Pennsylvania R. Co. v. International Coal Min. Co.

• Decision Date: 06 October 1909
• Docket Number: 36.
• Citation: 173 F. 1
• Parties: PENNSYLVANIA R. CO. v. INTERNATIONAL COAL MINING CO. INTERNATIONAL COAL MINING CO. v. PENNSYLVANIA R. CO.
• Court: U.S. Court of Appeals — Third Circuit

173 F. 1

PENNSYLVANIA R. CO. v. INTERNATIONAL COAL MINING CO.

INTERNATIONAL COAL MINING CO. v. PENNSYLVANIA R. CO.

No. 36.

United States Court of Appeals, Third Circuit.

October 6, 1909

Francis I. Gowen and Sellers & Rhoads, for Pennsylvania R. Co.

James W. M. Newlin, for International Coal Mining Co.

Before DALLAS, GRAY, and BUFFINGTON, Circuit Judges.

BUFFINGTON Circuit Judge.

In the court below the International Coal Mining Company, herein called the 'Mining Company,' recovered a verdict against the Pennsylvania Railroad Company, herein called the 'Railroad,' for alleged unjust discrimination in freight charges. To a judgment entered on such verdict, both parties sued out writs of error. We will first consider that of the Railroad.

It seems the Mining Company shipped coal over the Railroad's lines from its mines in bituminous regions of Pennsylvania to tide water from 1894 to 1901. The court excluded evidence bearing on the shipments prior to July 19, 1898, on the ground they were barred by the statute of limitations. As to the shipments from that date to April, 1899, the evidence showed the Mining Company paid the same rate as other shippers. Consequently there was no recovery for that period. From April 1, 1899, to 1901, it was conceded the Mining Company paid a higher rate than other shippers, and the verdict covered shipments during such period. The suit is based on section 2 of Act Feb. 4, 1887, c. 104, 24 Stat. 379 (U.S. Comp. St. 1901, p. 3155), which provides:

'If any common carrier subject to the provisions of this act shall, directly or indirectly, by an special rate, rebate drawback or other device, charge, demand, collect, or receive from any person or persons a greater or less compensation for any service rendered, or to be rendered, in the transportation of passengers or property, subject to the provisions of this act, than it charges, demands, collects or receives from any other person or persons for doing for him or them a like and contemporaneous service in the transportation of a like kind of traffic under substantially similar circumstances and conditions, such common carrier shall be deemed guilty of unjust discrimination, which is hereby prohibited and declared to be unlawful.'

The Railroad sought to escape liability for such excess freight charges during said last-named period by reason of the following facts: On April 1, 1899, by its published tariff, it advances its coal freight rates. At that time many shippers from the Mining Company's vicinity to seaboard had outstanding contracts to make coal deliveries over a series of years. These contracts were based on the freight rates in force when they were made. The Railroad, feeling its new and higher rates would entail serious loss on shippers bound by such contracts herein called 'contract coal,' continued in the case of such contracts the old and lower freight rates. This was done openly, and, indeed, the Mining Company was informed, if it had such contracts, its coal would be carried at the old rate. It had no such contracts, and therefore it was charged the higher rate. It had no such contracts, and therefore it was charged the higher rate for what was called 'free coal,' and the verdict is based on such differential. The Mining Company's shipments were in part from the Huntingdon & Broad Top Railroad, which was a separate company from the Railroad, but was operated by it. No shipments of contract coal were made from the Huntingdon & Broad Top Railroad. The other shipments of the Mining Company, as well as shipments of contract coal by other shippers, were made from the Clearfield district. The court submitted to the jury the question whether the Huntingdon & Broad Top Railroad was part of the Clearfield district, and its verdict established that such was the case. Now the Railroad sought to draw a distinction between shipments of 'contract coal' and 'free coal' as above described, requesting the court to charge:

'If the jury believe that it would tend to the benefit of its shippers, and would also tend to secure for it a larger volume of business, the carrier is not guilty of discrimination forbidden by the interstate commerce act, because it carries, at rates of freight in force at the time such contracts were entered into, coal embraced in and shipped under contracts extending for a period of time, even though at the same time it may be charging a higher rate on coal not covered by or embraced in contracts of such a character, provided it extends the benefit of the lower rates to all shippers having such contracts and shipping coal thereunder.'

We are thus brought face to face with the question whether the existence of these contracts created a dissimilarity of circumstance and condition under which the service of carriage was rendered. To us the reading of the act is clear. The act contemplates 'compensation for any service rendered.' Now it is manifest that 'service rendered' is the physical service of carriage. Elsewhere it is spoken of as 'a like and contemporaneous service.' Such service is 'service in the transportation,' it is a 'service in the transportation of a like kind of traffic'; and it is a service in transportation 'under substantially similar circumstances and conditions.' The law having in view the carriage of freight and equal rates to all, it is clear to us that the words 'substantially similar circumstances and conditions,' as used in this subsection, are those which affect transportation, and not those which involve personal conditions or contractual relations between one particular shipper and the carrier, but are such things only as are circumstances of carriage generally.

In Wight v. United States, 167 U.S. 513, 17 Sup.Ct. 822, 42 L.Ed. 258, it was sought to differentiate the service performed by the different terminal facilities of the two shippers at their respective warehouses; but the court held these were not the circumstances and conditions of the act, but that the circumstances and conditions the act contemplated were those which affected the actual carriage of the freight, using this language:

'It was the purpose of this act to enforce equality between shippers, and it prohibits any rebate or other device by which two shippers, shipping over the same line, the same distance, under the same circumstances of carriage, are compelled to pay.'

And that this phrase, 'circumstances of carriage,' was a carefully chosen one, limiting the circumstances to such as affected haulage of freight, is shown in Interstate Com. Com. v. Alabama R. Co., 168 U.S. 166, 18 Sup.Ct. 49 (42 L.Ed. 414), where, referring to Wight v. United States, supra, the court say:

'We there held that the phrase 'under substantially similar circumstances and conditions,' as used in the second section, refers to the matter of carriage, and does not include competition between rival routes.'

It follows, therefore, that if these circumstances and conditions of section 2 are those which affect haulage, and do not include competition between rival routes, they do not include individual elements affecting individual shippers. The purpose of the section is to afford identity of rate for substantial identity of transportation service, and anything that does not aid in determining what is such substantial identity of haulage does not aid in the application of the section. Evidently it was with this view the court purposely said in that part of its charge here assigned for error:

'It is contended by the defendant that, if shippers have overlapping contracts, they can be classified. The interstate commerce act authorizes the classification of commerce. You can ship coal for one price per ton, iron pipe for another, and pig iron for another. In other words, there is a classification of commerce. Whether they could classify overlapping contracts, schedule them, and make them public or not, is not a question in this case; but it is a question whether or not, when they schedule a certain figure for the transportation of property from one point to another as their tariff rate, and make that public, they are bound by it, and the law is that they cannot have a private agreement, overlapping or not overlapping, which gives a competitor, during the contemporaneous shipments, a return or an advantage over the published rate.'

Where, as in this case, the Railroad made a published rate for coal from the Clearfield district to tide water, and the Railroad charged the Mining Company for this haulage the published rate, but charged other shippers for the same haulage lower rates, it is clear it violated the second section, in that, as said by the Supreme Court:

'To shippers, shipping over the same line, the same distance, under the same circumstances of carriage, are compelled to pay different prices therefor.' Whether, indeed, the railroad might have classified contract coal in one class and free coal in another is not before us; for in point of fact it made no such classification and made no differential rates for such coal. What it did was to give a rate on coal from the Clearfield district to seaboard to one shipper and deny it to another, and thereby it violated the express provisions of the statute. The like circumstances and conditions are those which arise within the field of haulage, and not those which exist outside. In this case the Railroad charged to one shipper a rate of haulage, and, the coal of the other shipper being hauled from the same initial locality to the same terminal point, the haulage was identical, and therefore the freight should be the same. To hold otherwise, and to say that because one shipper had made a prior contract, based on lower freight rates, the service was thereby made dissimilar, is not only

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