Sullivan v. Minneapolis & R. R. Ry. Co.

• Decision Date: 29 May 1913
• Citation: 121 Minn. 488,142 N.W. 3
• Parties: SULLIVAN et al. v. MINNEAPOLIS & R. R. RY. CO.
• Court: Minnesota Supreme Court

121 Minn. 488

142 N.W. 3

SULLIVAN et al.

v.MINNEAPOLIS & R. R. RY. CO.

Supreme Court of Minnesota.

May 29, 1913.

Appeal from District Court, Itasca County; C. W. Stanton, Judge.

Action by J. C. Sullivan and others against the Minneapolis & Rainy River Railway Company. From an order sustaining a demurrer to the complaint, plaintiffs appeal. Reversed.

Syllabus by the Court

The jurisdiction of the state courts of an action by a shipper against a common carrier for damages resulting from unlawful discrimination against him in rates is not affected by the provisions of the federal Interstate Commerce Act (Act Feb. 4, 1887, c. 104, 24 Stat. 379 [U. S. Comp. St. 1901, p. 3154]), where the shipments involved are within points within the state and the transportation is wholly therein; and where such appears from the complaint a demurrer for lack of jurisdiction by reason of such act should be overruled, especially where there is no suggestion in the complaint that the defendant was ever engaged in interstate commerce, or that its road is so situated as to enable it to engage therein.

The modern common law imposes upon common carriers the duty of equality in freight rates to all shippers similarly circumstanced, for the transportation of the same class of goods the same distance; and our statutes prohibiting such discrimination are declaratory of the common-law rule.

The shipper's common-law right of action for damages for discrimination in rates is not taken away by our rate-regulating statutes, which furnish no civil remedy to the shipper therefor.

The shipper would have such a right of action, even though the statutory prohibition of discrimination in rates were deemed to create a new obligation on the part of the carrier; no civil remedy being provided thereby.

In such an action, whether based upon the common-law or the statutory duty not to discriminate in rates, the shipper may recover the difference between the charges exacted of him and those accepted from the most favored shipper; and though the rates charged the plaintiff were those established by law, such a recovery neither compels the defendant to commit a second wrong nor in any way affects the legally established rates. George H. Spear, of Duluth (Kingman & Wallace, of Minneapolis, of counsel), for appellants.

Powell & Simpson, of Minneapolis (E. C. Carman, of Minneapolis, of counsel), for respondent.

PHILIP E. BROWN, J.

Appeal by the plaintiffs from an order sustaining a demurrer to the complaint.

Two causes of action are attempted to be stated therein, the first of which is, in substance, that the defendant, a Minnesota corporation, is, and was at all times referred to, engaged as a common carrier in operating a railway extending north from a certain station known as Mississippi River, in Itasca county; that during the times stated the plaintiffs and an Illinois corporation known as the Itasca Lumber Company were logging in certain territory served by the defendant as a common carrier, the plaintiffs and the Itasca Lumber Company being competitors, each shipping large quantities of logs over the defendant's railway to its terminus at Mississippi River, in the course of which, between December 1, 1909, and January 1, 1911, the plaintiffs shipped over the defendant's road, from points in the state to Mississippi, several million feet of logs, paying the defendant therefor its regularly established and published rate of $2 per 1,000 feet, and believing, in so doing, that this represented the charge made by the defendant as against the public in general and all parties similarly situated with the plaintiffs; that during the same period the Itasca Lumber Company also shipped, and the defendant carried for it as a common carrier, large quantities of logs the same or a greater distance than that covered by the plaintiffs' shipments, the service thus rendered to the plaintiffs and the Itasca Lumber Company being like and contemporaneous; that the defendant transported the logs of the latter under the same conditions, except as to rates, as those of the former, but that the Itasca Company paid the defendant, and it accepted for the service so rendered, the sum of $1.50 per 1,000 feet of logs, thereby giving such company an unlawful preference over the plaintiffs and unlawfully subjecting them to an unreasonable prejudice, and thus unlawfully and unjustly discriminating against the plaintiffs in collecting and receiving from the Itasca Company a less compensation for services in transporting the logs than the regularly established schedule rates and charges enforced by the defendant as a common carrier against the public in general and these plaintiffs in particular, for like and contemporaneous service in transporting logs; and that by reason of all of the facts alleged ‘the plaintiffs have suffered damages in the sum of $4,556.24.’

The second cause of action is substantially a repetition of the first, except that the subjects of the shipment alleged consisted of lumbering supplies, horses, feed, etc., and the defendant is charged with having carried those of the Itasca Company for nothing, while the plaintiffs were compelled to and did pay the regular established rates, aggregating about $800, for which the plaintiffs also demand judgment.

The grounds for the demurrer are: (1) That the court was without jurisdiction; and (2) that the complaint does not state a cause of action. It does not appear on what theory the court based its ruling.

[1] 1. It is unnecessary, we think, to go into any extended discussion of the first ground of demurrer. The shipments involved in both causes of action were between points within the state and the transportation was wholly therein. Moreover, there is no suggestion in the complaint that the defendant was ever engaged in interstate commerce, or that its road is so situated as to enable it to engage therein. Under these circumstances the shipments must be deemed to have been intrastate, and the federal act has no application. The demurrer cannot be sustained upon the first ground.

[2] 2. The questions raised by the general demurrer are: (1) What is the common-law duty of a common carrier to shippers similarly circumstanced, with reference to equality of charges for the carriage of the same class of goods the same distance? (2) Has a shipper, discriminated against under such circumstances, any right of action for damages at common law; and, if so, what is the measure of his recovery? (3) What is the effect of our statutes relating to the regulation of railroad rates upon the questions here involved?

(1) While discrimination by railroads as to shipping facilities has been recently condemned by this court, through Chief Justice Start, in Banner Grain Company v. Great Northern R. Co., 119 Minn. 68, 137 N. W. 161,41 L. R. A. (N. S.) 678, the questions above stated have not been considered. Looking backward from the present viewpoint at the course of events, and had we no precedents to consider, no difficulty would, we think, be encountered in their determination; but, either fortunately or unfortunately, as it may be regarded, there is a wealth of authority upon the subjects involved, and our first effort will be to extract the common-law rule therefrom.

The earlier cases, of which Johnson v. Pensacola, etc., R. Co., 16 Fla. 623, 26 Am. Rep. 731, is an example, declared that a common carrier performed its full common-law duty when it served all alike in the matter of facilities for a reasonable compensation. This view probably originated because of the paucity of early English cases upon the common-law rule as to discrimination in tolls, which latter is not surprising, when we consider that the first common carriers were individuals whose fields of operation were of necessity extremely limited, and that they were many in number, performing services in various portions of the country and under widely differentiating circumstances. Under such a condition of affairs, and, moreover, when the doctrine of equal rights to all was in its infancy, and when competition, which makes special privilege almost necessarily disastrous to the disfavored party, may almost be said to have been nonexistent, it is not at all strange that the conception of a fixed and equal charge to every man for the same service remained undeveloped. In England legislation establishing equality in railroad rates came so soon after the advent of railroads that there was slight occasion for the courts there to examine into the common law of the subject independently of statute. See Scofield v. Railway Co., 43 Ohio St. 571, 598, 3 N. E. 907,54 Am. Rep. 846.

But later, when the question of the true common-law rule became of prime importance, further investigation brought to light broader principles. Said Mr. Justice Doe in McDuffie v. Portland, etc., R. Co., 52 N. H. 430, 455,13 Am. Rep. 72: ‘It seems to be supposed that, at common law, common carriers are not bound to carry all and for all on reasonably equal terms. * * * The principal English cases usually cited are [citing many cases]. These cases seem to be based on statutes general or special. The English Parliament has been extremely vigilant and industrious in putting, in the charters of corporations, provisions for the protection of the rights of individuals and the public. Out of abundant caution, and for the information of those specially concerned, and to guard against any possible construction by implication repealing the common law, they affirmed some of its simplest rules. Sandford v. Railroad Co., 24 Pa. 378 . * * * And the practice of the English courts, on charters and general acts of this kind, has been so long continued that the fact seems now to be overlooked that the general principle of equality is a principle of the common law. * * * It seems to have been a result of the anxiety of Parliament that, instead of merely providing such new remedies and modes of judicial procedure as t...