United States Shipping Board Emergency Fleet Corporation v. Western Union Telegraph Co 1927

• Decision Date: 03 January 1928
• Docket Number: No. 113,113
• Citation: 48 S.Ct. 198,72 L.Ed. 345,275 U.S. 415
• Parties: UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION v. WESTERN UNION TELEGRAPH CO. Argued Dec. 2-5, 1927
• Court: U.S. Supreme Court

275 U.S. 415

48 S.Ct. 198

72 L.Ed. 345

UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION

v WESTERN UNION TELEGRAPH CO.

No. 113.

Argued Dec. 2-5, 1927.

Decided Jan. 3, 1928.

The Attorney General and Mr. Gardner P. Lloyd, of New York City, for petitioner.

Messrs. John W. Davis and Francis R. Stark, both of New York City, and Paul E. Lesh, of Washington, D. C., for respondent.

Mr. Justice BRANDEIS delivered the opinion of the Court.

By Post Roads Act July 24, 1866, c. 230, 14 Stat. 221, Rev. Stat. §§ 5263-5266 (47 USCA §§ 1-3, 6; Comp. St. §§ 10072-10075), the United States offered privileges of great value to any telegraph company which should elect to accept its provisions. In return, it required, by section 2 of the act (now 47 USCA § 3; Comp. St. § 10075):

'That telegraphic communications between the several departments of the government of the United States and their officers and agents shall, in their transmission over the lines of any of said companies, have priority over all other business, and shall be sent at rates to be annually fixed by the Postmaster General.'

Each year since the passage of the act the government rates have been so fixed. For the fiscal years beginning July 1, 1921 and July 1, 1922, they were fixed for domestic telegrams substantially at 40 per cent. of the commercial rate, and for cablegrams at 50 per cent. of the commercial rate.

The Western Union accepted the provisions of the act on June 8, 1867. Pensacola Telegraph Co. v. Western Union Telegraph Co., 96 U. S. 1, 4, 24 L. Ed. 708; Telegraph Co. v. Texas, 105 U. S. 460, 26 L. Ed. 1067. The Fleet Corporation was organ- ized April 16, 1917. From that date to May, 1922, it was accorded, without question, the government rate on all messages sent by it. Then the Western Union claimed the right to the commercial rates for all its messages. The claim was resisted. Thereafter messages of the Fleet Corporation continued to be marked by it 'Government Rate'; but they were received under an agreement that the acceptance of the message and of payment therefor at the government rate should be without prejudice to the right of the Western Union to recover the additional amount claimed. This suit was brought, in the Supreme Court of the District of Columbia, to recover, for the months of June and July, 1922, the difference between the amount paid and the commercial rate. Of this amount, $1,071.16 was for messages sent to some official or agent of the Fleet Corporation or of the Shipping Board or to some other department or official of the government; $336.43, for messages addressed to private persons. A stipulation waiving the jury was filed; the case was heard on an 'agreed statement of facts'; the court found the facts to be as there stated; and a judgment entered for the full amount was affirmed by the Court of Appeals for the District. 56 App. D. C. 337, 13 F.(2d) 308. This court granted a writ of certiorari. 273 U. S. 681, 47 S. Ct. 236, 71 L. Ed. 837.

The question whether messages transmitted for the Fleet Corporation after May 31, 1922, shall be paid for at the commercial rates or at the lower government rates is one of statutory construction. The Post Roads Act had been in force, without amendment, more than 55 years before the transactions here involved. Throughout that period, the rights of the government and the Western Union concerning the transmission of messages had been governed by the act, unaffected by any special contract, and there had been a uniform practice in applying it. That practice should be stated before discussing the specific facts relating to the Fleet Corporation. For the construction given to the act by the United States, and acquiesced in by the Western Union, having been both contemporaneous and thereafter consistently and widely applied, is not only persuasive, but, in our opinion, decisive of the case. United States v. Alabama Great Southern R. R. Co., 142 U. S. 615, 12 S. Ct. 306, 35 L. Ed. 1134. Compare District of Columbia v. Gallaher, 124 U. S. 505, 510, 8 S. Ct. 585, 31 L. Ed. 526.

Continuously since June 8, 1867, the Western Union has extended the right of priority in transmission and the government rate, not only to each of the great Executive Departments presided over by a member of the Cabinet (and to the several bureaus, divisions, and officers thereof), but also to the judicial and the legislative branches, to the government of the District of Columbia, and to the following corporations existing at the time of the passage of the Post Roads Act: The Smithsonian Institution, organized pursuant to Act Aug. 10, 1846, c. 178, 9 Stat. 102, and the National Home for Disabled Volunteers, organized pursuant to Act March 3, 1865, c. 91, 13 Stat. 509, and Act March 21, 1866, c. 21, 14 Stat. 10. The Western Union has also extended, from time to time, the same preferences to at least the following minor independent departments established after the date of the acceptance by it of the provisions of the Post Roads Act: Civil Service Commission, Act Jan. 16, 1883, c. 27, 22 Stat. 403; Interstate Commerce Commission, Act Feb. 4, 1887, c. 104, 24 Stat. 379, 383; Bureau of American Republics (now the Pan-American Union), Act July 14, 1890, c. 706, 26 Stat. 272, 275; Panama Canal, Act April 28, 1904, c. 1758, 33 Stat. 429; Federal Reserve Board, Act Dec. 23, 1913, c. 6, 38 Stat. 251, 260; Federal Trade Commission, Act Sept. 26, 1914, c. 311, 38 Stat. 717 (15 USCA §§ 41-51); Inter-American High Commission, United States Section, Act Feb. 7, 1916, c. 20, 39 Stat. 8; Bureau of Efficiency, Act Feb. 28, 1916 c. 37, 39 Stat. 14, 15 (Comp. St. §§ 3286c, 3286d); United States Shipping Board, Act Sept. 7, 1916, c. 451, 39 Stat. 728, 729; United States Employees' Compensation Commission, Act Sept. 7, 1916, c. 458, 39 Stat. 742, 748; United States Tariff Commission, Act Sept. 8, 1916, c. 463, 39 Stat. 756, 795; Federal Board for Vocational Education, Act Feb. 23, 1917, c. 114, 39 Stat. 929, 932; Alien Property Custodian, Act Oct. 6, 1917, c. 106, 40 Stat. 411, 415 (Comp. St. § 3115 1/2 cc); United States Railroad Administration, Act March 21, 1918, c. 25, 40 Stat. 451, 455; War Finance Corporation, Act April 5, 1918, c. 45, 40 Stat. 506 (15 USCA § 331 et seq.); United States Interdepartmental Social Hygiene Board, Act July 9, 1918, c. 143, 40 Stat. 845, 886 (Comp. St. § 9188 1/4 (a)); Railroad Labor Board, Act Feb. 28, 1920, c. 91, 41 Stat. 456, 470; Federal Power Commission, Act June 10, 1920, c. 285, 41 Stat. 1063 (16 USCA § 792 et seq.); General Accounting Office, Act June 10, 1921, c. 18, 42 Stat. 20, 23 (31 USCA § 41 et seq.); Veterans' Bureau, Act June 7, 1924, c. 320, 43 Stat. 607, 608 (38 USCA §§ 425, 426). So far as appears by the record, there has been no denial of the government rate at any time to any department, office, or division of the government as organized, except that to the Fleet Corporation here in question.

The extension of the government rate to each of the above-named departments was made by the Western Union, as a matter of course, upon application therefor by the government, and has been continued ever since. The government rate was applied to all messages sent on official business of the government and chargeable to any of the departments named, whatever the nature of its organization, whatever its functions, and whatever the character of the official business. In extending priority and the lower rates, no distinction has ever been made between messages sent to persons within the several departments and those outside. And, obviously, the im- portance to the United States of securing both priority and the lower rate for official messages sent by it, is the same whoever the addressee. Messages sent by the government, but not on official business exclusively, have been paid for by the private person interested; and the payment has been made at the commercial rate.¹

The Western Union has never questioned the right of the Shipping Board to the government rate on any official messages sent by it. It concedes that all the messages here in question relate to activities which the Shipping Board itself might legally have conducted; that all the messages were sent on its official business; that the Board was authorized by Congress to employ the Fleet Corporation as its agency to perform the particular activities in connection with which they were sent; that the messages were not to be paid for out of any segregated portion of Fleet Corporation money; that payment of the commercial rates would involve, indirectly, as additional charge on the public treasury; and that, so far as concerns the character of the message or of the business, the government rate was chargeable for all the messages, if for any of them. The claim that the government rates do not apply to messages of the Fleet Corporation is rested in part upon the fact that it is, in form, a private corporation; in part upon the fact that it is an agency of the Shipping Board, as distinguished from a bureau or division; in part upon the fact that, to a considerable extent it is engaged in a business which involves competition with private shipowners. These arguments do not support the claim; but they make necessary a statement of the facts concerning the organization and activities of the Fleet Corporation.

The Fleet Corporation was organized by the United States Shipping Board pursuant to specific authority conferred by the Act of September 7, 1916, c. 451, § 11, 39 Stat. 728, 731 (46 USCA § 810; Comp. St. § 8146f). The legislation concerning it, its relation to the Shipping Board, its character and the scope of its activities are shown in the Lake Monroe, 250 U. S. 246, 39 S. Ct. 460, 63 L. Ed. 962, United States v. Strang, 254 U. S. 491, 41 S. Ct. 165, 65 L. Ed. 368, Sloan Shipyards Corporation v. United States Shipping Board Emergency Fleet Corporation, 258 U. S, 549, 42 S. Ct. 386, 66 L. Ed. 762, United States v. Walter, 263...