United States Chicago, New York Boston Refrigerator Co v. Interstate Commerce Commission

• Decision Date: 26 May 1924
• Docket Number: No. 288,288
• Citation: 68 L.Ed. 1024,69 L.Ed. 1024,44 S.Ct. 558,265 U.S. 292
• Parties: UNITED STATES ex rel. CHICAGO, NEW YORK & BOSTON REFRIGERATOR CO. v. INTERSTATE COMMERCE COMMISSION
• Court: U.S. Supreme Court

265 U.S. 292

44 S.Ct. 558

68 L.Ed. 1024

69 L.Ed. 1024

UNITED STATES ex rel. CHICAGO, NEW YORK & BOSTON REFRIGERATOR CO.

v INTERSTATE COMMERCE COMMISSION.

No. 288.

Argued May 2, 1924.

Decided May 26, 1924.

Messrs. Wm. G. Wheeler and Edward M. Hyzer, both of Washington, D. C., for plaintiff in error.

Mr. J. Carter Fort, of Washington, D. C., for defendant in error.

Mr. Justice SUTHERLAND delivered the opinion of the Court.

By section 209(c) of Transportation Act 1920, c. 91, 41 Stat. 456, 464 (Comp. St. Ann. Supp. 1923, § 10071 1/4 dd), the United States guarantees, for a period of six months after March 1, 1920, with respect to any carrier with which a contract has been made fixing the amount of just compensation under the Federal Control Act, that the railway operating income of such carrier as a whole shall not be less than one-half the amount named in such contract as annual compensation.

By the same section, subdivision (a), the term 'carrier' is defined to mean:

'(1) A carrier by railroad or partly by railroad and partly by water, whose railroad or system of transportation is under federal control at the time federal control terminates, * * * and (2) a sleeping car company whose system of transportation is under federal control at the time federal control terminates. * * *'

By subdivision (g), p. 466, the Interstate Commerce Commission is directed to——

'ascertain and certify to the Secretary of the Treasury the several amounts necessary to make good the foregoing guaranty to each carrier.'

On March 15, 1920, plaintiff in error, hereafter called the Car Company, filed with the Commission its written acceptance of the provisions of section 209, and at a later time applied to the Commission for the ascertainment and certificate mentioned in subdivision (g). The Commission denied the application, upon the ground that the Car Company was not a carrier within the meaning of the act. Thereupon a mandamus was sought from the Supreme Court of the District of Columbia, to compel the Commission to comply with the provisions of subdivision (g), but that court, after a hearing, discharged the rule and dismissed the petition. Upon appeal to the Court of Appeals this judgment was affirmed. 288 Fed. 649, 53 App. D. C. 111.

The single question presented is whether the Car Company is a 'carrier by railroad.' Immediately prior to federal control, the Car Company owned 1,340 refrigerator cars, which were operated over various lines of railroad under contracts with the railroad companies. The Car Company did not own or control any railroad property or facilities, aside from these cars. The contracts provided for payment of compensation for the use of the cars by the railroad companies on the basis of mileage—that is, a fixed sum for each mile over which the cars were run. The cars were under the control of the railroad companies, subject to the observance, on their part of the directions of the Car Company as to the distribution of the cars. The Car Company solicited freight from shippers for which it was generally paid commissions, and exercised a degree of supervision over the shipment. Sometimes cars containing shipments were delivered by noncontract railroads, from which the Car Company received payment of the mileage charges. Bills of lading covering shipments were generally made by the railroad companies; but a small percentage, perhaps 10 per centum, of the shipments originating west of Chicago were rebilled on the forms of the Car Company, subject to tariffs and classifications of the railroad companies then in effect. Waybills were made out by the railroad companies, and all freight charges were paid to the railroad companies, no payment for transportation being made by the shippers to the Car Company. The Car Company was incorporated to manufacture, sell, or rent freight cars, rolling stock and for other specified purposes; but nothing is said in its articles of incorporation in respect of any operation as a carrier. It filed no tariffs with the Commission, as interstate railroad carriers are required to do; nor did it keep its accounts in accordance with the rules of the Commission. The refrigerator cars were taken over and used by the Director General of Railroads during the period of federal control and compensation therefor paid to the Car Company. Upon the expiration of such control the cars were surrendered to the Car Company. The court below accurately summarized the testimony as showing:

'That the Refrigerator Company is not incorporated as a carrier, does not control or use the necessary facilities for performing carriage, does not hold itself out to perform carriage by publishing rates applicable thereto, and does not in fact perform carriage or receive any compensation from shippers whose shipments move in its cars. The cars are rented to railroad companies. They are...