Kaeiser v. Illinois Cent. R. Co.

• Decision Date: 24 October 1883
• Citation: 18 F. 151
• Parties: KAEISER v. ILLINOIS CENT. R. CO.
• Court: U.S. District Court — Southern District of Iowa

18 F. 151

KAEISER v. ILLINOIS CENT. R. CO.

United States Circuit Court, S.D. Iowa, Central Division.

October 24, 1883

By an act of the general assembly of Iowa, approved March 23, 1874 a tariff of maximum charges was provided for the transportation of freight and passengers by railroad. The act, by its terms, applies to 'all railroad corporations organized or doing business in this state, their trustee receivers, or lessees. ' It provides that 'all railroads in this state shall be classified according to the gross amount of their respective annual earnings within the state per mile for the preceding year,' and for a separate tariff of rates for each class. It also provides that the tariff of rates so established shall 'be considered a basis on which to compute the compensation for transporting freight, goods, merchandise, or property over any line of railroad within this state. This suit is brought to recover damages for overcharges upon freight shipped from points in Iowa to points in Illinois and Wisconsin over a part of defendant's road in Iowa, and over connecting lines in the other states named. The answer sets up, among other things, that the statute above named neither had, nor was intended to have, any extraterritorial operation beyond the limits of Iowa, and neither had, nor was intended to have, any application to or effect upon contracts, either expressed or implied, for the conveyance of persons or property from a point in one state to a point in another state. Plaintiff demurs to this answer, and the principal question discussed by counsel are: (1) Did the act, by its terms, apply to interstate commerce? (2) If so, is it constitutional?

A. B. &amp J. C. Cummins, for plaintiff.

John F. Duncombe, for defendant.

McCRARY J.

There may be room for doubt as to whether the act of 1874, by its terms, applies to interstate commerce. If it be construed as in pari materia with the subsequent act of the sixteenth general assembly, (1876,) 'for the relief of certain railroad companies, agents, and employes,' there is, I think, sufficient ground for holding that it was only intended to regulate such transportation as was carried on within the state. The latter act provides for releasing railroad companies from liability for having violated the act of 1874 upon certain conditions. Among these conditions was a requirement that such railroad companies should enter into bonds, with security, conditioned that they would not seek to evade the provisions of the act of 1874 'by increasing or contriving any increase on through rates to points on its line outside of the state. ' If the original act itself was intended to apply to through shipments between points in this state and points in other states, it is difficult to see how it could have been evaded by increasing such rates.

It is plain, therefore, that the legislature understood and construed the original act as applicable only to local or state commerce, and sought by the supplemental act above mentioned to induce railroad companies to bind themselves by contract not to increase their charges upon interstate commerce for the purpose of making up for their losses under the law upon state commerce.

If, however, the statute shall be held by its terms to apply to interstate commerce, I am of the opinion that it is in contravention of article 1, Sec. 8, of the constitution of the United States, which confers upon congress the power 'to regulate commerce with foreign nations and among the several states. ' The question is one of great importance, and, in some of its aspects, not free from difficulty. It has been much discussed in the courts of the country, and especially in the supreme court of the United States.

The following propositions may now be laid down as settled, at least so far as the federal courts are concerned:

(1) The transportation of merchandise from place to place by railroad is commerce. (2) The transportation of merchandise from a place in one state to a place in another is 'commerce among the states.' (3) To fix or limit the charges for such transportation is to regulate commerce. (4) A statute fixing or limiting such charges for transportation from places in one state to places in other states, is a regulation of commerce among the states. (5) The power to regulate such commerce is vested by the constitution in congress. (6) This power of congress is exclusive, at least in all cases where the subjects over which the power is exercised are in their nature national, or admit of one uniform system or plan of regulation. (7) The state cannot adopt any regulation which does or may operate injuriously upon the commerce of other states.

These general propositions are abundantly sustained by the following, among other, authorities: Crandall v. Nevada, 6 Wall. 35; Passenger Cases, 7 How. 283; Gibbon v. Ogden, 9 Wheat. 1; Case of State Freight Tax, 15 Wall. 232; Welton v. Missouri, 91 U.S. 279; Hall v. De Cuir, 95 U.S. 497; Railroad Co. v. Husen, Id. 469; Pensacola Tel. Co. v. Western, etc., Tel. Co. 96 U.S. 9; Carton v. Ill. Cent. R. Co. (Sup. Ct. Iowa) 13 N.W. 67.

It is insisted by plaintiff's counsel, in his very able and exhaustive argument in this case, that, conceding the soundness of these propositions, the statute in question may be upheld upon the ground that in enacting it the state exercised a power which is vested concurrently in the states and the general government. That certain powers may be exercised by the states in the way of regulating interstate commerce, where no act of congress is interfered with, may for the purposes of this case, well be...