law, whether by Congress, a state legislature, the Interstate Commerce Commission, a state public service commission, or a municipality, are presumed to be just and reasonable,57 where