Baltimore & OR Co. v. Domestic Hardwoods

• Decision Date: 08 May 1933
• Docket Number: No. 5737.,5737.
• Citation: 62 App. DC 142,65 F.2d 488
• Parties: BALTIMORE & O. R. CO. et al. v. DOMESTIC HARDWOODS, Inc., et al.
• Court: U.S. Court of Appeals — District of Columbia Circuit

62 App. DC 142, 65 F.2d 488 (1933)

BALTIMORE & O. R. CO. et al. v. DOMESTIC HARDWOODS, Inc., et al.

No. 5737.

Court of Appeals of the District of Columbia

Argued April 4, 1933.

Decided May 8, 1933.

John J. Hamilton, Charles Clark, Geo. E. Hamilton, Geo. E. Hamilton, Jr., and Henry R. Gower, all of Washington, D. C., for appellants.

H. L. McCormick, of Washington, D. C., for appellees.

Before MARTIN, Chief Justice, and ROBB, VAN ORSDEL, and GRONER, Associate Justices.

GRONER, Associate Justice.

Appellants are interstate carriers. Appellees are lumber companies. We shall speak of the former as the carriers and the latter as the shippers.

Shippers between April 9, 1926, and November 2, 1926, delivered to the Tuckaseegee & Southeastern Railway Co., the initial carrier, at East Laport, N. C., 23 carload lots of lumber consigned to Toronto, Canada. Shippers directed that the shipments move via Cincinnati, Ohio. The freight rate charged and collected was based on a combination commodity rate determined by adding to the rate from Laport to Cincinnati the rate from Cincinnati to Toronto. The aggregate was 58.5 cents per hundred pounds. Shippers claim that the rate charged should have been 53 cents, and to recover this overpayment filed a claim with the delivering carrier, Canadian Pacific Railway, March 19, 1929. The claim was disallowed November 6, 1929, and on December 13, 1929, shippers made complaint to the Interstate Commerce Commission, alleging that the rate collected was inapplicable. The ground was that the combination rate charged was subject to the rule for constructing combination rates published in Jones' Tariff, I. C. C. U. S. 1, and that the application of this rule would result in a rate of 53 cents. The carriers denied that Jones' rule was applicable, because, they contended, it applied only where no through tariff rate was published from point of origin to point of destination, which, they said, was the case when the shipments in question moved.

The Commission awarded reparation, saying in their report: "When these shipments moved a joint rate of 59.5 cents was in force from East Laport to Toronto, but was restricted to apply only via the Virginia and Maryland gateways. This rate was applicable in connection with the originating line to which these shipments were tendered. Defendants contend that the existence of the joint rate via the Virginia and Maryland gateways defeated the application of the combination rule to the factors applicable over the route of movement, under the language employed in the tariff which provides that the rule is applicable `where no published through rates are in effect from point of origin to destination.' We have repeatedly found that the combination rule applies to combination rates over routes where no joint rates are applicable, regardless of whether joint rates are maintained from and to the same points over other routes. Wausau Southern Lumber Co. v. A. G. S. R. R. Co., 142 I. C. C. 521."

Carriers refused to obey the reparation order and refund the overcharge assessed by the Commission. Shippers thereupon commenced this action in the Supreme Court of the District of Columbia. Carriers demurred to the declaration, and, after the demurrer was overruled, refused to plead further, whereupon judgment was rendered against them and an appeal taken to this court.

The points argued here are as follows:

First. The court erred in holding as a matter of law that the Interstate Commerce Commission, at the time complaint was filed with it, had jurisdiction.

Second. That the Interstate Commerce Act statute of limitations barred the right of recovery.

Third. That the Commission's decision and order were contrary to law and insufficient to support the reparations order.

We will discuss these points briefly in the order in which they are stated above.

First. The basis of the claim the Commission is without jurisdiction is grounded on the theory that under the terms of the Commerce Act a claim for overcharge is exclusively within the jurisdiction of the courts. The point is that the controversy involves no question of fact, but, on the contrary, turns upon the meaning of the language used in the tariff, and that in such circumstances the question is one of law, and therefore preliminary resort to the Commission is not necessary.

Section 9 of the Interstate Commerce Act (title 49 USCA § 9) provides: That "any person or persons claiming to be damaged by any common carrier subject to the provisions of this chapter may either make complaint to the commission as hereinafter provided for, or may bring suit in his or their own behalf for the recovery of the damages for which such common carrier may be liable under the provisions of this chapter, in any district or circuit court of the United States of competent jurisdiction; but such person or persons shall not have the right to pursue both of said remedies, and must in each case elect which one of the two methods of procedure herein provided for he or they will adopt. * * *"

Relying on this section, the shippers filed their claims with the Commission, asking for an order for the amount collected in excess of the legal tariff rates in effect when the shipments moved. Section 6 of the act (49 USCA § 6) declares that no carrier shall charge or receive a greater amount of compensation for transportation of property than the rates specified in the tariff filed and in effect at the time. And section 8 (49 US CA § 8) makes the carrier liable to any person injured for the full amount of damages sustained in consequence of any such violation of the act; and section 9, quoted in full above, makes it optional with the person injured to apply to the Commission or to bring suit in a court of proper jurisdiction.

The language of the act supports the position of the shippers, but carriers insist that there are many cases in which a violation of the provisions of the act is charged in which it has been determined that the Commission has exclusive primary jurisdiction, notwithstanding the optional provisions of the act, and from this they argue that, since it is held that in questions involving technical interpretation of the tariffs resort must first be had to the Commission, it would follow logically that, where only a question of law is to be decided, the courts would have exclusive jurisdiction, but they say very frankly that no case has yet so decided.

In order to sustain carriers' position, we should have to break new ground and disregard, not only the express statutory right to an aggrieved party to go either to Commission or court, but likewise to overturn an established practice hitherto unchallenged.

In the Abilene Cotton Oil Case, 204 U. S. 426, 27 S. Ct. 350, 51 L. Ed. 553, 9 Ann. Cas. 1075, the Supreme Court held that, on a suit for recovery of damages because of the application of an unjust and unreasonable rate, there must be a primary application to the Commission; in other words, that the action of the Commission in determining whether the rate was unjust or unreasonable was a condition precedent to the institution of the suit.

So in the Merchants' Elevator Case, 259 U. S. 285, 42 S. Ct. 477, 66 L. Ed. 943, the Supreme Court held, in a case in which only the construction of the words of a written instrument was involved, as the result of which the construction rested solely on a question of law, it was not necessary to resort first to the Commission.

But there is nothing in either conclusion which will support carriers' position here. Compare Baltimore & O. R. R. v. Brady, 288 U. S. 448, 53 S. Ct. 441, 77 L. Ed. 888, decided March 13, 1933. The ground of the holding in the first grows out of the necessity of having the expert judgment of the Commission on the subject of what is and what is not an unjust and...