Headnote 4 Headnote 5 The [34] those here, be regarded as so un-, tained by some, that in the safeguardreasonable as to make the order a viola- ing of railroad [35] crossings by order tion of the company's constitutional of state or local authority the exercise of rights and to be in the nature of con- police power escapes the ordinary confiscation. The pro- stitutional limitation of reasonableness tection of the 14th of cost. This is apt to give to local Amendment in such cases is real, and is boards a sense of freedom which tempts not to be lightly regarded. A railroad to arbitrariness and extravagance. company in main- case before us is one which is near the taining a path of line of reasonableness, but for the reatravel and transportation across a state, sons given we think it does not go with frequent trains of rapidity and beyond the line. great momentum, must resort to reason- An elaborate argument is made by able precaution to avoid danger to the counsel for the railroad company to impublic. This court has said that where peach the validity of the order of the railroad companies occupy lands in the board of public utilities in this case bestate for use in commerce, the state has a cause of the amendment to the Interconstitutional right to insist that a high-state Commerce Law contained in the way crossing shall not be dangerous to Transportation Act of 1920, §§ 416, the public, and that where reasonable 422. Based on this, it is said that safety of the public requires abolition of the board has no right to order grade crossings, the railroad can not prevent the exercise of the police power to this end by the excuse that such change would interfere with interstate commerce or lead to the bankruptcy of the railroad. Erie R. Co. v. Public Utility Comrs. 254 U. S. 394, 65 L. ed. 322, P.U.R.1921C, 143, 41 Sup. Ct. Rep. 169. This is not to be construed as meaning that danger to the public will justify great expenditures unreasonably burdening the railroad, when less expenditure can reasonably accomplish the object of the improvements and avoid the danger. If the danger is clear, reasonable care must be taken to eliminate it and the police power may be exerted to that end. But it becomes the duty of the court, where the cost is questioned, to determine whether it is within reasonable limits. Headnote 6 Headnote 7 Headnote 8 these unreasonable expenditures for construction because they exceed the legal duties of the carrier and the reasonable requirements of public safety and convenience. It is not necessary for us to controvert the proposition that unreasonably extravagant grade crossings are to be enjoined not only as violations of the 14th Amendment but also as forbidden by the Transportation Act. Headnote 9 But we can not see that the rule invoked from either will be violated by the order now made. The care of grade crossings is peculiarly within the police power of the states. (Railroad Commission v. Southern P. Co. 264 U. S. 331, 341, 68 L. ed. 713, 716, 44 Sup. Ct. Rep. 376), and if it is seriously contended that the cost of this grade crossing is such as to interfere with or impair economical management of the railroad, this should be made clear. It was certainly not intended by the Transportation Act to take from the states or to thrust upon the Interstate Commerce Commission investigation into parochial matters like this, unless by reason of their effect on economical management and service, their general bearing is clear. Railroad Commission v. Southern P. Co. 264 U. S. 331, 68 L. ed. 713, 44 Sup. Ct. Rep. 376. The latter case makes a distinction between the local character of [36] the usual elimination of grade crossings and the vital character from the standpoint of finance of the investment of large sums in the erection of a Union Station. This follows from principles clearly established by this court. Missouri, K. & T. R. Co. v. Oklahoma, 271 U. S. 303, 70 L. ed. 957, 46 Sup. Ct. Rep. 517; Missouri P. R. Co. v. Omaha, 235 U. S. 121, 129, 131, 59 L. ed. 157, 161, 162, 35 Sup. Ct. Rep. 82; Lawton v. Steele, 152 U. S. 133, 137, 38 L. ed. 385, 388, 14 Sup. Ct. Rep. 499; Norfolk & W. R. Co. v. Public Serv. Commission, 265 U. S. 70, 74, 68 L. ed. 904, 907, 44 Sup. Ct. Rep. 439; Mississippi R. Commission v. Mobile & O. R. Co. 244 U. S. 388, 390, 391, 61 L. ed. 1216, 1219, 37 Sup. Ct. Rep. 602; Dobbins v. Los Angeles, 195 U. S. 223, 49 L. ed. 169, 25 Sup. Ct. Rep. 18. We emphasize this not because there is doubt about it, but because we deprecate the impression, apparently enter-nation of grade crossings by the board The final objection to the order is that the statute providing for the elimi Headnote 10 of the board. If it should appear equitable and just that a rehearing be had before the board, the supreme court may determine that such hearing be had, upon such terms and conditions as are reasonable. of public utilities impinges on the con- notice, and the supreme court is given stitutional rights of the company, be-jurisdiction to review the order and to cause it makes no provision for appeal set it aside when it clearly appears that from the decision of the board of public there was no evidence before the board utilities to a court with jurisdiction reasonably to support the same, or that judicially to determine independently the same was without the jurisdiction on the law and facts whether the property of the company is being confiscated in violation of the 14th Amendment to the Federal Constitution. Ohio Valley Water Co. v. Ben Avon, 253 U. S. 287, 64 L. ed. 908, P.U.R.1920E, 814, 40 Sup. Ct. Rep. 527. In that case the public The language of § 38 in respect to the service commission of Pennsylvania in-appeal to the supreme court is much stituted an investigation and took evi- broadened by the construction of that dence upon a complaint charging a court. It has been established by its water company with demanding un- decisions that the legislature of New reasonable rates. The commission fixed Jersey may not impair the powers of the valuation of the company's property the supreme court and the court of and established rates on that basis. chancery as they existed when the state The company contended that the valua- Constitution was adopted, and there is tion upon which the income was calcu- much latitude in their jurisdiction lated was much too low and deprived it of a reasonable return and therefore eonfiscated its property. On appeal to the superior court, that court reviewed the certified record, appraised the property, reversed the order and remanded the proceedings with directions to au- The case of Public Serv. Gas Co. v. thorize rates sufficient to yield 7 per Public Utility Comrs. 84 N. J. L. 463, centum of the sum. The supreme court 87 Atl. 651, s. c. 87 N. J. L. 581, L.R.A. reversed the decree, saying that there 1918A, 421, P.U.R.1915E, 251, 92 Atl. was competent evidence tending to sus- 606, 94 Atl. 634, 95 Atl. 1079, construtain the commission's conclusion, and as ing § 38, as amended, is an illustration. no abuse of discretion appeared, the It came before the supreme court on superior court could not under the certiorari for consideration whether rates Pennsylvania statute interfere. This [38] fixed by the board for a public court held on error that because the service gas company of Passaic were plaintiff in error had not had proper unjust, discriminatory and unreasonopportunity for an adequate independent judicial hearing as to confiscation on the law and the facts, the challenged order was invalid, and that the judgment of the supreme court of the state must be reversed. [37] We do not think the Ben Avon Case applies here. In this case chapter 195 of the Laws of 1911 of New Jersey created a board of public utility commissioners and prescribed its duties and powers. By §§ 21 and 22 of that act, the board is vested with authority to protect the traveling public at grade crossings by directing the railroad company to install such protective device or devices and adopt such other reasonable provision for the protection of the traveling public at such crossing as in the discretion of the board shall be necessary. Section 38 of this act, as amended by chapter 130 of the Laws of 1918, provides that any order made by the board may be reviewed upon certiorari after growing out of this. Traphagen v. West Hoboken Twp. 39 N. J. L. 232; Flanigan v. Guggenheim Smelting Co. 63 N. J. L. 647, 44 Atl. 762, 7 Am. Neg. Rep. 113; Re Prudential Ins. Co. 82 N. J. Eq. 335, 88 Atl. 970. able. The supreme court said of § 38: "If this language is taken literally, we should be powerless in any case within the jurisdiction of the board to set aside its order if there was any evidence to support it, no matter how overwhelming the evidence to the contrary might be. It is needless to say that such a literal construction of § 38 would bring it into conflict with our Constitution. It needs no act of the legislature to confer on us the power to review the action of an inferior tribunal, and the legislature can not limit us in the exercise of our ancient prerogative. That the legislature did not intend to do so is made clear by a consideration of the whole act. We are, by the express terms of § 38, authorized to set aside the order when it is without the jurisdiction of the board. The jurisdiction of the board to fix rates is, by § 16c, limited to cases where the existing rate is unjust, unreasonable, insufficient, or unjustly discriminatory or preferential. The only words important for the pres- "The next ground of attack is that ent case are unjust and unreasonable, the evidence taken before the board of since the commissioners themselves went public utility commissioners does not no further in their adjudication. To justify nor reasonably support the determine then whether the commission- board's conclusions or findings. To that ers had jurisdiction, we must first deter-end the insistence is that this court [40] mine whether the existing rate was un-has power and should review the board's just and unreasonable, and in determin- findings of fact. We understand such ing that fact we are not limited to the to be the power of this court." question whether it clearly appears that there was no evidence before the board to support reasonably its order; § 16c does not purport to limit the scope of our inquiry into the fact, and we must, therefore, determine it in the usual way, according to the whole of the evidence." The supreme court proceeded itself to consider all the evidence in the case and to find whether the old rate was unreasonably high and the new rate reasonable. It said: [39] "All these considerations lead us to the conclusion that if there is any presumption in favor of the order of the commissioners, it depends like the opinion of the court of another state upon the strength of the reasoning by which it is supported. This is subject, however, to the qualification that in legislative action the courts will not merely substitute their judgment for that of a legislative body. We must, therefore, determine for ourselves upon all the evidence whether the former rate for gas in the Passaic district was unjust and unreasonable and whether the new rate is just and reasonable." The case went to the court of errors and appeals, and the action was affirmed on that opinion. There may be some confusion in a review of cases on certiorari by the supreme court of New Jersey; but the Passaic Case has never been overruled, and under it there is an appeal to a court which may examine the facts and the law independently as to the justice and reasonableness of the order. It is true that the court said that the case before it was not technically a confiscation case, but it resembled it so much that it used cases from this court on confiscation to guide its rulings, and said: "Since all cases of the kind may come before that tribunal and its decisions upon the constitutional questions would be binding upon us, we ought to adopt the same rule." The Passaic Case was followed in the consideration of the same § 38 in Erie R. Co. v. Public Utility Comrs. 89 N. J. L. 57, 98 Atl. 13, s. c. 90 N. J. L. 672, 103 Atl. 1052, a grade crossing case in which the supreme court said: Headnote 11 Objection is further made to this remedy before the supreme court that it is by certiorari and is within the discretion of the court. That, however, is hardly a serious obstacle. As Chief Justice Kinsey, in State v. Anderson, 1 N. J. L. 318, 1 Am. Dec. 207, said: "As upon a certiorari, the court have by law a discretionary power; I do not mean by this a power to do what they please, not directed by law and precedents, but, to employ the language of a great judge, to be confined to those limits within which an honest man competent to the discharge of the duties of his office ought to be confined." This court said of provisions for certiorari in a California statute like this, i. e., Nappa Valley Electric Co. v. Railroad Commission, 251 U. S. 366, 64 L. ed. 310, P.U.R.1920C, 849, 40 Sup. Ct. Rep. 174: "In those cases the applications for writs of certiorari were denied which was tantamount to a decision of the court that the orders and decisions of the commissions did not exceed its authority or violate any right of the several petitioners under the Constitution of the United States or of the state of California." Headnote 12 But if for any reason that remedy, as defined in those decisions, should not be available or be inadequate, it would seem to be clear that resort then might be had to the court of chancery. In Allen v. Distilling Co. of America, 87 N. J. Eq. 531, 100 Atl. 620, the court of chancery in New Jersey used this language: "So long as courts of equity are to serve the purpose of the creation of the court of chancery of England,-and in this state the court of chancery is the successor, in all that such term implies, of that court,-jurisdiction must depend only upon the existence of, or a threatened wrong, and the absence of an adequate remedy at law. Due to our habit of endeavoring to find decided cases to fit each [41] situation, we too often overlook the fundamental reasons for the creation or evolution of the court. ment. 4. In an adjustment of mutual claims between an individual and the government, It received no grant of express powers | Interest, § 30 We are of opinion that the infirmity Mr. Justice McReynolds is of opinion that the action of the board of public utility commissioners was unreasonable and arbitrary, and should be set aside. To permit the commissioners to impose a charge of $100,000 upon the railroad under the pretense of objection to a 6 per cent curve in a country road is to uphold what he regards as plain abuse of power. Note. On right to interest upon damages sustained in a collision-see annotation to The Albert Dumois, 44 L. ed. U. S. 751. Annotation.-Liability of United States I. Scope, 170. I. Scope. The present annotation considers generally the liability of the United States or of a state for interest. No attempt has been made to construe all the various contracts and statutes, or all the other special circumstances, allowing interest in certain case against the United States or a state, although some of these special cases have been treated. The liability of the United States or a state for interest on rebates on taxes and customs duties have been excluded BOSTON SAND & GRAVEL COMPANY, because of peculiar circumstances ap Petitioner, V. UNITED STATES OF AMERICA. (See S. C. Reporter's ed. 41–55.) Interest, § 30 - United States - liability for. 1. The United States is not liable for interest except where it assumes the liability by contract, or by the express words of a statute, or must pay it as part of the just compensation required by the Constitution. Interest, § 30 United States damages for collision effect of statute. 2. The special Act of 1922, making the United States liable for damages caused by collision and giving the court jurisdiction to hear and determine the whole controversy and enter judgment or decree for the amount of the legal damages sustained by reason of the collision, if one shall be found to be due, upon the same principle and measure of liability, with costs, as in like cases in admiralty between private persons, does not give a right to interest against the United States in view of the long-continued policy in that regard, and the gen eral Act of 1925, excluding an allowance of interest. plicable to that subject. Since the liability of the United States for interest on the value of property taken for public use is covered in an annotation to Seaboard Air Line R. Co. v. United States, 67 L. ed. U. S. 664, that question is not here discussed. It has, likewise, been deemed advisable not to consider the liability for interest of subdivisions of the state, such as counties and municipalities. For interest on soldiers' bounties, see annotation in 13 A.L.R. 601. II. The United States. Generally, interest is not recoverable on claims against the United States, whether arising from contract or tort, in the absence of a statute or contract providing for interest, or some special act on the part of the United States waiving its immunity and consenting to be liable for interest, as hereinafter stated. United States v. Sherman (1879) 98 U. S. 565, 25 L. ed. 235; Tillson v. United States (1879) 100 U. S. 43, 25 L. ed. 543; Harvey v. United States (1885) 113 U. S. 243, 28 L. ed. 987, 5 Sup. Ct. Rep. 465; United States ex rel. Angarica v. Bayard (1888) 127 U. S. 251, 31 L. ed. 159, 8 Sup. Ct. Rep. 1156; Cherokee Nation v. United States (1926) 270 U. S. 476, 70 L. ed. 694, 46 Sup. Ct. Rep. 428; United States v. Minnesota Mut. Invest. Co. (1926) 271 U. S. 212, 70 while the latter is entitled to interest on its credits, it is not liable for interest on the charges against it. [No. 15.] Argued February 28 and 29, 1928. Restored to docket for reargument May 28, 1928. Reargued October 18, 1928. Decided November 19, 1928. ed to pay it, or where the United States submits itself to the jurisdiction of the court, or, if sued, places itself in the position of a private party. Thus, where the United States enters the insurance business and issues policies, and agrees to be sued for losses, it is liable for interest on losses. Standard Oil Co. v. United States (1925) 267 U. S. 76, 69 L. ed. 519, 45 Sup. Ct. Rep. 211. Where the United States assumes a debt of a state, in the form of an outstanding negotiable instrument, and by special act of Congress lifts the Statute of Limitations, the United States will pay the debt in full, including interest, as the state would have done. United States v. McKee (1876) 91 U. S. 442, 23 L. ed. 326. L. ed. 911, 46 Sup. Ct. Rep. 501; Henkels | that effect, except where it has contractv. Sutherland (1926) 271 U. S. 298, 70 L. ed. 953, 51 A.L.R. 229, 46 Sup. Ct. Rep. 524 (reversing (1925; C. C. A. 2d) 4 F. (2d) 988); United States v. Commonwealth & Dominion Line (1929)_278 U. S. 427, post, 49 Sup. Ct. Rep 183 (reversing (1927; C. C. A. 2d) 20 F. (2d) 729); BOSTON SAND & GRAVEL CO. v. UNITED STATES (reported herewith); United States v. Woolen (1929) 278 U. S. 665, post, 49 Sup. Ct. Rep. 249, (vacating decree of (1928; C. C. A. 6th) 25 F. (2d) 673); Bunton v. United States (1894; C. C.) 62 Fed. 171; Watts v. United States (1904; D. C.) 129 Fed. 222; Pennell v. United States (1908; D. C.) 162 Fed. 75; Treat v. Farmers Loan & T. Co. (1911) 108 C. C. A. 98, 185 Fed. 760 (affirming (1909; C. C.) 171 Fed. 301); Scully v. United States (1912; D. C.) 197 Fed. 327; Whitelaw v. United States (1925; D. C.) 9 F. (2d) 103; War- | ren Gordon Lighterage Co. v. McCallister Towing & Transp. Co. (1926; D. C.) 12 F. (2d) 779; New York & C. Mail S. S. Co. v. United States (1927; C. C. A. 2d) 16 F. (2d) 945 (modifying (1924; D. C.) 300 Fed. 827, certiorari denied in (1927) 274 U. S. 753, 71 L. ed. 1333, 47 Sup. Ct. Rep. 765); New York & P. R. S. S. Co. v. United States (1928; C. C. A. 2d) 29 F. (2d) 1014 (affirming (1927; D. C.) 29 F. (2d) 1013); Becker v. Miller (1925; C. C. A. 2d) 7 F. (2d) 293 (appeal dismissed in (1925) 269 U. S. 596, 70 L. ed. 431, 46 Sup. Ct. Rep. 105); Wightman v. United States (1888) 23 Ct. Cl. 144; William R. Trigg Co. v. Bucyrus Co. (1905) 104 Va. 79, 51 S. E. 174. This rule, however, while spoken of as a general one which is followed by both the executive and legislative departments, is not absolute, uniform, and controlling, especially in regard to claims allowed by special congressional acts, or referred by such acts to some department or officer for settlement, or where the government stipulates to pay interest. 26 R. C. L. United States, 8 55, p. 1452. It is said in New York & C. M. S. S. Co. v. United States (1927; C. C. A. 2d) 16 F. (2d) 945 (modifying (1924; D. C.) 300 Fed. 827, certiorari denied in (1927) 274 U. S. 753, 71 L. ed. 1333, 47 Sup. Ct. Rep. 765), that the United States is not liable to pay interest in the absence of a statutory provision to Interest paid by the state of New York on its bond issued to defray the expenses of raising troops for the national defense, the funds being borrowed from the state canal fund under an agreement by its officer to pay such interest, is an expense properly incurred by the state in raising troops for the national defense, to be repaid by the United States to that state, as the state could not legally borrow from the canal fund without paying interest. United States v. New York (1896) 160 U. S. 598, 40 L. ed. 551, 16 Sup. Ct. Rep. 402. V. And in Naamlooze Vennootschap Maatschappij Stoomschip Barendrecht Moran Towing & Transp. Co. (1925; D. C.) 11 F. (2d) 377, where the United States sought affirmative relief by a cross libel, it was held liable for interest, on the authority of United States v. The Thelka (Luckenbach S. S. Co. v. The Thelka) 266 U. S. 328, 69 L. ed. 313, 45 Sup. Ct. Rep. 112, since complete justice requires the United States to pay interest, it being but one element of the obligation created by the attempt of the United States to collect its own damages with interest. A special act authorizing a court to hear a case growing out of a collision between a private and public vessel, "upon the same principles as in like cases in admiralty between private parties," authorizes the awarding of interest against the United States. New York & C. Mail S. S. Co. v. United States (1927; C. C. A. 2d) 16 F. (2d) |