Thompson v. United States

• Decision Date: 02 June 1952
• Docket Number: No. 513,513
• Citation: 72 S.Ct. 978,343 U.S. 549,96 L.Ed. 1134
• Parties: THOMPSON v. UNITED STATES et al
• Court: U.S. Supreme Court

343 U.S. 549

72 S.Ct. 978

96 L.Ed. 1134

THOMPSON

v UNITED STATES et al.

No. 513.

Argued and Submitted April 23, 1952.

Decided June 2, 1952.

Mr. Toll R. Ware, St. Louis, Mo., for appellant.

Mr. Samuel R. Howell, Washington, D.C., for appellee Federal Communications Commission.

Mr. G. M. Rebman, St. Louis, Mo., for appellee Omaha Grain Exchange.

Messrs. Philip B. Perlman, Sol. Gen., H. G. Morison and Ralph S. Spritzer, Washington, D.C., for appellee United States.

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

The sole question before the Court in this case concerns the content of the term 'through route' as used in the Interstate Commerce Act.¹

The question arises out of a controversy as to the shipment of grain to market from points in Kansas on the Central Branch of the Missouri Pacific Railroad. From Lenora, Kansas, a typical origin point, grain may be shipped eastward to the Kansas City market over Mis- souri Pacific lines via Atchison, Kansas, at a rate of 19 cents per hundred pounds. The Missouri Pacific also provides service from Lenora to Omaha, Nebraska, via Atchison, at the rate of 25.5 cents. Midway between Lenora and Atchison, at Concordia, Kansas, the Missouri Pacific connects with a line of the Chicago, Burlington & Quincy Railroad running in a northeasterly direction to Omaha. Concordia is listed by the carriers as a point for interchange of traffic and there is evidence that the Missouri Pacific and the Burlington offer through transportation via Concordia from Lenora to points on the Burlington line short of Omaha. But there is no evidence that any shipment has ever been made from Lenora to Omaha via the Burlington line or that the carriers have ever offered through service over that route, although the haul from Lenora to Omaha via the Burlington is approximately the same length as the haul from Lenora to Kansas City over the lines of the Missouri Pacific.

The Omaha Grain Exchange complained to the Interstate Commerce Commission that the rates published by appellant, Trustee for the Missouri Pacific, on grain shipped from Lenora and other Kansas origins are unreasonable and discriminate against Omaha in violation of Sections 1 and 3 of the Interstate Commerce Act. ² In the complaint it was contended that the route to Omaha via Concordia and the Bulington line 'is a practicable through route as provided in Section 15 of the Interstate Commerce Act, and that the rates to the market of Omaha should be no greater than the rates to the market of Kansas City.'

Section 15(3) of the Act provides that—

'The Commission may, and it shall whenever deemed by it to be necessary or desirable in the public interest, after full hearing upon complaint or upon its own initiative without complaint, establish through routes, joint classifications, and joint rates, fares, or charges, applicable to the transportation of passengers or property by carriers subject to this part, * * *.' 54 Stat. 911, 49 U.S.C. § 15(3), 49 U.S.C.A. § 15(3).

The Commission's power to establish through routes is limited by a provision of Section 15(4), quoted in the margin,³ whenever such action would require a carrier to short haul itself. Under that Section, a carrier may be required to short haul itself only where its own line makes the existing through route 'unreasonably long as compared with another practicable through route which could otherwise be established', or where the Commission makes special findings that a proposed through route 'is needed in order to provide adequate, and more efficient or more economic, transportation'.⁴ Establishment of a new through route from Lenora to Omaha, via the Burlington, would compel the Missouri Pacific to permit use of the Lenora-Concordia portion of its line in the new through route to Omaha in competition with the Missouri Pacific's own route from Lenora to Omaha via Atchison. As a result, establishment of a new through route as requested by the Omaha Grain Exchange admittedly invokes the restriction against short hauling in Section 15(4).

The parties dispute whether, on the record in this case, there is sufficient basis for making the findings required by Section 15(3) and (4) for the establishment of a through route. We do not reach this question because there was no attempt to make the inquiry and findings required by Section 15, the Commission finding that a through route from Lenora to Omaha via Concordia and the Burlington line was already in existence and, therefore, did not have to be 'established.' The Commission granted relief to the complainant Omaha Grain Exchange by finding that the sum of the local rate from Lenora to Concordia published by appellant and the local rate from Concordia to Omaha published by the Burlington (totaling 30 cents per hundred pounds) is an 'unreasonable' rate over the route from Lenora to Omaha via the Burlington. Appellant was ordered to provide transportation of grain from Lenor to Omaha at rates not exceeding the rates charged by the Miss ouri Pacific on like traffic to Kansas City (19 cents). The Commission did not consider the reasonableness of the rate published by appellant for the route from Lenora to Omaha via Atchison, nor is there any finding that the local rate from Lenora to Concordia published by appellant is itself either unreasonable or discriminatory. 278 I.C.C. 519, affirming Division 2, 272 I.C.C. 368.

Appellant sued in the District Court to enjoin enforcement of the Commission's order on the sole ground that the Commission erred in finding the existence of a through route from Lenora to Omaha via the Burlington with the result that the order, in effect, establishes a new through route without complying with the requirements of Section 15(3) and (4) of the Act. A three-judge District Court, one judge dissenting, sustained the Commission's order and dismissed appellant's complaint. The District Court concluded that 'evidence of physical interchange connection at Concordia, plus long established joint rates to some points on the Burlington short of Omaha, plus combination rates to Omaha,' furnished sufficient evidentiary basis for the Commission's finding of the existence of a through route. 101 F.Supp. 48, 52. The case is here on direct appeal. 28 U.S.C.(Supp. IV) § 1253, 28 U.S.C.A. § 1253.

Under the Interstate Commerce Act, a carrier must not only provide transportation service at reasonable rates over its own lines but has the additional duty 'to establish reasonable through routes with such other carriers, and just and reasonable rates * * * applicable thereto'.⁵ Through routes may be, and ordinarily are, established by the voluntary action of connecting carriers. Since 1906, through routes may also be established by order of the Interstate Commerce Commission. In that year, Congress authorized the Commission to establish through routes 'provided no reasonable or satisfactory through route exists'.⁶ In 1910, Congress first empowered the Commission to establish alternate through routes but restricted this power by adding the forerunner of present Section 15(4) to prevent the Commission from establishing any through route requiring a carrier to short haul itself unless the existing route was unreasonably long compared to the proposed route.⁷

The Commission's effort to limit by construction the impact of the short-hauling restriction on its power to establish through routes was rejected by this Court in United States v. Missouri Pacific R. Co., 1929, 278 U.S. 269, 49 S.Ct. 133, 73 L.Ed. 322. Following this decision, the Commission asked Congress to delete completely the short-hauling restriction.⁸ In the Transportation Act of 1940, Congress refused to eliminate the restriction against short hauling, but adopted a compromise under which the restriction against short hauling was retained subject to a new exception applicable only where the Commission makes the special findings listed in the amended Section 15(4).⁹

Confronted with this consistent legislative refusal to eliminate the short-hauling restriction on its power to establish through routes, the Commission justifies its order on the ground that a 'through route' from Lenora to Omaha via the Burlington was already in existence. If the Commission has correctly applied the term 'through route' in this case, the Commission's restricted power to 'establish' through routes under Section 15(3) and (4) is not relevant to this case. The statutory term 'through route,' used throughout the Interstate Commerce Act,¹⁰ has been defined by this Court as follows:

'A 'through route' is an arrangement, express or implied, between connecting railroads for the continuous carriage of goods from the originating point on the line of one carrier to destination on the line of another. Through carriage implies a 'through rate.' This 'through rate' is not necessarily a 'joint rate.' It may be merely an aggregation of separate rates fixed independently by the several carriers forming the 'through route'; as where the 'through rate' is 'the sum of the locals' on the several connecting lines or is the sum of lower rates otherwise separately established by them for through transporta- tion. Through Routes and Through Rates, 12 I.C.C. 163, 166.'¹¹

The Commission decision cited by the Court was summarized as follows in the Commission's 21st Annual Report to Congress:

'A through route is a continuous line of railway formed by an arrangement, express or implied, between connecting carriers. * * * Existence of a through route is to be determined by the incidents and circumstances of the shipment, such as the billing, the transfer from one carrier to another, the collection and division of transportation charges, or the use of a proportional rate to or from junction points or basing points. These incidents named are not to be regarded as exclusive of others which may tend to establish a carrier's course of business with respect to through shipments.'¹²

In short, the test...