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Abandonment Legal Opinion

Nevada State Attorney General's Letter

by J. A. McCulloch

 

Interstate Commerce Commission
and
Nevada Public Service Commission
Conflicting Jurisdiction.

Basis for requesting the Nevada State Attorney General's opinion:

Conflicting jurisdiction between Interstate Commerce Commission and Nevada Public Service Commission on application of railroad situated partly in Nevada and partly in another State on traffic over such railroad for permission to abandon service on the line rather than to abandon the line. Interstate Commerce Commission has jurisdiction under commerce clause of Federal Constitution, although not over purely intrastate service itself as distinguished from abandonment of service. State Commission and residents have, however, right to be heard on such application.


CARSON CITY, January 10, 1939.

Public Service Commission of Nevada, Carson City, Nevada.
Attention: HONORABLE HARLEY A. HARMON, Chairman.
Re: Tonopah & Tidewater-Railroad Company, Ltd., Application for Discontinuance of Service from Crucero, California, to Beatty, Nevada.

GENTLEMEN: This will acknowledge receipt of your letter of January 6, 1939, relative to the above-entitled matter.

It is noted that the above-named railroad company has filed with the Interstate Commerce Commission on application for discontinuance of service on its line of railroad extending from Crucero, California, to Beatty, Nevada, a distance of approximately 143 miles. It is also noted that Public Service Commission of Nevada seeking permission to discontinue service on such line of railroad. We are advised from your letter that the Interstate Commerce Commission has given notice to Nevada citizens who might be effected by the discontinuance of service, and also that your Commission has filed a protest with the Interstate Commerce Commission protesting the granting of the application and requesting a hearing on the application to be held in Nevada.

It appears from your letter that a question has arisen with your Commission as to the jurisdiction of the Interstate Commerce Commission to act in the matter, in that the application filed with the Interstate Commerce Commission was not an application for abandonment of the line, but an application for permission to abandon service on the line, and that you desire the advice of this office on such question.

We understand from your letter that the service proposed to be discontinued is interstate service and, from our knowledge of the railroad, we apprehend that practically all of the service performed by it is interstate in character. This being the class of service performed by the railroad in question, we think, after an examination of the law, that the Interstate Commerce Commission has jurisdiction to pass upon the application.

An examination of the Interstate Commerce Commission Act discloses that Congress has vested the Interstate Commerce Commission with broad powers of jurisdiction, in all\ matters relating to the extension, construction or abandonment of railroad lines where such lines are engaged in interstate commerce, and Congress has also provided power and jurisdiction for the Interstate Commerce Commission to pass upon all questions relative to the abandonment of operations of railroad lines engaged in interstate commerce. See paragraph 18, section 1, title 49, U.S.C.A. Paragraph 19 of the above section provides the procedure with respect to abandonment of railroads or operations thereon, and paragraph 20 of said section provides the Interstate Commerce Commission shall have power to issue such certificates as are prayed for, or to refuse to issue such certificates, including certificates relative to abandonment of service. So, the Federal law itself, a law enacted pursuant to the commerce clause of the Federal Constitution, is the basis of the power and jurisdiction of the Interstate Commerce Commission, and the cases hold that, with respect to interstate commerce, the Federal law is supreme and operates to the exclusion of all State laws on the subject.

We have examined several cases pertaining to your question, among them being: St. Louis, etc., R.R. Co. v. Alabama Public Service Commission, 279 U.S. 560; Pittsburgh & W.V.R. Co. v. Unitedí States, 41 Fed. (2d) 806 United States v. Idaho, 298 U.S. 105; Transit Commission v. United States, 289 U.S. 121; Colorado v. United States, 271 U.S. 153; Town of Inlet v. N.Y. Central R.R. Co., 7 Fed. supplement 781. These cases clearly decide that the jurisdiction of the Interstate Commerce Commission, insofar as interstate commerce is concerned is absolute.

In the Colorado v. United States case, supra, we find almost an identical situation as we have here, except that in the Colorado case it was sought to abandon the line entirely and the power and jurisdiction of the Interstate Commerce Commission to entertain the application for abandonment and decide the matter was questioned. The Supreme Court of the United States definitely decided in such case that, under the sections of the Interstate Commerce Act above cited, the Interstate Commerce Commission had full jurisdiction to entertain the application for abandonment and pass on the same. As illustrative of what the court said in the opinion, we quote briefly therefrom the following:
 

The exercise of federal power in authorizing abandonment is not an invasion of a field reserved to the State. The obligation assumed by the corporation under its charter of providing intrastate service on every part of its line within the State is subordinate to the performance by it of its federal duty, also assumed, efficiently to render transportation services in interstate commerce. There is no contention here that the railroad by its charter agreed in terms to continue to operate this branch regardless of loss. Compare Railroad Commission v. Eastern Texas R.R. Co., 264 U.S. 79. But even explicit charter provisions must yield to the paramount power of Congress to regulate interstate commerce. New York v. United States. 257 U.S. 591, 601. Because the same instrumentality serves both, Congress has power to assume not only some control, but paramount control, insofar as interstate commerce, is involved. It may determine to what extent and in what manner intrastate service must be subordinated in order that interstate service may be adequately rendered. The power to make the determination inheres in the United States as an incident of its power or interstate commerce. The making of this determination involves an exercise of judgment upon the facts of the particular case. The authority to find the facts and to exercise thereon the judgment whether abandonment is consistent with public convenience and necessity, Congress conferred upon the commission.
 

The same situation existed in the Town of Inlet v. N.Y. Central R.R. Co. case, supra, and the court there held that the determination of how far a railway company, engaged in interstate commerce, should be required to continue service at constantly increasing loss, after many people served have abandoned rail for motor transportation is particularly within the Interstate Commerce Commissionís province.

We conclude that as to the instant matter, insofar as interstate service is concerned, the Interstate Commerce Commission has jurisdiction to entertain an application to discontinue service and to pass upon such question. However, as to purely intrastate service, if any there be, the Interstate Commerce Commission has no jurisdiction, but such jurisdiction is vested in the Public Service Commission of this State with respect to intrastate service in Nevada.

The foregoing opinion is not to be construed as meaning that the State of Nevada, through your Commission, has no right to be heard in the matter of the discontinuance of service on the railroad in question. As we view the law, Congress intended that the people of a State have the right to be represented at the hearings held for the purpose of determining whether service on a railroad should be discontinued. In the Colorado v. united States case, supra, it was held that the sole test with respect to abandonment proceedings is whether such abandonment be consistent with public convenience and necessity, and that the Interstate Commerce Commission must have regard for the needs of both intrastate and interstate commerce. It is further pointed out in that case that State Commissions sometimes sit with the representatives of the Interstate Commerce Commission at such hearings that the practice has been established that the Interstate Commerce Commission leaves the preliminary inquiry to the State Commission, and that always consideration is given to representatives of the State authorities. Your letter of inquiry states that your Commission has filed a protest with the Interstate Commerce Commission and that you have requested a hearing to be held in Nevada. We, therefore, suggest that your Commission vigorously follow up your protest upon every available ground, and that the people of this State directly affected by the proposed discontinuance of service be given every opportunity to appear in any hearings held concerning the matter, either in person or by attorney, and there present their evidence as to why the petition should not be granted.

Respectfully submitted,
GRAY MASHBURN, Attorney-General.
By W.T. MATHEWS, Deputy Attorney-General.

 

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05/01/2003