settled, populated and developed, this development having occurred. principally within the last six years. There were about 2,000 acres of fruit, more than 7,000 acres of alfalfa and over 40,000 acres of grain and hay in cultivation in 1914. The country is also an important poultry and live stock section. There are being worked in this territory vast deposits of cement material (75,000 tons went out in 1913), together with building and paving stone.

Fifth. That the complainants believe that the revenue from freight and passenger traffic resulting from the reconstruction of the road would fully justify the necessary expenditure.

In its answer to the complaint the defendant, in effect, states:

First. That it has no information or belief sufficient to answer complainant's allegation with reference to the bonus in land and money furnished by the citizens of San Diego towards the building of the railroad and for that reason denies these allegations.

Second. That the California Southern Railroad Company between the date of its incorporation, in 1880, and the 1st of January, 1884, constructed and began the operation of a railroad from San Diego to Colton, near and south of San Bernardino; that in the spring of 1884 approximately 30 miles of this railroad, being the line through Temecula Canyon, was destroyed by floods, and was thereafter reconstructed by means of funds furnished by The Atchison, Topeka and Santa Fe Railroad Company, which company long afterwards passed into the hands of a receiver and was reorganized as this defendant, The Atchison, Topeka and Santa Fe Railway Company; and defendant denies that any portion of said railroad was constructed cheaply and improperly. It is stated that in or about the year 1882 the California Southern Railroad Company and a company known as the California Southern Extension Railroad Company were consolidated under the name of the California Southern Railroad Company; that thereafter this consolidated company was, in the year 1889, with certain other companies, consolidated into the Southern California Railway Company, the property of which last mentioned company was, in the year 1906, sold to defendant; but that Southern California Railway Company exists as a corporation at the present time under the laws of the State of California.

Defendant denies that all trade relations between the people of San Diego and vicinity and the country along and tributary to said railroad from Temecula north as far as Highgrove, Riverside County, is destroyed and rendered impracticable.

Third.-Defendant admits that by purchase it has become the owner of the railroad built by the California Southern Railroad Company, having purchased the same in the year 1906, and has been, since 1906,

the owner of all the properties of California Southern Railroad Company; but denies that it ever became the owner of any bonus or subsidy given as alleged in this complaint or otherwise.

Fourth. That the allegations of the complainants referring to the general desire of the people in the territory tributary to the road to have the line rebuilt, are denied, as are also the allegations as to the areas, resources and population of this territory.

Fifth. It is denied that the prospective traffic would justify the necessary expenditure for the reconstruction of the road.

Sixth.-Defendant, in addition, refers to a previous proceeding in this same matter before the Board of Railroad Commissioners of the State of California, and shows that on or about the 10th day of April, 1895, one Montgomery M. Moulton, on behalf of the citizens of Fallbrook mentioned in this complaint, made inquiry of the Board of Railroad Commissioners concerning the rebuilding of this line, and on or about the 28th day of August, 1895, the San Diego Property Owners' Union filed with the board a request for a copy of the laws relating to the forfeiture of railroad charters, and that the board take such other action as might be proper in aiding the union in securing their legal and just rights from the Santa Fe Railroad Company in respect to the rebuilding of the road. Thereafter, on August 1, 1896, the board convened in San Diego, at which time Gilbert J. Arnold filed a complaint, complaining that the line had been abandoned through the Temecula Canyon and that the Southern California Railway Company refused to rebuild or operate its line through this canyon, and praying that the board declare it to be the duty of the Southern California Railway Company to operate its railroad through this canyon, and that suit be instituted against the corporation to compel it to perform its duty in the premises. To this complaint the Southern California Railway Company filed its answer on the same day, and the board thereupon proceeded with an investigation of the matter set forth in the complaint, both parties appearing by their attorneys; and after hearings on the first, third, fourth and fifth days of August, 1896, the board, on October 14, 1896, filed an opinion in which, among other things, it was stated that the board was of the opinion that the petition should be denied, and it was so ordered.

Seventh-Finally, the defendant as a separate defense, demurs and alleges that this Commission is without jurisdiction over the subjectmatter of this complaint.

Hearings were held in the case in San Diego on June 1st and 3d and on July 30, 1915. During the course of the hearing on July 30, 1915, and with consent of defendant the original complaint was amended. An alternative line between Oceanside and Temecula is proposed, and the Commission is asked to order the construction of this

line in case it should decide that it is the more practicable one for the defendant to build. This so-called alternative line is described as extending from the present terminus of defendant's line in Temecula to the city of Oceanside, in San Diego County, by a route through what is known as the Viacitos or Rainbow Valley; thence to the town of Fallbrook, San Diego County; thence in a southerly and southeasterly direction into the valley of the San Luis Rey River; thence in a southwesterly direction down the valley of the San Luis Rey River through the town of Bonsall to the city of Oceanside.

In support of the alternative line complainants state that a large territory of about 200,000 acres of partly valley and partly mesa lands, and now without transportation facilities, would be opened for development, and that the new revenue created in this territory would fully justify the construction expenditure.

Defendant made its answer to this amendment, admitting the practicability of the alternative line, but making a general denial of all other allegations.

A large amount of testimony was taken during the hearing in San Diego, a number of exhibits were filed, and after the filing of briefs, both by the defendant and by the complainants, the case is now ready for decision.

It is desirable to shortly review the history of this complaint. The rebuilding of the Temecula Canyon line has been agitated continually since its abandonment in 1891. After a number of fruitless petitions to the Southern California Railway Company, the predecessor of defendant in this case and conferences with its officials, a complaint was filed by Gilbert J. Arnold, of San Diego, with the Board of Railroad Commissioners of the State of California, praying "that it be declared the duty of the Southern California Railway Company to operate its railway through the Temecula Canyon in connection with its other branches and lines, and that suit be instituted against the corporation to compel it to perform its duty in the premises."

The Southern California Railway Company denied the jurisdiction of the Board of Railroad Commissioners, answering that it would cost practically $100,000.00 to rebuild and put in good operating condition the line through the Temecula Canyon, and demanded that the complaint be dismissed. The board. after an investigation and after hearings, rendered its decision, confining its action solely to the consideration of one question. I quote from the decision of October 14, 1896: the only question for determination is whether this Commission shall direct the attorney general to institute proceedings against the Southern California Railway Company for forfeiture of its right to operate the whole or part of the Temecula Canyon line."

On this question the petition was denied. I will hereafter have occasion to again refer to that decision.

After the creation of the present Commission under the Public Utilities Act of February 10, 1911, the people of San Diego and vicinity in the same year asked for relief from this Commission, and a large number of informal complaints were filed during the last three years. The Commission, as long ago as 1911, informally inquired of the defendant if there was any intention of rebuilding the line in the near future, but was informed that it was not the defendant's purpose to rehabilitate the road. The present action is the final outgrowth of all these proceedings.

It appears from the testimony of M. A. Luce in this case, that in October, 1880, Benjamin Kimball came to San Diego as attorney for Thomas Nickerson, then president of the Santa Fe Railroad Company, and together with the witness proceeded to organize the California Southern Railroad Company. The latter company was incorporated to construct a railroad from National City, in San Diego County, to a point on the Mojave River, there to connect with a transcontinental road "by the shortest commercial line practicable"; and the line by way of Oceanside through the Temecula Canyon to Colton, Riverside and San Bernardino was selected and ultimately built.

On July 23, 1880, an agreement was entered into between Frank A. Kimball, representing himself, the firm of Kimball Bros., the Chamber of Commerce, the Board of City Trustees and prominent citizens of the city of San Diego, State of California, party of the first part, and Kidder, Peabody & Co., B. P. Cheney, George B. Wilbur, Lucius G. Pratt, and Thomas Nickerson, all of Boston, Mass., party of the second part, which reads:

"That whereas the party of the first part desires to obtain railroad connection from the bay of San Diego to the eastern part of the United States, and in and of the same, is able and willing to donate the lands, privileges and franchises hereinafter mentioned; and whereas the party of the second part is willing to furnish such connection and receive such donation,

"Now, therefore, in consideration of the premises and their respective undertakings hereinafter set forth, and of one dollar to each paid by the other, receipt acknowledged, said parties mutually agree as follows:

"Article 1.-The party of the first part will convey or cause to be conveyed by good and sufficient deeds in fee simple, free from all incumbrances except taxes due on the first Monday in January, 1881, to Henry B. Williams of San Francisco, John A. Fairchild and Warren C. Kimball, both of said San Diego and all of the State of California, trustees, the several parcels of land and the several privileges and franchises hereinafter set forth, namely:

"(a) In behalf of Kimball Brothers, ten thousand acres of land in Rancho de la Nacion made up and selected as follows: Frac

tional quarter sections one hundred and seventy-five (175) and one hundred and seventy-six (176), according to survey and patent of the United States now on file and of record in the county of San Diego, said fractional quarter sections giving one mile front upon the water of San Diego Bav, and all the land running back from said water front to such a distance as to embrace in all (exclusive of land heretofore sold which does not exceed twenty acres) two hundred acres, being the land heretofore bonded to a representative of the Texas Pacific Railroad Company together with such additional quantity of land south of National Citv, adjacent thereto, in such convenient shape as shall be required for workhouses, machine shops, warehouses, wharves and other appurtenances of the line of railroad hereinafter mentioned; and also together with all the riparian rights appertaining to the lands agreed to be conveyed and to any and every part thereof.

"One-half equitably selected of all the unsold portions of National City, being from one hundred fifty (150) to one hundred seventy-five (175) blocks of two and one-half acres each measuring through the centers of the streets as laid down on the plan of said National City.

"Also south of National City, quarter sections 174, 179 and 160, and so much of quarter sections 173, 180 and 161 as may be necessary in the judgment of the engineers of the party of the second. part, to control the channel of Sweetwater River, and then selecting alternate half miles of water front, measuring on the base line, said Kimball Brothers making the first selection, until two miles of water front (as near as may be) have been taken south of National City (making about three miles of water front in all) and then starting from said water front and running back, selecting tracts alternate (as near as may be) exclusive of those parcels already conveyed to sundry persons, until the full complement of ten thousand acres, as aforesaid, has been completed. Together with all tide lands and riparian rights belonging to or in anywise appertaining thereunto and to any and every part thereof.

"The selections above referred to shall be made by mutual agreement between said Frank A. Kimball, and the party of the second part, or in case of dispute, by three persons chosen one by each of the parties hereto, and one by the two thus chosen, and the decision of a majority of them shall be final.

"(b) On behalf of A. Overbaugh. O. S. Witherby and L. C. Gunn, about forty-five hundred (4500) acres of land in San Diego, being the same tract conveved to said Overbaugh, Witherby and Gunn, by Charles S. Hamilton by deed recorded with San Diego deeds, to which reference is had for more particular description.

"(c) About three hundred scattered blocks and lots in the city of San Diego and about five thousand acres of land in and around the same, all of which now stand in the name of George B. Wilbur, as shown by sundry deeds in escrow in the hands of Bryant Howard and E. W. Morse of San Diego.

"(d) The party of the first part also agrees to contribute the sum of ten thousand dollars to be used for the purchase of right. of way and lands for depots, shops, water and other stations on