Louisville Co v. United States 15 16, 1931

• Decision Date: 25 February 1931
• Docket Number: No. 333,333
• Citation: 51 S.Ct. 297,75 L.Ed. 672,282 U.S. 740
• Parties: LOUISVILLE & N. R. CO. et al. v. UNITED STATES et al. Argued Jan. 15-16, 1931
• Court: U.S. Supreme Court

282 U.S. 740

51 S.Ct. 297

75 L.Ed. 672

LOUISVILLE & N. R. CO. et al.

v UNITED STATES et al.

No. 333.

Argued Jan. 15-16, 1931.

Decided Feb. 25, 1931.

Mr. Alfred P. Thom, of Washington, D. C., for appellants.

The Attorney General and Mr. Daniel W. Knowlton, of Washington, D. C., for appellees.

Mr. Chief Justice HUGHES delivered the opinion of the Court.

This is an appeal from a decree of the District Court, constituted as required by statute, dismissing the petition of the appellants to set aside, in part, two orders of the Interstate Commerce Commission, which were made on November 4, 1929, and July 30, 1929, respectively.

The first-mentioned order was made in a proceeding instituted by the Commission in December, 1925, on its own motion, for an investigation concerning the use of private passenger train cars, including so-called office cars. A questionnaire was sent to all class I and class II carriers, and to switching and terminal carriers, calling for information 'as to private passenger-train cars owned, leased, or operated, the movement or use of such cars as were transported free or at less than tariff rates on home and foreign lines, and the occupants of such cars on respective trips.' Returns were made by 387 carriers covering the calendar years 1923, 1924, and 1925. In July, 1928, a proposed report was served upon appellants and all other carriers. Exceptions were filed by the association of Railway Executives on behalf of its members, including the appellants; argument was heard; and the matter submitted to the Commission. Its report was issued on June 21, 1929, setting forth the Commission's findings and conclusions. 155 I. C. C. 775. After waiver by the carriers of further hearing before the Commission, the order in question was entered requiring the carriers named, including these appellants, 'to cease and desist, on or before January 15, 1930, and thereafter to abstain, from the transportation or movement of private passenger train cars, including so-called office cars, of another carrier free or at other than published tariff rates.'

The other order of the Commission under attack, that is, the order of July 30, 1929, amended the Commission's regulations governing the form and recording of passes, by the insertion of the following: 'A car pass may be issued only for cars owned by the issuing carrier or held by it under lease for use in its business as a common carrier. It may not be issued for other cars. This provision is not to be construed as prohibiting the issuance of passes for cars of lines operated as a part of the same system. See In the Matter of Private Passenger Train Cars, 155 I. C. C. 775.'

The case was tried in the District Court on the facts detailed in the report of the Commission as to the practices of the carriers, ad a § to these facts were was no dispute. The Court concluded that the practice condemned by the Commission was a matter within its jurisdiction, and that, the order being supported by substantial evidence, the Court was without power to interfere.

The evidence before the Commission consisted of the returns of the carriers to its questionnaire. These returns contained a vast amount of statistical data, differing in details but practically the same in substance, which were reviewed and tabulated in the Commission's report. The commission found, in substance, that carriers transported free of charge the private, or office, cars¹ of other carriers when occupied by persons for whose transportation it was lawful to issue a pass; that carriers also provided accessorial transportation of such cars free of charge when they were moved 'deadhead' to stations where they were to be occupied, or to their home stations after occupancy, and also in switching and storing the cars. The wide extent of the practice and the abuses attending it were shown.² The Commission referred to the proposal of the carriers to undertake the correction of such abuses, and stated that the Commission was concerned primarily with the legality of the free transportation of the private cars of other carriers.

With respect to the transportation of privately owned cars, that is, of cars owned by others than carriers, or of cars chartered for the exclusive use of special parties, the Commission found that such cars were transported in pas- senger trains under tariffs which provided for certain minimum revenues, ³ and that these charges were intended to cover the service of transporting the cars; that is, 'to compensate for the movement of the car rather than its contents.'⁴ The Commission concluded that the transportation of the private cars of other carriers free, or at less than published rates, while making charges for the movement of privately owned or chartered cars, was injustly discriminatory.

Treating the private, or office, cars of other carriers as property, to which the provisions of the Interstate Commerce Act applied, and considering that the free transportation of property was lawful only in the exceptions provided in section 22 of the Interstate Commerce Act (49 USCA § 22), the Commission concluded that the transportation of such cars free, or at other than published tariff rates, was a violation of the act. The Commission pointed out that its finding 'does not extend to the point of saying that it is unlawful for private cars of one carrier to be transported over the lines of other carriers, but is confined to the assertion that under existing law the transportation of private cars on foreign lines should be paid for through the assessment of a just and reasonable charge.' 155 I. C. C. p. 793.

The conclusions of the Commission were thus summarized in its order of November 4, 1929:

'1. That the transportation or movement of private passenger cars, including so-called office cars, of one car- rier subject to the Interstate Commerce Act by another such carrier free or at other than published tariff rates is contrary to the provisions of the Interstate Commerce Act;

'2. That it is unjustly discriminatory and unduly preferential and prejudicial to haul such private cars of other carriers free, or at less than published tariff rates, while charging certain minimum fares and revenues for the movement of privately owned or chartered cars; and

'3. That the transportation of persons in such private passenger cars, including berth and other accommondations, at the rate charged passengers provided only with ordinary coach accommodations is unjustly discriminatory and unduly preferential and prejudicial.'

Appellants state that they are not attacking the third of these propositions; that is, there is no effort in this suit to set aside that part of the Commission's order which relates to the transporting of revenue passengers in business cars at the rate charged passengers holding tickets which are good only in the coach. The appellants say that it is the purpose of the carriers to remove this discrimination in some satisfactory way.

The first two propositions are those in controversy. The appellants confine their complaint in this Court to the aspect of the Commission's order which holds unlawful the movement by a carrier subject to the act 'of the private or business car of another such carrier when such car is occupied by a person using, and lawfully entitled to use, free transportation.' A similar position is taken with respect to the other order of the Commission (of July 30, 1929), amending the Commission's regulations as to passes.

With the premise that the Commission has no authority except that delegated to it by the Congress, the appellants contend (1) that the movement under consideration 'is not a shipmen of property subject to section 6 of the Interstate Commerce Act, which relates to property shipments'; and (2) that 'the transaction here involved does not violate the discrimination provisions' of the act.

We may first consider the question of unjust discrimination. It is not open to dispute that there is discrimination in fact, The findings of the Commission are decisive upon that point. The tariffs of the carriers provide for certain minimum fares and revenues for the movement of the private cars of individuals and of corporations other than those of other carriers. These charges, as the Commission found, cover the service of transporting the car and not simply the passengers. 'Apparently,' said the Commission, 'the only matterial difference between the cars on which these minimum charges apply and the private cars of other carriers is the matter of who owns or is using them.' The Commission found that this discrimination is unjust, and, so far as this is a question of fact, it does not appear that the finding lacks adequate support. The appellants emphasize the convenience to railraod officials of the existing practice. It is said that much of a railroad officer's time is spent in traveling, not only over his own lines, but to points on the lines of other railroads, in connection, as questions of management and operation, as well as of financial and other executive policies of importance to all the railroads; that he must attend meetings and conferences, and hearings before Commissions; that during such journeys, which frequently cover long periods, he is handling mail and business documents, and is giving attention to the conduct of his railroad work; and that he must take with him voluminous papers and office assistants. It is also pointed out that inspection of the properties of other carriers is necessary to good management, and has high educational value. But, if it be assumed that the existing practice is a convenience to railroad officials, still it does not appear that the convenience is essentially one peculiar to their case. The finding of the Commission is that, while the use of private cars of railroad officials as 'offices on wheels for those whose duties require considerable travel over the line' is an important facility for carrying on the...