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can not be seriously objectionable from its own point of view. In such degree as this contention may be sincerely advanced the carrier becomes a relatively unimportant factor in the struggles of rival localities. It may be led to sacrifice little or much in its well-founded desire to maintain cordial relations with its patrons at any point, but its interests demand, as do those of the communities themselves, the establishment of some means by which fair and harmonious relations may be maintained, or reestablished when temporarily disturbed, with the least possible sacrifice of traffic or revenue or business stability. On two important occasions this Commission has seemed to those concerned to be an available means for restoring harmony. The further point is suggested by these voluntary submissions that the usefulness of the Commission in this direction would be greatly increased if its determinations in such cases were sanctioned by authority not now possessed. In other words, the matters above recited furnish an argument in favor of the amendments which the Commission has so often recommended.


It is probably near the truth to say that the cases now pending before the Commission directly or indirectly affect almost every locality, and therefore nearly all of the people in the United States. Some of these proceedings involve very large interests, others present issues of comparatively trifling importance to the general public, while a few are based upon matters relating to individual claims. The questions presented in such cases relate to the unreasonableness of rates, discriminations in rates between persons, or as between commodities, discriminations between shippers in furnishing cars, undue preference of various descriptions of one person or locality over another person or locality, overcharges, unjust demurrage charges, pooling, and disregard of the law in the publication of tariffs. These general characterizations embrace a great variety of cases arising under differing conditions, each presenting new phases of the transportation problem growing out of facts peculiar to the situation of the complaining shipper or locality and circumstances surrounding the traffic.

The widely differing character of the cases before the Commission is shown by comparing a case involving only an alleged overcharge above the tariff rate, amounting to a few dollars, and affecting only the shipper making the complaint, with pending proceedings embracing vast business interests. Some of these more important cases are the investigation based upon the long-standing dispute as to the relation of rates between New York, Philadelphia, Baltimore, and Boston on all freight traffic, foreign and domestic, transported in either direction between those cities and western points; the well-known anthracite coal rate investigation, which affects the rates upon that commonly used commodity to seaboard points and intermediate localities, and the Cattle Raisers' case of alleged unreasonable charges on live stock from producing localities west of the Missouri River to Chicago and other large consuming markets. Numerous other cases among those now pending in some stage of progress before the Commission might be described and compared with like result.

It is not just, however, to view any of these proceedings as presenting matters of little consequence and affecting small amounts on the one hand, or as of overshadowing importance and involving millions of capital on the other. An advance in the rate upon a single commodity may take but a few dollars each year from the shipper's business, and if he complains of the unreasonableness or injustice of the increased charge, he is entitled to a decision upon the merits, regardless of the fact that the increase in rate as applied to all shipments of that commodity will constitute a large sum. All of these cases deal with rates which rarely exceed, and almost always are greatly below, $1 per hundred pounds. The rates on staple commodities like grain, flour, hay, coarse vegetables, and lumber, which are made the subject of complaint, are usually expressed by a small number of cents, and the real subject for consideration is the rate itself, instead of the aggregate the carrier may derive from a large number of shipments to many different points under the charge in question. A case in point is the Chicago Live Stock Terminal Charge case, where the carriers to Chicago imposed a charge of $2 per car on live stock destined to the Union Stock Yards, at Chicago, in addition to the tariff rate in force to Chicago. The whole case deals with that terminal charge, stated by itself, and the decision of the Commission, in which the cost per car of making the transfer to the stock yards was considered, declared that a reduction of $1 would be just and reasonable. Nevertheless, the $1 excess charge amounts, during the time the case has been pending before the Commission, in the courts, and before the Commission again, to a very large amount. That, however, has nothing to do with the justice of the charge above $1 per car, for if the charge was excessive at the time of its first application, and the controlling conditions have not materially changed, it is wrong to-day and has been wrong during the whole time it has been in force.

Cases which in themselves present demands for slight relief often bring up important as well as novel questions of law and procedure, and the reported decisions in these cases are capable of citation as precedents in future proceedings.

The complaints very frequently contain demands for damages, and decisions rendered in favor of complainants in such cases often include an award of reparation. In this connection it should be stated that section 9 of the act to regulate commerce requires the complaining shipper to elect whether he will bring his case for damages in consequence of an alleged violation of the statute in the Federal court or before the Commission. It follows that when he elects to pursue his remedy in a proceeding before the Commission, alleging violation of the law and claiming damages, he can not thereafter bring suit for damages in court upon the same cause of action.

In cases where wrongful discrimination or preference is claimed to exist, through an unjust relation of rates, complaints usually also allege the higher rate complained of to be unreasonable, and it often happens that the rates may appear unjustly related because the higher charge is unreasonable, indicating the proper method of securing a readjustment of the related rates to be by an order forbidding the higher charge. One or more instances of this kind will be found in the statement of cases decided by the Commission during the year.


The decision of the United States Supreme Court in the proceeding entitled “Interstate Commerce Commission v. Baird et al.,” reported in 194 U. S., 25, affirms the power of the Commission to require witnesses to testify and to produce documentary evidence in relation to matters which may have bearing upon issues presented in cases and investigations under the act to regulate commerce. This decision also construes the law with reference to procedure on appeal from circuit courts and the right to bring and maintain cases before the Commission.

This litigation in the United States Supreme Court arose from a case brought upon complaint of William R. Hearst against the Philadelphia and Reading Railway Company and other roads engaged in carrying anthracite coal from Pennsylvania mines to New York and other tide-water points which was being heard by the Commission in New York City. This coal case, which is still pending, involves questions of unreasonable rates, unjust discrimination between shippers, and pooling. In the course of that hearing in New York City several witnesses refused to produce certain coal purchase contracts, others declined to obey subpænas calling for the production of so-called Temple Iron Company contracts demanded for the purpose of showing a combination between the different roads, and still others withheld testimony sought to be elicited concerning the prices and sale of coal. A petition filed by the Commission in the United States circuit court for the southern district of New York to compel the testimony and production of the documents was dismissed, upon the ground that the documentary evidence required and the testimony called for by the questions were not relevant to the subject matter of the investigation. The case was promptly appealed to the United States Supreme Court,

with the result that on April 4, 1904, a decision was filed reversing the decree of the circuit court.

The act of February 19, 1903, commonly known as the “Elkins law,” in a proviso to section 3, makes the expediting act of February 11, 1903, apply to any case prosecuted under the direction of the Attorney-General in the name of the Interstate Commerce Commission. The act of February 11, 1903, provides in section 2 that in every suit in equity pending or hereafter brought in any circuit court of the United States under the antitrust act or the act to regulate commerce, wherein the United States is complainant, an appeal from the final decree of the circuit court will lie only to the Supreme Court. The defendants in the case in the Supreme Court moved to dismiss the appeal upon the ground that no direct appeal could be taken to the Supreme Court from the order of the circuit court in this case. They insisted that the language of the proviso applied only to cases in equity, and did not include proceedings of the character of an action to compel the production of books and papers and the giving of testimony by witnesses called before the Commission.

The Supreme Court said that in this instance the proviso was inserted for the purpose of enlarging the operation of the statute so as to include a class of cases not otherwise within the operation of the section, and that it might be admitted that this use of a proviso is not in accord with the technical meaning of the term or the office of such part of a statute when properly used, but that it was nevertheless a frequent use of the proviso in Federal legislation to introduce new matter, extending rather than limiting that which has gone before. The court then went on to say that the proviso in the statute under consideration being intended to enlarge rather than limit the application of previous terms should not receive so narrow a construction as to defeat its

purpose; that it extends the terms of the act of February 11, 1903, to “any case” brought under the direction of the Attorney-General in the name of the Commission; and that the application of that act was not limited simply to suits in equity. While the proceeding before the court had for its object the obtaining of testimony in aid of proceedings before the Commission, it was evident to the court that important questions might be involved, touching the power of the Commission and the constitutional rights and privileges of citizens, and it said that Congress deemed it imperative that such cases, affecting the commerce of the country, as well as personal rights, should be promptly determined in a court of last resort.

It was also urged that the complainant before the Commission did not show any real interest in the case brought and that the proceeding should for that reason have been dismissed. The language in section 13 of the act to regulate commerce, that any person, firm, or corporation, may complain to the Commission, and that the Commission may institute any inquiry on its own motion in the same manner and to the same effect as though complaint had been made, and that no complaint shall at any time be dismissed because of absence of direct damage to the complainant, was considered by the court, and upon this point it ruled that, in the face of this mandatory requirement that the complaint is not to be dismissed because of the want of direct damage to the complainant, no alternative is left to the Commission but to investigate the complaint, if it presents matter within the purview of the act and powers granted to the Commission.

The court also notices the power conferred upon the Commission by section 12 of the act, as amended, to inquire into the management of the business of all common carriers subject to the provisions of the statute, and to keep itself informed as to the manner and method in which the same is conducted, with the right to obtain from such common carriers full and complete information necessary to enable the Commission to perform the duties and carry out the objects for which it was created. The court said, however, that in the present case, whatever might be the right of the Commission to carry on an investigation under the general powers conferred in section 12, this proceeding was under the complaint filed, and that it would examine the testimony offered with a view to its competency.

The coal purchase contracts, the production of which before the Commission had been refused by the witnesses, were made with coal companies owned principally by railroad companies and contained the same general provisions; among others, the purchase price of anthracite coal above a certain size was to be 65 per cent of the average price, . computed monthly, at certain tide-water points, and all of the coal mined by the contracting operators was sold, the shipments to be made as called for by the purchasers. The circuit court held those contracts to be irrelevant, on the ground that they related wholly to an intrastate transaction, the selling of coal in Pennsylvania, and had nothing to do with interstate commerce. The testimony showed that much of the coal purchased under these contracts was sold in Pennsylvania, but a considerable portion was carried to tide-water points. The Supreme Court said: “Here is a railroad company engaged at once in the purchase of coal through a company which it practically owns and the transportation of the same coal through different States to the seaboard,” and asks why the Interstate Commerce Commission may not, under the powers conferred and under this complaint inquire into the manner in which this business is done. The court said: 6 We see no reason why contracts of this character, which have a direct relation to a large amount of the carrying trade, can be withheld from examination as evidence by the Commission."

It was further found by the court that if the railroad companies in fact received their compensation for carriage from the sum retained

H. Doc. 146, 58–3–3

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