Davis v. Keystone Steel & Wire Co.

• Decision Date: 11 June 1925
• Docket Number: No. 16299.,16299.
• Citation: 148 N.E. 47,317 Ill. 278
• Court: Illinois Supreme Court
• Parties: DAVIS, Agent, v. KEYSTONE STEEL & WIRE CO.

317 Ill. 278

148 N.E. 47

DAVIS, Agent,

v.KEYSTONE STEEL & WIRE CO.

No. 16299.

Supreme Court of Illinois.

April 24, 1925.

Rehearing Denied with Modification June 11, 1925.

Action by James C. Davis, Agent of the United States Government, etc., against the Keystone Steel & Wire Company. Judgement for plaintiff, and defendant appeals.

Affirmed.Appeal from Circuit Court, Peoria County; Charles V. Miles, judge.

Tichenor, Todd, Wilson & Barnett, of Peoria, for appellant.

Miller, Elliott & Westervelt, of Peoria (Barnes, Magoon & Black, of Peoria, of counsel), for appellee.

DUNN, J.

The defendant, the Keystone Steel & Wire Company, claiming that, by a judgment rendered against it by the circuit court of Peoria county, in favor of James C. Davis, Agent of the United States under the provisions of the Transportation Act of 1920 (U. S. Comp. St. Ann. Supp. 1923, § 10071 1/4 et seq.), for $18,930, demurrage on certain cars delivered to defendant between August 5 and October 10, 1919, it has been deprived of its property without due process of law, in violation of the Constitutions of the state of Illinois and of the United States, has appealed to this court.

The cause was heard by the court without a jury, upon the plea of the general issue and stipulation that any evidence showing a defense might be offered. The defense made by the evidence was that, on July 5, 1919, a strike of the defendant's employees was called, which, because of threats and intimidation, resulted on August 13 in depriving it of all of its employees, who usually numbered between 400 and 600 men, except the office employees and from 50 to 75 employees in the plant. On August 13 it undertook to increase its working force, but its efforts were frustrated by a mob, which by violence drove out its employees and took possession of its plant. The defendant sought protection from the sheriff and the state, but received none, and finally regained possession of its plant on October 2 by the assistance of the United States marshal, acting under a restraining order issued by the federal District Court. From August 13 to October 2 the defendant was prevented from unloading the cars delivered to it, except one car, which was unloaded on September 26. The demurrage charges which accrued to October 2 amounted to $16,830. On October 3 the unloading of cars began and continued until October 17. During this time the demurrage charges accumulated to the amount of $2,100. The unloading was accomplished as fast as the defendant could get the men to do it.

Propositions of law were submitted to the court by the parties, and the court held, in substance, that it was the duty of the appellee to collect the demurrage charges in accordance with the tariffs in force and on file with the Interstate Commerce Commission and the Illinois Public Utilities Commission, that the defendant was bound to pay such charges, even though it had been prevented from unloading the cars by reason of a strike of its employees, and that a strike, where the strikers and mob took possession of the defendant's plant, and by threats and acts of violence and intimidation prevented it from carrying on its business and unloading cars delivered to it, did not relieve it from this liability. The contention of the appellant is that the duty to pay demurrage charges is one imposed by law, and is in the nature of a penalty not arising from any contract, and that the failure to admit its defense deprived it of its property without due process of law, and its whole argument is based on that proposition.

[1] The charges of common carriers, keepers of ferries, wharfingers, innkeepers, hackmen, and others whose business is affected with a public interest, have from time immemorial been subject to regulation by law, and the rates to be charged for their services have been fixed by statute. The owner of property which he has devoted to a use in which the whole public has a direct interest must submit to the regulation for the common good so long as he exercises the use. The public has a direct interest in all these occupations, for they are necessary to the public convenience and welfare. Every one has a right to make use of the services and enjoy the accommodations of those who are engaged in these employments, and every one is at times obliged to have the use of some of them. At common law persons engaged in these employments were allowed to charge such prices as they could agree upon with those dealing with them but not entirely at their own will. The rule was recognized that the charges for their services and accommodations must be reasonable and not arbitrary and excessive. This rule was the regulation at common law of rates charged for service. As to carriers it was early amended in England by statute (3 W. & M. c. 12, § 24), fixing rates, and following a preamble reciting:

‘Whereas, divers wagoners and other carriers by combination amongst themselves have raised the prices of carriage of goods in many places to excessive rates, to the great injury of the trade, be it therefore enacted,’ etc.

[2] An act of the General Assembly of Illinois, approved April 25, 1871 (Laws 1871-72, p. 762) fixed the maximum rate to be charged for the storage of grain in warehouses. An information for a violation of the act was filed in the criminal court of Cook county, and the defendants being convicted prosecuted a writ of error from this court, insisting that the statute violated the constitutional prohibitions against deprivation of liberty or property without due process of law, and against the taking of private property for public use without just compensation. The judgment was affirmed, the court holding that a law providing a maximum rate of charges did not violate either of the constitutional provisions in question. Munn v. People, 69 Ill. 80. The case was then taken to the Supreme Court of the United States, which affirmed the judgment, holding that the statute did not violate the Fourteenth Amendment of the federal Constitution or any other provision of that instrument, and that the fixing of maximum rates is a legislative function. Munn v. Illinois, 94 U. S. 113, 24 L. Ed. 77. In Budd v. New York, 143 U. S. 517, 12 S. Ct. 468, 36 L. Ed. 247, the constitutionality of a somewhat similar statute of the state of New York, governed by the same principle, was sustained, the court citing numerous cases as recognizing the doctrine of the Munn Case that the Legislature may fix a maximum fee, beyond which any fee would be unreasonable, in respect to services rendered in a public employment or for the use of property in which the public has an interest, but cannot compel the doing of services without reward, or taking private property for public use without just compensation or due process of law. Where the maximum charge has been fixed by legislative authority, the court has nothing to do with the question unless the lawmaking power has attempted to force the owner to use his property for public benefit without just compensation.

Moved by combinations and practices similar to those recited in the preamble to the statute of 3 W. & M. 200 years before, which has been referred to, and by other practices and devices, resulting not only in excessive rates but also in unjust discrimination between individuals and communities, Congress passed the act of February 4, 1887 (U. S. Comp. St. § 8563 et seq.), to regulate commerce, known as the Interstate Commerce Act, for the purpose of preventing interstate railroad carriers from charging unreasonable rates and from unjustly discriminating between persons and localities. New York, New Haven & Hartford Railroad Co. v. Interstate Commerce Com., 200 U. S. 361, 26 S. Ct. 272, 50 L. Ed. 515. The railroads availed themselves of the weakness and cumbrousmachinery of the original law to defeat its purpose, and this led to various amendments strictly defining and limiting the duties and powers of the carriers, and giving authority to the Interstate Commerce Commission for effective action to secure the observance of the law by the establishment and enforcement of reasonable, uniform rates, without discrimination between persons and localities. Railroad Com. v. Chicago, Burlington & Quincy Railroad Co., 257 U. S. 563, 42 S. Ct. 232, 22 A. L. R. 1086, 66 L. Ed. 371.

The act of June 29, 1906, known as the Hepburn Act, amended section 6 of the Interstate Commerce Act so that paragraph 7 of that section provides as follows:

‘No carrier, unless otherwise provided by this act, shall engage or participate in the transportation of passengers or property, as defined in this act, unless the rates, fares, amd charges upon which the same are transported by said carrier have been filed and published in accordance with the provisions of this act; nor shall any carrier charge or demand or collect or receive a greater or less or different compensation for such transportation of passengers or property, or for any service in connection therewith, between the points named in such tariffs than the rates, fares, and charges which are specified in the tariff filed and in effect at the time; nor shall any carrier refund or remit in any manner or by any devise any portion of the rates, fares, and charges so specified, nor extend to any shipper or person any privileges or facilities in the transportation of passengers or property, except such as are specified in such tariffs: Provided, that wherever the word ‘carrier’ occurs in this act it shall be held to mean ‘common carrier.” U. S. Comp. Stat. § 8569, par. 7.

An act of Congress of August 29, 1916, § 1, gave the President, in time of war, power to take possession and control of any system of transportation and use it to the exclusion of all other traffic, so far as necessary for the transportation of troops, war material, and equipment, or such other purposes connected with the emergency as might be necessary or desirable. U. S. Comp. Stat. § 1974a. War...