Texas New Orleans Railroad Company v. Sabine Tram Company

• Decision Date: 27 January 1913
• Docket Number: No. 93,93
• Citation: 227 U.S. 111,57 L.Ed. 442,33 S.Ct. 229
• Parties: TEXAS & NEW ORLEANS RAILROAD COMPANY, Texarkana & Fort Smith Railway Company, and United States Fidelity & Guaranty Company, Plffs. in Err., v. SABINE TRAM COMPANY
• Court: U.S. Supreme Court

227 U.S. 111

33 S.Ct. 229

57 L.Ed. 442

TEXAS & NEW ORLEANS RAILROAD COMPANY, Texarkana & Fort Smith Railway Company, and United States Fidelity & Guaranty Company, Plffs. in Err.,

v SABINE TRAM COMPANY.

No. 93.

Argued December 17 and 18, 1912.

Decided January 27, 1913.

The question in the case is whether shipments of lumber on local bills of lading from one point in Texas to another point in Texas, destined for export under the circumstances presently to be detailed, were intrastate or foreign commerce.

The action was brought by defendant in error, here called the Sabine Company, against the railroad companies (we shall so designate them unless it be necessary to distinguish them), to recover the sum of $1,788.33, alleged to be due for overcharges in freight on thirty-three cars of lumber shipped by the Sabine Company from Ruliff, in the state of Texas, to Sabine, in the same state, the shipments moving from the initial point to Beaumont over one of the roads, and from Beaumont to Sabine over the other. It was alleged that the legal rate applicable to the shipments under the orders of the Railroad Commission of Texas was 6 1/2 cents per hundred pounds, and that the railroad companies collected, over the protest of the Sabine Company, 15 cents per hundred pounds under tariffs filed with the Interstate Commerce Commission, amounting to an illegal charge of 8 1/2 cents per hundred pounds. Recovery was also prayed for penalties for extortion under the laws of the state in the sum of $16,500, the maximum penalty of $500 per carload, upon the assumption that each car was a separate act of extortion, or the sum of $13,000, if shipment on different days should be adjudged to be separate acts.

The railroad companies defended on the ground that the shipments were foreign commerce and subject to a charge of 15 cents per hundred pounds, and that such rate had been established by them and regularly filed with the Interstate Commerce Commission in accordance with the act to regulate commerce.

The trial court charged against the defense, and also that the freight charges collected having been paid in five separate payments, there were five distinct acts of extortion for which the Sabine Company was entitled to recover penalties in the sum of not less than $625 nor more than $2,500; that is, not less than $125 nor more than $500 for each act.

The jury returned a verdict for $1,788.33 as overcharges, with interest at 6 per cent per annum from January 1, 1907, and $1,785 penalties. Judgment was entered on the verdict. A motion for a new trial was denied, and the case was then taken to the court of civil appeals. There was a cross assignment of errors by the Sabine Company, complaining of the ruling of the trial court in finding that the company was only entitled to five penalties. It consented that if the assignment of errors be sustained, the court could render judgment for the lowest penalty, $125. The court sustained the assignment and modified the judgment of the trial court, and rendered judgment for penalties in the sum of $125 for twenty-four shipments, aggregating $3,000. A writ of error to review the judgment of the court of civil appeals was denied, and the judgment thereby becoming final, this writ of error was prosecuted.

The facts were found by the court of civil appeals and are not in dispute:

'At the date of the transaction in question the Sabine Tram Company was engaged in the manufacture of lumber at its mill at Ruliff, a station in Texas on the line of the Texarkana & Fort Simth Railway Company. W. A. Powell Company, Limited, was engaged in buying lumber for export to different points in Europe, through the ports of Sabine and Port Arthur, both in the state of Texas. On August 28, 1906, having made sales to customers for future delivery in Europe of large amounts of heavy pine lumber, for the carriage of which steamships had in part already been chartered, to fill such contracts, W. A. Powell Company bought of the Sabine Tram Company 500,000 feet of heavy pine lumber of certain dimensions, to be delivered during the months of September and October. The contract provided for delivery either in the water at Orange, Texas, or f. o. b. cars at Sabine, Texas, at the option of the seller. The seller exercised the option to deliver at Sabine, a station on the line of the Texas & New Orleans Railway. During the months of September and October the lumber purchased was delivered to the Texarkana & Forth Smith Railroad at Ruliff, to be by it transported to Beaumont, the terminus of its line, and thence by connecting carrier, the Texas & New Orleans Railway, to Sabine, and delivery to the Sabine Tram Company. There were twenty-four several shipments of the lumber on as many different days, the shipments embracing thirty-three cars, for which thirty separate bills of lading were executed by the Texarkana & Fort Smith road, for delivery at Sabine to the Sabine Tram Company, 'Notify W. A. Powell Company, Limited.' No other contract or arrangement was made by the Sabine Tram Company for the carriage of the lumber except that evidenced by the bills of lading aforesaid. Waybills accompanied the shipments, upon which were marked in pencil 'for export but the Sabine Tram Company had no connection with, or knowledge of, the making of these waybills, which was the act of the railway company alone. According to the course of dealing between the parties these bills of lading were indorsed by the Tram Company and sent through [a bank] to W. A. Powell Company, Limited, at New Orleans, Louisiana, attached to a draft for the price of the lumber, which being paid, the bills were delivered to Powell Company and by them transmitted to their agent, Flanagan, at Sabine. In case of most of the shipments in question the bills of lading reached Flanagan at Sabine before the arrival of the lumber for which they were given. The lumber was carried under the shipping contracts or bills of lading aforesaid, by the Texarkana & Fort Smith road to Beaumont, and there delivered to the Texas & New Orleans road, by which it was carried to Sabine. Upon arrival at the station of Sabine it was, by direction of the agent of Powell Company, carried without delay about a quarter of a mile beyond the station to the dock, where the lumber was to be unloaded. The lumber was unloaded from the cars into water of the slip in reach of ship's tackle, ready for loading onto the ships. The Sabine Tram Company had no connection with this further carriage or switching of the lumber to the docks after its arrival at the station of Sabine, but this was done solely at the instance and under the direction of the agent of Powell Company. The transportation from Ruliff to Sabine was entirely within the state of Texas.

* * * * *

'When the lumber had been switched to the docks, W. A. Powell Company, through their agent, presented the bills of lading and demanded the lumber, offering to pay the freight charges, which, according to the course of dealing between the parties, they were to pay for the Sabine Tram Company, who owed the same, and which it was to repay to Powell Company. The Texas & New Orleans Company, acting for itself and the Texarkana & Fort Smigh Company, demanded the Interstate Commission rate of 15 cents per hundred pounds, having been previously instructed by the Texarkana & Fort Smith Company that 10 cents per hundred pounds was its rate from Ruliff to Beaumont. This Powell Company, under instructions of the Sabine Tram Company, at first refused to pay, but after communicating with the Tram Company, finally paid the freight at this rate under protest, in order to get possession of the lumber.

'For switching from Sabine to the docks, the rules and orders of the Texas Railroad Commission would allow a switching charge of $1.50 per car on domestic shipments, and if foreign or interstate shipments, the Interstate Commerce Commission tariffs would allow a switching charge of $2.50 per car, had not the charge for this service been absorbed in the 15-cent rate established as aforesaid.

'Upon shipment of freight not for export, only forty-eight hours free time was allowed for unloading cars, after which demurrage was charged, and if not removed from railroad premises when unloaded, a atorage charge was made in addition. No such charge was made upon any of the lumber involved in this suit.

'W. A. Powell Company, Limited, regarded the shipments in controversy as export shipments, and demanded expected, and received the use of terminal facilities, additional free time, and other privileges accorded to shippers of export freight under export tariffs.

'The railway company knew, when the freight charges were collected, that the lumber was to be placed in its slips and exported to Europe on incoming ships, and the freight was believed by the officers and agents of the railroad company at the time the charges were collected to constitute foreign commerce, and to both permit and require the application of the rate fixed by the tariff on file with the Interstate Commerce Commission, and this rate was applied.

'All the lumber in question was in fact unloaded from the cars by W. A. Powell Company, Limited, into the Texas & New Orleans Railroad Company's slips, or upon its docks, in reach of ship's tackle, and loaded into the ships previously chartered for the purpose by W. A. Powell Company, Limited, which steamships carried same thence direct to Europe, where this lumber was applied upon contracts for sale in Europe, made before the lumber began to leave Ruliff, and made in fact before the lumber was purchased from the Sabine Tram Company, and before it was sawed, and before the logs from which it was sawed left the state of Louisiana for the Sabine Tram Company's mill at Ruliff, in the state of Texas. One of the ships actually waited at the docks at Sabine for the arrival of part of the lumber, which constituted a portion of its cargo.

'The ship which...