297 U.S. 175 (1936), 33, United States v. California

Docket Nº:No. 33
Citation:297 U.S. 175, 56 S.Ct. 421, 80 L.Ed. 567
Party Name:United States v. California
Case Date:February 03, 1936
Court:United States Supreme Court

Page 175

297 U.S. 175 (1936)

56 S.Ct. 421, 80 L.Ed. 567

United States



No. 33

United States Supreme Court

Feb. 3, 1936

Argued January 16, 17, 1936




1. Whether a transportation agency is a common carrier depends not upon its corporate character or declared purposes, but upon what it does. P. 181.

2. The State Belt Railroad, owned by the California and operated by it along the waterfront of San Francisco harbor, which receives all freight cars, loaded and empty, offered to it by railroads, industrial plants and steamships, with which it connects, and hauls them at a flat rate per car, the larger part of such traffic having its origin or destination in States other than California, is a common carrier engaged in interstate commerce. P. 182.

3. In operating a common carrier railroad in interstate transportation, though the purpose be to facilitate the commerce of a port and the net proceeds be used in harbor improvement, a State acts in subordination to the power of Congress under the commerce clause. P. 183.

4. Even though the State, in the conduct of its railroad, be said to act in its "sovereign," distinguished from a "private," capacity, its sovereignty in that regard is necessarily diminished to the extent of the power granted by the Constitution to the Federal Government. P. 183.

5. The principle by which state instrumentalities are protected from federal taxation, and vice versa, is inapplicable by analogy as a limitation upon the federal power to regulate interstate commerce. P. 184

6. The provisions of the Safety Appliance Act forbidding any common carrier engaged in interstate commerce by railroad to haul cars not equipped with couplers as prescribed, and penalizing infractions, include state-owned interstate rail carriers. P. 185.

7. The canon of construction that a sovereign is presumptively not intended to be bound by its own statute unless named in it should not be extended so as to exempt from an Act of Congress a business plainly within its terms and purpose merely because the business is carried on by a State. P. 186.

8. Congress may confer on inferior courts original jurisdiction of suits in which a State is a party. P. 187.

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9. The inclusion of an earlier provision in the Judicial Code was not a reenactment. P. 187.

10. Section 6 of the Safety Appliance Act, as amended in 1896, provides that any common carrier, for each car hauled by it in violation of the Act, shall be liable to penalty of $100,

to be recovered in a suit or suits to be brought by the United States district attorney in the district court of the United States having jurisdiction in the locality where such violation shall have been committed.

Section 233, Jud.Code, originally enacted as part of the Judiciary Act of 1789, gave this Court "exclusive jurisdiction of all controversies of a civil nature where a State is a party," (with certain exceptions). Assuming that a suit to recover the penalty is a controversy of a civil nature, held that, with respect to such suits when brought against States, § 6 supplants § 233, and lodges jurisdiction in the district court of the locality. P. 187.

75 F.2d 41 reversed.

Certiorari, 296 U.S. 554, to review a judgment reversing a judgment for a penalty recovered by the United States against the California by suit in the District Court.

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STONE, J., lead opinion

MR. JUSTICE STONE delivered the opinion of the Court.

This is a suit brought by the United States against the state of California in the District Court for Northern California to recover the statutory penalty of $100 for violation of the Federal Safety Appliance Act, § 2, Act of March 2, 1893, c.196, 27 Stat. 531, 45 U.S.C. § 2, and § 6 of the Act, as amended April 1, 1896, 29 Stat. 85, 45 U.S.C. § 6. *

The complaint alleges that California, in the operation of the state-owned State Belt Railroad, is a common carrier engaged in interstate transportation by railroad, and that it has violated the Safety Appliance Act by hauling over the road a car equipped with defective coupling apparatus. Upon the trial, without a jury, upon stipulated facts, the District Court gave judgment for the United States. The Court of Appeals for the Ninth Circuit reversed, 75 F.2d 41, on the ground that, as exclusive jurisdiction of suits to which a state is a party is conferred upon this Court by § 233 of the Judicial Code, 36 Stat. 1156, 28 U.S.C. § 341, the District Court was without

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jurisdiction of the cause. We granted certiorari to review the case, as one involving questions of public importance, upon a petition of the government which urged that the state is a common carrier by railroad, subject to the Safety Appliance Act, and, under its provisions, to suit in the District Court to recover penalties for violation of the act.

In an earlier suit, Sherman v. United States, 282 U.S. 25, brought against the Board of State Harbor Commissioners, which supervises operation of the State Belt Railroad, to recover penalties for violation of the Act, this Court set aside the judgment of the District Court for the government because the state had not been made a party.

1. Whether a transportation agency is a common carrier depends not upon its corporate character or declared purposes, but upon what it does. United States v. Brooklyn Eastern District Terminal, 249 U.S. 296, 304. The State Belt Railroad is owned and operated by the [56 S.Ct. 423] state, see Sherman v. United States, supra. It parallels the waterfront of San Francisco harbor and extends onto some forty-five state-owned wharves. It serves directly about one hundred and seventy-five industrial plants, has track connection with one interstate railroad, and, by wharf connections with freight car ferries, links that and three other interstate rail carriers with freight yards in San Francisco leased to them by the state. It receives and transports from the one to the other, by its own engines, all freight cars, loaded and empty, and the freight they contain, offered to it by railroads, steamship companies, and industrial plants. The larger part of this traffic has its origin or destination in states other than California. For the transportation service, it makes a flat charge per car. It issues no bills of lading, and is not a party to through rates. It moves the cars on instructions contained in "switch lists" made out by the delivering or receiving carrier, which pays the charge and absorbs it in its rate. The

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charge on cars not delivered to or received from another carrier is paid by the industry concerned.

The Belt Railroad is thus a terminal railroad for the industries and carriers with which it connects, and it serves as a link in the through transportation of interstate freight shipped to or from points in San Francisco over the connecting carriers. Its service is of a public character, for hire, and does not differ in any salient feature from that which this Court, in United States v. Brooklyn Terminal, supra, 304-305, held to be common carriage by rail in interstate commerce within the meaning of the Federal Hours of Service Act, 34 Stat. 1415, 45 U.S.C. § 61.

The state insists that the facts that it maintains no freight station, issues no bills of lading, and is engaged only in moving cars for a flat rate instead of at a charge per hundred pounds of freight moved, distinguish the operation of its railroad from that of the Brooklyn Terminal. As the service involves transportation of the cars and their contents, the method of fixing the charge is unimportant. Belt Railway Co. of Chicago v. United States, 168 F. 542, 544; see United States v. Union Stock Yard & Transit Co., 226 U.S. 286, 299-300. And, while maintenance of a freight station and the issue of bills of lading may be embraced in the service of a common carrier, and a part of interstate commerce, see United States v. Ferger, 250 U.S. 199, Atchison, T. & S.F. Ry. Co. v. United States, 295 U.S. 193, they are not indispensable adjuncts to either where the subject of transportation -- here cars loaded and empty -- may be effected without.

All the essential elements of interstate rail transportation are present in the service rendered by the State Belt Railroad. They are the receipt and transportation, for the public, for hire, of...

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