Great Northern Ry Co v. United States, 612

• Decision Date: 14 May 1928
• Docket Number: No. 612,612
• Parties: GREAT NORTHERN RY. CO. v. UNITED STATES et al
• Court: U.S. Supreme Court

277 U.S. 172

48 S.Ct. 466

72 L.Ed. 838

GREAT NORTHERN RY. CO.

v UNITED STATES et al.

No. 612.

Argued April 27, 1928.

Decided May 14, 1928.

Mr. F. G. Dorety, of St. Paul, Minn, forappellant.

[Argument of Counsel from pages 173-174 intentionally omitted] Mr. Blackburn Esterline, of Washington, D. C., for the United States.

Mr. D. W. Knowlton, of Washington, D. C., for Interstate Commerce commission.

[Argument of Counsel from page 176 intentionally omitted] Mr. Justice BRANDEIS delivered the opinion of the Court.

This suit, under the Act of June 18, 1910, c. 309, 36 Stat. 539, as amended by Urgent Deficiencies Act of Octo- ber 22, 1913, c. 32, 38 Stat. 208, 220 (28 USCA § 43-48, 214, 380) was brought by the Great Northern Railway Company against the United States, in the federal court for Minnesota, to annul two certificates issued by the Interstate Commerce Commission to the Secretary of the Treasury, pursuant to section 209 of Transportation Act 1920, February 28, 1920, c. 91, 41 Stat. 456, 464-468 (49 USCA § 77; Comp. St. § 10071 1/4 dd). The company claims that these certificates are orders of the Commission, that they were issued without authority of law, and that they are void. The United States and the Commission moved to dismiss on the ground that the certificates sought to be annulled are not orders of the Commission within the meaning of the Commerce Court and Urgent Deficiencies Acts, and that the United States had not consented to be sued. The case was heard before three judges, who dismissed the bill for want of jurisdiction. 22 F.(2d) 865. Whether they erred in so doing is the only question presented by the appeal.

Certificates under section 209 are an incident of the termination of the federal control of the railroads on March 1, 1920. They are provided for in title 2 of Transportation Act 1920. By section 209(c) of that act (49 USCA § 77(c); Comp. St. § 10071 1/4 dd(c)), the United States guaranteed to each company that its railway operating income for the following six months should be not less than one-half of the amount of the annual compensation to which it was entitled during the period of federal control. Paragraph (g) (49 USCA § 77(g); Comp. St. § 10071 1/4 dd(g)) provided that:

'The Commission shall, as soon as practicable after the expiration of the guaranty period, ascertain and certify to the Secretary of the Treasury the several amounts necessary to make good the foregoing guaranty. * * *'

Paragraph (h) (Comp. St. § 10071 1/4 dd(h)) provided for the issue, during the guaranty period, of certificates for payment on account, if the carrier furnishes an adequately secured contract to repay to the United States any amount received in excess of that which shall be finally determined as the sum to which the carrier is entitled under the guaranty. Section 212, added by the Act of February 26, 1921, c. 72, 41 Stat. 1145 (49 USCA § 79; Comp. St. § 10071 1/4 e(1)), provided for payments on account after the expiration of the guaranty period, the Commission being authorized to 'make its certificate for any amount definitely ascertained by it to be due, and * * * thereafter in the same manner make further certificates, until the whole amount due has been certified.' Upon receipt of certificates, the Secretary of the Treasury was directed 'to draw warrants in favor of each such carrier upon the Treasury of the United States, for the amount shown in such certificate as necessary to make good such guaranty.'

Upon certificates of the Commission issued to the Secretary of the Treasury under paragraph (h), he paid the company $6,500,000 in 1920. Upon certificate issued under section 212, he paid it $6,000,000 in 1921. Several years later, in the course of the proceedings for final settlement of the amount due the company under section 209, the Commission issued to the Secretary of the Treasury the two certificates here in suit. Only the second of them is of importance. It certified that the total amount required to make good to the company the guaranty provided for in section 209 was $11,170,214.02. Guaranty Settlement with Great Northern Railway Co. et al., 99 I. C. C. 231; Id., 111 I. C. C. 318. As the Secretary of the Treasury had paid $12,500,000 to the company, he demanded reimbursement, as an overpayment, of $1,329,785.98, being the difference between the aggregate amounts received by the company and the total amount certified as payable under the guaranty. Pending settlement of that claim, the government withheld payment to the company of all amounts accruing for transportation services, but the payments were resumed upon the company's deposit of Liberty bonds as collateral. Thereupon this suit was brought by the company to annul the certificates and to restrain the government from enforcing its claim by sale of the Liberty bonds or otherwise.

The function imposed upon the Commission by section 209 is solely that of determining the amount required to make good the government's guaranty. It is not an exertion of the delegated power to regulate interstate commerce. It is an incident of the World War-a temporary, nonrecurrent task, which might appropriately have been performed for the Treasury by its Comptroller or auditors, or by other trusted official. Congress selected the Commission for this service, doubtless, because of its special fitness. For the Commission had knowledge of railroads and experience in railroad accounting; it had the custody of the records of railroad operations; and its staff was competent to make speedily the necessary investigations.

Transportation Act 1920, did not confer upon the Commission power to order anything in connection with the issue of the certificates. There is in the certificates no direction, no word of command. They are the recital of a finding of act. They are addressed to the Secretary of the Treasury; and only to him. The form of the certificate expresses appropriately the character of the service performed by the Commission. The final certificate does not purport to declare that the carrier is indebted to the United States in any sum. It states the total amount required of the United States to make good the guaranty and the aggregate amount theretofore certified. It discloses the facts, but does not certify that there was an overpayment.¹ Congress distinguished clearly, in fram- ing Transportation Act 1920, between provisions which were amendments of the Interstate Commerce Act (49 USCA § 1 et seq.; Comp. St. § 8563 et seq.) and those which, while relating to railroads, were not. The amendments were grouped under title 4. The provisions here involved, which related solely to the termination of federal control, were grouped under title 2. Those which provided for the Railroad Labor Board under title 3. Because issuing certificates is not a part of the Commission's delegated power to regulate commerce, and is not an...