Great Northern Ry. Co. v. Erie R. Co.
| Decision Date | 08 April 1932 |
| Parties | GREAT NORTHERN RY. CO. v. ERIE R. CO. |
| Court | U.S. District Court — Southern District of New York |
F. G. Dorety, R. J. Hagman, and J. P. Plunkett, all of St. Paul, Minn., and White & Case, of New York City (Chester Bordeau, of New York City, of counsel), for plaintiff.
H. A. Taylor, of Cleveland, Ohio, and Marion B. Pierce, of New York City, for defendant.
The action is at law to recover money had and received. A jury was waived and the case submitted on an agreed statement of facts.
The railroad companies carried freight on through transportation, the charges being collected in some cases wholly by the Great Northern and in others wholly by the Erie. The charges so collected were subject to agreed bases for division among the railroads participating in the traffic. There thus arose what are called "interline accounts" between the two companies, the accounts being settled monthly. In the months from May, 1925, to July, 1926, inclusive, the balances due to the Great Northern on these accounts totaled $1,102,911.54. The Erie paid over the sum of $1,066,739.62. The balance, $36,171.92, was withheld by the Erie as money to which it claimed to be entitled under an order of the Interstate Commerce Commission. The $36,171.92 so withheld is the amount now sued for.
The order of the commission relied on by the Erie was entered in a proceeding commenced on September 13, 1922, entitled Erie R. R. Co. v. Alabama & Vicksburg Ry. Co., 98 I. C. C. 268. In this proceeding the Commission found that the existing divisions of the joint transcontinental rates on certain kinds of freight were unjust to the Erie, that the just divisions were those specified in the Commission's decision, and that such divisions would have been the just ones on and after September 13, 1922, when the proceeding was commenced. The order entered on April 30, 1925, set forth the divisions found by the Commission and provided that they should take effect retroactively, as of September 13, 1922. The $36,171.92 withheld by the Erie was the amount to which it was entitled under the retroactive feature of the Commission's order. The Great Northern protested against the deduction but without success. It also asked the Commission for a rehearing as to the retroactive adjustment, but its petition was denied.
In 1928 the Supreme Court held that the Commission had no power to give retroactive effect to an order of the type entered in the Erie Case. Brimstone R. R. &...
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