The Southern Passenger Fare Case

Abstract

The Commission's order had directed that intrastate railway passenger fares in Alabama, Kentucky, North Carolina, and Tennessee be raised from 1.65 cents per mile to 2.2 cents, that round-trip coach rates be proportionally raised, and that sleepingand parlor-car fares in some of the states also be increased. The regulatory bodies of the four states asked for injunctions to set aside the increases. The Stabilization Director, through the Office of Price Administration, intervened in behalf of the states, and the various railroads involved in behalf of the defendant Commission. Since the decision of the Supreme Court in this instance apparently runs counter to a long line of decisions reaching back to the so-called Shreveport Case4, the facts, the reasoning of the Court (including that contained in the dissenting opinion), and the possible implications, appear to warrant brief review. Prior to 1936 the basic passenger fare in coaches on Class I railroads was 3.6 cents a mile. Some roads maintained lower intrastate fares. From December 1, 1933 through November 14, 1937 a number of southern railroads experimented with an interstate fare of 1.5 cents for one-way trips and 1.35 cents for roundtrips. Certain other roads tried a 2-cent interstate fare. In 1936 the Interstate Commerce Commission ordered the basic interstate coach fare reduced to 2 cents, effective June 30,5 at which level it remained until February 10, 1942 when a 10 per cent increase was granted to be in effect for the duration of the war and for six months thereafter.6 However, it should be noted that the Commission order lowering the basic rate to 2 cents did not disturb the experimental rates in effect in the South as these fares were held to be not unreasonable or otherwise unlawful (p. 257). The experimental rates were increased to 2 cents one-way and 1.8 cents roundtrip through January 14, 1939 when they were again dropped to the former 1.5 and 1.35 cents level, at which point they remained until February 10, 1942 when