Boston Maine Railroad Co v. United States Chicago, Burlington Quincy Railroad Co v. Boston Maine Railroad Co
| Decision Date | 17 November 1958 |
| Docket Number | Nos. 310,322,s. 310 |
| Citation | 358 U.S. 68,79 S.Ct. 107,3 L.Ed.2d 34 |
| Parties | BOSTON & MAINE RAILROAD CO. et al., Petitioners, v. UNITED STATES of America et al. CHICAGO, BURLINGTON & QUINCY RAILROAD CO. et al., Petitioners, v. BOSTON & MAINE RAILROAD CO. et al |
| Court | U.S. Supreme Court |
Messrs. Richard Swan Buell, Wm. T. Griffin, Otto M. Buerger, Carl E. Newton, New York, for appellants.
Messrs. S. R. Brittingham, Jr., Chicago, J. Lee Rankin, Solicitor General, Washington, D.C., for appellees.
Mr. S. R. Brittingham, Jr., Chicago, for appellants.
Mr. J. Lee Rankin, Solicitor General of the U.S., Washington, D.C., for appellees.
These cases concern the range of the Interstate Commerce Commission's power over rates for car hire in railroading. Because they predominantly originate freight, long-haul trunk-line railroads own most of the freight cars in the industry. Short-haul terminal railroads, on the other hand, mainly terminate freight; to avoid needless duplication, they hire the cars of the long-haul roads rather than replace them with their own. The compensation to be paid for use of another's cars has, for the most part, been fixed by the railroads themselves, originally in terms of the mileage which borrowed cars traveled over the using road, later in the form of a flat per diem rate. Since September 1, 1947, the amount of the per diem has been adjusted in accordance with an agreement prepared by the Association of American Railroads (AAR). Prior to this litigation, the rates so established were followed by railroads generally, signers and nonsigners of the agreement alike.
In March 1951 the New York, Susquehanna & Western Railroad announced that it would no longer comply with the then applicable per diem. Other terminal roads soon followed suit. In response, nineteen Class I long-haul roads filed a complaint with the Commission against five short-haul roads of the same Class and six short-line roads in Classes II and III. Additional roads intervening on one side or the other brought the total number involved to just over one hundred.
The complainants specifically declined to invoke the Commission's recognized rule-making power over car-hire rates conferred by § 1(14)(a) of the Interstate Commerce Act, 40 Stat. 101, as amended, 41 Stat. 476, 49 U.S.C. § 1(14)(a), 49 U.S.C.A. § 1(14)(a). Instead, they asked the Commission to declare that the various per diems in effect since November 1, 1949, were just and reasonable and that the public interest required uniform observance of those rates by all members of the industry. Relying on the power to issue declaratory orders granted by § 5(d) of the Administrative Procedure Act, 60 Stat. 240, 5 U.S.C. § 1004(d), 5 U.S.C.A. § 1004(d), the Commission held each per diem not in excess of reasonable compensation. Accordingly, it entered an order discontinuing the proceeding.
The terminal roads then brought an action before a statutory three-judge District Court to have this order set aside. As the court below noted, the effect of the Commission's action was 'to require the respondent (terminal) carriers, and, indeed, as a practical matter all others, to pay the charges for car-use found to be reasonably compensatory * * *.' 162 F.Supp. 289, 292—293, note 4. The terminal roads contended that determination of a uniform rate to be applied throughout the industry was beyond the Commission's adjudicatory jurisdiction and lay exclusively within its § 1(14)(a) rule-making power.
This contention, which forms the basis of the appeal in No. 310, was rejected by the District Court, one judge dissenting. Nonetheless, that court set aside the Com- mission's order on the merits. It pointed out that the Commission had erred in considering the repairs, depreciation and 'car day divisor' components of the per diem. But it rested decision on the Commission's summary rejection of an alternative method of compensation, which would introduce a mileage factor into the per diem, advocated by certain of the terminal roads. In the...
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