In re Independent Sewer Pipe Co.

• Decision Date: 04 March 1918
• Docket Number: 2173.
• Citation: 248 F. 547
• Court: U.S. District Court — Southern District of California
• Parties: In re INDEPENDENT SEWER PIPE CO.

248 F. 547

In re INDEPENDENT SEWER PIPE CO.

No. 2173.

United States District Court, S.D. California, Southern Division.

March 4, 1918

A.L Abrahams, of Los Angeles, Cal., for trustee.

W.I Gilbert and F.S. Sisk, both of Los Angeles, Cal., for claimants.

BLEDSOE District Judge.

Review is sought of an order of the referee disallowing in full a claim of the Southern Pacific Company against the bankrupt in the sum of $1,749.09, representing alleged unpaid freight charges upon a certain commodity transported over claimant's lines from Ione, Amador county, to Tropico Los Angeles county, and also for the transportation of a similar commodity from Alberhill and Prado, Riverside county to Tropico.

California has a Public Utility Act (Stats.Cal. 1915, p. 115 et seq.) modeled, at least with respect to railroad companies, after, and therefore to be construed similarly to, the federal Interstate Commerce Act. Section 14 of the act (p. 122) provides that the carrier shall file with the Railroad Commission and keep open for public inspection schedules showing the rates, fares, charges, and classifications for the transportation between termini within this state of persons and property from each point upon its route to all other points thereon, etc. Section 15, p. 124, provides that, unless otherwise permitted by the Railroad Commission, no change shall be made by any public utility in any rate, fare, charge, or classification, except after 30 days' notice, etc. Section 17a(2), p. 124, provides that:

"No common carrier shall charge, demand, collect or receive a greater or less or different compensation for the transportation of persons or property, or for any service in connection therewith, than the rates, fares and charges applicable to such transportation as specified in its schedules filed and in effect at the time; nor shall any such carrier refund or remit in any manner or by any device, any portion of the rates, fares, or charges so specified, except upon order of the Commission," etc.

The same inhibition is reiterated as to public utilities generally in section 17b, p. 127. Appropriate penalties (sections 76 and 77, p. 167), being not less than $500 nor more than $2,000 fine for each violation of the provisions of the act, as against the public utility guilty thereof, and by both fine and imprisonment against any officer, agent, or employé thereof, are provided.

In this case it appears, without question, that the commodity which was hauled from Ione to Tropico, a distance of over 500 miles, consisting of about 25 carloads, was hauled, waybilled, and paid for by the bankrupt as "sand," the rate on which under the published schedules at all times in question was $2.20 per ton. (One of claimant's briefs contains a statement, coming from one of its general officers, that the classification in the schedules was "common sand"; but I do not find this sustained by anything in the record. It would seem "important, if true," although, perhaps, the term "sand," as used in the schedules, would import "common sand.") At the same times the rate on "crude clay (except china clay or kaolin)" was $3 per ton. The commodity shipped from Alberhill and Prado to Tropico, amounting to 13 carloads, was waybilled as "clay," although, as hereinafter referred to, it also seems to have been considered by the referee as having been shipped as "sand."

The question in the case is whether the substance actually transported by claimant was sand or clay. If sand, at least with respect to the Ione shipments, the carriage charges have been fully paid. If clay, under the law as repeatedly determined, the carriage charges with respect to such shipments having been paid only in part, it is not only claimant's right, but its duty, to present its claim, and, if possible, effect a recovery as for the balance due. Loath as I am to disagree with a referee upon a question of fact presented upon review, I am constrained to believe that in this case the referee has arrived at erroneous conclusions with respect both to the fact and the law involved, and that in consequence his order should be annulled. The referee in his certificate, inter alia, says:

"It also appears from uncontradicted evidence adduced that the commodity, the character and proper classification of which is at issue here, had been shipped over claimant's lines for a number of years prior to the shipments in question, and had been received by the claimant for shipment, under the classification of sand and at the sand rate. The commodity is, and at all times has been, used commercially as what is called a grog or filler in the making of clay products, and is commonly and usually designated as what is known as 'Ione sand.' "

He then refers to the testimony of an expert geologist, offered by claimant, and, after admitting some inability thoroughly to understand just exactly what the expert intended to testify to--an inability which is shared by the court after reading his testimony carefully--the referee proceeds to quote the definitions of clay and sand as given in Webster's Dictionary, and then says:

"An examination and inspection of the samples offered in evidence brings the substance within the definition of sand, rather than within the definition of clay. Taking all the evidence into consideration, the referee finds that this substance, viz. the commodity involved in this controversy, is geologically as well as commercially to be classified as sand."

Some attention is then paid by the referee to a suggestion that had been made that the Railroad Commission had never classified this commodity either as clay or sand, and that in a proceeding had before the Commission, intended, as it is said, to effectuate that purpose, no action was taken. The referee then proceeds: "The referee finds that it was at the time of the shipments in question, and for a long time prior thereto had been, the practice of the claimant to carry the commodity in question at the sand rate, and that the claimant has not obtained from the Railroad Commission of the state of California permission to change the classification, so as to increase the rate on the commodity in question; nor has the claimant obtained permission to change its practice of carrying this commodity at the sand rate. The referee finds that the Railroad Commission of the state of California has made no findings or order permitting the claimant to change its said practice or classification, nor has said Commission made any findings that the increase in the rate is justified."

The statement last expressed by the referee leads the court to indulge in the inference that it was the opinion of the referee that, since the Railroad Commission had not authorized an increase in the rate affecting the particular commodity hauled by claimant, in consequence, claimant's claim for unpaid transportation charges should be denied. My understanding of the situation, however, is that a rate becomes fixed, certain, and exclusively applicable because of the fact that, being reasonable, it is adopted, announced and published with the consent of the Railroad Commission as the rate to be charged; that for the particular commodity which may be specified in the rate, and between the termini stated, no other rate for the carriage of that commodity may be charged or collected; and that, if a different rate than the one published in the schedules for that commodity be charged or collected, as for an excess a refund may be had, and as for an under-charge suit may be brought for the recovery of the difference. This is upon the principle that definite rates for definite commodities between definite points are to be established, subject to such governmental regulation as may be provided, and that, when so established and until lawfully changed, they may not be departed from, in order that equality and justice and no discrimination may be had as among shippers. All shippers, as well as the carrier, are required to live up to and in completest fashion abide by the rates thus announced and adopted; for an infraction of these requirements appropriate penalties are provided, and indubitable authority exists on the civil side of the courts to effect such a readjustment as will make the charges fixed and the charges paid, or to be paid, accord. Louisville & Nashville Rd. Co. v. Maxwell, 237 U.S. 94, p. 97, 35 Sup.Ct. 494, 59 L.Ed. 853, L.R.A. 1915E, 665; Central of Georgia Rd. v. Curtis, 14 Ga.App. 716, 82 S.E. 318; Ill. Cent. Ry. Co. v. Separi (D.C.) 205 F. 998; South. Ry. Co. v. Harrison, 119 Ala. 539, 24 So. 552, 43 L.R.A. 385, 72 Am.St.Rep. 936; Pecos Valley Ry. Co. v. Harris, 14 N.M. 410, 94 P. 951; Davis v. Sou. Pac. Co. (D.C.) 235 F. 731, in which case this court had occasion to consider the general subject-matter here involved and announced conclusions which seem to be fortified by authorities apposite herein. No mistake of fact, or special practice, engagement, or understanding of the parties, will...