■^.. :-\- Kf Cornell University Library KF 2289.J93 1916 The law of Interstate commerce and its f Cornell University Library The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924019318520 THE LAW OF INTERSTATE COMMERCE ANDSITS FEDERAL REGULATION BY ^^;-^ FREDERICK N." JUDSON f * Of the St. Louis Bar THIRD EDITION CHICAGO T. H. FLOOD & CO. 1916 Copyright, 1916 BY T. H. FLOOD AND COMPANY CANTWELL PRINTING COMPANY. Pbinters and Bindbrs; madisoni wis. PREFACE. The primary office of a preface of a new edition of a law treatise is to give, if not a reason, at least an excuse for the publication. The several editions of this book mark suc- cessive periods in the development and expansion of the law of interstate commerce and its federal regulation in the United States during the last ten years. This development and expansion have come r^J^OrSf^. through judicial con- struction and application but through far reaching statutory changes. Thus since the last edition important amend- ments have been made to the Interstate Commerce Act, and the supplemental anti-trust legislation of 1914 has been enacted. The Supreme Court also has finally announced certain constructions and applications of the law, in some cases overruling the district courts and the United States courts of appeal, or unifying the law where theretofore there had been conflicting opinions. A new edition is required not only because new matter must be added, but also for the further reason in some cases that what was then de- clared to be the law must necessarily be rewritten. In view of the vast increase in the number of adjudica- tions by the Federal courts under the Interstate Commerce and Anti-trust Acts, and the fact that there are some sixty district courts, nine circuit courts of appeal (in some cases courts of last resort), and one Supreme Court of last resort, it has been the aim to include, not only all the final adjudications of the courts of last resort, construing and applying the statutory law, but also to include such de- cisions of the district courts and courts of appeal, and also decisions of the state courts as would serve to illustrate, not only the existing law, but the historic development of the law, and thus serve in the construction and application of the existing law. As was said in the preface of the first edition, in view of the informality of the procedure, as well as for convenience and in the interest of brevity, the citations of the Com- IV PREFACE. mission's cases have been by the book and page of the reports without the names of the parties. The reports of the Com- mission are not adjudications in the ordinary sense of the term, as they deal with temporary conditions which may be transitory, and the administrative orders are effective only for a period of two years. It has been the aim, therefore, to note those rulings which are of value as precedents for the determination of similar controversies. Repeating what was said in the preface of the second edition, while th« book is entitled, "The Law of Interstate Commerce and Its Federal Regulation," and deals in Part I. with the law of interstate commerce as declared by the courts, the remaining parts of the book are taken up with the actual regulation of interstate commerce through the acts relating to transportation, and with the anti-trust act which was enacted to protect interstate commerce against unlawful combinations. The enforcement of the Anti- Trust Act of 1890 and the supplemental acts of 1914 are so closely allied to the subject of the regulation of commercial intercourse that they seem properly included in such a treatise. The law of interstate commerce has, through recent legis- lation of Congress, a still broader scope, illustrated in such acts as the Pure Food, Meat Inspection, National Quaran- tine, and the like, which are enacted in what, for want of a better term, may bp classed as the police regulation under the interstate commerce clause of the Constitution. The discussion of this legislation seemed apart from the scope planned for this book, and only incidental reference has been made thereto. On the other hand the questions relating to the concurrent powers of the state and federal government in interstate commerce, and the federal control of state regulation of state traffic of interstate carriers conducted with the same equipment and with the same employees as interstate traffic, seemed properly included in a treatise on the federal regulation of interstate commerce. I take pleasure in renewing the acknowledgment expressed in the preface of the second edition to Mr. J. Edgar Smith, of the Washington, D. C. bar, associated with the Interstate Commerce Commission, for valuable suggestions and assist- PRKFACE. V ance in that edition, and also in acknowledging to Mr. Eustace C. Wheeler, of the St. Louis bar, my appreciation of his very efficient assistance in general revision, reading proofs, and in the difficult and tedious work of preparing the index of this edition. FREDERICK N. JUDSON. St. Louis, April, 1916. TABLE OF CONTENTS. PARTI. CHAPTER I. INTERSTATE COMMERCE UNDER THE FEDERAL CONSTITUTION. PAGE. 1. The commerce clause in the constitution 3 2. Power of congress in foreign commerce and with the Indian tribes distinguished 6 3. The preference clause in the constitution 7 4. The prohibition of tax or duty on exports from state 7 5. Federal sovereignty in interstate commerce 8 6. Gibbons v. Ogden 11 7. What is commerce 12 8. What is not commerce : 17 9. Insurance and commerce 18 10. What are the subjects of commerce 20 11. Wild game and fish as subjects of commerce 23 12. Natural oil and gas as subjects of commerce 25 13. The commerce clause and the admiralty jurisdiction 27 14. Erie Canal subject to admiralty jurisdiction 28 15. Jurisdiction of federal courts in admiralty cases 29 16. State corporations in interstate commerce 30 17. When transit ends; the original package in interstate com- merce 33 18. The Wilson Bill of 1890 36 19. Limitations of state control of liquor traffic 37 20. The Webb Kenyon Act of 1913 39 21. A state cannot tax interstate commerce 40 22. But a state can tax the property employed in interstate com- merce 41 23. State power of taxation of corporations engaged in interstate commerce summarized 43 CHAPTER n. THE CONCURRENT AND EXCLUSIVE POWERS. 24. The concurrent and exclusive powers distinguished 45 25. The supreme court on the three classes of commerce cases.. 47 26. The concurrent state power 47 Vlll TABLE OF CONTENTS. § 27. The State power as to interstate telegraph companies 49 28. Concurrent power in interstate railroad transportation 51 29. State Sunday laws and interstate traffic 52 30. State laws as to qualifications of employes and safety of public i °2 31. State laws concerning separation of races in interstate traffic 54 32. Limitation of state power in stoppage of through trains 55 33. State regulation of contractual relations of interstate railroad and shippers 56 34. State regulation under rules of common law in state courts.. 57 35. The concurrent jurisdiction in live stock inspection laws 60 36. Effect of congressional legislation upon concurrent power of state 60 37. State quarantine laws 64 38. State inspection charges, when unlawful 65 39. Freedom of interstate commerce 66 40. Congressional inaction in foreign and interstate commerce 70 distinguished 41. Attachment of foreign railroad cars 71 42. Rulings of the state courts on the commerce clause 72 CHAPTER III. THE FEDERAL REGULATION OF INTERSTATE COMMERCE. § 43. The beginning of federal regulation 77 44. The railroad act of 1866 78 45. The state control of local business of interstate railroads 80 46. State regulation of railways in the United States 81 47. Governmental regulation of railways in England 82 48. The common law in interstate commerce 84 49. Federal and state courts in the federal regulation of interstate commerce 86 50. Federal causes of action in the state courts 88 51. Genesis of the Interstate Commerce Act 90 52. Successive amendments of the Interstate Commerce Act 92 53. Enlarged powers and jurisdiction of the Interstate Commerce Commission 96 54. The short life of the commerce court 100 55. Regulation of bridges and ferries over navigable rivers 101 56. No rate regulation of water transportation 104 57. Regulation of telegraph and telephone companies 105 58. The release of the federal regulating power 108 59. Regulation by the delegation of power 109 60. Additional acts of congress in the regulation of commerce... Ill 61. The Commerce Bureau and the Federal Trade Commission.. 113 TABLE OP CONTENTS. IX CHAPTER IV. THE FEDERAL POWER OF REGULATION IN INTERSTATE COMMERCE. § 62. No judicial formulation of extent of power 116 63. The supremacy of federal regulation 117 64. Federal regulation of employes performing duties in both intrastate and interstate commerce 118 65. Federal control over intrastate rates in preventing discrimi- nation in interstate commerce 120 66. The federal regulating power and state corporations 121 67. The commerce clause and the police power 123 68. Limitations upon the federal authority in interstate com- merce 124 69. Prohibition as a means of regulation 125 70. Regulation of commerce through the taxing power 126 71. The federal power of granting corporate charters 128 72. Federal incorporation as a means in the exercise of the com- merce power 129 73. Relation of the states to federal corporations 131 74. The Federal incorporation of business companies 132 75. The requirement of federal franchise for business corpora- tions in interstate commerce 133 76. The development of the latent federal power in the regulation of commerce 135 CHAPTER V. BUSINESS COMBINATIONS IN INTERSTATE COMMERCE. 77. The demand for federal regulation of business combinations 138 78. The anti-trust act of 1890 140 79. The supplemental anti-trust acts of 1914 141 80. The suppression of competition under the Clayton Act 142 81. Enforcement of the Clayton Act by the Federal Trade Com- mission 143 82. Unfair methods of competition declared unlawful 144 83. Restraint of trade in interstate commerce under the common law 146 84. Constitutionality of the act of 1890 147 85. Railroads included in the act of 1890 148 86. Reasonable construction and reasonable restraint of trade distinguished 149 87. Direct and incidental restraint of trade 152 88. The modern law of restraint of trade 154 TABLE OF CONTENTS. 89. Illegal cpmbinatlons in interstate commerce 155 90. Complete suppression of competition not essential 157 91. Monopoly within the meaning of the act of 1890 158 92. No application to commerce within the state 160 93. State holding companies 162 94. Suppression of competition must be substantial to be a re- straint of trade 164 95. The stock control by Union Pacific over Southern Pacific dis- approved 165 96. A natural terminal monopoly regulated by reorganization.... 166 97. Control of prices in interstate commerce by contract and by discriminating sales 167 98. The distinction as to commodities subject to contract 169 CHAPTER VI. LABOR COMBINATIONS IN INTERSTATE COMMERCE. 99. The labor legislation of congress 172 100. Regulation of interstate commerce in relation to labor 173 101. The courts on labor combinations in relation to interstate commerce 176 102. Interstate commerce and railroad labor organizations 177 103. Business boycotts in interstate commerce 178 104. Strikes and boycotts by employes of interstate carriers 180 105. Injunctions in labor controversies under the Clayton Act 182 106. The law of conspiracy in interstate commerce 184 1 07. Distinguished from common-law conspiracy 188 108. Interstate, commerce in relation to employes therein 189 109. "Picketing" and "soliciting" in interstate commerce 191 110. The status of interstate railroad employes is that of free contract 192 111. The right of labor organization includes the right of repre- sentation 194 112. Injunction in interstate commerce 195 113. Contempt in United States courts 198 114. Direct and indirect contempts 200 115. Criminal and civil contempts 200 116. Conspiracy and contempt 203 117. Contempt under the Act of 1914 203 118. Mandatory injunctions in interstate commerce 204 TABLE OF CONTENTS. XI CHAPTER VII. FEDERAL CONTROL OF STATE RAILROAD REGULATION. § 119. State regulation of railroads through state commissions 206 120. Assessment of expense of state regulation upon railroads 208 121. State regulation not dependent upon state incorporation 208 122. State cannot regulate any part of interstate rates 209 123. State regulation of local rates of interstate commerce 210 124. The Fourteenth Amendment 211 125. Federal review of state regulation of railroads 212 126. The federal jurisdiction must be invoked on substantial grounds 214 127. Jurisdiction of the federal courts not limited by state legis- lation 215 128. Injunctions against state officials not violative of the eleventh amendment 216 129. The regulating orders of state commissions legislative, not judicial 217 130. Procedure in federal review of state legislation 218 131. Temporary injunctions in federal control of state legislation 221 132. Interlocutory injunction against state ofHcials 222 133. Reasonableness and confiscation in regulation of rates 223 134. State rates determined without reference to interstate traffic 225 135. The supreme court on state regulation 226 136. Schedules of rates and special rates 228 137. A state cannot impose a confiscatory rate upon any class of traffic 229 138. The valuation of railroad property in state regulation 230 139. The apportionment of railroad property in state regulation.. 232 140. Confiscation in state regulation; how proved 233 141. The Minnesota rate case on the proof of value 235 142. The apportionment of cost in the Minnesota rate case 237 143. The practical testing of state rates 238 144. Rate of profit necessary to avoid charge of confiscation 238 145. Protection of the carrier against discriminating state regula- tion 241 146. The state power of regulation not limited to rates 243 147. The enforcement of excursion rates — when unreasonable 246 148. The state anti-trust laws and the fourteenth amendment 247 149. Classification in state railroad legislation 250 XU TABLE OF CONTENTS. PARTE. INTERSTATE COMMERCE ACT. Section 1. 150. Section 1 of the Act of 1887 256 151. Section 1 as amended by Act of June 18, 1910 257 152. Amendments to the section 262 153. The inclusion of telegraph, telephone and cable companies 263 154. All of interstate commerce not included 263 155. Parties subject to the act 265 156. Standard Oil pipes properly included in the act 265 157. Common carriers under the act 266 158. Who is a common carrier 268 159. Express companies under the act 269 160. Sleeping car companies 271 161. Under common control, management or arrangement for a continuous carriage 273 162. Transportation through a state _ 275 163. Territorial transportation 276 164. Interstate street railroads 277 165. Interstate street railways and interurban electric railroads transporting freight, distinguished 278 166. Receivers, lessees, and purchasers pendente lite 278 167. Foreign commerce 279 168. Place of incorporation of carrier immaterial 280 169. The intention of interstate shipment not sufficient 280 170. All instrumentalities of shipment or carriage 282 171. Delivery, cartage, storage, and demurrage charges 283 172. Terminal facilities and plant facilities 285 173. Bulk grain storage as part of transportation 285 174. The amendments of section as to accessory charges 286 175. Carriage of live stock and perishable property 287 176. Refrigeration in transit : 289 177. Private cars 292 178. The enforcement of the duty of carriers to furnish cars 292 179. Prohibition of passes 294 180. Stipulations in passes against liability sustained 296 181. The commodities clause 296 182. Switch connections 299 183. The establishment of through routes 301 184. Classifications, regulations, and practices 301 TABLE OF CONTENTS. XIU 185. Unlawful use of peddler cars 302 186. Charges must be reasonable and just 302 187. Practical difficulties in the enforcement of reasonableness in rates 303 188. Standard of reasonableness under state statutes 305 189. Standard of reasonableness under the act 306 190. The power of the conmiission in fixing rates 307 191. Rates, and not systems of rates, determined by the commis- sion 307 192. No pctwer in the courts to fix rates 308 193. The federal courts on reasonableness of raibroad rates 309 194. The value of railroad property as a basis for rate regulation 311 195. The unearned increment in valuation of raUroad property in rate regulation 312 196. The relation of railroad rate to investment of earnings in property 313 197. Reasonableness under sections 1 and 3 314 198. Consideration of reasonableness in the courts 314 199. Rulings of the commission upon the reasonableness of rates. 315 200. Considerations in the advance of rates 317 201. Limitation of the commission's power in fixing rates 317 202. Presumptions of reasonableness from established rates 318 203. Burden of proof 319 204. Considerations in the determination of reasonableness 319 205. Review of the commission's rulings on rates 320 206. What is a reasonable rate 322 207. Res Judicata with respect to rates 323 208. Through rates and local rates 323 209. Reasonableness in commutation rates 325 210. Relation of interstate to state rates 326 211. Rates as affected by development of country 327 212. Supreme Court on the considerations admissible in fixing rates 328 213. Commission on the interdependence of rates 329 214. No vested interest in rates 329 215. Reasonableness of rates as dependent on character of traffic. 329 216. Distance as a factor in rates 331 217. The commission on comparison of rates 332 218. Reasonableness of rates as relating to cost of service and needs of the shipper 332 219. Reasonableness and proportion 334 220. The commission on rate wars and reasonableness of rates 335 Section 2. 221. Section 2. Unjust discrimination defined and forbidden 337 222. Origin of the Section 337 223. Purposes of the Section 338 XIV TABLE OP CONTENTS. § 224. Effectiveness of the section. The act of February 19, 1903 339 225. Common law as to discriminations 341 226. Just and unjust discrimination at common law 342 227. Discrimination in charge based upon differences in service not discriminative 345 228. The meaning of "rebate" in the section 346 229. Circumstances and conditions of through traffic and local traffic are dissimilar 347 230. Competition of carriers does not make circumstances dis- similar under section 2 348 231. The party rate case 349 232. Wholesale and retail rates in freight traffic 350 233. Wholesale rates in freight and passenger traffic distinguished 352 234. Discrimination not unjust when based on special service 353 235. Carload and less than carload rates .^ 354 236. Discrimination in application of carload rates 355 237. The Supreme Court on forwarding agents in carload rates.... 356 238. Discrimination in carload rates 357 239. Cargo rates discriminative 357 240. Different forms of discrimination 358 241. Discrimination in restricted rates 360 242. Discrimination through industrial tap lines and plant facili- ties 360 243. Discrimination through interest in connecting company 363 244. Control by commission of Division of Joint Rates to Pre- vent Discrimination 365 245. Allowance to short lines of railroads serving industries 365 246. Discrimination by carrier in favor of itself as a shipper 367 247. Discrimination in storage of goods, etc 369 248. Stoppage in transit privileges 370 249. Unjust discrimination through abuse of stoppage in transit privileges 371 250. Unjust discrimination in passenger service 372 251. Discrimination in rating of Sunday magazines 374 252. Giving passes to shippers prohibited 374 253. Unjust discrimination in telephone service 375 254. Application of the section 375 255. Retention of overcharge 377 256. Enforcement of the section 378 257. Connecting carrier not responsible for discrimination by initial carrier 379 258. Effect of rebates upon contracts of affreightment 379 259. Discrimination in allowance to private transfer companies.... 379 Section 3. § 260. Section 3. Undue or unreasonable preference or advantage forbidden 382 261. Origin of section 383 TABLE OF CONTENTS. XV 262. Relation to sections 1 and 2 385 263. Preferences of localities enforced by competition are not unjust V 386 264. Application of the competition rule 387 265. Whether competition is controlling is a question of fact 388 266. Discrimination between domestic and foreign traffic in im- port and export rates not unjust preference 389 267. Milling in transit and export trade 391 268. Application of the import rule to intermediate points on the line 392 269. Undue preference in export rates and bills of lading 393 270. Through rating by water route 393 271. Competition created by carriers 394 272. The "basing point system" not illegal 395 273. Basing points not exempt from regulating power of commis- sion 396 274. Grouping of rates 398 275. Qualifications in the application of the competitive rule 400 276. Recognition of natural advantages of localities not an unjust preference 403 277. Country and town millers 403 278. The competition of localities 404 279. Competing cities on opposite banks of rivers 406 280. St. Louis and East St. Louis rates 407 281. Terminal charges, St. Louis and East St. Louis 407 282. Privilege of grain-reshipment in Nashvrille within six months held not preferential 409 283. Differentials between competitive cities 409 284. Preference in demurrage charges 412 285. Uniform demurrage rules recommended 413 286. Different forms of undue preference 414 287. Undue preference in allowance for grain elevator service 415 288. Undue preference in wharfage rights 417 289. Wharves and approaches thereto 417 290. Undue preference in management of freight stations and warehouses 418 291. Unjust preference in car service 419 292. The commission's regulations of coal car service sustained.... 422 293. The irregularities in mine ratings.for distribution of coal cars 425 294. The embargo by a carrier on coal cars going to other carriers unlawful 425 295. Distribution of cars for transporation of grain 426 296. Discrimination by carrier in its own favor 426 297. Undue preference in private cars 427 298. Demurrage and other charges on privately owned cars 429 299. Exclusive use of excursion or sleeping cars of one owner 430 300. Leasing of cars does not carry right of exclusive use by owner 430 301. Stoppage in transit privileges 430 XVI TABLE OF CONTENTS. § 302. Fabrication in transit 431 303. Reconsignment charges "^^^ 304. Transit privileges "^33 305. Privileges of storage in transit 433 306. Transit privileges in lumber shipments •• 434 307. Interference by state railroad commission with proportional tariff rates 434 308. The rates on bales of compressed cotton 435 309. Sidetracks and connections 436 310. Switch connections and local terminal facilities 438 311. Absorption of switching charges. When preferential 440 312. Undue preference in denying shippers the choice of route 441 313. Undue preference in arbitrary division of territory 441 314. Rate wars and undue preference 442 315. Discrimination in kinds of traffic 443 316. Preferences against traffic — must involve injury 445 317. A reasonable regulation of carload weights not preferential.. 446 318. Differentials between grain and grain products 447 319. Discrimination in mode of shipment 448 320. Classification 450 321. Uniform classification recommended 450 322. Classification distinct from rate making 452 323. Consultation of carriers in classification not illegal combina- tion 453 324. Undue preference in classification 453 325. Power of commission in correcting classification 456 326. Reasonable regulations in classification 456 327. Facilities for interchange of traffic 457 328. Discrimination in exacting prepayment from connecting car- riers 459 329. Discrimination in exacting prepayment from shippers 460 330. State control of interchange of interstate traffic 461 331. State and municipal control of terminals 462 332. The charging of local rates not an unjust discrimination 463 333. The right of exclusive through routing :. 463 334. Contract rights of trackage 464 335. Rights of connecting carriers as to milling in transit privileges 465 336. Exclusive contracts for station facilities not unlawful 466 337. Baggage transfer under the act 467 338. Undue preference through action of State Commission 467 339. Interstate and state passenger rates 468 340. The relation of state fares to interstate 469 Section 4. § 341. Section 4. Long and short haul provisions 471 342. History of the section and its amendments 472 343. Construction of the section prior to the amendment of 1910.. 473 344. "Over the same line." 474 TABLE OF CONTENTS. XVll 345. Application to the Commission 475 346. The burden of proof 476 347. Construction of section by Commission and application to different classes of rates 476 348. Ruling of Commission as to export and import rates under section 477 349. The Commission on application for relief under the fourth section 478 350. The five trade zones for transcontinental traffic 479 351. The Commission sustained by Supreme Court 482 352. Applications for relief under this Section 482 353. The water competition amendment 483 354. Burden upon carrier of showing discrimination is not unjust 484 355. Application for relief in the courts 485 Section 5. 356. Section 5. Pooling of freight and division of earnings for- 486 bidden 486 357. Construction of section 486 358. ControlUng through routing by initial carrier is not pooling.. 487 359. Agreements not within the prohibition 488 360. The relation of the section to the Anti-trust Law of 1890 489 361. Pooling as a defense to action of the carrier 491 362. Text of Amendment by Panama Canal Act approved August 24, 1912 491 363. Construction of this section by the Commission 493 Section 6. 364. Section 6 as amended in 1906 and 1910 495 365. History and amendment of the section 499 366. Effect of publication under the section 500 367. Limitation of baggage liability under established rate 502 368. The published rate conclusive 503 369. Conclusiveness of the published rate irrespective of reason- ableness 505 370. Conspiracy to violate the section held indictable 506 371. Contract for different than the published rate invalid 506 372. Failure to post rates in stations 507 373. Insurance policy of carrier in violation of this section unen- forcible 509 374. The section not applicable to a foreign shipment 510 375. Claims for misrouting 510 376. Status of carriers as shippers or consignees 512 377. What is included in schedules 513 378. What is sufficient publication and fifing 515 379. Joint tariffs and through rates 516 XVlll TABLE OF CONTENTS. § 380. Responsibility for through rates 517 381. PubUshed joint rates must be duly authorized 518 382. The Commission's power of modification as to filing of tar- iffs 519 383. Inclusion of transit privileges in tariffs 520 384. Commission on request for waiver of time limitation on loss claims 520 385. Control of accessory charges in the tariffs by the Commis- sion 521 386. Text of amendment by Section 11 of Panama Canal Act of August 24, 1912 522 387. Construction by Commission of the amendment of 1912 524 Section 7. § 388. Section 7. Continuous carriage of freights from place of shipment to place of destination 526 389. Judicial application of section 526 Section 8. § 390. Section8. Liability of common carriers for damages 528 391. Right of action based on the statute 528 392. Plaintiff must allege and prove damage 528 393. Allowance of attorney's fee as costs 530 394. Limitation of actions 530 395. Assignability of claims 531 396. The jurisdiction of federal courts 531 397. Jurisdiction of the federal courts in equity under the act 532 398. Jurisdiction in equity for protection of interstate commerce 534 Section 9. § 399. Section 9. Right of election in appealing to commission or the court 536 400. The hmitation of the right of private action in the courts 536 401. Discrimination in a rule of a carrier and in the enforcement of a rule distinguished 539 402. The complainant must show right of action under the act.... 542 403. Complainant must show specific and final determination of Commission 542 ' 404. Application of the rule to telegraph companies 544 405. Jurisdiction in equity under the act 544 406. When the court has jurisdiction at law 547 407. Judicial apphcation of section 549 TABLE OF CONTENTS. XIX Section 10. §408. Section 10. Penalties for violation of act by carriers 551 409. Amendments to the section 553 410. The amendment of 1903 553 411. Section 10 not repealed by the Elkins Act 554 412. Illegal combinations under section 10 554 413. The incidental interferenc,e with commerce by a peaceable strike not a violation of the section 556 414. Construction of the statute 557 415. Sufficiency of indictment for violation of section 558 416. Removal of indicted persons to other districts for trial 558 417. Limitation of criminal prosecution under the act 559 Section 11. § 418. Section 11. Interstate commerce commission. How ap- pointed 560 419. Organization and membership 560 Section 12. §420. Section 12. General investigating powers of commission 562 421. Amendments of the section 564 422. Compelling of self-incriminating testimony 565 423. Corporations not included in immunity of witness 567 424. Immunity acts of February 25, 1903 and June 13, 1906 569 425. Corporate official compelled to produce corporate books con- taining personally incriminating matter , 570 426. Probative effect of self-incriminating testimony 571 427. Immunity is limited to the subject of testimony 571 428. Power of the court to enforce testimony before the commis- mission sustained 572 429. Relevancy of testimonybefore the commission 573 430. Limitation of the power of the commission to enforce testi- mony 574 431. No provision for inspection by examiners in this section 575 432. Investigating powers of a grand jury in the United States courts 576 433. General powers of the commission 576 434. General reports of commission 578 Section 13. § 435. Section 13. Complaints to commission — How and by whom made — How served upon carriers 580 436. The amendment of 1910 581 XX TABLE OF CONTENTS. § 437. Procedure before commission — Parties 581 438. Pleadings and proofs 583 439. Demand for reparation must be specifically stated 584 440. Burden of proof 585 441. Production of books and papers 586 442. The rulings of the commission as precedents 586 Section 14. §443. Section 14. Commission's report of investigation 588 444. Amendments of the section 588 445. The changed relation of the commission to the courts 589 446. Procedure before commission 589 447. Reports of decisions 591 Section 15. I 448. Section 15 as amended in 1910 593 449. The amendments of 1906 and of 1910 598 450. The constitutionality of the amendment of 1906 sustained.. 598 451. The enlarged powers of the commission 599 452. The establishment of through routes 601 453. The establishment of through routes and joint rates by rail and water ., 603 454. Switch connections and through routing with street rail- ways denied 605 455. Interstate street railways and interstate electric railways distinguished 606 456. The two year limitation of commission's orders 606 457. Selection of the route by the shipper 608 458. The advanced rate cases of 1910 :. 608 459. The advanced rate cases of 1914 and 1915 610 460. Jurisdiction over contracts of carriers 611 461. Jurisdiction of the commission under the Clayton anti-trust act 612 462. Allowances by carriers for shippers* services must not involve undue preference 613 463. The powers of the commission construed 614 Section 16. § 464. Section 16. Enforcement of orders 616 465. The amendments of 1906 and 1910 619 466. The saving of the right of trial by jury 620 467. The time limitation of actions for reparation 621 468. Not necessary to fix future rate before ordering reparation... 623 469. Proceedings before the Commission inure to the benefit of all parties interested 624 TABLE OF CONTENTS, XXI § 470. The jurisdiction of the Commission in awarding reparation.. 624 471. Jurisdiction of Commission in reparation for discrimination in car distribution 626 472. Jurisdiction of Commission in awarding general damages 627 473. Jurisdiction of federal and state courts in reparation actions.. 630 474. Limitation of right to sue in State Court 631 475. The prima facie effect of the Commission's orders 632 476. The conclusiveness of orders enforcing the Qayton Act 633 477. The procedure in court in reparation cases 634 478. Damages recoverable in reparation actions 636 479. Allowance of attorney's fees 636 480. The jurisdiction of the district court in reparation actions.... 637 481. The judicial review of the Commission's orders 638 482. The Supreme Court on the judicial review of Commission orders 639 483. Interlocutory injunctions in judicial review 641 484. Venue of court review of the orders of commission 642 485. Court's review limited to cases of affirmative action by the Conlmis^ion 642 486. The finality of the orders of the Commission 643 Section 16a. § 487. Section 16a, Commission may grant rehearings 645 Section 17. § 488. Section 17. Form of procedure 646 Section 18. § 489. Section 18. Salaries of commissioners, secretary, etc 647 490. Expenses of the commission 647 Section 19. § 491. Section 19. Principal office of the commission, etc 649 492. Practice of commission in hearings 649 Section 19a. § 493. Text of Act of March 1, 1913 on Physical Valuation 650 494. Reports of Commission on Physical Valuation 655 XXll TABLE OF CONTENTS. Section 20. I 495. Section 20 as amended 657 496. The amendments of 1906 and 1910 661 497. The railroads not subject to section 20 of the act 662 498. The enforcement of reports by mandamus 662 499. The power of Commission in enforcing reports sustained : 662 500. Limitation of the power of the Commission in enforcing in- spection *63 Section 20a. 501. Section 20a. The Carmack amendment as amended by Cummings Act of 1915 665 502. The Carmack amendment sustained by Supreme Court 667 503. The displacement of State Laws by Carmack amendment.... 668 504. Intermediate carrier not liable under this amendment, even though issuing bill of lading 669 505. Limitation of liability by carrier under Carmack amendment 671 506. Construction of Cummings amendment by Interstate Com- merce Commission..., 672 Section 21. § 507. Section 21 as amended 674 508. The annual reports of the commission 674 Section 22. § 509. Section 22. Persons and property that may be carried free or at reduced rates, etc 675 510. Amendments to section 676 511. The section illustrative and not exclusive 677 512. The section permissive only 678 513. Withdrawal of commutation tickets 678 514. The commission on excursion rates 680 515. The jurisdiction of the commission as to commutation rates 680 Section 23. 516. Section 23. Jurisdiction of United States courts to issue writs of mandamus 682 517. Application of section to car shortage 682 518. Commission to consist of seven members; salaries 684 THE ELKINS' ACT. 519. The Elkins Act as amended 686 520. The enactment of and amendments to the act 691 521. The repealing clause of the Hepburn Act did not bar prior offenses 691 522. The validity and enforcibility of the act .692 523. Participation in a joint rate under the act 693 524. Discrimination as a criminal offense under the act 694 525. The unit of offenses under the act. The Standard Oil Com- pany of Indiana case 695 526. Prior contracts and want of criminal intent no offenses 696 527. Conspiracy in rebating 697 528. What are rebates under Elkins Act 698 529. A corporation bound by knowledge of its agents 701 530. Requisites of indictment under the act 701 THE ANTI-TRUST ACT OF 1890. Section 1. § 531. Section 1 of the act 703 532. The Anti-trust acts and the supplementary act 704 533. The Sugar Trust case 705 534. Interstate transportation subject to the act 705 535. Unlawful combinations other than transportation. The Addyston Pipe Trust Case 706 536. The California Tile Trust case..... 707 537. The Tennessee, California and Ohio coal cases 708 538. The Chicago Meat Trust case 709 539. The Washington Shingle Trust case 709 540. Incidental restraint of trade not violative of the act 710 541. The Kansas Live Stock Exchange case 710 542. The Chicago Board of Trade Bucket Shop case ,.... 711 543. The Calumet and Hecla Mining Co. case 712 544. Combinations held to be within the act 713 545. Agreements held not within the act 716 546. The continuance of an association for social purposes after dissolution, not violative of the act 717 547. The Standard Oil case 718 548. The American Tobacco Company case 719 549. Railroad combinations held within the act 719 550. The Eastern Retail Dealers Association 720 551. The Powder Trust case 720 552. Application of the act to labor combinations 721 553. Labor unions as such not unlawful under the act 723 XXIV TABLE OF CONTENTS. § 554. Employment of common agency not necessarily within the act 724 555. Acts done outside of the United States not within the act.... 724 556. Combinations, wherever made, if affecting foreign com- merce of this country, are within the act 725 557. Patent monopoly not within the act 726 558. Agreements of patentees and copyright holders violative of the act 727 559. Secret formula contracts under the act 728 560. The combination of non-competitive patents not violative of the act 729 561. Tying contracts. The Shoe Machinery cases 730 562. Restrictive sales under the Clayton Act and the Sherman Act 731 563. Application of the Clayton Act and other acts to existing contracts 732 564. The case of United States Steel Corporation 733 Section 2. § 565. Section 2 of act 734 566. Criminal procedure under the act — Sufficiency of indictments 734 567. The act sufficiently definite for prosecution for criminal conspiracy r. 737 568. Overt act not necessary to criminal conspiracy under the act 738 569. Limitations of prosecutions for conspiracy 738 570. Indictments for conspiracy — sufficiency 739 571. Corporations indictable for criminal conspiracy under the act „ 740 572. . Conspiracy to run a corner in cotton indictable 741 573. Immunity of witnesses in criminal prosecutions under act.... 741 574. The plea of nolo contendere 742 Section 3. 575. Section 3 of the act 744 576. Territories and district of Columbia included 744 Section 4. 577. Section 4 of the act 746 578. Procedure in equity under the act 746 579. Right of statutory injunction now not limited to the govern- ment 747 580. The act under the general equity jurisdiction of the court... 748 581. A state cannot enjoin under the act 749 TABLE OF CONTENTS. XXV § 582. Suits by the government for dissolution of unlawful combi- nations, procedure 750 583. Decree in the Standard Oil case 751 584. Decree in the American Tobacco Co. case 752 Section 5. § 585. Section 5 of the act 754 586. The scope of decrees under the anti-trust act 754 587. Judicial application of section 756 Section 6. i 588. Section 6 of the act 759 589. Enforcement of seizure of goods under section 6 759 Section 7. § 590. Section 7 of the act 760 591. The re-enactment of the section in the act of 1914 760 592. The section construed by the Supreme Court 761 593. Three fold damages recoverable under acts of 1890 and 1914 only in actions at law 762 594. Plaintiff must show injury 762 595. A state is not a "person or corporation" under section 7.... 764 596. Only the parties to an unlawful conspiracy liable as defen- dants 764 597. Pleadings under Section 7 765 598. Evidence under Section 7 766 599. The Danbury Hat Case 767 600. Measure of damages under Section 7 767 601. The act as a defense in suits by alleged illegal combinations.. 768 602. The illegality of a corporation plaintiff and the illegality of the contract of sale distinguished 770 603. No recovery under act for violation of interstate commerce act 771 604. Limitations 771 605. Self-incriminating testimony 771 606. Service upon Foreign Executor under New York Statute quashed 772 607. Service upon Foreign Corporation doing business in the district 773 Section 8. § 608 Section 8 774 609. Definitions 774 THE EXPEDITION ACT. 610. The Expedition Act 776 611. The judicial application of the act 778 612. The amendment of 1910 778 613. The construction of the statute 779 614. The act not violative of due process of law 780 EMPLOYERS LIABILITY ACT. 615. The Employers Liability Act of 1906 781 616. The Act of 1906 invalid as to interstate carriers 782 617. The act of 1906 valid as to District of Columbia and terri- tories 783 618. The employers liability act of 1908 783 619. The Amendatory act of April 5, 1910 785 620. The acts of 1908 as amended in 1910 sustained by the Su- preme Court 786 621. The amendment of 1910 787 622. The abolition of contributory negligence in connection with Safety Appliance Act 788 622a. Contributory negligence and assumption of risk distinguished 788 623. What is employment in interstate commerce 789 624. Concurrent jurisdiction of the State courts 794 625. Jurisdiction of the Supreme Court in suits brought in State courts 795 626. Prohibition of contracting out of the act 796 627. The superseding of State statutes 797 627a. The Employers Liability Act and state compensation laws 799 628. Parties entitled to right of action under the act 800 629. Right of removal under the act 802 630. Procedure in trials under the act 803 631. Measure of damages under the act 805 632. Set-off under the act 806 633. Aliens as beneficiaries within the terms of the act 806 THE SAFETY ACT OF 1893, AMENDED 1896. Section 1. § 634. Section 1 of the act 807 635. Railroads subject to the act 807 636. The common law duty of the carrier in relation to safety appliances _ 809 TABLE OF CONTENTS. XXVll § 637. Petition and procedure under the act 810 638. Federal question in suits under the act 810 639. The act in the state courts 811 640. The eilect of the act upon state legislation 811 Section 2. § 641. Section 2 of the act 813 642. Coupler equipment under section 2 813 643. Automatic couplers of different makes 814 644. The meaning of "car" in section 2 814 645. An absolute duty imposed upon carriers by the act to pro- vide and maintain automatic equipment 815 646. When cars are in interstate commerce 816 Section 3. i 647. Section 3 of the act 820 648. The use of defective cars forbidden 820 Section 4. § 649. Section 4 of the act 821 650. Construction of section 821 Section 5. § 651. Section 5 of the act 822 652. The delegation of power sustained 822 Section 6. § 653. Section 6 of the act '. 824 654. Enforcement of act by prosecution 824 655. The supreme court on prosecution for penalty under the act 825 656. The burden of proof under the proviso 825 Section 7. § 657. Section 7 of the act 827 658. Discretion of the commission in delaying enforcement of the act 827 Section 8. S 659. Section 8 of the act 828 660. Contributory negligence under the act 828 XXVlll TABLE OF CONTENTS. § 661. Contributory negligence distinguished from assumption of risk ..•■ ^^° 662. Responsibility of carrier for cars out of condition 831 AMENDMENT OF 1903 TO SAFETY ACT. § 663. Amendment of 1903 832 664. Relation of the Act to the Employers Liability Act 833 SAFETY ACT OF 1910. § 665. Safety Act of 1910 834 THE HOURS OF SERVICE ACT OF 1907. § 666. The act of 1907 837 667. The constitutionality of the act sustained 839 668. The act invalidates State acts on the subject 840 669. The statute not void for uncertainty 1840 670. The Interstate Commerce Commission had authority to require reports 840 671. No privilege to a corporation or corporation ofTicers against self-incrimination 841 672. Construction of liability of carriers under the act 841 673. What trains employed in interstate commerce within the meaning of the act 843 THE TWENTY-EIGHT HOUR ACT. I 674. The twenty-eight hour act 844 675. Delivery to connecting carrier 846 676. Accidental or unavoidable causes defined 847 677. Violation of rules and regulations of company no defense 848 678. Press of business 848 679. Substitution for accommodation of animals 848 680. Requested confinement — Question for jury 848 681. Burden of proof 849 682. The government is entitled to writ of error 849 683. Pleadings 849 684. "Wilfully" and "knowingly" construed 849 685. Who subject to the act 850 686. Place of bringing suits 850 687. Procedure — Unit of offense 850 TABLE OF CONTENTS. XXIX APPENDIX. 1. Anti-Trust Sections of Tariff Act 851 2. Anti-Trust Act of 1914 (Clayton Act) 853 3. Federal Trade Commission Act 869 4. Code Pro\dsion for Designation of Carrier's Agent at Wash- ington 878 5. Decrees Entered in Anti-Trust Cases 879 6. Rules of Practice Trade Commission 887 7. Rules of Practice Interstate Commerce Commission 892 8. Forms of Procedure, Interstate Commerce Commission 902 9. Act of 1913 — Abolishing Commerce Court 905 10. Arbitration Act of 1913 909 11. Interlocking and Automatic Signals Act 917 12. The Ash-Pan Act 918 13. The Report of Accidents Act 920 14. Locomotive Boiler Inspection Act 922 The Law of Interstate Commerce PART I. CHAPTER I. INTERSTATE COMMERCE UNDER THE FEDERAL CONSTITUTION. CHAPTER n. THE CONCURRENT AND EXCLUSIVE POWERS CHAPTER HI. THE FEDERAL REGULATION OF INTERSTATE COMMERCE CHAPTER IV. THE FEDERAL POWER OF REGULATION IN INTERSTATE COMMERCE CHAPTER V. BUSINESS COMBINATIONS IN INTERSTATE COMMERCE CHAPTER VI. LABOR COMBINATIONS IN INTERSTATE COMMERCE CHAPTER VII. FEDERAL CONTROL OF STATE RAILROAD REGULATION CHAPTER I. INTERSTATE COMMERCE UNDER THE FEDERAL CONSTITUTION. § 1. The commerce clause in the constitution. 2. Power of congress in foreign commerce and with the Indian tribes distinguished. 3. The preference clause in the constitution. 4. The prohibition of tax or duty on exports from state. 5. Federal sovereignty in interstate commerce. 6. Gibbons v. Ogden. 7. What is commerce. 8. What is not commerce. 9. Insurance and commerce. 10. What are the subjects of commerce. 11. Wild game and fish as subjects of'commerce. 12. Natural oil and gas as subjects of commerce. 13. The commerce clause and the admiralty jurisdiction. 14. Erie Canal subject to admiralty jurisdiction. 15. Jurisdiction of federal courts in admiralty cases. 16. State corporations in interstate commerce. 17. When transit ends; the original package in interstate commerce. 18. The Wilson Bill of 1890. 19. Limitations of state control of liquor traffic. 20. The Webb Kenyon Act of 1913. 21. A state cannot tax interstate commerce. 22. But a state can tax the property employed in interstate com- merce. 23. State power of taxation of corporations engaged in interstate commerce summarized. "The congress shall have power ... to regulate commerce with foreign nations, among the several states, and with the Indian tribes." Constitution of the United States, art. I, sec. 8, par. 3. "To establish post offices and post roads." Art. I, sec. 8, par. 7. "The congress shall have power to make all laws which shall be necessary and proper for carrying into effect the foregoing powers, and all other powers vested by this con- stitution in the government of the United States, or in any department, or any officer thereof." Art. I, sec. 8, par. 18. "No tax or duty shall be laid on articles exported from any state. No preference shall be given by any regulation of com- § 1 ] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 3 merce or revenue to the ports of one state over those of an- other; nor shall vessels bound to or from one state be obliged to enter, clear, or pay duties in another." Art. I, sec. 9, par. 5. "No state shall, without the consent of the congress, lay any imposts or duties on imports or exports except what may be absolutely necessary for executing its inspection laws. * * * ^j.^ i^ ggc iQ^ pj^j. 2. "The citizens of each state shall be entitled to all the privi- leges and immunities of the citizens of -the several states." Art. IV, sec. 2. "This constitution and the laws of the United States which shall be made in pursuance thereof, and all treaties made or which shall be made under the authority of the United States shall be the supreme law of the land; and the judges in every, state shall be bound thereby, anything in the constitution or laws of any state to the contrary notwithstanding." Art. VI, par. 2. "No person shall * * * be deprived of life, liberty or property without due process of law; nor shall private prop- erty be taken for public use without just compensation." Amendment V. Ratified Jan. 8, 1798. "The enumeration in the Constitution of certain rights shall not be construed to deny or disparage others retained by the people." Amendment IX. Ratified Jan. 8, 1798. "The powers not delegated to the United States by the constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people." Amendment X Ratified January 8, 1798. "All persons born or naturalized in the United States and subject to the jurisdiction thereof are citizens of the United States and of the state wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States, nor shall any state deprive any person of hfe, Uberty or property without due process of law, nor deny to any person within its juris- diction the equal protection of the laws." Article XIV, Sec- tion 1 (declared ratified July 28, 1868). § 1. The commerce clause in the constitution. — The commerce clause in the federal constitution illustrates more pointedly than any other the circumstances which forced the adoption of the constitution and the formation of the government of the Union, and its judicial history is the clearest example of the adaptation of a written constitu- 4 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 1 tion by construction to conditions and emergencies never contemplated by its framers. It was the necessity for na- tional control over foreign commerce which was the imme- diate occasion for calling the convention of 1787, as the defect of the articles of confederation in failing to provide for the control of this commerce was universally recognized. Under the articles of confederation adopted during the revolutionary war, congress had power to regulate trade with the Indians, but the control of foreign and injtersta-te com- merce remained with the States. The compact between Vir- ginia and Maryland relative to the navigation of the Poto- mac river and the Chesapeake Bay, and the report of the commissioners thereon led the Virginia legislature to call a conference at Annapolis in 1786 to take into consideration the "trade of the United States, to examine the relative situ- ation in the trade of the states, to consider how far a uniform system in their commercial relations may be necessary to the common interests and their permanent harmony." From the Annapolis conference came the call for the Philadelphia convention of 1787, which framed the constitution. Commerce among the states however was in 1787 very simple, and other than that carried on in teams and wagons was carried on by navigation. There was comparatively little discussion in the debates of the convention or in the Federahst concerning the federal control over interstate commerce, and no consideration seems to have been given to the question of the effect of this grant of the federal power upon the pohce or taxing power of the states. It was re- garded as essentially supplemental to the control over foreign commerce, and was granted so as to make the control over foreign commerce effective. It was said by Mr. Madison, ^ that without this supplemental provision the great and es- sential power of regulating foreign commerce would have been incomplete and ineffectual, and that with state control of interstate commerce, ways would be found to load the 1 Federalist No. 42. It was sug- gation law or law regulating com- gested in the convention, though merce should be passed without not adopted, and also in some of the consent of two-thirds of the the state conventions as a condi- members present in both houses, tion of ratification, that no navi- § 1 ] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 5 articles of import and export during the passage through their jurisdictions with duties, which would fall on the makers of the lazier and the consumers of the former. The far-reaching importance of this federal control over commerce among the states was not and could not be fore- seen. It only came to be realized in the course of years, as the commercial development of the country demanded a judicial construction of the federal power in harmony with the requirements of such commerce. The basis of this con- struction for all time was made by the far-sighted and mas- terful reasoning in the broad and comprehensive opinions of Chief Justice Marshall.' The Supreme Court in 1895 in afTirming the supremacy of the federal power in interstate commerce, said:^ "Constitutional provisions do not change, but their opera- tion extends to new matters, as the modes of business and the habits of life of the people vary with each succeeding gen- eration. The law of the common carrier is the same to-day as when transportation on land was by coach and wagon, and on water by canal boat and sailing vessel, yet in its actual operation it touches and regulates transportation by modes then unknown, the railroad trains and steamships. Just so it is with the grant to the national government of power over interstate commerce. The constitution has not changed. The power is the same. But it operates to-day upon modes of interstate commerce, unknown to the fathers, and it will operate with equal force upon any new modes of such com- merce which the future may develop." ' Justice Bradley in the opinioa clauses of the constitution, the of the Court in Leloup v. Port of court has been constrained to refer Mobile, 127 U. S. 640, 32 L. Ed. to the fundamental principles 311, (1887), said that a great stated and illustfated with so number and variety of cases in- much clearness and force by Chief volving the commercial power of Justice Marshall and other mem- congress have been brought to bers of the court in former times, the attention of this court during and to modify to some degree cer- the past fifteen years, which have tain dicta and decisions which frequently made it necessary to have occasionally been made in re-examine the whole subject with the intervening period, care and the result has some- " In re Debs (1894), 158 U. S. times been that in order to give 564, c. p. 591, 39 L. Ed. 1092. full and fair effect to the different 6 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 2 § 2. Power of congress in foreign commerce and with the Indian tribes distinguished. — In the commerce clause, congress is empowered to regulate commerce with foreign nations, among the several states, and with the In- dian tribes. Although the three classes of commerce are thus grouped in the same clause and in the same terms, there is a distinction, which has been frequently discussed, be- tween interstate commerce on the one hand, and that with foreign nations and with the Indian tribes on the other, and this distinction is important not only in the construction of the legislation heretofore enacted by congress, but in deter- mining the power of congress in what may be termed its unexercised power over interstate commerce. In its control over foreign commerce, congress exercises the power of an independent sovereign dealing with other independent sovereign powers, and there is no implied or reserved power in the states in relation to such commerce. Congress may exercise the sovereign power of placing an embargo upon foreign commerce ' or it may exclude aliens. Commerce with the Indian tribes is also distinct from that between the states, in that congress in such regulation ex- ercises the power of a sovereign over a dependent people or tribal communities subject to the paramount authority of the United States.^ The power of controlling commercial relations with foreign nations and with the Indian tribes is therefore an essential sovereign power, which might have been inferred as an attribute of an independent sovereign nation created by the constitution without express grant of such power in the constitution. The power to regulate commerce among the states was ex- pressly given to congress in order to secure equality and free- dom in commercial intercourse between the states as sover- eign pohtical communities, subject only to the paramount ' 1 Story on the Constitution, (1832) 8 L. Ed. 483; United States sec. 289; United States v. Brigan- v. Kagama, 118 U. S. 375, 30 L. Ed. tine William, Dist of Mass., 2 228 (1886) ; United States v. Forty- Hall's Am. Law. J. 255. three Gallons of Whiskey, 93 U. S. 2 Cherokee Nation v. Georgia, 5 188, 23 L. Ed. 846 (1876); Cherokee Peters, 1 (1831), 8 L. Ed. 25; Wor- Nation v. Kansas Ry. Co., 135 caster v. Georgia, 6 Peters, 515 U. S. 641 (1890), 34 L. Ed. 295. § 4] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 7 authority of the United States in national concerns. Al- though the three classes of commerce are thus included in the same clause and in the same terms in the enumeration of powers, they are clearly distinguished in their historic- setting and constitutional import, and the laws, which are necessary and proper in regulating commercial intercourse with foreign nations and with the Indian tribes, may not be necessary and proper in regulating such commercial inter- course between the states. ^ § 3. The preference clause in the constitution. The so-called preferential clause of the constitution (article I, section 9, paragraph 5, supra) illustrates this differentiation of the federal control of commerce among the states from that over foreign commerce and with the Indian tribes. As already observed, at the time of the adoption of the con- stitution, commerce among the states, all of which were con- nected by sea and navigable waters, was conducted wholly by navigation except what was conducted by stage or wagon. The prohibition therefore of any preference of the ports of one state over those of another, or of any duties in interstate trafTic, had an importance at that time as a restraint upon the powers of the general government which can hardly be ap- preciated at the present time. The section is devoted ex- clusively to defining the powers conferred upon congress, and is a distinct limitation of the powers of congress in the regu- lation of commerce between the states. - § 4 The prohibition of tax or duty on exports from a state. — The prohibition of a tax or duty upon articles of export from any state was assumed in Almy v. California^ to ' See opinion of Justice McLean islative authority would not con- in Groves v. Slaughter, 15 Peters, 1. stitute a preference between the c. 505, 10 L. Ed. 800-821 (1841). ports of different states within ''Morgan, etc. Co. v. Bd. of the prohibition of Art. 1, Sec. 9, par- Health, 118 U. S. 455 (1886), 30 agraph 5 of the Constitution, even L. Ed. 237. Attorney-General though they resulted in a varying Moody, in his opinion of May 25, charge per ton per mile to and 1905 (Vol. 11, Senate Reports, from the ports of the different p. 1674), advised the senate com- states. mittee of interstate commerce that ' 24 Howard, 169 (1860), 16 L. reasonable rates determined by leg- Ed, 644. 8 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 5 apply to exports from one state to another. It has since been held that this prohibition has no application to interstate traffic, but applies to foreign exports only.^ This clause was discussed in one of the Insular cases,^ where a bare majority of the Court held that a tariff upon merchandise going into Porto Rico from the United States was not a duty upon an article exported from the United States, as it was not exported to a foreign country. Mr. Justice Brown in delivering the opinion of the Court said it was not intended to intimate that congress could lay a tariff upon merchandise carried from one state to the other, while in the dissenting opinion' it was insisted that this clause was intended to prevent the exercise through the taxing power of congress or its power to regulate commerce so as to discriminate between one part of the country and another, and the power to regulate interstate commerce was granted in order that trade between the states might be left free from discriminating legislation, and not to impart the power of creating antagonistic commercial relations between them. § 5 Federal sovereignty in interstate commerce. — The federal authority in interstate commerce is enforced not only by the power of regulation granted to congress by the constitution, but also by the exercise of other expressly enumerated powers of congress, more or less directly relating to interstate commercial intercourse. Thus the power to estabhshfpost ofTices and post roads,* to coin money, to es- 1 Woodruff V. Parham, 8 Wal- taries on the Constitution, sections lace, 123 (1868), 19 L. Ed. 382. ii23, et seq. It was discussed in ^Dooley v. United States, 183 connection with the building of U. S. 151 (1901), 43 L. Ed. 128. the Cumberland or National road s Justices Fuller, Brewer, Harlan by the United States. See Sea- and Peckham. right v. Stokes, 3 How. 151, 11 L. «The Articles of Confederation Ed. 537 (1845). Mr. Tucker, in gave congress the power only to his Commentaries on the Consti- establish post offices. The en- tution, Sec. 276, claims that the larged grant in the constitution so power to construct post roads is as to include the establishment of limited to cases where there are no post roads, was the subject of ex- post roads and it is necessary to tended discussion in the ante-rail- build them for postal purposes road days. See Story's Commen- He says, however, that the ques- § 5] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 9 tablish uniform systems of bankruptcy, to grant patents for discoveries, and most important of all the taxing power, are closely associated with commercial relations and activities. There is also what has been termed the "co-efficient power," the power to make all laws necessary and proper to carry into effect the foregoing powers, and all other powers vested by the constitution, in the government of the United States or in any department or officer thereof. The broad and comprehensive construction given to this "co-efficient power," in selecting measures for carrying into execution the constitutional powers of the government has made academic rather than practical the long debated dis- tinction between the express and impUed powers of con- gress. ' The words "necessary and proper" are not limited to such measures as are absolutely and indispensably neces- sary, without which the powers granted must fail of execu- tion, but they include all proper means which are conducive or adapted to the end to be accomplished, and which in the judgment of congress will most advantageously effect such end.2 The federal authority in interstate commerce, as in other matters, does not rest on a mere aggregation of the enumer- tion of power to build the roads, would authorize Congress to oi- where not for postal purposes, has ganize a system of national post- never been settled. In Pennsyl- road corporations with incidental vania v. The Wheeling & Belmont power to deal in transportation of Bridge Co., 18 How., 421, 15 L. Ed. persons or property within as well 435 (1856), in sustaining the as among the states. See mono- power of Congress to declare the graph of Hon. Edgar Howard Far- Wheeling bridge a lawful struct- rar (1907). Since the introduc- ure, the Court declined to enter tion of railroads they have been upon the question whether Con- uniformly used to carry the mails, gress possessed the power to estab- and state roads have been used to lish the bridge as a post road reach post offices not reached by under the Post Road Clause, say- the railroads. In the Railroad Act ing, "For, conceding that no such of 1866, infra, § 44, Congress re- power can be derived from this ferred, in the preamble to the act, clause, it must be admitted that it to the power to establish post- is at least necessarily included in roads. the power conferred to regulate ' McCulloch v. Maryland, 4 commerce among the several Wheat. 316, 438,4 L. Ed. 579(1819). states." It has been claimed that * Legal Tender Cases, 110 U. S. the power to establish post roads 421 (1884), 28 L. Ed. 204. IQ INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 5 ated powers. Although the government of the United States is one of enumerated powers, and under the tenth amendment- the powers not delegated to the United States by the consti- tution, nor prohibited by it to the states, are reserved to the states respectively or to the people, it is also true that there is a national sovereignty — a national Federal State — ^within the scope of the enumerated powers, and the constitution and laws of the United States are the supreme law of the land. Upon this broad principle of the sovereignty growing out of the aggregation of enumerated powers was based the power to charter a national bank,* the power to exercise the right of eminent domain, ^ the power to issue legal tender notes,^ and the power to exclude aliens.* The power to issue legal tender notes, which was strongly controverted, was based upon two enumerated powers, that of coining money and thereby establishing a national currency, and also upon the commerce power. It was also declared to be a power in- herent in sovereignty, as exercised by, other sovereignties at the time of the adoption of the constitution, and not ex- pressly withheld by the constitution from congress. As a political sovereignty the government of the United States may by physical force, through its official agents, in the enforcement of its powers, exercise complete sovereignty over every part of American soil which belongs to it. There is a "Peace of the United States," and this Peace can be en- forced by the executive^ in the protection of the judicial olTicers of the United States throughout the United States and within the limits of any State. These fundamental principles were very strongly asserted in the Debs case,* where the Court said that the government of the United States, in the exercise of its power over the mails and in pro- tecting interstate commerce, had jurisdiction over every foot of soil in its territory and acted directly upon every citizen. The decision was expressly based upon the sovereign power of the United States within the limits of its enumerated - McCulloch V. Maryland, supra. ' Chinese Exclusion Cases, 130 ' Kol 1 V. United States, 91 U. S. U. S. 581 (1889), 32 L. Ed. 1068, 367, 23 L. Ed. 449 (1875); Stock- 149 U. S. 698 (1893), 37 L. Ed. 905. ton V. Baltimore, 32 Fed. Rep. 9, » In re Nagel, 135 U. S. 1 (1890), (1887). 34 L. Ed. 55. 'Legal Tender Case, supra. "Supra, § 1. § 6] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 1 1 powers, and on the power of the government to enforce that sovereignty through the executive or through the courts, act- ing directly through the citizens and not through the agencies of a state, when the federal authority is resisted. The complexity of our federal governmental system in- cludes distinct sovereign power in the federal government with sovereign powers in the states. In the language of Chief Justice Marshall,' the powers of a sovereign are di- vided between the government offices of the Union and those of the states. They are each sovereign with respect to the rights committed to it, and neither sovereign with respect to the rights committed to the other. The supreme court of Massachusetts^ said that it was a bold, wise and successful attempt to place the people under two distinct governments, each sovereign and independent within its own sphere of action, dividing the jurisdiction between them, not by terri- torial limits nor by the relation of superior or subordinate, but classifying the subjects of jurisdiction and designating those over which each had entire and independent jurisdic- tion. The federal government therefore, though sovereign within the sphere of its enumerated powers, has not what has been termed inherent sovereignty, nor has it any general police powers; but with its wide scope of selection of the means for the execution of its enumerated powers the distinction is hardly a practical one in the actual working of our dual politi- cal system. § 6 Gibbons v. Ogden. — The judicial construction of the commerce clause begins in 1824 with the great opinion of Chief Justice Marshall in Gibbons v. Ogden,' wherein a grant of the state of New York for the exclusive right to navigate the waters of New York with boats propelled by fire or steam was held void as repugnant to the commerce clause of the constitution, so far as the act prohibited vessels licensed ' McCulloch V. Maryland, supra. Kent, J., in 4 Johns. Ch. 150 2 Opinion of Justices, 14 Gray, (1819), and also in Livingston v. 615. Van [ngen, 9 Johns. 507 (1812). » 9 Wheat. 1, 6 L. Ed. 23, revers- ing 17 Johns. 488 (1820), and 12 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 7 by the laws of the United States for carrying on the coast trade from navigating the said waters by fire or steam. The broad and comprehensive construction of the term "commerce" in this opinion is the basis of all subsequent de- cisions construing the commerce clause, and is the recognized source of authority. Commerce is more than traffic; it in- cludes intercourse. The power to regulate is the power to prescribe the rules by which commerce is to be governed. This power like all others vested in congress is complete in itself, and may be exercised to its utmost extent, and ack- nowledges no limitations other than as prescribed in the constitution. The power over commerce with foreign na- tions and among the several states, said the court, is vested in congress as absolutely as it would be in a single govern- ment having in its constitution the same restrictions on the exercise of the power as is found in the constitution of the United States. The power comprehended navigation within the limits of every state, so far as navigation may be in any manner connected with commerce with foreign nations or among the several states, or with the Indian tribes, and therefore it passed beyond the jurisdictional line of New York and included the public waters of the state which were connected with such foreign or interstate commerce. The most important and far-reaching declaration in the opinion was that of the suprenlacy of the federal power, so that in any case of conflict the act of congress was supreme, and state laws must yield thereto, though enacted in the exercise of powers which are not controverted. § 7 What is Commerce. — The term "commerce" is not defined in the constitution, but its meaning has been deter- mined by the process of judicial inclusion and exclusion on the broad and comprehensive basis laid down in Gibbons v. Ogden. Commerce, it was there said, is not traffic alone, it is intercourse. "It described the commercial intercourse be- tween nations, and parts of nations in all its branches, and is regulated by prescribing rules for carrying on that inter- course." In the Passenger Cases^ the rule declared in Gibbons v. Ogden was appUed in holding invalid certain state statutes 1 7 How. 283 (1849), 12 L. Ed. 702. §7] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 13 imposing taxes upon alien passengers. It was said that com- merce included navigation and intercourse and the transpor- tation of passengers. In the Pensacola Telegraph Company case' the Court said that since the case of Gibbons v. Ogden it had never been doubted that commercial intercourse was an element which comes within the power of regulation by congress, and that the power thus granted was not confined to the instrumen- talities" of commerce known or in use when the constitution was adopted, but kept pace with the progress of the country, adapting themselves to the developments of time and cir- cumstances. In the language of the Court: "they extend from the horse with its rider to the stage coach, from the. sailing vessel to the steamboat, from the coach and steamboat to the railroad, and from the railroad to the telegraph, as these new agencies are successively brought in to use to meet the demands of increasing pop- ulation and wealth. They were intended for the govern- ment of the business to which they relate at all times and under all circumstances." In a later case it was said^ that the commerce which con- gress could regulate included not only the interchange and transportation of commodities or visible and tangible things, but the carriage of persons and the transmission by tele- graph of ideas, orders and intelligence. Importation into one state from another is the indispens- able element, the test of interstate commerce; and every ne- gotiation, contract, trade and dealing between citizens of different states which contemplates and uses such importa- tion, whether it be of goods, persons or information, is a transaction of interstate commerce.' Such commerce, there- fore, includes not only communication by telephone between •96 U. S. 1 (1877), 24 L. Ed. 'From opinion of Sanborn, J., 708, 711. Construing act of July in Butler Brothers Shoe Co. v. 24, 1866, as a prohibition of all United States Rubber Co., 156 Fed. state monopolies in interstate tele- 1, C. C. A. 8th Cir., quoted by the graph business. Supreme Court, in International ''W. U. Tel. Co. V. Pendleton, TextBook Co. v. Pigg, 217U. S. 91, 122 U. S. 347 (1887), 30 L. Ed. 54 L. Ed. 678 (1910). 1187. 14 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§7 points in different states' but also communication through a correspondence school, where the intercourse and communi- cation relates to matters of regular and continuous business and the conduct of such business, therefore, through local agencies is exempt from state control or interference.^ The power of Congress over interstate transportation is complete in itself, and Congress, as an incident to it, may- adopt not only the means necessary but convenient to its exercise, and such means may have the quality of pohce regulations as in the Food & Drug Act, Lottery Act or White Slave Act.^ 1 Richmond v. Southern Bell Tel. Co., 174 U. S. 761, 43 L. Ed. 1162 (1899); Sunset Telephone & Telegraph Co. v. Ureka, 172 Fed. 755, Cir. Ct. of Northern Dist. of Cal. (1902). 2 International Text Book Co. v. Pigg, supra, reversing 76 Kan. 328. In U. S. Fidelity & Guarantee Co. V. Commonwealth, Ct. Apps. of Ky. 139 Ky. 27, the case of a corpo- ration operating a scheme of recommending commercial credits through a list of attorneys of dif- ferent states, was distinguished from the above case and held liable to a state license tax. 3 In Wilson v. United States, 232 U. S. 563, 58 L. Ed. 728, (1914), the court held valid the Act of June 25, 1910, known as the White Slave Traffic Act making it a criminal offense to knowingly trans- port or to procure the transporta- tion of women for immoral pur- poses, as within the commerce power. In U. S. V. Portale, 235 U. S. 27, 59 L. Ed. Ill, (1914), this White Slave Act was construed as includ- ing women as well as men in har- boring alien women for the purpose of prostitution and in U. S. v. Holte, 236 U. S. 140, 59 L. Ed. 504, (1915), the court held that a woman could conspire to commit an offense though the object of the conspiracy was her own trans- portation in Interstate Commerce for the purpose of prostitution, Justice Lamar dissenting, and in U. S. V. Portale, 235 U. S. 27, 59 L. Ed. Ill, the requirement that every person harboring an alien woman for the purpose of prostitution, etc., should file a statement of the facts with the Commissioner of Immigration could not be construed as confined to person who had to do directly or indirectly with the bringing or sending forth of such alien woman. Hoke v. United States, 227 U. S. 308, 57 L. Ed. 523 (1913), affirming 187 Fed. 992. For application of this act see also Athanasaw v. United States, 227 U. S. 326, 57 L. Ed. 528, (1914) and Bennett v. U. S., 227 U. S., 333, 57 L. Ed. 531, (1914), Harris V. U. S., 227 U. S. 340, 57 L. Ed. 534, (1914). Diggs V. U. S., 220 Fed. 545. (C. C. A. 9th Cir.), 1915. Welch V. U. S., 220 U. S. 764, (C. C. A. 4th Cir.), 1915. Johnson V. U. S. (C. C. A. 7th Cir.), 215 Fed. 679 (1914). Kalen v. §7] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 15 While a bridge is not a common carrier, it affords a high- way for such carriage, and a state enactment prescribing the rate of toll on an interstate bridge is an unauthorized regula- tion of interstate commerce.^ Commerce among the states, therefore, embraces navigation, transportation of passengers and freight traffic and the communication of messages by telegraph^ and by telephone' and by correspondence schools. The carrying of lottery tickets from one state to another by corporations or companies whose business it is to carry tangible property from one state to another, constitutes in- terstate commerce which may be properly prohibited by congress under its power of regulation.* Certificates of stock, bonds and securities of all kinds are subjects of interstate commerce, and shipments and sales of the same between the states are interstate commerce.* The right to make sales includes the right to solicit such sales in other states, and such a sale on personal solicitation for delivery in another state carries with it the right to de- liver the accessories of the commodity sold, where such ac- cessories may be included as a part of the interstate trans- action.^ U. S. (C. C. A. 9th Cir.), 196 ^Lottery Cases, 188-U. S. 321, Fed. 888 (1912). Paulser v. U. 47 L. Ed. 492 (1903), four judges S. (C. C. A. 9th Cir.), 199 dissenting. Fed. 423 (1912). Bennett v. U. ^ Compton v. Allen, 216 Fed. S., (C. C. A. 6th Cir.), 194 Fed. 537, Dist. Ct. Iowa, (1914) holding 630 (1912). Harris v. U. S. (C. the Blue Sky Law of Iowa, which C. A. 6th Cir.), 194 Fed. 634 (1912). by its terms prohibited a citizen Cohen v. U. S. (C. C. A. 9th Cir.), of another state from bringing or 214 Fed. 23 (1914). sending securities into the state for ' Covington, etc. Bridge Co. v. saie without obtaining from the Kentucky, 154 U. S. 204 (1894), 38 Secretary of State a certificate as L. Ed. 962. As to taxation of an an investment company or stock interstate bridge, see Henderson broker, was not within the police Bridge Co. v. Kentucky, 166 U. S., powers of the State and uncon- 150 (1897), 41 L. Ed. 953, and stitutional as a burden upon inter- Henderson Bridge Co. v. Hender- state commerce, son, 173 U. S. 592, 48 L. Ed. 823 See also Ala. & N. C. T. Co. v. (1899). Doyle, (Dist. Ct. Mich., 1914) 210 ^ Pensacola Telegraph Co. case. Fed. 173, holding invalid a similar supra. law of Michigan. ' Central Union Tel. Co. v. « See this principle applied to State, 118 Ind. 194, and In re Penn. the delivery of frames for pictures Tel. Co., 48 N. J. Eq. 91. sold through soliciting agents in 16 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 7 Interstate commerce, as distinguished from domestic com- merce, includes traffic between points in the same state, but which in transit is carried through another state. ' It follows that the railroad commission of a state cannot, with- out violating the commerce clause, fix and enforce rates for the continuous transportation of goods between such termi- nal points.^ A tax on an interstate railroad can be appor- tioned according to mileage in a state (see § 22, infra), hut when a freight rate is established it must be established as a whole. (See § 162, infra.) Commerce includes navigation, and the power to regulate commerce comprehends the control, for that purpose, and to the extent necessary, of all the rivers of the United States which are accessible from a state other than those in which they lie.' The right to regulate navigation carries with it the right to regulate and improve navigable rivers and the ports on such rivers, and the power to close one of several channels in a navigable stream, if in the judgment of congress the navi- gation of the river will be thereby improved. Thus the power of congress over the Savannah river was not affected by the compact between South Carolina and Georgia in 1787, before the adoption of the constitution.^ (As to concurrent power of state in river improvements, see chap. 2, infra.) '(. To constitute interstate commerce, it must be so in fact and not only in intention. The intention to ship manufac- tured goods to other states does not make a contract for the operation of a factory for their manufacture relate to inter- state commerce in a constitutional sense so as to exempt it from Ihe operation of state laws,* nor does such intention to export property from the state constitute a ground for the Davis vs. Virginia, 236 U. S. 697, Tea Co. v. Lee's Summit, W. D. 59 L. Ed. 795 (1915). of Mo. et al., 189 Fed. 280 (1911). 1 Hanley v. K. C. So. R. Co., 187 » Oilman v. Philadelphia, 3 Wal- U. S. 617 (1903), 47 L. Ed. 333. lace, 724, 18 L. Ed. 96 (1866). ^ Delivery of packages from in- * South Carolina v. Georgia, 93 terstate trains to addresses in a U. S. 4, 23 L. Ed. 782 (1876). As city is a part of interstate com- *° ^^^ admiralty jurisdiction, see infra, § 13. merce. Burnett v. City of New York, C. C. S. D. of N. Y., 189 Fed. 268 (1911). See also Jewel (1900). 103 Fed. Rep. 838. ' Diamond Glue Co. v. United York, C. C. S. D. of N. Y.. 189 states Glue Co.. E. D of wL §8] INTEESTATE COMMERCE UNDER FEDERAL CONSTITUTION. 17 exemption from the power of state taxation. (See § 21, infra.) § 8. What is not commerce. — -While commerce is more than traffic and includes commercial intercourse and the transmission of intelligence, it does not include the con- tractual relations between citizens of different states, which are incidental or even in one sense are essential to interstate commercial intercourse.^ The distinction may be illustrated by a bill of lading and a bill of exchange. A bill of lading upon an interstate or foreign shipment represents the prop- erty shipped, and in the case of an interstate shipment is beyond the taxing power of a state, and in the case of a foreign shipment a tax upon a bill of lading is a tax upon ex- ports, and therefore beyond the taxing power of either the state or federal government.^ On the other hand, a bill of exchange, whether drawn on an interstate shipment or a foreign shipment, is an incident of such commerce and not a part of it. It follows, therefore, that a broker dealing in foreign bills of exchange is not engaged in commerce, but in supplying the instrumentalities of commerce, and a state tax upon money and exchange brokers is not void as a regulation of commerce.' ' Almy V. California, 24 How. ' Fairbanks v. United States, 181 169, 16 L. Ed. 644 (1860); Wood- U. S. 283 (1901), 45 L. Ed. 862. ruff V. Parham, 8 Wall. 123 (1870), » Nathan v. Louisana, 8 How. 19 L. Ed. 382. The business of 73 (1850), 12 L. Ed. 992. The publishing and distributing a list lending of money by a citizen of of selected attorneys in the United one state to a citizen of another States, was held, in U. S. Fidelity is not interstate commerce. Nelms & Guaranty Co. v. Kentucky, v. Mortgage Co., 92 Ala. 157. (1913) 231 U. S. 394, 58 L. Ed., Mr. Hamilton, in his argument on 283 not to be an engagement the power to charter a national in interstate commerce so as to bank, 3 Hamilton's Works (Lodge), exempt the corporation from liabil- pp. 179-203, enumerates, among ity for a license tax under the the subjects over which he had Kentucky statute on commercial little doubt the national power agencies, although some of the in- extended, the regulation of policies quiries may be received from of insurance and bills of exchange merchants without the State in drawn by a merchant of one state anticipation of future commercial upon a merchant of another, interstate transactions. J-2. 18 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 9 The manufacturing business of a company, although the manufactured product is scQd by the company in other states and in foreign countries, is not interstate commerce.' Com- merce succeeds manufacture and is not a part of it, and the relation of the manufacturer, in such a case, to interstate and foreign commerce is incidental and indirect, and the business therefore is subject only to state control. Trade marks, though useful and valuable aids of com- merce, are not subject to congressional regulation unless limited to their use in commerce with foreign nations and among the several states and with the Indian tribes.'' But the regulation of trade marks by Congress by providing for their registry and protection in connection with commerce, interstate or foreign, or with the Indian tribes, is legitimate legislation in connection with the regulation of such com- merce.' The regulation of places and the manner in which com- modities shall be sold which are in course of transportation as articles of interstate commerce is not an unconstitutional regulation of such commerce.* The business of private banking is not commerce, although it may include the receipt of bailments from other states. A state statute requiring a license for individuals or partnerships desiring to engage in business of private banking as applied to one whose business chiefly existed in receiving deposits in very small sums from time to time until they reach an amount sufficient to be sent to other states or foreign coun- tries, is not an unconstitutional regulation of interstate com- merce.^ § 9. Insurance and commerce. — An important appli- cation of this principle, that the contractual relations inci- dental to commerce are not included in the commerce clause, 1 Kidd V. Pierson, 128 U. S. 1 * Broadnax v. Missouri, 219 U. S. (1888). 32 L. Ed. 346; United 285, 55 L. Ed. 219, affirming 228 States V. Knight Co., 156 U. S. 1 Mo. 25, (1914). (1895), 39 L. Ed. 325. » Engel v. O'Malley, 219 U. S. 2 Trade Mark cases, 100 U. S. 82, 128, 55 L. Ed. 128 (1911), affirming 25 L. Ed. 550 (1879). 182 Fed. 365. ' Rossman v. Garniea, C. C. A. 8th Cir., 211 Fed. 401 (1914). §9] INTERSTATE COMMEECE UNDER FEDERAL CONSTITUTION. 19 has been made in relation to the business of insurance. The business of fire and marine insurance is .intimately related to interstate and foreign commerce, and is indeed an essential feature of such commerce, while life insurance involves an associated relation for the averaging of human lives, extend- ing not only through the states of this country but foreign countries.' It was held first in the case of a foreign fire in- surance company which claimed exemption from state con- trol, that a policy of insurance was not an instrument of commerce, but was a mere contract for indemnity against loss by fire, and that the fact that the parties were domiciled in different states did not make such contracts interstate trans- actions within the meaning of the commerce clause.^ Later this ruhng was apphed to a contract of marine insurance,' and the Court said, if the power to regulate interstate com- merce applied to all the incidents to which commerce might give rise, and to all the contracts which might be made in the course of its transaction, the power would embrace the entire sphere of mercantile activity in any way connected with trade between the states. Finally, in 1900, the ruling was extended to the case of mutual life insurance, although here it was contended that the policies were not mere contracts of in- demnity, but represented an associated relation based on the comparative certainty of the average life and the uncertainty of the individual hfe, thus necessitating a uniform law con- trolling this associated relation of parties resident in differ- ent states and countries. The Court, however, refused to distinguish the business of mutual life insurance from that of fire and marine insurance.^ The business of insurance there- ' President Roosevelt in his mes- tions, infra, § 61, could not con- sage of December, 1904, says stitutionally be extended to cover that the business of insurance interstate transactions in insurance, vitally affects the great mass of ^ Paul v. Virginia, 8 Wall. 168 the people of the United States, and (1869), 19 L. Ed. 357. is national and not local in its ap- 'Hooper v. California, 155 U. S. plication, and that it involves a 647 (1895), 39 L. Ed. 297. multitude of transactions among * New York Life Ins. Co. v. the people of the different states Cravens, 178 U. S. 389 (1890), 44 and between American countries L. Ed. 1116. In New York Life and foreign governments. He urges Insurance Co. v. Deer Lodge congress to consider whether the County, 231 U. S. 495, 58 L. Ed. power of the Bureau of Corpora- 332 (1913), the Court reaffirmed 20 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§10 fore in all its branches is subject to the legislation of the dif- ferent states^ wherein the companies are located. It was strongly contended by the dissenting judges in the lottery cases, supra, that lottery tickets, under the ruhng in the insurance cases, were mere evidences of contractual re- lations, furnishing the means of enforcing contract rights, and were not instruments of commerce in any sense. It was ruled in the prevailing opinion, however, that lottery tickets are subjects of traflTic, and are therefore subjects of commerce. § 10. What are the subjects of commerce.— Com- merce between the states includes only the subjects, which are properly and lawfully articles of commerce. The regu- lating power of congress does not deprive the states of their inherent police power in protecting the lives and property of their citizens, although the line is oftentimes difficult to draw, as the dissents in the Supreme Court show, between reasonable police regulation which only indirectly or inci- dentally affects interstate commerce, and legislation which invades the prerogatives of congress. Thus the states may legislate to prevent the spread of crime, and may exclude from their limits paupers, convicts, persons likely to become a pubUc charge, and persons afflicted with contagious diseases,^ A state may protect the moral as this ruling that insurance is not company to do business in the commerce and held that a foreign state. The license was refused life insurance company could be unless the company would invest subjected to an annual tax imposed one fourth of its reserve of South by the State of Montana upon the Carolina policies in improved South basis of excess of premiums received Carolina securities. The Court held over losses and expenses incurred that this was not a denial of due within the state during the previous process of law and the equal pro- year, although all the contracts tection of the laws, were made and discharged at the ^ As to the exercise of their company's home office in New power by the states and its effect York, — affirming 43 Mont. 243. upon the business of insurance. In South Carolina ex rel v. see infra, § 16. McMaster, 237 U. S. 63, 59 L. Ed. ' But as to right of excluding 839 (1915), the Court affirmed 94 foreign immigrants, see Hender- S. C. 397, refusing a writ of man- son v. New York, 92 U. S. 259 damns to compel the state in- (1875), 23 L. Ed. 543; Chy Lung v. surance commissioner to issue a Freeman, 92 U. S. 275 (1875), 23 license to a foreign life insurance L. Ed. 550. §10] INTERSTATE COMMERCE UNDER FEDERAL CONSTITTJTION. 21 well as the physical health of its people. A corpse is not the subject of commerce.^ This power of the state includes the right to protect the people against fraud and deception in the sale of food products. The principle was applied by the Court in sustaining a Massachusetts statute,^ which prohibited the manufacture and sale of imitation butter, oleomargarine, artificially colored so as to cause it to look like butter. This principle does not extend to the exclusion of any com- modity which is generally recognized as a legitimate article of commerce, though condemned and sought to be excluded by the legislation of a particular state. A state cannot deter- mine for itself upon its own standards of public opinion what are and what are not lawful subjects of commerce, against the generally accepted opinion of the commercial world. This distinction was illustrated in another oleomargarine case' where the Court held invalid a statute of Pennsylvania which absolutely prohibited the manufacture or sale of oleomar- garine, so far as that statute prohibited the introduction of oleomargarine from another state and its sale in the original package. The Court distinguished the Plumley (Massachusetts) case on the ground that it was based upon the right of the state to prevent deception and fraud, and that the right of a state in relation to the administration of its internal affairs was one thing, and its right to prevent the introduction within its limits of an article of commerce was another and totally different thing. The Court in its opinion referred to the fact that oleomargarine had been treated by congress as a proper subject of taxation,'' that this was in effect an affirmative ' In re Wong Yung Quy, 6 Saw. Dairy Co. v. Ohio, 183 U. S. 238 442. (1902), 46 L. Ed. 171. ' Plumley v. Massachu.setts, 155 ^ SchoUenberger v. Pennsylvania, U. S. 461 "(1895), 39 I.. Ed. 223. 171 U. S. 1 (1898), 43 L. Ed. The same principle was applied in 49. In Collins v. New Hampshire, Crossman v. Lurman, 192 U. S. 189 171 U. S. 31 (1898), 43 L. Ed. 60, (1904), 48 L. Ed. 401, in sustain- the Court held invalid, as being in ing a New York statute as to the necessary effect prohibitory, a importation of artificially colored statute prohibiting sale of oleo- foreign coffee. Held that there margarine as a substitute for butter was no error in excluding evidence unless colored pink. that it was a recognized article of * Act of August 2, 1866, c. 40, commerce. See also Capitol City 24 statutes at large, 209. 22 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§10 declaration by congress that it was a proper subject of com- merce, and that it was established by 'competent testimony that it was a wholesome human food and a legitimate subject of commerce. This conflict between local and general public opinion as to what are proper subjects of commerce was illustrated in the case of spirituous Hquorsi which the Court held were legiti- mate subjects of commerce, the introduction and sale whereof in the original package could not be prohibited by the state.^ The right of the state in its control of its domestic commerce to enforce its own views of public pohcy in prohibiting the manufacture and sale of both liquors' and oleomargarine* had been sustained by the Court. Tobacco is also a legitimate article of commerce and the Supreme Court said that it could not take judicial notice of the fact that it was more noxious in the form of cigarettes than in other forms.* It was therefore subject to the same extent as intoxicating liquors to the police power of the state, that is, the state could declare how far cigarettes should be sold or prohibit their sale entirely after they had been taken from the original packages, or had left the hands of the im- porter, providing no discrimination was used as against those imported from other states,^ but could not prohibit their importation. The lawful police power of the state also extends to the reasonable inspection of articles brought in from the other states, this right of inspection being expressly recognized by ' See infra, § 19. the enforcement of a state statute '' As to the regulation of inter- prohibiting coloring, coating or state liquor traffic under Wilson polishing an article intended for Act, see infra, § 18. food, whereby damage or inferiority 'Mugler V. Kansas, 123 U. S. is concealed. The court said this 623, 31 L. Ed. 205 (1877); Boston was not in conflict with the power Beer Co. v. Mass., 97 U. S. 25; 24 of congress to regulate commerce, L. Ed. 989 (1878). though applied to articles sold in * Powell V. Pennsylvania, 127 U. original packages imported from S. 678 (1888), 32 L. Ed. 253. See other states. also Arbuckle v. Blackburn, 6th « Austin v. Tennessee, 179 U. S. Circuit, 51 C. C. A. 122, 113 Fed. 343 (1900), 45 L. Ed. 224. Rep. 616, 65 L. R. A. 864, (1902) » As to size of the original where the court refused to enjoin package, see infra, § 17. § 1 1] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 23 the constitution in the case of foreign importations.' But this inspection must be reasonable, and is invaUd if burdened with such conditions as would wholly prevent the introduc- tion of the sound article from other states.^ (See infra § 38.) § 11. Wild game and fish as subjects of commerce. — Lawful subjects of commerce must be capable of private ownership, and while this is not subject to the determination of a state in relation to recognized subjects of commerce, it is subject to the state control where the matter is not a sub- ject of private ownership except as permitted by state law. Thus the wild game within a state at common law belongs to the sovereign, and in this country to the people in their col- lective capacity, and the state therefore has a right to say that it shall not become the subject of commerce. Upon this principle the Supreme Court sustained a Connecticut^ statute prohibiting the killing of certain game in the state, with the intent of transporting the same out of the state. A state in the exercise of its police power may also pro- hibit the possession of game during prescribed seasons, ex- cept on giving bond against the sale, whether the game was taken within or without the state and although the game may have been taken in foreign countries during the open season for taking game in such countries.'* The act of congress* prohibiting the shipment or transpor- tation in interstate commerce of game killed in violation of the local laws, and requiring all packages containing game shipped in interstate commerce to be plainly marked, show- ing the name and address of the shipper and the character of the contents, and making the violation of these provisions a ' Art. 1, sec. 10, par. 2; Pat- " See Minnesota v. Barberl36, apsco Guano Co. v. North Carolina U. S. 313 (1890), 34 L. Ed. 455. Board of Agriculture, 171 U. S. 345 « Geer v. Connecticut, 161 U. S. (1898), 43 L. Ed. 191. New Mex- 519 (1896) 40 L. Ed. 793. ico ex rel. v. Denver & R. G. R. R. * New York ex rel. Silz v. Hes- Co., 203 U. S. 38, 51 L. Ed. 78 terbey, 211 U. S. 31, 53 L. Ed. 75 (1906), sustaining the hide inspec- (1908), affirming 184 N. Y. 126. tion law of Territory of New » See Act of May 25, 1900, U. S. Mexico. Compiled Statutes 1901, p. 3181, known as the Lacey Act. 24 INTERSTATE COMMERCE UNDER FEDERAL CONpTITUTION. [§11 criminal offense, was sustained as within the lawful power of congress over interstate commerce. ^ Under the same principle the state determines on what con- ditions the products of oyster beds and fisheries may become subjects of commerce, as each state, subject to the paramount control of navigation in the federal government, owns the beds of all tide waters and public waters in its jurisdiction.^ In the case cited from Massachusetts the courts held valid an act of that state prohibiting fisheries in the waters of Buzzard's Bay, except under the regulations prescribed by the act, and held that it applied to a vessel which had a li- cense to fish under the laws of the United States. There has been no grant to congress of power over fisheries, and these remain under the exclusive control of the states. The extent of the territorial jurisdiction of the state of Massachusetts over the sea adjacent to its coast was held to be that of an independent nation, and except so far as the right of control over this territory had been granted to the United States, the control remained with the state, subject of course to the 1 Rupert V. United States, C. C. A. 8th Circuit, 181 Fed. 87 (1910). On March 4, 1913, Congress passed an act, 37 Stat. L. and 847e, 145, known as the Migra- tory Birds Act, which declared that certain migratory game birds which in their northern and southern migrations pass through or do not remain permanently the entire year within the borders of any state or territory, shall hereafter be deemed to be within the custody and protection of the Government of the United States, and authorizes the Department of Agriculture to formulate and promulgate rules as to when and under what cir- cumstances such game might be killed. This act was held invalid because not authorized expressly or by necessary implication by the constitution and was not an exer- cise by Congress of the power to regulate Interstate Commerce, by_ Trieber, J., in United States v. Shauver, 214 Fed. 154, (D. C. of Ark. 1914). This ruling was followed by Pollock, J., in District Court of Kansas, 221 Fed. 288 (1915), in U. S. V. McCullaugh, and the matter is now (1916) pending in the Supreme Court. 2 McCready v. Virginia, 94 U. S. 391 (1876), 24 L. Ed. 248; Man- chester v. -Massachusetts, 139 U. S. 240 (1890), 35 L. Ed. 159. Com- merce between the states of New York and New Jersey was not in- terfered with by a New Jersey statute, whereunder a riparian owner was forbidden to direct the waters of Passaic river beyond the state under a contract to furnish water supply for city of New York. Hudson County Water Co. v. Mc- Carter, 209 U. S. 349, 52 L. Ed. 828 (1909), aff'g 70 N. J. Eq. 695. §12] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 25 admiralty and maritime jurisdiction of the United States. Within what are generally recognized as the territorial limits of states by the law of nations, a state can define its bound- aries on the sea and the boundaries of its counties; and by this test Massachusetts can properly include Buzzard's Bay within the limits of its counties. § 12. Natural oil and gas as subjects of commerce. — Natural oil and gas are not subject to absolute ownership while in the confines of the earth, and from their tendency to move from one place to another have been called in some of the decisions minerals ferae naturae. They become however lawful subjects of commerce when brought to the surface and secured in pipes. A statute of Indiana prohibiting the piping of natural gas from the state was held by the supreme court of that state to be an attempted regulation of interstate commerce, and violative of the natural right of dealing with the property, and therefore void. The court said that the natural gas in the earth cannot be a commercial commodity, but when brought to the surface and placed in pipes for transportation, it assumed that character as completely as coal in cars or petroleum in tanks. ^ While this position seems to be conceded in all the courts as to the commercial character of oil and gas when brought to ' State ex rel. v. Indiana & Ohio but it was property which by law- Gas and Mining Co., 120 Ind. 575. ful right one could transport and In West V. Kansas Natural Gas sell as other personal property. In Co., 220 U. S. 229, 55 L. Ed. 716 this case the state had granted the (1911), the Supreme Court af- use of highways to domestic cor- firmed the United States circuit porations engaged in intrastate court of the Eastern District of transportation of natural gas, giv- Oklahoma, 172 Fed. 545, in enjoin- ing such corporations even the ing the enforcement of an Okia- right to the longitudinal use of the homa statute, which prohibited ex- state highways but denied to the cept for private use construction appellees the right to pass under of pipe lines for the transportation and over the highways. The Court of natural gas, and held that the said that this discrimination was act providing that the gas should beyond the power of state to make, not be transported out of the state This case was therefore distin- was void as an interference with guished from the Indiana case. Interstate Commerce. Natural gas infra. Justices Holmes, Lurton and was not a product which the state Hughes dissenting, could conserve for its own people, 26 INTEESTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§12 the surface and secured in possession, it is also recognized that owing to the pecuhar character of these substances the property right of the owner of the land in such mineral oil and gas while confined in the earth is necessarily subject to quaUfications. Thus an act of Indiana making it unlawful for the owner of a natural gas or oil well to allow or permit the flow of gas or oil from any such well to escape into the air, without being confined within the well or proper pipes, for a longer period than two days after the gas or oil shall have been struck in such well, was not a violation of the con- stitution of the United States, nor taking of private property without compensation, nor a denial of due process of law, but was a lawful regulation by a state within its discretion of a subject which especially comes within its lawful authority.' The Supreme Court said in this case that there is a distinc- tion between animals/erae naturae and gas and oil, in that in the case of the former there was no individual proprietorship until the actual reduction of the property to possession, the property right until then being in the public. In the case of natural gas and oil no such right exists in the public; and in the case of the former every one may be prohibited from seek- ing to reduce to possession. In the case of natural gas and oil however the surface proprietors within the gas field have the right to reduce to possession the gas and oil beneath, and they cannot be absolutely deprived of this right without the taking of 5)rivate property. The legislative power however, from the pecuhar nature of the right and the objects upon which it is to be exerted, can be manifested for the purpose of protecting all the collective owners in the gas field and preventing waste. It was urged in this case that it was necessary to waste the gas in order to force up the oil; but the Court said this was a 1 Ohio Oil Co. V. Indiana, 177 U. v. Horlass, 131 Ind. 446; Hague v S. 190, 44 L. Ed. 729 (1900). See Wheeler, 157 Pa. St. 324; Jamison also Brown v. Spillman, 155 U. S. v. Indiana Natural Gas & Fuel Co 665, 39 L. Ed. 304 (1898); West- 128 Ind. 555, 12 L. R. A. 652i moreland-& Cambria Natural Gas Benedict v. Construction Co., 49 Co. V. Dewitt, 130 Pa. St. 235; N. J. Eq. 23; Manufacturer Gas Townsend v. State, 147 Ind. 624; Co. v. Ind. Nat. G. & F. Co., 155 Indiana Consumers & T. R. Co. Ind. 545. §13] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 27 matter which addressed itself to the wisdom of the legisla- ture and did not affect the power to make the regulation. The right of a state to conserve its resources for its own people, as illustrated in the case of flowing rivers and game, does not extend, whatever the local needs of a state, to natural oil and gas, when reduced to private possession through ownership of the soil and thus become the subjects of private ownership. In such case the state can adopt such reasonable methods of regulation of the production of oil and gas as are required by the peculiar nature of the property, but it cannot deprive the owner of his right to withdraw and sell the oil or gas when reduced to possession in interstate commerce, and a state statute seeking to attain these un- authorized ends is void.^ § 13. The commerce clause and the admiralty juris- diction. — The federal power over interstate and foreign commerce is reinforced as to the commerce on water, as dis- tinguished from land transportation, by section 2, article III, of the constitution, extending the judicial power of the courts of the United States to all cases of admiralty and maritime jurisdiction. It is not within the scope of this work to con- sider the federal legislation enacted in the regulation of this admiralty and maritime jurisdiction, further than to show the progressive development of this jurisdiction, which has more than kept pace with the judicial development of the commerce clause. It was first ruled, following the English precedents,^ that the admiralty courts could not rightfully exercise jurisdiction except in cases where the service was substantially performed or to be performed upon the sea, or upon waters within the ebb and flow of the tides. The effect of this decision was to exclude from the admiralty and maritime jurisdiction the commerce upon the great lakes and navigable rivers of the 'West V. Kansas National Gas (1911), wherein an interlocutory Co., supra. In this case the Su- injunction against the enforcement prenie Court cited and quoted ap- of same Oklahoma statute was provingly the opinion of the cir- affirmed. cuit court of appeals of the 8th ^^ The Thomas Jefferson, 10 circuit in Haskell v. Cowhan, 187 WTieat. 428 (1825), 6 L. Ed. 358. Fed. 402, decided shortly before 28 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§13 United States. It was not until 1851 that the earlier decision was overruled, and it was definitely decided that the admir- alty and maritime jurisdiction granted to the federal gov- ernment by the constitution of the United States was not limited to tide waters, but extended to all pubhc navigable lakes and rivers where commerce was carried on between different states or with foreign nations. ^ This case arose upon the great lakes, but the rule was subsequently extended to cases arising upon the navigable rivers of the United States where there was no ebb and flow of the tide.^ Later it was held that a stream lying wholly within a state and forming by its junction with Lake Michigan a continu- ous highway for commerce, both with other states and with foreign nations, was a navigable water of the United States.' In this case the rule was announced, that those rivers must be regarded as public navigable rivers in law, which are navi- gable in fact, and that they constitute navigable waters of the United States within the meaning of the acts of congress in contradistinction from the navigable waters of the states, when they form in their ordinary condition by themselves, or by uniting with other waters, a continued highway over which commerce is or can be carried on with other states or foreign countries, in the customary modes in which such commerce is conducted by water. It is immaterial that the navigabihty of such a river may be interrupted by rapids and falls over which portages are required to be made.* § 14. Erie canal subject to admiralty jurisdiction. — In a recent case the admiralty and maritime jurisdiction has been extended to the Erie canal, which lies wholly within the 1 The Genesee Chief, 12 How. der valid coasting license on vessel 443 (1851), 13 L. Ed. 1058. in the lakes was engaged in inter- 2 The Magnolia, 20 How. 296 state commerce and was not sub- (1856), 15 L. Ed. 909; Fretz v. ject to state or municipal license. Bull, 12 H:ow. 466, 13 L. Ed. 1068 * The Montello, 20 Wall. 430 (1851). (1874), 22 L. Ed. 391; Escanaba ' The Daniel Ball, 10 Wall. 557 Co. v. Chicago, 107 U. S. 678 (1870), 19 L. Ed. 999. In Ex parte (1882), 27 L. Ed. 442; Miller v Eaglesfield, 180 Fed. 558 (1910 E. The Mayor, 109 U. S. 385 (1883). D. of Wis., it was held that one 27 L. Ed. 971; In re Garnett, 141 trading in interstate commerce un- U. S. 1 (1891), 35 L. Ed. 631. §15] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 29 state of New York, on the ground that it connects navigable waters and is a great highway of commerce between ports of different states and foreign countries, and is, therefore, a navigable water of the United States within the legitimate scope of the admiralty jurisdiction of the courts of the United States. In this case it was adjudged that the enforcement of a lien in rem for repairs to a canal boat engaged in traffic on the Erie canal and the Hudson river, and at a port in the state, was within the admiralty jurisdiction, and could not be enforced by any proceeding in the courts of the state of New York. 1 § 15. Jurisdiction of federal courts in admiralty cases. — The admiralty and maritime jurisdiction is conferred by the constitution upon the judicial power, and not in ex- press terms upon the legislative power of the federal govern- ment. The Supreme Court however has held that the power of legislation upon the same subject must necessarily be in the national legislature, and not in the state legislatures. The federal legislative power is not confined to the boundaries or class subjects which limit and characterize the power to regu- late commerce ; but in maritime matters it extends to all mat- ters and places to which the maritime law extends. The boundaries and limits of the admiralty and maritime jurisdic- tion are matters of judicial cognizance, and they cannot be affected or controlled by legislation, whether state or na- tional. The jurisdiction of the federal courts in maritime cases, therefore, is broader than that under the commerce clause, as it includes maritime cases, where the voyage or contract, if maritime in character, is made to be performed wholly within a single state. ^ Under the judiciary act of 1789 the jurisdiction of the courts of the United States is exclusive in all cases of admiralty and maritime jurisdiction, ' The Robert W. Parsons, 191 U. tracts for repairs to vessels which S. 17 (1903), 48 L. Ed. 73, Justices were incapacitated for foreign com- Brewer, Fuller, Peckham and Har- merce and designed and used ex- lan dissented on the ground that clusively for mere local traffic the contract was not a maritime within the state, contract and that the admiralty ' In re Garnett, 141 U. S. 1, and urisdiction did not extend to con- cases cited, 35 L. Ed. 631 (1901). 30 INTERSTATE COMMEECE UNDER FEDERAL CONSTITUTION. [§16 saving to suitors a common-law remedy, where the common law is competent to give it.' § 16. State corporations in interstate commerce. — The right of a state corporation to engage in business in an- other state by locating therein, without the permission of that state, must depend upon whether the corporation is en- gaged in carrying on interstate commerce. In this connec- tion the term "carrying on interstate commerce" is limited to the corporations actually engaged in carrying on inter- state commerce, that is, common carriers and others who afford the facilities whereby commerce is carried on among the states or actually carry on such commerce, and does not include manufacturing and trading companies making inter- state shipments. Thus all pubUc carriers, railroads, steam- boats, telegraph or telephone companies, bridge and ferry companies operating in different states, are carrying on inter- state commerce in this sense. The state can neither exclude corporations of this class actually engaged in interstate com- merce, nor can it impose conditions upon the transaction of their business in the state, though it may tax their property employed in the state. ^ Corporations engaged in the execution of contracts for the federal government, are also protected as to such business from state interference or control.' 'Sec. 711, R. S. U. S. A con- portation originating and terminat- tract to build a ship is not a mari- ing within the state as applied to time contract, and a lien given by navigation in towing upon the a state law for materials used in Hudson River iinder authority of such construction can be enforced a license granted by the United against the vessel in the state States. The Court held that it court. Iroquois Trans. Co. v. Dc- was immaterial that part of the Laney, 205 U. S. 354, 51 L. Ed. 837 course lay partly in the State of (1907). New Jersey. In New York ex rel Cornell " Western Union Tel. Co. v. Steamboat Co. v. Sohmcr, 235 Kansas, 216 U. S. 1, 54 L. Ed. U. S. 549, 59 L. Ed. p. 355 (1915) 3.55 (1909); Pullman Co. v. Kansas, afTirming 206 N. Y. 651, the court 216 U. S. 56, 54 L. Ed. 378 (1909). held valid the annual excise tax = U. S. to use v. Fidelity Guar, or hcense fee of Ko of one percent Co., 178 Fed. 721, Cir. Ct. E. D. of imposed by New York Tax law Penn. (1909). upon gross earnings from trans- §16] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 31 In one sense, all commercial business between citizens of different states is interstate commerce, and the manufacturer who ships his goods to the purchasers in another state is en- gaged in interstate commerce. This commerce is protected by the federal power against discriminating or interfering state legislation, and in such protection, there is no distinc- tion between non-resident individuals and corporations. Cor- porations, it is true, are not citizens within the meaning of the constitution,! providing that citizens of each state shall be entitled to all the privileges and immunities of the citizens of the several states, though they are persons within the mean- ing of the fourteenth amendment and are therefore entitled to due process of law and the equal protection of the laws. The right to engage inHnterstate commerce does not depend upon citizenship, and the capacity of the foreign corporation to carry on such business must be determined by its own charter, granted by the state of its creation, and by the law of the state in which it is carrying on business. The manu- facturing or trading company incorporated and doing busi- ness under the laws of one state can send its commercial travelers soliciting sales through other states, and may ship its goods to the purchasers, or factors, and such business cannot be interfered with by the states in the exercise of either their taxing or pohce powers. Such interstate com- merce does not constitute a "doing of business" within the state.^ But while the foreign manufacturing or trading cor- ' Constitution, art. IV., sec. 2; broad statement in Paul v. Vir- Crutcher v. Kentucky, 141 U. S. 47 ginia, 8 Wall. 168, that a state may (1901), 35 L. Ed. 649. exclude a foreign corporation from 'Cooper V. Ferguson, 113 U. S. business or may condition its ad- 727 (1884), 28 L. Ed. 1137. In But- mission to do business in the state ler Brothers Shoe Co. v. U. S. Rub- by such terms as it may deem ber Co., C. C. A. 8th Cir. 156 Fed. proper, had been qualified, and the 1, in holding that a foreign corpora- following exceptions thereto estab- tion consigning goods to its factor lished by the decisions of the Su- in a state, who conducts all the preme Court, business there, is engaged in inter- (a) Every corporation empow- state commerce and is not doing ered by state of its creation to en- business in the latter state, within gage in interstate commerce, may the meaning of the statute relative carry on that commerce in sound to the admission of foreign corpo- and recognized articles of con- rations, the court said that the grass in every state of the Union. 32 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§16 poration may sell its goods in the state, or solicit sales in the transaction of interstate commerce, it cannot establish a business office in the state for the transaction of intrastate business without the consent of the state. As a state has the right to exclude foreign corporations from local business it necessarily has involved therein the right to impose condi- tions upon their admission into the state to transact such business.* The right to impose such conditions does not, however, justify a state in making a compliance with such require- ment a condition of enforcing in the local courts payment for goods lawfully sold in interstate commerce. The right of a foreign corporation to demand and enforce payment for goods sold in interstate commerce is so directly connected with such commerce and is so essential to its existence and continuance that such a requirement necessarily operates as a restraint on interstate commerce.^ Every prohibition and obstruction or burden which the other states attempt to impose upon such busi- ness is unconstitutional and void. (b) Every corporation of every state which is in the employ of the United States has the right to ex- ercise the necessary corporated powers and to transact the requi- site business, to discharge the duties of that employment in every other state in the Union, without let or hindrance from the latter. (c) Every corporation of every state has the absolute right to in- stitute, maintain and defend in the federal courts and to remove to those courts its suits in any other state in the cases and on the terms prescribed by the acts of congress. This right of removal, however, by a foreign corporation doing busi- ness in the state is subject to the power of the state to provide that the license of any such company to do business in the state through the comity of the state should be revoked if the company should re- move to the federal court a case which has been commenced in a state court. It is immaterial what is the motive of the state in the exercise of its lawful power. See Security Mutual Life Ins. Co. v. Prewitt, 202 U. S. 246, 50 L. Ed. 1013 (1906). As to what constitutes a sale in interstate commerce not affected by state statutes, see in re Sel- mann Heating & Plumbing Co., Dist. Ct. of Ala. (1913), 204 Fed. 839, and Vulcan Steam Shovel Co. V. Flanders, Dist. Ct. of Michigan (1913), 205 Fed. 102. ' Waters Pierce Oil Co. v. Texas, 177 U. S. 28 (1900), 44 L. Ed. 657; Philadelphia Fire Ass'n v. New York, 119 U. S. 110 (1886), 30 L. Ed. 342. ^ Sioux Remedy Company v. Cope, 235 U. S. 197; 59 L. Ed. p. 193, reversing 28 S. D. 397, (1914). §17] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 33 Neither does the right to compel such conditions justify a state in requiring as a condition to do a purely interstate busi- ness within the state and maintain an action in the courts of the state making a complete and detailed statement exhibit- ing their financial condition.^ The state power of prohibiting, absolutely or condition- ally, the foreign corporations, not engaged in interstate com- merce in the constitutional sense from doing business in the state is illustrated by the rulings of the Supreme Court already referred to sustaining state statutes regulative of the insur- ance business. See § 9 supra. Thus, the provisions of state statutes prescribing terms and conditions of insurance con- tracts have been held to be written into the pohcy contracts made by the parties, over-riding the will of the parties and making contracts for them contrary to their expressed in- tent.^ These statutes were sustained on the theory that the state had the power to determine the conditions under which the insurance business should be conducted, to the extent of writing these conditions in the policies for the parties and controlling the terms of their contracts, and in the case of foreign corporations such conditions would be enforced as conditions imposed upon their being permitted to do business in the state, and to which the companies are presumed to assent by doing business in the state under its laws.' § 17. When transit ends; the original package in interstate commerce. — The "original package" rule, which has been the subject of extended judicial discussion ' See Buck Stove & Range Co. v. ent state statutes into the policy Vickers, 226 U. S. 205, 57 L. Ed. contracts necessarily impairs the 189, (1912) reversing 80 Kans. 29. insurance scheme, which is based ' Orient Insurance Co. v. Daggs, upon the uncertainty of the in- 172 U. S. 557 (1899), 43 L. Ed. dividual life and the compara- 552; Equitable Life Assurance Soc. tive certainty of the average life V. Clements, 140 U. S. 226, 35 L. ascertained from human experi- Ed. 497 (1890); New York Life ence, and which therefore contem- Ins. Co. V. Cravens, 178 U. S. 389 plates the union of the interests of (1900), 44 L. Ed. 1116. New York a large number of persons resident Life Ins. Co. v. Deer Lodge County, in different states and countries 231 U. S. 495 (1913) 58 L. Ed. 332. and the administration of a fund ' In mutual^ life insurance it is for the mutual benefit under a obvious that the writing of differ- single applicatory law. New York J-3. 34 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§17 both in relation to the taxing power as well as the police power of the state, was first declared in 1827, in Brown v. Maryland. 1 This case involved the validity of a statute of Maryland, requiring every importer of foreign merchan- dise to take out a license, paying therefor fifty dollars. The Court admitted the difficulty of setting a time when the taxing power of the state should begin, but fixed it as beginning when the original package in which the goods had been imported was broken up or sold, and thus was first laid down the "original package" rule. While the Court has adhered to this rule in respect to state taxation of foreign importations, it has not been extended to interstate commerce, so that goods brought from one state into another are subject to the taxing power of the state, whether they are in the original package or not;^ that is to say, such goods which have reached their destination in the state may be taxed as property in common with the other property in the state, when the tax is levied without discrimination as between domestic and non-domestic goods.' There is a distinction, however, between the taxing power of a state and its police power with reference to the original packages in interstate shipments. In the absence of legisla- tion by congress, commerce between the states must be free, and the right to sell goods imported is an inseparable incident of the right to import. Congress alone can act as to the admission of goods from one state to another, and its non- action means that the commerce must be free.* This free- Life Ins. Co. V. Statham, 93 U. S. the line could be drawn more ac- 21, 23 L. Ed. 789; Bogardus v. In- curately. surance Co., 101 N. Y. 329. ^ Woodruff v. Parham, § Wall. ' 12 Wheat. 419, 6 L. Ed. 678. 123 (1868), 19 L. Ed. 382; Brown Twenty years later Chief Justice v. Houston, 114 U. S. 622 (1885), Taney said in his opinion in the 29 L. Ed. 257; Pittsburg, etc. Coal License Cases, 5 How. 1. c. 505, 12 Co. v. Bates, 156 U. S. 577 (1895), L. Ed. 256, that he argued this 39 L. Ed. 538. case for the state of Maryland, but ' American Steel & Wire Co. v. that since then matured reflection Speed, 192 U. S. 500, 48 L. Ed. 538 had convinced him that the rule (1904). laid down by the Supreme Court « Bowman v. Railway Co., 125 was a just and safe one. It was a U. S. 465 (1888), 31 L. Ed. 700; very difficult question for the judi- Leisy v. Hardin, 135 U. S. 100 cial mind, but he did not see how (1890), 34 L. Ed. 128, overruling, §17] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 35 dom of transportation and of sale extends to goods in their original packages, when imported in packages. Thus, the original package first introduced in Brown v. Maryland, in reference to foreign importations, becomes material in interstate commerce in limiting the police power of the state. An original package in interstate commerce means the box or case in which the goods were shipped, and not the pack- age in which they were placed by the manufacturer when manufactured and before they were placed in the larger boxes for shipment.' The importation however must be made in the usual manner prevalent among honest dealers, and in a bona fide package usual for shipment.^ The original package rule was one of convenience, is not defined in any statute of the United States, and is of course only applicable where property is imported in packages. As to other property, such as live stock, the commercial transit ends when it is delivered to the consignee. Thus a flock of sheep driven through a state is a subject of interstate commerce and protected by the federal power against state taxation, although the sheep were permitted to graze during their journey.' Property in commercial transit, however transported, through a state or into a state, is not subject to the taxing power of a state, and this immunity extends until the termination of the shipment by the delivery to the consignee.^ Goods, to be exempt, however, must be actu- the License Cases, 5 How. 504 ' May v. New Orleans 178 U. S. (1847), 12 L. Ed. 256; Lyng v. 496 (1900), 44 L. Ed. 1165, affirm- Michigan, 135 U. S. 161, 34 L. Ed. ing 51 La. Ann. 1064, four justices 150 (1890). The distinction be- dissenting; SchoUenberger v. Penn- tween the state police power and sylvania, 171 U. S. 1 (1898), 43 the state taxing power in rela- L. Ed. 49. lion to "original packages" im- '^ Austin v. Tennessee, 179 U. S. ported from other states is illus- 343 (1900), 45 L. Ed. 224. See also rated in two Iowa cases (January, Cook v. County of Marshall, supra. 1905), decided by the supreme « Kelley v. Rhoades, 188 U. S. 1, court. In Am. Exp. Co. v. Iowa, 47 L. Ed. 359; Diamond Match Co. 196 U. S. 133, 49 L. Ed. 471, the v. Ontonogon, 188 U. S. 82 (1903), state police interference with a 47 L. Ed. 394. Hquor importation was denied; ■• Rhodes v. Iowa, 170 U. S. 412 while in Cook v. County of Mar- (1898), 42 L. Ed. 1088. In Simp- shall, 196 U. S. 261, 49 L. Ed. 471, son Crawford Co. v. Burough of a state tax on a cigarette importa- Atlantic Highlands, 158 Fed. 372. tion was sustained. C. C. N. J., goods were sold by 36 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§18 ally in commercial transit, that is, the transit must have commenced by the delivery to the carrier for shipment. * It does not follow however that this immunity from the state taxing power would prevent the property from being subject of an illegal agreement of a combination in violation of the anti-trust act. The termination of the transit means that the property is subject to taxation in common with other property; but it cannot be subjected to any dis- criminating regulations on account of its foreign origin. § 18. The Wilson bill of 1890.— The judicial appUcation of the original package rule in interstate commerce to the police power of the state and the consequent inability of the state to exclude the importation of liquors resulted in the passage by congress in 1890 of the so-called Wilson bill,^ — providing that liquors transported into any state or territory should, upon arriving in such state or territory, be subject to the operation and effect of its laws enacted in the exercise of its police powers to the same extent and in the same manner as though such liquors had been there produced, and should not be exempt therefrom by reason of being introduced in the original packages or otherwise. The purpose of this act was to make effective the state control of the local traffic in imported liquors. Its constitutionality was contested on the ground that congress could not delegate its control over interstate com- merce to the states. It was sustained, however, by, the Supreme Court.^ The Court said that in surrendering their own power over interstate commerce the states did not complainants in New York City 2 Act of August, 1890, and 26 for delivery to customers in Atlan- Stats. 313, c. 728. The same prin- tic Highlands, N. J., where they ciple was also applied in 1900, in were delivered from the steam- making effective the game laws of boats to complainant's wagons for the states. Act of May 25, 1900, 3 delivery to the purchasers, and it Comp. Stats. U. S. p. 3181, and in was held that the entire transac- Act. of May 9, 1902, in making ef- tion constituted interstate com- fective state laws as to "oleomar- merce, and that the license tax garine," "butterine" and other im- thereon was invalid. itations of butter. 'Coe V. Errol, 116 U. S. 517 'In re Rahrer, 140 U. S. 545 (1886), 29 L. Ed. 715. (1891), 35 L. Ed. 572. §19] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 37 secure absolute freedom in such commerce, but only the protection from encroachment afforded by confiding its reg- ulation exclusively to congress. The Court held that liquors transported into the state and there sold after the passage of this act of August, 1890, be- came subject to the then existing laws of the state as to the sale of liquors; that congress did not use terms of permission for the state to act, but simply removed an impediment to the enforcement of state laws in respect to imported pack- ages in their original condition created by the absence of a specific utterance on its part. It imparted no power to the state not then possessed, but allowed imported property to fall at once upon arrival within the local jurisdiction. § 19. The limitations of the state control of the liquor traffic under the Wilson Act. While the Wilson Act may enable a state to control the sale of liquors imported from other states, it does not prevent the importation and consumption by the consignee. This is because the term "arrival" as used in the Wilson bill, has been construed by the Supreme Court to mean the completion of the shipment by delivery by the consignee in the state and not by the arrival at the station of the carrier, i The Court said that the act was not intended to, and did not, cause the power of the state to attach to an interstate commerce shipment whilst the merchandise was in transit under such ship- ment and until its arrival at the point of destination and delivery there to the consignee. It is immaterial that the packages of liquor are shipped by a c. o. d. interstate ship- ment, and the agent of the express company agres to hold the shipment to suit the convenience of the consignee in paying for the liquor and taking it away.^ Neither can intoxicating liquors shipped c. o. d. into a state from another state be seized while in the hands of the express company on the ground that the sale to the consignee was consum- mated at the time of shipment so that the merchandise was at his risk.' Nor can the agent of an express company ' Rhodes v. Iowa, supra. reversing the Court of Appeals of 2 Adams Express Co. v. Ken- Ky., 87 S. W. 1111. tucky, 206 U. S. 129, 51 L. Ed. 987, ' American Express Co. v. Iowa, 196 U. S. 133, 49 L. Ed. 417 (1905). 38 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§ 19 m be prosecuted for violation of a state statute for furnishing knowingly intoxicating liquor to an inebriate, from another state, the agent paying the express charges^ as the statute construed to cover such case was held to be an attempt to regulate interstate commerce. Neither can a liquor dealer be prosecuted or enjoined^ in a "dry" state, who from his place of business in an adjoining "wet" state personally solicits orders and makes deliveries to his customers in the "dry" state, as this is Interstate Commerce, and the beer delivered was a recognized article of commerce. The liquor law of South Carolina was held void* because it imposed conditions upon the shipment into South Carolina from other states of liquor to a consumer who had purchased it for his own use, and not for sale, as the Wilson Act, while giving to the state plenary power to regulate the sale of liquors, did not permit the state to prevent an individual from ordering liquors from outside of the state for his own consumption. A state, in the exercise of its police powers within the mean- ing of the Wilson Act, may lawfully impose an inspection fee upon beer or other malted liquors shipped from other states into the State and held for consumption therein; and it was held immaterial that such an act was denominated as an "inspection law" and did not provide an adequate inspec- tion.* A state may also exact a license fee for the sale of liquors within the state on board a ferry boat engaged in interstate commerce and making landings at a port of the state.^ ' Kirmeyer v. Kansas, 236 U. S. Liquor Co. v. Piatt, 148 Fed. 894, 568, 59 L. Ed. 894, reversing 88 C. C. W. V., holding invalid Act of Kans. 587. West Va. In U. S. ex rel. Fried- 2 Rossi V. Pennsylvania, (1915) man v. U. S. Express Co., 180 Fed. 238 U. S. 62, 59 L. Ed. 1201. 1006, the Circuit Court of "West reversing 53 Pa. Sup. Ct. 000. Dist. of Ark. held that petitioner Both these cases arose before was entitled to \vrit of mandamus the passage of the Webb Kenyon to compel the express company to Act. receive shipments of liquor for de- a Adams Express Co. v. Ken- livery to customers in Oklahoma tucky, 214 U. S. 218, 53 L. Ed. 972 under Interstate Commerce Act. (1909). "Pabst Brewing Co. v. Cren- * Vance v. Vandercook, 170 U. shaw, 198 U. S. 17, 49 L. Ed. 925. S. 438, 42 L. Ed. 1100; Crescent Fobpiano v. Speed, 199 U. S. 20] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 39 § 20, The Webb-Kenyon Act of 1913.— The growing demand for the control of the Hquor traflTic, and the difficulty of effecting such control by a state in regard to the freedom of interstate shipments to consignees led to the enactment of what is known as the Webb-Kenyon Act of 1913, which is entitled an Act "divesting intoxicating Hquors of their inter- state character in certain cases."' By this act the ship- ment into a state of spirituous, vinous or malted liquors is prohibited, when the liquor is "intended by any person interested to be received, possessed, sold or in any manner used, either in the original package or otherwise", in viola- tion of the law of the state. This Act thus goes far beyond the Wilson Act, and prohibits the shipment into a state, when the intent of consignee is in violation of the local law. It will be seen that this exercise of the Federal power in withdrawing the protection of the commerce clause is only effective in enabling the state to exercise its own power of legislation. Where there is no staute of the State prohibit- ing or regulating the traffic the Act of course has no appli- cation. ^ 501, 50 L. Ed. 288, affirming 113 Tcnn. 167. See also Meyer et al. v. Mobile, 147 Fed. 843, C. C. of Ala., holding valid a liquor ordinance under the Wilson Act. 'Act of 1913. Act of Mar. 1, 1913, c. 90, 37 Stat. 699, U. S. Comp. Stat. 1913, Sec. 8739. This act was passed over the veto of President Taft. It was held valid by C. C. A. 4th Circuit in West Vir- ginia V. Adams Express Co., 219 Fed. 794, (1915) reversing 219 Fed. 331. The court held that this act was within the lawful power of Con- gress in excluding injurious articles from interstate commerce, and that the State of West Virginia which had enacted a law that the title was not complete until delivery within the state, could enjoin the express company from delivering the ship- ment in the State, and the fact that the consignee had solicited orders by mail to be delivered in West Virginia, afforded no protec- tion to the carrier. 2 In Adams Express Co. v. Kentucky, 154 Ky. 462, it was held that the Webb-Kenyon Act did not prevent shipments to a con- signee for his personal use, the law of the state not prohibiting such use. In Atkinson v. Southern Express Co., 44 S. C. 441, the court held that the Webb-Kenyon Act did not revive an act of the state which had been adjudged unconstitu- tional prior to the act. See also U. S. ex rel Zimmerman V. Ore. Washington N. R. Co., Dist. Ct. of, Oregon (1913), 210 Fed. 378. As to what is a shipment see U. S. V. Joe Freeman 36 Sp. Ct. Ref. 32. 40 INTERSTATE COMMEB.CE UNDER FEDERAL CONSTITUTION. [§21 Where the facts of a case show that the liquor is not to be used in violation of the laws of the State as such laws are con- strued by the highest court of the State, the Webb-Keynon law has no apphcation and no effect to change the general rule that the states may not regulate commerce wholly interstate. 1 § 21. A state cannot tax interstate commerce. — Although the necessity for the regulation of commerce was the great moving force in the adoption of the constitution, and was thoroughly discussed in the proceedings of the convention and in the Federalist, there is in neither any reference to any possible interference with the taxing power of the state growing out of such regulation. The law of federal restraints upon state taxation has been developed upon the fundamental principle of the supremacy of the federal authority. The exemption from state taxation of the means employed by the federal government for carrying on its functions was first declared in 1819, in McCuUoch v. Maryland,^ and the principle was later extended in 1827, in Brown v. Maryland,^ to the hmitation of the state taxing Kansas City Breweries Co. v. of liquor into Georgia, as equity Triclcett, Circuit Ct. Dist. of would not interfere by injunction Kansas, 195 Fed. 840. to restrain a public nuisance except In Theo. Hamm Brewing Co. v. in cases of special and serious C. R. I. & P. R. Co., Dist. Ct, injury to complainant, distinct Minn. (1913), 215 Fed. 672, held from that suffered by the public; that the Webb-Kenyon law did and where a state had practically not prevent the transportation of repealed its prohibitory law by liquor intended for the personal non-enforcement, there was no use of the consignee, and this equity in a bill by citizens of though it is in violation of the laws another state to restrain an express of the State in that he has not company from transporting inter- acquired a permit required by the state shipments of liquor, laws of the State. i Adams Exp. Co. v. Kentucky, Southern Express Co. v. Long, 238 U. S. 190, 59 L. Ed. 1267, C. C. A. 5th Circuit (1913), 202 reversing a conviction in Circuit Fed. 462, reversing 201 Fed. 441, Court of Whitley County, Ky. and holding that a court of equity (1915). would not grant an injunction to 'Supra, § 5. restrain an express company from ^ Supra, § 17. transporting intrastate shipments §22] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 41 authority by reason of the national control over foreign commerce. Under the rule declared by the Supreme Court for the first time in 1886,^ which has since been consistently adhered to by the court, the business of carrying on interstate com- merce cannot be taxed at all, and as the right to bring goods from other states includes the right to sell them and to solicit sales therefor, as well as to deliver the property sold, the state cannot tax the right to sell or deliver, or to solicit sales, whether in the form of license tax or otherwise. It is immaterial that the tax is without discrimination, as between domestic and foreign drummers, as interstate commerce cannot be taxed at all.^ § 22. But a state can tax the property employed in interstate commerce. — While a state cannot tax inter- state commerce, that is, the privilege of carrying on such commerce, it can tax the property in its jurisdiction employed in carrying on such commerce, and can also tax the privilege of conducting a local business within its jurisdiction.' While a state cannot tax personal property actually in transit in interstate commerce though the owner is a resident ' Robbins v. Shelby County Tax- ing District, 120 U. S. 489 (1887), 30 L. Ed. 694. 2 Asher v. Texas, 128 U. S. 129 (1888), 32 L. Ed. 368; Brennan v. Titusville, 153 U. S. 289 (1894), 38 L. Ed. 719; Stockard v. Morgan, 185 U. S. 27 (1902), 46 L. Ed. 785; Caldwell v. North Car., 187 U. S. 622 (1902), 47 L. Ed. 336; N. & W. R. R. Co. V, Sims, 191 U. S. 441 (1902), 48 L. Ed. 254. Dozier V. Alabama, 218 U. S. 123, 54 L. Ed. 965, reversing 154 Ala. 83. Stewart v. Michigan, 232 U. S. 665, 58 L. Ed. 786. (1914) re- versing 107 Mich. 417. Singer Sewing Mach. Co. v. Brickell, 233 U. S. 304, 58 L. Ed. 974. (1914) affirming 199 Fed. 654. Crenshaw v. Arkansas, 227 U. S. 389, 58 L. Ed. 565 (1913) reversing 95 Ark. 464. ' Browning v. Waycross, 233 U. S. 16, 58 L. Ed. 828 (1914) affirm- ing 11 Ga. App. 46. The taxation of shares in foreign corporations owned by inhabitants of the state while shares in domestic corpora- tions are only taxable when the property of the corporation is not exempt, and not taxable to, the corporation itself does not violate the commerce clause of the con- stitution. Kidd V. Alabama, 188 U. S. 730, 47 L. Ed. 669. (1902). Darnell v. Indiana, 226 U. S. 390, 57 L. Ed. 267, affirming 147 Ind. 143. (1913). 42 INTERSTATE COMMERCE TINDER FEDERAL CONSTITUTION. [§22 of the state and the property is within the limits of the county where the assessment is made, it can tax such prop- erty when it is temporarily withdrawn from transit with the intent to ship out of the state under contract, while it is subject to local control and protection. ^ The practical difficulty of defining the line where the state and federal powers meet in such cases is illustrated by the not infrequent dissents of members of the Supreme Court in cases involving these questions of conflict between the state and federal power. 2 No question is made as to the power of a state to tax the tangible property within its jurisdiction of a railroad, tele- graph or other company engaged in interstate commerce, but the difficulty has been found in determining what por- tion of the intangible property of such corporations can be located within a state so as to be subject to its taxing power. Thus, has been formulated the so-called "unit rule" where- under the entire value of an interstate railroad, tangible as well as intangible, may be apportioned upon a mileage basis as a means, prima facie, of arriving at the value of the property within the state, that is, the state's proportion- ate part of the value of the entire property.' 1 Bacon v. Illinois, 227 U. S. 504, v. Massachusetts, 125 U. S. 530 57 L. Ed. 615, affirming 243 111. (1888), 31 L. Ed. 790; Massachu- 313. See also Susquehanna Coal setts v. Telegraph Co., 141 U. S. 40 Co. V. South Amboy, 228 U. S. (1891), 35 L. Ed. 628; Western 655, 57 L. Ed. 1015. (1913), Union Tel. Co. v. Taggard, 163 U. affirming 184 Fed. 941. See also S. 1 (1896), 41 L. Ed. 49; Adams Heyman v. Hays, (1915) 236 v. Ohio, 165 U. S. 194 (1897), 41 L. U. S. 176, 59 L. Ed. 527. Ed. 683; Adams Express Co. v. 2 Erie R. Co. v. Pennsylvania, Kentucky, 166 U. S. 171 (1897), 41 158 U. S. 431, 1. c. 437 (1895), 39 L. Ed. 960; Henderson Bridge Co. L. Ed. 1043. V. Kentucky, 166 U. S. 150 (1897), » State Railroad Tax Cases, 92 41 L. Ed. 953; W. U. Tel. Co. v. U. S. 575 (1875), 23 L. Ed. 663; Gottlieb, 190 U. S. 412 (1903), 47 Kentucky Railroad Tax Cases, 115 L. Ed. 1116. U. S. 321 (1885), 29 L. Ed. 414; Wells Fargo Co. v. Johnson Pittsburgh etc. R. Co. v. Backus, Dist. Ct. of S. Dak.(1913),205 Fed. 154 U. S. 421 (1894), 38 L. Ed. 60, and M. K. & T. R. Co. v. 1031; C. C. C. & St. L. R. Co. v. Meyer, Dist. Ct. of Okla. (1913), Backus, 154 U. S. 439 (1894), 38 L. 204 Fed. 140. Ed. 1041; Western Union Tel. Co. § 23] INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. 43 The rule of the "average habitual use" has also been formulated in the taxation of railroad cars, so that a state may tax its proportionate part of the property actually employed in its jurisdiction. ^ Thus also while the receipts from interstate commerce cannot be taxed as such, the tax may be levied upon the corporation, as an excise or franchise tax, which may be apportioned on the basis of the porportion of the mileage within the state to the total mileage. ^ These rules, however, are only admissible in determining the actual value of the property in the state for the purpose of taxation, and will not authorize the taxing by a state of the privilege of carrying on interstate commerce among the states, nor the taxation of property permanently out- side of its jurisdiction.' § 23. State power of taxation of corporations en- gaged in interstate commerce summarized. — The Su- preme Court,' in holding that a city could recover from an interstate telegraph company a reasonable license fee for the occupation of its streets by telegraph poles, subject however to the determination by a jury of the reasonableness of the charge, said that there were few questions more important or more embarrassing than those arising from the efforts of the states or municipalities to increase their revenues by collections from corporations engaged in interstate com- 1 Pullman Palace Car Co. v. Ohio Tax Cases, 232 U. S. 574, Pennsylvania, 141 U. S. 18 (1891), 58 L. Ed. 737. (1914). 35 L. Ed. 613; Marye v. B. & 0. R. « Fargo v. Hart, 193 U. S. 490 Co., 127 U. S. 117 (1888), 32 L. Ed. (1904), 48 L. Ed. 761; Galveston 94; American Refrigerator Transit etc. Co. v. Texas, 210 U. S. 217, 52 Co. V. Hall, 174 U. S. 70 (1899), 43 L. Ed. 1131 (1908). For considera- L. Ed. 899; Union Refrigerator tion of the many questions arising Transit Co. v. Lynch, 177 U. S. 149 in the adjustment of the taxing (1900), 44 L. Ed. 708; Wisconsin & power of the state to the para- M. R. Co. v. Powers, 191 U. S. 379 mount authority of congress in (1903), 48 L. Ed. 229. interstate commerce, see author's ^ The State Freight Tax Cases, "Power of Taxation," chapters III 15 Wall. 232 (1872), 21 L. Ed. 146; and VIII. Maine v. Grand Trunk R. Co., 142 < Atlantic, etc. Tel. Co. v. Phila- U. S. 217 (1891), 35 L. Ed. 994, delphia, 190 U. S. 160 (1896), 47 L. Four judges dissenting. Ed. 995. 44 INTERSTATE COMMERCE UNDER FEDERAL CONSTITUTION. [§23 merce, but that the following propositions had been so often adjudicated as to be no longer open to discussion: First. The constitution of the United States having given to con- gress the power to regulate commerce not only with foreign nations but among the several states, that power is neces- sarily exclusive whenever the subjects of it are national in their character or admit of only one uniform system or plan of regulation. Second. No state can compel a party, individual or corporation, to pay for the privilege of engaging in inter- state commerce.^ Third. This immunity does not prevent a state from imposing ordinary property taxes upon property having a situs in its territory and employed in interstate commerce. Fourth. The franchise of a corporation, although that franchise is the business of interstate commerce, is, as a part of its property, subject to state taxation, provided the franchise is not derived from the United States. ^ Fifth. No corporation, even though engaged in interstate commerce, can appropriate to its own use property, public or private, without liability to charge therefor. - The soliciting of traiRc for an merely as an attempted regulation interstate railroad is exempt from of commerce among the states, taxation. McCall v. Cal., 136 U. S. The opinion of . Justice Miller quotes 104(1890), 34 L.Ed. 391. In 1868 from the dissenting opinion of before the adoption of the four- Chief Justice Taney in the Passen- teenth amendment it was held in ger Cases, Infra, § 24, where he Crandall v. Nevada, 6 Wall. 35, 18 concedes that the state tax im- L. Ed. 745, that a state tax upon posed on foreigners would be in- through passengers was void as valid, if imposed on citizens, inconsistent with the rights of cit- ^ n y. ex rel. v. Miller, 202 U. S. izens of the United States, in free 584, 50 L. Ed. 1155 (1906). travel through the states, and not CHAPTER II. THE CONCURRENT AND EXCLUSIVE POWERS. § 24. The concurrent and exclusive powers distinguished. 25. The Supreme Court on the three classes of commerce cases. 26. The concurrent state power. 27. The state power as to interstate telegraph companies. 28. Concurrent power in interstate railroad transportation. 29. State Sunday laws and interstate traffic. 30. State laws as to qualifications of employes and safety of public. 31. State laws concerning separation of races in interstate traffic. 32. Limitation of state power in stoppage of through trains. 33. State regulation of contractual relations of interstate railroad and shippers. 34. State regulation under rules of common law in state courts. 35. The concurrent jurisdiction in live stock inspection laws. 36. Effect of congressional legislation upon concurrent power of state. 37. State quarantine laws. 38. State inspection charges, when unlawful. 39. Freedom of interstate commerce. 40. Congressional inaction in foreign and interstate commerce dis- tinguished. 41. Attachment of foreign railroad cars. 42. Rulings of the state courts on the commerce clause. § 24. The concurrent and exclusive powers distin- guished. — The supremacy of the federal power in interstate commerce was declared in 1824, in Gibbons v. Ogden {supra, § 6), in a case wherein congress had exercised its power by authorizing the granting of coasting licenses, and the decision of the court therefore was based upon the claim of an ex- clusive grant by the state as against this right, under au- thority of congress, in the navigation of the public waters of the state. The question of the power of the state to legislate affecting interstate commerce, when congress had not legis- lated upon the subject, was not directly involved or decided; and this remained a vexata quaestio, and widely different views were expressed by members of the Court, until a definite rule 46 THE CONCDBRENT AND EXCLUSIVE POWERS. I§ 24 was declared in 1851.' Thus it was contended on the one hand that the power to regulate interstate commerce was itself a unit, and the grant to congress was necessarily ex- clusive, and no part of this regulation could be exercised by a state ; and on the other hand that the grant to congress was not itself a prohibition to the states, and that this authority of the states in the exercise of their sovereign police powers was complete and exclusive.^ The uncertainty produced by these differing opinions was shown in sustaining a New York statute^ requiring masters of passenger vessels to report to the state authorities as to arriv- ing passengers ; while a few years later statutes of New York and Massachusetts imposing a tax upon passengers arriving from other states or foreign countries, for defraying expenses of police laws excluding paupers and convicts, the surplus to be applied to state purposes, were held void.* In 1846 the laws of certain of the New England states, pro- hibiting or restraining the introduction of spirituous liquors were sustained, all the six judges filing opinions,^ and con- curring in the judgment, though on different grounds. Finally, in 1851, the rule was declared, which has been the basis of subsequent adjudications,^ that the power to regu- late commerce is one which includes many subjects, various and quite unlike in their nature, and that whenever these subjects are in their nature national, or admit only of one uniform system or plan of regulation, they may be justly held to belong to that class over which congress has exclusive power of regulation; but that local and limited matters, not national in their nature, may be regulated by the states dur- ing the non-action of congress. The action of congress how- ever renders void such regulations of the states as conflict with it.' 1 Wilson V. Black Bird Creek ' New York v. Miln, supra. Marsh Co., 2 Peters, 245 (1829), 7 < Passenger Cases, supra, four L. Ed. 412; New York v. Miln, 11 justices dissenting. Peters, 102 (1837), 9 L. Ed. 648; ' License Cases, supra. This de- License Cases, 5 How. 504 (1847), cision was overruled in 1890; 12 L. Ed. 256; Passenger Cases, Leisy v. Harding, supra, § 17. 7 How. 283 (1849), 12 L. Ed. 702. « Cooley v. Board of Wardens, 12 ' See opinions in the Passenger How. 299 (1851), 13 L. Ed. 996. and License Cases, supra. ' The rule has been stated in § 26] THE CONCURRENT AND EXCLUSIVE POWERS. 47 § 25. The Supreme Court on the three classes of commerce cases. — The Supreme Court in denying the power of a state to regulate tolls upon an interstate bridge without the assent of congress, reviewed its decisions upon the construction and application of the commerce clause of the constitution, and said they were divisible into three dis- tinct classes.' The first, where the power of the state was exclusive, including the construction of highways, turnpikes, railroads and canals, between points in the same state, and their regulation for public use, the operating of bridges over navigable streams and regulating navigation over internal waters which did not by themselves or in connection with other waters form a continuous highway for interstate or foreign commerce. In the second class were included the cases of concurrent jurisdiction of the states, and wherein it is not the existence, but the exercise of the power of congress which is incompatible with the exercise of the same power by the states. In the third class the court included those cases where the power of congress was exclusive, and it was not the exercise but the existence of the power in congress which excluded the power of the state. The first class requires no distinct consideration. The dividing line between the second and third class has, however, been questioned in a number of cases, as will be seen in the succeeding sections. § 26. The concurrent state power. — The concurrent jurisdiction of the states, as it is called, may be exercised in the second of the classes of cases mentioned in the preceding section, where it is not the existence but the exercise of the power of congress which is incompatible with the exercise of the state power. Thus, the regulation of pilots has an intimate connection with commerce, and discriminating state laws might be en- acted on the subject, yet the nature of the power is such that subsequent opinions without the 23 L. Ed. 349; Henderson v. quahfication of the word "only," Mayor, 92 U. S. 1. c. 259 (1875), 23 so as to read "admit of one uni- L. Ed. 543. form system or plan of regula- • Covington, etc. Bridge Co. v. tion." See State Freight Tax, 15 Kentucky, 154 U. S. 204 (1894), 38 Wall. 232, 21 L. Ed. 146; Welton v. L. Ed. 962. Missouri, 91 U. S. 1. c. 280 (1875), 48 THE CONCURRENT AND EXCLUSIVE POWERS. [§26 it is likely to be best provided for by the legislative discretion of the several states, adapted to local needs. ^ In this essentially local class are the state inspection laws,^ state quarantine laws,' and laws regulating the improvement of navigable waters within the jurisdiction of a state, or the use of bridges over such waters which have been sustained. In the Mobile harbor case cited,* the Court said that perhaps some of the divergent views noticed upon this question of state power among former judges, may have arisen from not always bearing in mind the distinction between commerce as strictly defined and its local aids or instrumentalities, or measures taken for its improvement. In the Chicago case^ the Court sustained the state control of the construction, re- pair and regulation, and use of the bridges over the Chicago river, saying that until congress acted, the power of the state over the bridges was plenary. In the same class are state laws regulating wharves, piers and docks,* the construction of bridges,' and establishing ferries over navigable rivers within state jurisdiction. Local regulations, however, cannot impose a'tax or charge upon interstate commerce. Thus, while a state can exact a toll or compensation for a specific improvement of a navigable water within its jurisdiction,* it cannot exact a license for the * Cooleyv.Bd. of Wardens, supra, < County of Mobile v. Kimball, It was held by the Circuit Court 102 U. S. 691 (1880), 26 L. Ed. 238, of Appeals of the 9th Circuit in ' Escanaba Co. v. Chicago, 107 The Queen, 206 Fed. 148, (1913) U. S. 678 (1882), 27 L. Ed. 442. that the fact that under the Pilot- » Packet Co. v. Aiken, 121 U. S. age laws of the State the pilotage 444 (1887), 30 L. Ed. 976. fees fixed were based in part on ' Cardwell v. Am. Bridge Co., the tonnage of the vessel, and that a 113 U. S. 205 (1885), 28 L. Ed. 959. percentage of such fees were re- As to interstate bridges and fer- quired to be paid to the State ries and cases cited, see Gloucester Pilot Commission, does not make Ferry Co. Case, 114, U. S. 196 *the statute unconstitutional as (1885), 29 L. Ed. 158; St. Clair imposing a tonnage duty; reversing County v. Interstate Sand & Car 184 Fed. 537. Transfer Co., 192 U. S. 454 (1904), 2 See § 10, supra. 48 L. Ed. 518. Savage v. Jones, 225 U. S. 501, » Huse v. Glover, 119 U. S. 543 56 L. Ed. 1182, (1912). (1886), 30 L. Ed. 487; Sands v. ' Morgan's etc. Co. v. Louisi- Manistee River Imp. Co., 123 U. S. ana, 118 U. S. 455 (1886), 30 L. 288 (1887), 31 L. Ed. 149. Ed. 237. Infra, § 37. § 27] THE CONCURRENT AND EXCLUSIVE POWERS. 49 use of navigable waters, which is not a charge for any specific improvement. 1 The creation and enforcement of a lien for a nonmaritime tort against a foreign vessel engaged in interstate commerce which embraces all vessels, whether domestic or foreign, and whether engaged in intrastate or interstate commerce, does not offend against the commerce clause of the constitution, although the enforcement may occasionally and temporarily interrupt or prevent the use of -a vessel in such commerce.^ The appointment by the State court of a receiver of a rail- road with the State of a foreign corporation engaged in inter- state commerce does not amount to an unlawful interference with the right of such corporation to transact interstate commerce.' § 27. The state power as to interstate telegfraph companies. — A telegraph company doing an interstate busi- ness is engaged in interstate commerce, and is so recognized by act of congress.^ It cannot therefore be excluded by a state, nor can its interstate messages be, taxed by the state.^ A state cannot, as a condition of authorizing a foreign tele- graph company to do local business in the state, exact a char- ter fee of a given percent of the entire authorized capital stock of the company, as that would be in effect a burden and tax upon the company's interstate business and on its prop- erty located or used outside of the state and in such a case, it is immaterial that the state disclaims the purpose of obstruct- ing or embarrassing interstate commerce.^ The state may, however, make regulations with respect to building poles, location of wires, and all necessary appHances, which the con- venience of the community may require. It can tax intra state messages, and municipalities may charge a reasonable • Harman v. Chicago. 147 U. S. « Act of July 24, 1866, Comp. 396 (1893), 37 L. Ed. 216. Stats. 5263; Pensacola Tel. Co. v. 2 Martin v. West, 222 U. S. 191, W. U. Tel. Co., supra. 56 L. Ed. 159, (1911) affirming 47 <■ Telegraph Co. v. Texas, 105 U. Washington 417. S. 460 (1881), 26 L. Ed. 1067. ' McKinney vs. Kansas Natural « Western U. Tel. Co. v. Cole- Gas. Co.. District of Kansas, 206 man, 216 U. S. 1, 54 L. Ed. 355 Fed. 772. (1913). (1910). J— t. 50 THE CONCURRENT AND EXCLUSIVE POWERS. [§27 rental for occupation of streets with poles. ^ The state can prescribe how messages shall be delivered within the state, whether received from within or without the state,^ as this is the exercise of the police authority of the state in its jurisdic- tion; but on the contrary, the state cannot prescribe how messages received within, but delivered without the state, shall be delivered.' Interstate commerce is not unconstitutionally regulated by a state statute of Michigan under which, as construed by the state courts, a telegraph company cannot limit its liability for its negligent failure to deliver a telegram addressed to a per- son in another state. Such a regulation would be valid if rested upon the common law of the state and is no less vahd because made by a state statute.^ A State statute granting the right of eminent domain to telegraph companies in respect to railroad rights of way is not inconsistent with any legislation of Congress, nor invalid as ' Telegraph Co. v. Philadelphia, 190 U. S. 160 (1903), 47 L. Ed. 995. ' Western U. Tel. Co. v. James, 162 U. S. 650 (1896), 40 L. Ed. 1105. ' Western U. Tel. Co. v. Pen- dleton, 122 U. S. 347 (1887), 30 L. Ed. 1187. The Virginia statute imposing penalty for failure to de- liver telegraph messages has no operation in limits of Norfolk Navy Yards. Western U. Tel. Co. V. Childs, 214 U. S. 274, 53 L. Ed. 994, (1909) citing and following Fort Leavenworth R. R. Co. v. Love, 114 U. S. 525, 29 L. Ed. 264 (1885). In Ivy v. Western U. Tel. Co., 165 Fed. 371, E. D. of Ark. (1908), the Arkansas statute al- lowing damages for mental an- guish, etc., in actions against tele- graph companies, was held valid, though incidentally affecting inter- state transactions. In Western Union Tel. Co. v. Brown, 234 U. S. 542, 58 L. Ed. 1457, (1914) the Supreme Court reversed 92 S. C. 354, holding that a recovery in an action of tort of damages, for mental anguish, arising out of the negligent failure of the Telegraph Company to deliver in the city of Washington a telegram forwarded without delay to that city from the company's ofTice in South Carolina, where it was received, cannot be authorized under the South Caro- lina statute as construed by the State Court without violating the Commerce Clause of the Federal Constitution. * Western U. Tel. Co. v. Com- mercial Mill Co. 218 U. S. 408, 54 L. Ed. 1088 (1910). The same principle was applied in sustaining the statute of Virginia in Western U. Tel. Co. v. Crovo, 220 U. S. 264, 55 L. Ed. 498. (1911). § 28] THE CONCtJERENT AND EXCLUSIVE POWERS. 5 1 an attempted regulation of interstate commerce as applied to interstate lines of railroads. * § 28. Concurrent powers in interstate railroad transportation. — Not only is the rule established that the state, in the absence of congressional action, may regulate local matters which relate to interstate or foreign commerce, but the state power of regulation has been further extended and held to include a wide field in the exercise of its lawful power over the relations of persons and property in its juris- diction. The federal power of regulation may be exercised without legislation, as well as with it, and by inaction, con- gress in effect adopts the local law. State laws regulating the relative rights and duties of persons within the jurisdiction of the state are therefore effective upon interstate carriers.' The Court said in the case cited that it is to this law that per- sons within the scope of its operation look for the definition of their jights and for the redtess of wrongs. The failure of congress to act can be construed only as an intention not to disturb what exists, and is the mode by which it adopts, for cases within its power, the rule of the state law, which, until displaced, covers the subject.' Upon this principle the state regulation, in the absence of congressional action, of the manner in which interstate trains shall approach dangerous crossings and the giving of signals and control of trains under such circumstances, has been sus- tained,^ yet, it was said in the same opinion that statutes re- quiring the speed of such trains to be checked at all crossings, where numerous and near together, might be practically destructive to the successful operation of passenger trains and a direct burden upon interstate commerce. The effect of the enactment of congress upon the police power of the state is illustrated by the ruling of the Supreme ' L. & N. R. Co. vs. W. U. Tel. cago, etc., R. Co. v. Solan, 169 U. S. Co., (C. C. A. 6th Circuit, 1913) 133 (1898), 42 L. Ed. 688. 207 Fed. 1. * Southern R. R. Co. v. King, 'Smith V. Alabama, 124 U. S, 217 U. S. 324, 54 L. Ed. 868 (1910). 465, 31 L. Ed. 508. affirming 160 Fed. 332, C. C. A. 5th « Sherlock et al. v. Ailing, 93 U. Cir. S. 99 (1876), 23 L. Ed. 819; Chi- 52 THE CONCTmRENT AND EXCLUSIVE POWERS. [§ 29 Court prior to the enactment of the interstate commerce act^ holding vaUd a statute of Iowa requiring each railroad com- pany annually, in the month of September, to establish passenger and freight rates, and on the first day of October following to put up at all the stations on its road a printed copy of such rates and cause it to remain posted during the year, notwithstanding the act of congress of 1866^ authoriz- ing the interstate carriage of freight. The state statute was held to be simply a police regulation, and that even though it did effect commerce, the question would arise whether it did not fall within that class of cases where state legislation was sustained in the absence of congressional legislation. A similar statute came before the Court from Texas after the passage 6i the interstate commerce act, although the statute had been enacted before.' The Court said that the state law and the national law operated upon the same subject matter and prescribed different rules, and that the state statute must therefore give way. § 29. State Sunday laws and interstate transporta- tion. — Included in this range of the concurrent state power regulating persons within the jurisdiction and affecting inter- state commerce are Sunday laws, prohibiting the running of freight trains on Sunday.* The Court said such a law merely established a rule of civil conduct appUcable to all freight trains, domestic as well as interstate, and to all similar traffic. The Court in this case sustained a Georgia statute and quoted from the opinion of the supreme court of that state which said that the legislature had the right to enforce a day of rest as a civil duty, although men might differ as to the religious duty. § 30. State laws as to qualifications of employes and and safety of the public— The principle has been extended 1 Railroad Co. v. Fuller, 17 * Hennington v. Georgia 163 Wall. 560 (1873), 21 L. Ed. 710. U. S. 299 (1896), (Fuller, C. J. and ' Infra, § 44. White, J., dissenting), 41 L. Ed. ' Gulf, Colo. etc. R. Co. v. Hel- 166. fley, 158 U. S. 98 (1895), 39 L. Ed. 910. § 30] THE COKCURRENT AND EXCLUSIVE POWERS. 53 to include laws which estabhsh a standard of quahfications for railroad employes^ on interstate as well as local trains, for example, color blindness of engineers. The Court said in the latter case that it was a principle fully recognized that where- ever there is danger to the public in the conduct of a business, it was not only within the power, but the plain duty of a state to make provision against accidents likely to follow. State laws requiring the heating of passenger cars, requiring guard posts on railroad bridges and trestles, ^ the protection of sur- face crossings in cities,^ and the regulation of speed in muni- cipal hmits^, are sustained upon the same principle. The Court said that travelers on interstate trains are as much en- titled, while within a state, to the protection of that state as those who travel on domestic trains. Congress has also enacted legislation, as will be seen here- after for the safety of employes and the prevention of acci- dents in interstate commerce. These acts, as the Accident Act, infra, and the Safety Act, infra, are by their terms ap- plicable to all railroads engaged in interstate commerce. From the nature of the subject it is difficult to say when the enactment of such legislation by congress so covers the ground as to make inoperative state legislation bearing upon the same subject. Under the ruling laid down by the Su- preme Court in the live stock cases (see infra, § 36), the state statute enacted for the protection of employes and travelers within its jurisdiction must be taken as valid, unless the same subject is taken under direct national supervision in the exercise of the lawful power of congress over interstate commerce. Under this principle it was held that a state could lawfully prescribe a minimum of three brakemen for freight trains of more than twenty-five cars operated in the state, and that such a regulation was vafid when applied to a foreign railway •Smith V. Alabama, 124 U. S. ^ Southern R. R. Co. v. King, 465 (1888), 31 L. Ed. 508; Nash- supra. ville, etc. R. Co. v. Alabama, 128 ' Erb v. Morasch, 177 U. S. 584 U. S. 96 (1888), 32 L. Ed. 352. (1900), 44 L. Ed. 897. 2 N. Y., N. H. & H. R. Co. v. New York, 165 U. S. 628 (1897), 41 L. Ed. 853. 54 THE CONCURRENT AND EXCLUSIVE POWERS. [§31 when engaged in interstate commerce. The Court said that such a statute, enacted for the safety of all engaged in the business, was not in any sense a regulation of interstate com- merce. ^ The State in the exercise of its sovereign police powers might legislate for the protection of its citizens through work- men's compensation acts, which in the absence of legislation by Congress, will apply to those engaged in interstate com- merce as well as others.^ § 31. State laws concerning separation of races in interstate traffic— A state can regulate the separation of races in railroad transportation on trains within the state,^ but it cannot determine whether white and colored interstate passengers shall be compelled to share their cabin accommo- dations on steamboats, as that is a question of interstate commerce to be determined by congress alone. A statute of Louisiana enacted in 1869, prohibiting discrimination on ac- count of race, was held inapplicable to a Mississippi steam- » Chicago, R. I. & Pac. R. R. Co. V. Arkansas, 219 U. S. 453, 55 L. Ed. 290 (1911), affirming 86 Ark. 412. ' See Stoll vs. Workmen's Pacific Coast Steamship Co., District of Washington, 205 Fed. 169, (1913). Connole v. Norfolk & Western R. Co., 216 Fed. 823, Dist. Ct. Ohio, (1914). See infra, sec. 627a. 3 L., N. O. & T. R. Co. V. Missis- sippi, 133 U. S. 587 (1890), 33 L. Ed. 784, distinguished Hall v. De Cuir, 95 U. S. 485, 24 L. Ed. 547; C. & 0. R. Co. V. Kentucky, 179 U. S. 388, 45 L. Ed. 244; Plessy v. Fer- guson, 163 U. S. 537 (1896), 41 L. Ed. 256. In McCabe v. Atchison, Topeka & Santa Fe R. Co., 235 U. S. 154, 59 L. Ed. 169, (1914) the Court af- firmed the judgment of the Circuit Court of Appeals of the 8th Circuit, 186 Fed. 966, in dismissing a bill of complaint whereby it was sought to enjoin compliance with the statute of Oklahoma, which provided that railroad companies could provide sleeping, dining or chair cars attached to their trains to be used exclusively by either white or negro passengers, but not jointly, and this was construed as requiring a furnishing of these cars when sufficient demand existed therefor. The Court found that these statu- tory provisions should be con- strued as relating wholly to intra- state commerce, and that a state could without infringing the 14th amendment require separate but equal accommodations for the races. The Court affirmed the dismissal of the bill on the ground that the complainants were not passengers and had never requested trans- portation, so there was no ground for an injunction. The Supreme Court, however, did not agree § 32] THE CONCURRENT AND EXCLUSIVE POWERS. 55 boat engaged in commerce between the states ;' while the state laws providing for separate cars within the state, were sustained. Congressional inaction is equivalent to a declaration that an interstate carrier may by its own regulations separate white and colored passengers. ^ § 32. Limitation of state power in stoppage of through trains. — The limitation of the state's power of , regulation in relation to interstate commerce is illustrated by the rulings of the Supreme Court upon state laws requiring the stoppage of trains at certain stations. A statute of Minnesota requiring every railroad company to stop all regular trains at county seats, but providing that it should not apply to other railroad trains entering the state from another state, or to transcontinental trains from an- other state, was sustained as to a train connecting with an interstate train and carrying mails and some interstate pas- sengers for that train. ^ This case, however, was decided upon its special facts, as the train was run wholly within the state. A statute of Illinois was held invalid which required all regular passenger trains to stop a sufficient length of time at county seats to receive and let off passen- gers with safety, as a direct interference with interstate traffic. This statute was held invahd both as to a county seat station which was three and one-half miles from the direct road* and also as to a county seat station which was with the court below in holding judges dissented from this opinion that as these cars were compara- but all concurred in the judgment tively speaking luxuries, it was com- of dismissal. petent for the legislature to take , ^^^^ ^ DeCuir, supra. mto consideration the limited de- , ^^-^^^^ ^ (, ^ q j^ j^ _ 2I8 U. mand for such accommodation by 5 ^j^ 54 ^ g^ 93g ^^giQ^^ ^f, one race as compared with the de- filming 125 Ky 299 mand on the part of the other. The 3 Qladson v. Minnesota, 166 U. Court said this consideration made g^ 457 (1897), 41 L. Ed. 1064; L. S. constitutional rights depend upon ^ ^ g ^ ^ ^^ q^^^^ ^73 y. s. the number of persons who might be 285, 43 L. Ed. 702 (1899). discriminated against, whereas the 4 Illinois Central R. Co. v. II- essence of the constitutional right linois, 163 U. S. 142 (1896), 41 L. is a personal one. Four of the Ed. 107. 56 THE CONCUREENT AND EXCLUSIVE POWERS. [§33 on the direct line.' In the case last cited the Court reviewed the previous decisions and said that none of them were opposed to the principle that, after all local conditions had been adequately made, railways had the legal right to adopt special provisions for through traffic, and that legislative interference therewith was unreasonable and an infringe- ment upon the constitutional guaranty of the freedom of interstate commerce. In determining the validity of a state order, requiring the stoppage of interstate railroad trains, the Supreme Court will consider the adequacy of the local facilities existing in such station, as their existence is involved in the determina- tion of the federal question whether the order does or does not directly regulate interstate commerce." § 33. State regulation of contractual relations of interstate railroad and shippers. — The contract relations of interstate railroads with their shippers must be deter- mined, in the absence of congressional legislation, by the local law of the place where the contract is made. State statutes regulating the contractual relations and changing the common-law rules controlling such relations are within the scope of the state's regulating power. Thus statutes 1 Cleveland, etc., R. Co. v. lUi- trains was held reviewable on nois, 177 U. S. 514 (1900), 44 L. writ of error. In Herndon v. C. R. Ed. 868. I. & P. R. R. Co., 218 U. S. 135, 54 i^In Atlantic Coast Line R. R. L. Ed. 970 (1910), a statute of Co. v.^ Wharton, 207 U. S. 328, 52 Missouri requiring the stoppage L. Ed. 230 (1907), reversing 74 S. of interstate trains at junction C. 80, the Court held that a points was held an unnecessary state order requiring a railroad and unlawful burden upon inter- company to stop, on signal, two of state commerce, when ample facil- its fast mail trains running be- ities for the traveling public were tween Jersey City and Tampa, already provided. In this case Florida, at a small town in South the Court affirmed a decree en- Carolina, which was also the junc- joining the secretary of state tion point with a small branch from revoking the company's li- road was void, where, in addition cense and right to do local busi- to several local trains daily, Ihe ness because of bringing suit in town was furnished daily one the federal court. See C. B. & Q. slower through train, each way. R. Co. v. Railroad Commission, 237 The order of the supreme court of U. S. 220, 59 L. Ed. 926. (1915) ra- the state granting a mandamus versing 152 Wis. 654. compelling the railroads to stop the § 34] THE CONCURRENT AND EXCLUSIVE POWERS. 57 permitting the carrier to limit his common-law liabiUty to a stipulated valuation, regulating the effect of an agree- ment limiting liability to the carrier's own line in a ship- ment to be made over other lines, and also prohibiting con- tractual exemption from any common-law liability of the carrier, have been sustained. In the Hughes case^ it was said by the Supreme Court, in allowing a judgment against an interstate carrier in excess of the amount limited in the bill of lading on the ground that no federal right was denied, that although congress had made it obligatory to provide proper facilities for the interstate carriage of freight and had prevented carriers from obstructing continuous ship- ments on interstate lines, there was no sanction of agree- ments limiting liability by stipulation, and until congress had legislated upon it there was no valid objection to the states enforcing their own regulations upon the subject, although they may to that extent affect interstate contracts of carriage.^ § 34. State regulation under rules of common law in state courts. — It is immaterial, in this exercise of the state's lawful power over persons and property within its jurisdiction, whether the enforcement by the state of its power in the regulation of relative rights and duties of per- '■ Pennsylvania R. Co. v. Hughes, state commerce, it has, by the en- 191 U. S. 477 (1903), 48 L. Ed. 268. actment of the Harter Act, U. S. 2 Richmond, etc., R. Co. v. To- Compiled Statutes, 1901, p. 2946, bacco Co., 169 U. S. 311 (1898), 42 legislated concerning the forms of L. Ed. 759. A contract for through maritime bills of lading and con- transportation from Oklahoma to trolling the insertion of stipula- New York was held subject to the tions therein limiting the responsi- Oklahoma law to the extent that bility of carriers. See case of The such law was not an invasion of Delaware, 161 U. S. 459 (1896), 40 the exclusive rights of congress, L. Ed. 771. By provision of the and under this law the exemption Act of 1906, known as the Railroad of the bill of lading was not bind- Rate Bill of that year, congress ing upon the shipper in the absence has regulated the issue of bills of of his assent in writing. Erie lading, fixing the responsibility R. Co. V. Pond Creek Mill & upon the initial carrier; Held Elevator Co., C. C. A. 7th Circuit, valid by the supreme court. See 162 Fed. 878 (1908). While con- infra, section 20a Interstate Com- gress has not legislated upon the merce Act. forms of bills of lading in inter- 58 THE CONCURRENT AND EXCLUSIVE POWERS. [§ 34 sons and corporations within its limits is enacted into a statute or results from the rules of law enforced in the state courts. The state, said the Supreme Court, has a right to promote the welfare and safety of those within its juris- diction by requiring carriers to be responsible to the full measure of the loss resulting from their negligence, a con- tract to the contrary notwithstanding. The penalizing of the failure of a common carrier to adjust and pay within a specified time claims for loss or damage under state law does not unlawfully interfere with interstate commerce, even as applied to shipments from without the state, where the statute is construed by the state court as affecting only the liability of carriers doing business in the state for property lost or damaged while in their possession. 1 In the absence of action by congress or the Interstate Commerce Commission, a railway company may be com- pelled by mandamus to resume the transfer and return of cars loaded and unloaded from the line of a connecting carrier to a flour mill and elevator of a shipper, upon request and demand of the shipper and the payment of customary charges.^ On the other hand, a statute which is calculated to impose heavy penalties .for trivial, accidental and unintentional violations of duty, as the failure of a railroad company to furnish cars to a shipper within a certain number of days 'Atlantic C. & L. P. Co. v. ises, and that the Court would take Mazurski, 216 U. S. 122, 54 L. Ed. judicial notice of the fact that the 411 (1910). selling of citrus fruits was one of 2 Mo. Pac. R. R. Co. v. Laraby the great industries of the state. FlourMillCo., 211U. S. 612, 53L. In Wilmington Transportation Ed. 352 (1908). In Sligh v, Co. v. Railroad Commission of Kirkwood, 237 U. S. 52, 59 L. Ed. California, 236 U. S. 151, 59 L. 835, (1915), the Court affirmed 65 Ed. 508, (1915) the Court affirmed Fia. 123, and held that the statute 166 Cal. 741, sustaining the author- of 1911, Chapter 6326, making a ity of the state railroad commission criminal offense of shipping in to prescribe reasonable rates for interstate commerce citrus fruits carriage by water between two which are immature and unfit was ports in the state over a course a valid exercise of the police power traversing the high seas. The Court of the state until Congress exercised held that in the absence of Federal its supreme authority in the prem- regulation the state had such power. 34] THE CONCURRENT AND EXCLUSIVE POWERS. 59 after the latter's requisition in writing, in the sum of $25 a day for each car not furnished and admitting of no excuse except as arising from wars or other calamity, is an uncon- stitutional regulation of interstate commerce. ^ The state regulations in these cases were sustained upon the theory that they are not in themselves regulations of interstate commerce, though they control in some degree the conduct and liability of those engaged in the commerce, and as long as congress had not legislated upon the particular subject, they are to be regarded as legislation in aid of such commerce, and as "a rightful exercise of the police power of the state to regulate the relative rights and duties of per- sons and corporations within its hmits.^ This lawful exercise of the pohce power of the state over persons and things within its jurisdiction is illustrated by the rulings of the Supreme Court sustaining the power of the state to regulate the sale of patent rights, or articles cov- ered by letters-patent of the United States. The Court said that congress never intended that the patent laws 1 H. & T. C. R. Co. V. Mayes, 201 U. S. 321, 50 L. Ed. 772 (1906), re- versing 36 Tex. Civ. App. 606, 609. Also St. Louis S. W. Ry. Co. v. Arkansas, 217 U. S. 136, 54 L. Ed. 698 (1910), reversing 85 Ark. 311. See also McNeil v. Southern Ry. Co., 202 U. S. 543, 50 L. Ed. 1142 (1906); Mississippi R. R. Com. v. 111. Central R. R. Co., 203 U. S. 335, 51 L. Ed. 209 (1906), affirming 128 Fed. 327. » Chicago, M. & St. P. R. Co. v. Solan, 169 U. S. 133 (1898), 42 L. Ed. 688. In Michigan C. R. Co. V. Michigan R. Commission, 236 U. S. 615, 59 L. Ed. 750 (1915) the Court affirmed 168 Mich. 230, awarding a peremptory writ of mandamus to compel compliance with an order of the State railroad commission requiring a Steam Rail- way Company and an Interurban Electric Company to interchange traffic. The Court found the statute was not unreasonable in its requirements and if properly construed did not interfere with interstate commerce. In St. L. & S. W. R. Co., v. Arkansas, 235 U. S. 350, 59 L. Ed. 265, (1914) the Supreme Court affirmed 106 Ark. 321, in holding that the franchise tax law of Arkansas was not repugnant to the commerce clause of the con- stitution nor a denial of due process of law, nor the equal protection of the laws, as it was construed by the Supreme Court of the state that the enforcement of the tax would only involve the forfeiture of the privilege to do an intrastate busi- ness, and the forfeiture section might also be treated as separable from the other provisions of the statute. 60 THE CONCURRENT AND EXCLUSIVE POWERS. [§36 should displace the police powers of the state, that is, those powers by which the health, good order, peace and general welfare of the community are promoted, provided such laws do not discriminate against non-residents, i § 35. The concurrent jurisdiction in live stock in- spection laws. — The concurrent jurisdiction of the state and federal governments in interstate commerce is well illustrated in the matter of state laws regulating the exclu- sion of diseased cattle. The danger of the communication of disease in driving or otherwise transporting cattle from state to state has been recognized both in the legislation of the western states as well as in that of the federal govern- ment. The right of the state to protect its people and property against such dangers by reasonable enactments, not going beyond the necessities of the case, has been affirmed in several cases, ^ but this right of protection against diseased cattle did not justify the absolute prohibition against certain cattle within certain seasons.^ The right of inspection of animals or of anything intended for human food brought into the state from another state is conceded, but such inspection must be reasonable, and a state law is invalid which is burdened with such conditions, as would prevent the introduction into the state of sound meats, the product of animals slaughtered in other states.* In this case the act required inspection twenty-four hours before slaughtering, and this necessarily included all meats from animals slaughtered in other states. § 36. Effect of congressional legislation upon con- current state power. — In the second class of cases, supra, section 25, where it is not the existence, but the exercise of the power of congress which is incompatible with the exer- 1 Webber v. Virginia, 103 U. S. " Minnesota v. Barber, 136 U. S. 344 (1881), 26 L. Ed. 565. 313, 34 L. Ed. 455 (1890); Brim- 2 Kimmish v. Ball, 129 U. S. 217 mer v. Redman, 138 U. S. 78 (1889), 32 L. Ed. 695. (1890), 34 L. Ed. 862. ' Hannibal & St. Joe Railroad Co. V. Husen, 95 U. S. 465 (1879), 24 L. Ed. 527. § 36] THE CONCDERENT AND EXCLUSIVE POWERS. 61 cise of the same power by the states, and wherein, by inac- tion, congress in effect adopts the local law, the question necessarily arises whether an act of congress in this field of concurrent legislation has the effect of nullifying the state statutes on the same subject. This question must be determined by the scope and terms of the act of congress, that is, whether or not it covers the whole subject, thus excluding the exercise of the state power. Thus congress has legislated on the subject of the trans- portation of live stock, ' and has authorized the investigation and inspection of cattle intended for interstate commerce, and has made unlawful the transportation of cattle known to be diseased. Though it was argued that this exercise of the federal power of regulation had the effect of nullify- ing or suspending the state statutes on the subject, the Supreme Court held,^ that the act of congress did not cover the whole subject of the transportaion of live stock from one state to another, and that the statutes of Kansas and Colorado related to matters not covered by such act. The statute of Kansas imposed a civil liabiUty upon the railroad company bringing diseased cattle into the state, and that of Colorado made it a misdemeanor to bring into 1 Act of May 29, 1884, c. 60, and agriculture by the Act of February Act of Aug. 30, 1890, c. 839, chap. 3 2nd, 1903. Asbell v. Kansas, 209 Comp. Stats, pp. 3182 to 3193. U. S. 251, 52 L. Ed. 778 (1908). A statute of Kansas, making it a This Act of August 30, 1890, in misdemeanor to transport into the so far as it provided for the inspec- staLe cattle from any point south tion of the slaughtering and pack- of the south line of the state, ex- ing within a state of cattle intended cept for immediate slaughter, with- for exportation, was declared void; out having first caused them to and the party indicted for bribing be inspected and passed as healthy an inspector was discharged on the by the proper state officials or ground that congress had no power by the bureau of animal industry to provide for the inspection of a of the Interior Department of manufacturing business within the the United States, was sustained limits of the state. U. S. v. Boyer, as consistent with the federal 85 Fed. 425 (W. Dist. of Mo.) legislation on the same subject (1898). and with the powers to control ' Missouri, Kansas & Texas R, the interstate movement of cattle Co. v. Haber, 169 U. S. 613 (1898), liable to be afflicted with a com- 42 L. Ed. 878; Reid v. Colorado, municable disease, which had been 187 U. S. 137 (1902), 47 L. Ed. 108. conferred upon the secretaries of 62 THE CONCURRENT AND EXCLUSIVE POWERS. [§ 36 the state cattle which had been herded within ninety days prior to their importation with cattle having a contagious disease.! -phe Court said that the state, not having assumed charge of the matter as involved in interstate commerce, could protect its people and their property against such dangers. When the entire subject of the transportation of live stock from one state to another is taken under direct national jurisdiction, and a system devised by which diseased stock may be excluded from interstate commerce, all local or state regulations in respect of such matters and covering the same ground would cease to have any force, whether formally abrogated or not, and such rules and regulations as congress may lawfully prescribe or authorize would alone control. The power, said the Court, may thus be suspended until national control is abandoned and the subject thereby left under the police power of the state.^ This class of cases, where the exercise of the power of con- gress nullifies the statutes of the state enacted in the exer- cise of this concurrent jurisdiction, is illustrated in the effect of the enactments of congress regulating the hours of labor and other conditions of employment of the employes of rail- roads engaged in interstate commerce. Thus, the act of congress of 1907, known as the Nine Hour Law,' prohibiting the employment of certain employes in interstate commerce for a longer period than nine hours, was adjudged by the supreme courts of both Missouri and Wisconsin to make inoperative the laws of their respective states fixing a maxi- mum of eight hours.^ In these cases it is held, while the state acts were valid in the absence of congressional legis- lation and appUed to all employes whether engaged in interstate commerce or not, the act of congress was a clear declaration that the employers engaged in interstate com- 1 Rasmussen v. Idaho, 181 U. S. ing was made as to the Employer's 198 (1901), 45 L. Ed. 820. Liabihty Act of 1908 as supersed- 2R. R. Com. of Ohio v. Worth- ing the Arkansas statute in Fulg- ington, 187 Fed. 965 (1911). ham v. Railway Co., 167 Fed. 660, ' See infra, § 666. W. D. of Ark. (1909), and as < State V. Missouri Pacific R. R. superseding the Georgia statute in Co., 212 Mo. 658 (1908), and State Dewberry v. Southern Railway of Wisconsin v. C, M. & St. P. Ry. Co., 175 Fed. 307, N. D. of Ga. Co., 136 Wis. 407. The same rul- (1910). § 36] THE CONCURRENT AND EXCLUSIVE POWERS. 63 merce should be under federal, and not state regulation. The effect of the enactment was therefore to make inopera- tive the state laws.^ Thus in the absence of legislation by Congress the state may lawfully require that railway employes of interstate roads should be paid their wages semi-monthly, the effect being to prohibit both the carrier and employes contracting otherwise, and the requirement relating to those railway servants who are employed while within the state and whose duty takes them from their state to other states. ^ The supremacy of the Federal power when exercised in Interstate Commerce was forcibly illustrated in the holding by the Supreme Court that state legislation governing the sale of food products was invalidated by the Food and Drugs Act of June 30, 1906, which made adulterated and misbranded articles contraband of interstate commerce, and this act could authorize, as it did in Section 10, seizures for confiscation and condemnation as long as the articles re- mained unsold, whether in the original packages or not; and such means of enforcement may not be thwarted by state legislation which provided that packages should only 1 In I. C. R. R. Co. V. DeFuentes, lines at points within the city 236 U. S. 157, 59 L. Ed. 517 loaded cars brought from other (1915), the Court held that Con- states and place them on its own gress had so far undertaken to side track, although such side regulate the subject as to invalidate track was the real destination con- an order of a State Railroad Com- templated at the time of the original mission under which a carrier may shipment. The Court held that be required, upon demand of a when freight actually starts in the carrier or shipper, and on terms course of transportation from one fixed by the Commission, to switch state to another, it becomes a part empty cars from any connection of interstate commerce, with a competing interstate rail- See also Southern R. Co. v. Reid, way to a designated side track with 222 U. S. 425, 56 L. Ed. 257; its own terminals in a city. Tor the Southern R. Co. v. Burlington purpose of being loaded there with Lumber Co., 225 U. S. 100, 56 goods intended for interstate com- L. Ed. 1001, (1912); Standard merce, and, when so loaded, to Stock Co. v. Wright, 225 U. S. 541, move the same back to the com- 56 L. Ed. 1197, (1912). petitor's line for continued trans- * Erie Railroad Co. v. Williams, portation to another state, and also 233 U. S. 685, 58 L. Ed. 1155. to accept from competing interstate (1914) affirming 199 N. Y. 525. 64 THE CONCURRENT AND EXCLUSIVE POWERS. [§37 bear the labels required by the state law to the exclusion of those affixed conformably to the Federal law. ' It was said by the Supreme Court, in sustaining a state statute as to the qualifications of certain railway employes in the absence of congressional legislation,^ that it was conceded that the power of congress to regulate interstate commerce is plenary; that, as incident to it congress may legislate as to the qualifications, duties and liabilities of employes and others on railway trains engaged in that commerce; and that such legislation will supersede any state action on the subject. Congress has so taken possession of the subject of the delivery, when called for, of railroad cars to be used in interstate traffic, that the provisions of the state statute requiring railroad companies to furnish freight cars on de- mand for penalty for each day's delay not due to merely certain excepted causes were invalidated by this exercise of jurisdiction by Congress.' § 37. State quarantine laws. — The quarantine law established by the state of Louisiana* was also sustained, the court saying that the state quarantine laws were a rightful exercise of the police power of the state for the protection of health, and although some of the rules of this system amounted to regulation of commerce with foreign nations, they belonged to the class which the state could establish, until congress acted in the matter by covering the same ground or by forbidding state laws, and congress had in effect adopted the laws of the state and forbidden interference with their enforcement.^ 1 See McDermott v. Wisconsin, 118 U. S. 455 (1886), 30 L. Ed. 228 U. S. 115, 57 L. Ed. 754, 237. (1913) reversing 143 Wis. 18. ' In I. C. R. R. v. McKendree, ^ Nashville, etc., R. R. Co. v. 203 U. S. 514, 51 L. Ed. 298 (1906), Alabama, supra. the Court held that the quarantine ' See Chicago R. I. & Pac. R. Co. regulations promulgated by the V. Hardwick Farmer's Elev. Co., secretary of agriculture, under Act 226 U. S. 426, 57 L. Ed. 284 (1913). of Feb. 2, 1903, were void as in See also St. L. I. M. & S. R. Co. v, excess of the powers conferred by Hesterly, 228 U. S. 700, 57 L. Ed. that act, where on their face they 1031 (1913). apply as well to intrastate as to * Morgan's etc., Co. v. Louisiana, interstate commerce. § 38] THE CONCURRENT AND EXCLUSIVE POWERS. 65 § 38. State Inspection Charges. — When Unlawful. — The Constitution, while it authorizes Congress to regulate commerce with foreign nations and among the several states, provides, in Sec. 10 of Paragraph 2, that no state shall, without the consent of the Congress, lay any imposts or duties on imports or exports except what may be abso- lutely necessary for executing its inspection laws. The states are thus authorized to collect the necessary expenses of such inspection laws. Inspection necessarily involves expense, and the power to fix the fee to cover that expense is left primarily to the State Legislature, which must exer- cise discretion in determinng the amount to be charged, since it is impossible to tell how much will be realized under the future operations of any law. Even if it appears that the sum collected is beyond what is needed for inspection expenses, it does not follow that the courts will interfere immediately upon application as it may be presumed that the Legislature will reduce the fees to a proper sum when the necessary amount is ascertained. ^ The state may thus exercise the power to levy necessary inspection charges in interstate as well as in foreign com- merce. ^ But when the necessary cost of inspection is as- certained, the Constitution prohibits the collection by a state of more than this necessary sum, whether levied in interstate or foreign commerce; and a tax levying more than this necessary amount is void because such increased cost by necessary operation obstructs commerce between the states or with foreign countries. There may be cases where some degree of supervising or policing is required in order to secure the proper inspection of property intended for sale or shipment; but the Supreme Court has said that while these two duties may sometimes overlap, it must be made to appear that the tax does not materially exceed the cost of inspection, the burden in such cases being on those seeking to collect the combined charge. This was illustrated in the holding that the charge under ' Red Sea Oil Mfg. Co. v. Board ' Patapsco Guano Co. v. B'd of Agriculture, 222 U. S. 393, 56 of Agriculture, 171 U. S. 345, 43 L. L. Ed. 240 (1912). Ed. 191 (1897), affirming 52 Fed. 690. J-6. 66 THE CONCURRENT AND EXCLUSIVE POWERS. [§39 the Maryland statute of one cent a bushel upon oysters coming from other states was void as an unlawful interfer- ence with interstate commerce, when it was shown that the tax originally yielded a revenue largely in excess of the amount required t-o pay the salaries of the inspectors, and the excess was devoted to non-inspection purposes. ' § 39. Freedom of interstate commerce. — The right of interstate commerce, that is, the right of conducting traffic and commercial intercourse between the states, is independent of state control, and where freedom of com- merce between the states is directly involved, the non- action of congress indicates its will that the commerce should be free and untrammeled, and the states cannot interfere therewith either through their police power or their taxing power. ^ This freedom of interstate commerce from state control was definitely established as to the taxing power of the state in the case of the State Freight Tax^ in 1873, and later, in 1887, in the case of Robbins v. Shelby County Taxing District.* The freedom of interstate commerce with respect to the police power of the state was also declared in the cases relating to the liquor traffic* Finally, in 1886, 'Foote & Co. V. Stanley, 232 Bridge Co. v. Kentucky^ 154 U. S. U. S. 494, 58 L. Ed. 698, reversing 204, 38 L. Ed. 962. The Court said 117 Md. 335 (1914). the absence of Federal regulation 2 In South Covington & C. S. R. did not justify unreasonable re- Co. V. Covington, 235 U. S. p. 537, quirements such as that the com- 59 L. Ed. 350 (1915) the Supreme pany could admit to the car not Court reversed in part the decision more than one-third in excess of its in 146 Ky. 592, which sought to seating capacity except on certain enjoin the City of Covington from holidays, and that they -should enforcing a certain ordinance never be permitted to be below 50 regulating the operation of the degrees in temperature, which was street cars of the company, a found to be impracticable owing to Kentucky corporation which car- the opening and closing of doors, ried passengers in connection with etc. an Ohio corporation across a ' See 15 Wall. 232, 21 L. Ed. bridge from Covington to Cincin- 146. nati. The Court had held this to * See supra, § 20. be an instrument of Interstate ' See supra, § 10. Commerce in Covington & C. §39] THE CONCURRENT AND EXCLUSIVE POWERS. 67 in the Wabash Railway case,' the Supreme Court held that a statute of a state, intended to regulate or to tax or to impose any other restrictions upon the transmission of persons and property or telegraph messages from one state to another, was not within that class of legislation which the states could enact in the absence of legislation by con- gress, and that such statutes are void even as to that part of such transmission which may be within the state. - The statute of Ilhnois therefore- regulating railroad charges was held to have no application to an interstate shipment even as to that part of the distance which lay within the state of Illinois, and the regulation of interstate commerce from the beginning to the end of the shipment was confided to congress exclusively under the power to regulate commerce among the states. In 1894 this principle was extended to an interstate bridge, and it was held that the bridge was an instrument of inter- state commerce whereon congress alone possessed the power to enact a uniform schedule of charges, and that the author- ity of the state was limited to fixing tolls of such channels of commerce as were exclusively within its territory.^ The Court in reviewing the cases said, that in none of the subse- quent cases had any disposition been shown to limit or qualify the doctrine laid down in the Wabash case. The freedom of interstate commerce from state control forbids any legislation discriminating against the products of other states. This principle has been appUed to statutes imposing discriminating taxes or other discriminations against importations from other states in case of the Uquor traffic. Thus, a Michigan statute imposing a specific tax on persons engaged in the business of selling liquors at wholesale or soliciting or taking orders for liquors to be shipped into the state, not having their usual place of busi- ness in the state, without imposing the same tax upon per- sons engaged in the liquor business in reference to liquors 'Wabash R. Co. v. Illinois, 118 'Covington, etc.. Bridge Co. v. U. S. 557 (1886), 30 L. Ed. 244. Kentucky. 154 U. S. 204 (1894), 38 L. Ed. 962. 68 THE CONCURRENT AND EXCLUSIVE POWERS. [§39 manufactured in the state, was held void.' It was claimed that this could be sustained as a tax on occupations, but the court said that an occupation could not be taxed if the tax is so specialized as to operate a discriminating bur- den against the introduction and selling of the products of another state or against the citizens of another state. Upon the same principle the dispensary laws of South Caro- lina, regulating the sale of intoxicating liquors and pro- hibiting their importation,^ were held void, the court hold- ing that as the state recognized the sale, manufacture, and use of intoxicating liquors, as valid, it could not discriminate against their being imported from other states. The right to carry on commerce among the states is subject only to the regulation of congress, and as to this fundamental right to conduct such commerce, it is not the exercise but the existence of the power in congress which excludes all state control and interference whether under the taxing or the police power.' This freedom from state control in the carrying on of interstate commerce must however be reconciled with the general police power of the state in regulating persons, cor- porations and property within its jurisdiction, and in deter- mining their relative rights and obligations. Thus while a state cannot impose any tax upon interstate commerce as such, nor restrict the persons or things to be carried therein, nor regulate the rate of tolls, fares or freight, or interfere with through trains, or exclude any lawful subjects of com- merce, it caii prescribe rules for the construction of rail- roads and their management and operation for the protec- 1 Walling V. Michigan, 116 U. S. braskfi, abolishing the fellow-serv- 446, 29 L. Ed. 691 (1886). ant rule and adopting the rule 2 Seott V. Donald, 165 U. S. 58, of comparative negligence and re- 41 L. Ed. 632 (1897); Vance v. quiring all questions of negligence Vandercook, 170 U. S. 468 (1898), and contributory negligence to be 42 L. Ed. 1111. submitted to the jury, was sus- ' Chicago, etc., R. Co. v. Solan, tained and held applicable to 169 U. S. 133 (1898), 42 L. Ed. 688; interstate railroads in the absence Pennsylvania R. Co. v. Hughes, of valid legislation of congress, 191 U. S. 477 (1903), 48 L. Ed. 268. the Employer's Liability Act of In Missouri Pacific R. R. Co. v. 1906 having been held invalid, and Castle, C. C. A. 8th Circuit, 172 that of 1908 not having been en- Fed. 841 (1909), the Act of Ne- acted. § 39] THE CONCURRENT AND EXCLUSIVE POWERS. 69 tion of persons and property. Such rules are not in them- selves regulations of interstate commerce, although they may control in some degree the conduct and liability of those engaged in such commerce. While the line of dis- tinction is not always clear between what is a lawful regula- tion of persons and property _ within the jurisdiction and what is a regulation of interstate commerce conducted by such persons or with such property, the rule remains as declared in the Wabash case, that it is not the exercise but the existence of the power in congress which makes void any action by the states regulating such commerce. The distinction between the lawful exercise of the power of the state in regulating the relative rights and duties of those subject to its jurisdiction and the unlawful regulation of interstate commerce was illustrated in two cases where state legislation undertook to deal with the liability of carriers in interstate shipments of goods damaged on con- necting hnes. A Virginia statute, providing that a carrier might make any limitation as to its liability on an interstate shipment beyond its own line which it deemed proper, pro- viding only the evidence was a contract in writing and signed by the shipper, ^ and that the carrier should be liable unless within a reasonable time he gave satisfactory proof to the consignor that the loss or injury did not occur while the thing was in his charge, was sustained by the Supreme Court. Such a provision, the Court said, was a reasonable one and not a regulation of interstate commerce. On the ' Richmond & A. R. Co. v. Pat- commerce and was therefore valid terson Tobacco Co., 169 U. S. 311, until displaced by Federal Legisla- 42 L. Ed. 759 (1898). tion. In Hendrick v. Maryland, 235 In Mutual Film Corp. v. Indus- U. S. 610, 59 L. Ed., 385, (1915), trial Com. 236 U. S. 230, 59 L. Ed, the Court sustained the conviction 552, (1915) the Court affirmed the in the State Court of Maryland District court for the northern of a resident of the District of district of Ohio, 215 Fed. 138, in Columbia for failing to comply refusing to restrain the enforcement virith a requirement of that state of a state statute for the censorship for the registration of motor ve- of motion picture films. The Court hides and held that the requirement held that this was not an inter- was not so arbitrary or unreason- ference with interstate commerce as able as to amount to a direct and applied to films brought from material burden upon interstate another state. 70 THE CONCURRENT AND EXCLUSIVE POWERS. [§ 40 other hand, a Georgia statute, which, as construed by the supreme court of that state, applied to interstate ship- ments and imposed upon the carrier, as a condition of avail- ing itself of a valid contract of exemption from liabihty beyond its own line, the duty of tracing the freight and informing the shipper when, where, and how, and by which carrier, the freight was lost, damaged or destroyed, and of giving the names of the parties and their oflTicial position, if any, by whom the truth of the fact set out in the informa- tion could be established, was, when applied to an interstate shipment, in violation of the constitution. ' The Court distinguished this case from the Virginia case in that the carrier was made liable for the negligence of another car- rier over whose track it had no control, unless it obtained information which it had no means of compelling another carrier to give. The court said this was not a reasonable regulation in aid of interstate commerce but a direct and immediate burden upon it.^ § 40. Congressional inaction in foreign and inter- state commerce distinguished. — In one of the "original package" cases, Bowman v. Railroad Company,' where the ' Central of Georgia R. Co. v. make the lowest rate, was, as ap- Murphey, 196 U. S. 194, 49 L. Ed. plied to interstate shipments, an 444. unlawful interference with inter- 2 In St. Louis, I. M. & S. Ry. Co. state commerce. V. Hampton, U. S. Circuit Court E. In Globe Elevator Co. v. D. of Ark., 162 Fed. 693 (1908), Andrew, C. C, W. D. of Wis., 144 the act of Arkansas regulating Fed. 871 (1906), on a motion for freight transportation and making preliminary injunction, an act of an absolute requirement for fur- Wisconsin providing for the in- nishing cars therein, was held an spection and grading of grain of unlawful interference with inter- Superior City, and requiring all state commerce. grain to be sold and delivered un- In St. Louis & S. F. R. Co. v. der certain grades established, and Allen, 181 Fed. 710 (1910), a rule prohibiting any sales or deliveries of the Railroad Commission of Ar- under Minnesota grades (the city kansas providing that in case being on the state line), was an of failure on the part of the ship- attempted regulation of interstate per to give routing instructions commerce and therefore void, it should be the duty of the rail- ' Bowman v. Chi. & N. W. R, road receiving the shipment to Co., 125 U. S. 465 (1888), 31 L. Ed. forward it via such route as would 700. § 41] THE CONCURRENT AND EXCLUSIVE POWERS. 71 Supreme Court first laid down the rule that in interstate commerce the inaction of congress meant freedom of com- mercial intercourse as to any lawful subject of commerce in the "original package," i it was suggested that while the two powers over interstate and foreign commerce are con- tained in the same clause and in the same term, the same inference was not always to be drawn from the absence of legislation by congress. Laws which concern the exterior relations of the United States with other nations and govern- ments are general in their nature, and the people of the several states can have no relation with foreign powers in respect to commerce or any other subject except through the government of the United States, its laws and treaties. The question was therefore to be considered in each case, as it arises, whether the fact that congress has failed in the particular instance to provide by law a regulation of commerce ampng the states is conclusive of the intention that the subject shall be free from all positive regulation, or that until it positively interferes such commerce may be left free to be dealt with by the respective states. § 41. Attachment of foreign railroad cars. — An in- teresting question, which has been differently ruled upon in the state courts,^ as to the liabihty of cars of a foreign rail- road company, while in a state in the custody of another company, to attachment under legal process in such state, has been definitely decided by the Supreme Court, and it is held that such cars are subject to attachment under state laws notwithstanding the provisions of the interstate com- merce act and of the act of congress, securing continuity of transportation.' The Court said in this opinion^ that the interstate com- merce act was directed against the acts of railroad companies which prevent continuity of transportation, and section 5258, R. S., was directed against the trammels of state enactments then existing or which might be attempted 'Supra, § 17. ' U. S. R. S. 5258. infra, § 44. 2 Wall V. Norfolk & Western R. « Davis v. C. C. & St. U R. R- R. Co., 52 W. Va. 485, 64 L. R. A, Co., 217 U. S. 157, 54 L. Ed. 708 (annot.) 501. (1910). 72 THE CONCURRENT AND EXCLUSIVE POWERS. [§ 42 and that neither statute had the purpose to reUeve the rail- roads of any obligations to their creditors or to take from their creditors any remedial process provided by the state. Sums due to a foreign railroad carrier from other carriers as the former's share of freight on interstate shipments were held garnishable under state laws. The Court in this case commented on the possible inter- ference with the continuity of interstate commerce through the enforcement of state attachment laws against the cars employed in interstate commerce, and said that such en- forcement shall not be exaggerated so as to cause embar- rassment in carrying on interstate commerce, that the pending case did not call for a very comprehensive deci- sion on the subject, and only decided that the amounts due from the garnishee companies to the defendant railroad company were not exempt from process under the state laws. 1 § 42. Rulings of the state courts on the commerce clause. — While the Supreme Court of the United States is the final arbiter of all questions in the construction and application of the federal constitution and the validity of state legislation in the exercise of the police or taxing power of the state with reference to the same, it is also true that under our dual form of government the state courts may, in the exercise of their jurisdiction, be called upon to deter- mine such questions, and their judgment may be final as to the parties to the cause when their decision is in favor of the federal right set up in the case.^ Under the Judi- 1 See Pullman Co. v. Linke, bark and accept other accommoda- (Dis. Ct. of Ohio, 1913) 203 Fed. tions. 1017, where the court construing ^ A number of decisions have and applying this decision of the been rendered in state courts, ad- Supreme Court held that a sleeping judging state statutes to be viola- car enroute from Columbus, Ohio live of the fourteenth amend- to Washington, D. C. and waiting ment. In two notable cases in at a junction with its passengers Missouri, Russell v. Croy, 164 Mo. aboard was an instrumentality of 69, (1901) and State ex rel. John- interstate commerce and could not son v. C. B. & Q. Ry. Co., 195 Mo. be attached by the sheriff com- 228, amendments to the state con- pelling the passengers to disem- stitution were adjudged violative of §42] THE CONCURRENT AND EXCLUSIVE POWERS. 73 the equal protection of the laws guaranteed by the federal consti- tution. In Ives V. Buffalo, etc., R. R. Co., 94 N. E. 432, the Work- men's Compensation Act of New York was held to violate the due process of law guaranteed by the federal as well as state consti- tutions. The following are some of the cases wherein state statutes have been held void by state courts as interfering with interstate com- merce, these judgments being fmal as not reviewable by the supreme court of the United States. Arkansas: (1908). Railroad v. State, 85 Ark. 284, 107 S. W. 989, the statute of the state, requiring the stoppage at a given station of a train engaged in interstate com- merce, where it appears that there are sufficient trains already stop- ping to accommodate the public. Colorado: (1907). Stubbs v. People, 40 Colo. 414. Act of Colo- rado prohibiting the docking of horses and the importation and the use of them as to such horses brought into the state and used therein by the owners. Act requiring inspection before . slaughtering of certain animals in so far as it provides that fresh meats cannot be shipped into the state except that the animals shall be inspected forty-eight hours be- fore being slaughtered, Schmidt V. People, 18 Colo. 78. (1892). Georgia: (1909.) A statute mak- ing it unlawful if a person shall solicit a sale of liquor in any county where the sale is forbid- den, where any shipment of any part of the sale was an act of interstate commerce. Rose Co. v. State, 133 Ga. 353 (1909). An ordinance creating a packing- house inspector whose duty it is to inspect all meats shipped into the city or brought from outside the county, and requiring him to visit all packing-houses daily and imposing upon the importers an inspection charge while it im- poses no charge on others engaged in like business. Armour & Co. V. City Council of Augusta, 134 Ga. 178. Iowa: (1900). City ordinance permitting a street railroad, en- gaged in interstate commerce, to discriminate in rates in favor of residents of city. State v. Omaha R. Co., 113 Iowa, 30 (1901), Re- quiring a railway company to transfer its interstate freights, passengers, etc., at a given point, Council Bluffs v. Railway Co., 45 Iowa, 338 (1876). Kansas: (1909). Where freight is received in Kansas to be trans- ported over its own and connect- ing line to a point beyond the state, and the rate charged is the aggregate of the local rates of the two lines, and the connecting line had previously adopted and filed with the Interstate Commerce Commission a tariff under which its proportion of the charge on the through shipment was collected and there is a claim that the charge is excessive, the shippers redress must be through the Inter- state Commerce Commission and not in a state court. M., K. & T. Ry. Co. v. New Era MiUing Co., 80 Kan. 141. Kentucky: (1907). Common- wealth V. Hay Company, 104 S. W. 224, 31 Ky. Law Rep. 824. The laws of Kentucky requiring that a corporation carrying on business in that state shall file in the office of the secretary of state statement 74 THE CONCURRENT AND EXCLUSIVE POWERS. [§42 of the location of its office and the name of its agent on whom process can be served as to corporations engaged in interstate commerce. Ryan Steam Ship Line v. Common- wealth, 30 Ky. Law Rep. 1276, 10 L. R. A. N. S. 1187, held that the laws of Kentucky, Sec. 571 (1903) providing that all corporations carrying on business in the state shall have an office and agent where services can be had making it unlawful for such corporation carrying on business without com- plying with the laws, in so far as it affects steamship companies en- gaged in interstate commerce. Maine: (1892). Making a rail- way ticket binding on the rail- way company for six years. La- Farier v. Railway Co., 84 Me. 286. Railroads to remove free of charge paupers brought into the state by it. Bangor v. Smith, 83 Me. 422 (1891). Maryland: (1907). State v. Cumberland R. Co., 105 Md. 478, Acts of Maryland, p. 413, amending the charter of the C. & P. R. Co., so as to prohibit it from allowing its tracks to be connected with the tracks of the B. & O. which passes through other states unless the latter shall arrange its freight charges on coal delivered to it from the former, so that the freight charges of the two com- panies shall not exceed a certain rate. Massachusetts: (1906). Com- monwealth V. Caldwell, 190 Mass. 355, act permitting the sale by peddlers of agricultural products of the United States without a license and forbidding unlicensed sales of agricultural products of other countries. (1881). Providing for the in- spection of lime imported into the state, Higgins v. Casks of Lime, 130 Mass. 1. Missouri: (1907). State v. Mo. Pac, 212 Mo. 658. A law regulat- ing the hours of service of tele- graph operators and train de- spatchers in so far as it applies to interstate traffic. (1909). International Text Book Co. V. Gillespie, 229 Mo, 397, a law requiring a foreign corporation carryiiig on solely inter- state commerce in Missouri to make out and deliver to the secre- tary of the state a statement as to its property and business within the state and to pay a tax thereon. New York: (1898). Goods made by convict labor in another state to be labeled as such when exposed for sale. People v. Hawkens, 157 N. Y. 1. (1901). Providing that no stone shall be used on any municipal work except the stone was dressed or cut or carved withinjthe state. People V. Coler, 166 N. Y. 144. Ohio: (1897). Act regulating sale of convict-made goods from other states. Arnold v. Yanders, 56 Ohio, 417, 47 N. E. 50. Oklahoma: (1893). Inspecting cattle driven into a state and im- posing a fee therefor. Paris v. Henderson, 1 Okl. 384. South Carolina: (1907). Wens- low V. Atlantic Coast Line, 79 S. C. 344, 60 S. E. 709, act making the carrier the agent of its connecting carrier from whom it receives freight, liable for freight lost by such connecting carrier. (1901). Imposing a penalty of $500 for shipping freight other than as designated by the shipper. Lowe V. Railway Co., 63 S. C. 248. §42] THE CONCURRENT AND EXCLUSIVE POWERS. 75 ciary Act of 1789 the appellate jurisdiction of the Supreme Court in reviewing decisions of highest courts of the state was limited to cases where the decision of the state court was against the federal right, privilege or exemption claim, so that if the judgment of the highest court was in favor of a party making such a claim of federal right the decision Tennessee: (1909). Acklen v. Thompson, 126 S. W. 730, 122 Tenn. 43, act prohibiting the sale of plumage of birds captured or killed without the state, if applied to the case where the possessor had in the course of his trade ac- quired title in a foreign state and brought the game into the state for use or commercial purposes. (1896). Requiring all persons other than photographers of the state who shall solicit pictures to be enlarged outside of the state to pay tax. State v. Scott, 98 Tenn. 254. Texas: (1906). Ex parte Massy, 49 Tex. Grim. App. 60. A stat- ute making it a misdemeanor to solicit orders for the sale of in- toxicating liquors in local option districts. (1906). Texas & Pacific v. Al- le^, 42 Tex. 331, 98 S. W. 450, act imposing a penalty on carriers for delay in furnishing cars. (1909). Contract made in Texas for the sale of goods to a resi- dent corporation by a foreign corporation to be shipped from a sister state to a buyer in Texas affects interstate commerce and is not subject to Texas Anti-Trust laws. Hardware Co. v. Pottery Co. 120 S. W. 1088. Utah: (1908). The law requir- ing a license to canvass or sell by sample certain goods to be shipped into the state and permitting with- out hcense, canvassing or selling in such manner goods not shipped into the state, though such a sale without a license is prohibited only in case of selling to users and consumers. The mere fact that the goods had been shipped into the state being not alone con- clusive that they have lost that character as articles of interstate commerce. State v. Bayer, 34 Utah, 257. Vermont: (1908.) In State v. Peet, 68 Atl. 661, 80 Vt. 449, the law of Vermont making it punish- able to keep, with intent to ship out of the state for food purposes, the flesh of a calf which was less than four weeks old or weighed less than 50 pounds. Washington: (1908). A city or- dinance designating as peddlers non-residents of state taking or- ders in the city for groceries and imposing a penalty for doing business without a -license. State V. Glasby, 50 V/ash. 704. West Virginia: (1906). Jen- nings V. Big Sandy R. Co., 61 W. Va. 664, 57 S. E. 272, act imposing a forfeiture on any railroad which shall demand or receive a greater toll for compensation than is pro- vided by the act so far as appli- cable to interstate commerce. Wisconsin: (1908). State v. C. M. & St. P. By. Co., 136 Wis. 407, a statute providing hours of service for telegraph operators, including train despatchers. 76 THE CONCURRENT AND EXCLUSIVE POWERS. [§42 of the state court thereon was final. Under the recent act of Congress* the judicial code was amended so that the Supreme Court can now require by certiorari or otherwise any such case to be certified to the Supreme Court for final determination, although the decision may have been in favor of the right or immunity claimed under the federal constitution and laws. As it is for the Supreme Court to determine when Such jurisdiction should be exercised, the state courts will continue as in the past to render judgments in such cases, which will be final, if certiorari is not granted. 1 Sect. 1214 (Jud. Code, Sect. 237 as amended. Act Dec. 23, 1914). "It shall be competent for the Supreme Court to require, by certiorari or otherwise, any such case to be certified to the Supreme Court for its review and determina- tion, with the same power and authority in the case as if it had been carried by appeal or writ of error to the Supreme Court, al- though the decision in such case may have been in favor of the vali- dity of the treaty or statute or authority exercised under the United States or may have been against the validity of the State statute or authority claimed to be repugnant to the Constitution, treaties, or laws of the United States, or in favor of the title, right, privilege, or immunity claimed under the Constitution, treaty, statute, commission, or authority of the United States." The American Bar Association at its meeting of 1911 recommended the amendment of R. S. U. S. 709 so that the final judgment of a state court when a federal claim was involved could be re- viewed on writ of error where the claim was affirmed as well as where it was denied. Congress however provided that the review should be by certiorari or other- wise, leaving the matter to the discretion of the Supreme Court. CHAPTER III. THE FEDERAL REGULATION OF INTERSTATE COMMERCE. § 43. The beginning of federal regulation. 44. The railroad act of 1866. 45. The state control of local business of interstate railroads. 46. State regulation of railways in the United States. 47. Governmental regulation of railways in England. 48. The common law in interstate commerce. 49. Federal and state courts in the federal regulation of interstate commerce. 50. Federal cause of action in the state courts. 51. Genesis of the Interstate Commerce Act. 52. Successive amendments of the Interstate Commerce Act. 53. Enlarged powers and jurisdiction of the Interstate Commerce Commission. 54. The short life of the Commerce Court. 55. Regulation of bridges and ferries over navigable rivers. 56. No rate regulation of water transportation. 57. Regulation of telegraph and telephone companies. 58. The release of the federal regulating power. 59. Regulation by the delegation of power. 60. Additional acts of congress in the regulation of commerce. 61. The Commerce Bureau and the Federal Trade Commission. § 43. The beginning of federal regulation. — Although the recognized necessity for the national control of interstate commerce was the immediate occasion and moving purpose in the adoption of the constitution and the formation of the federal union, and the broad and comprehensive construction of the commerce clause by the Supreme Court under chief justice Marshall has laid the foundation of all subsequent decisions, the direct federal regulation of such commerce, at least as to land transportation, did not begin until the close of the first century of the repubUc's existence. The far-reaching importance of national control over interstate as well as over foreign commerce was not and could not be foreseen at the time of the adoption of the constitution. It was not until twenty years after the close of the civil war that changed economic conditions of the country made 78 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 44 intolerable the discriminating legislation of the states and led to the judicial declaration by the Supreme Court in 1886, ' that in the matter of interstate commerce the United States are but one country and are and must be subject to but one system of regulations, and not to a multitude of systems. Soon after this, in 1888 and in 1890^ the court extended the same principle of the freedom of interstate commerce to the police power of the states in the liquor traffic decisions. In 1886 it was also definitely decided,' that the state power of regulation of railway traffic did not and could not extend to interstate traffic in any form, and that such shipments were national in their character, and their regulation con- fined to congress exclusively. Thus it was for the first time decided that this right of interstate commerce was so essentially national in its character, that the inaction of congress was equivalent to its determination that the commerce must be free, and that therefore any state regu- lation of the right to carry on such commerce was inopera- tive and void. The principle of concurrent state powers during the inaction of congress, and the invalidation of state action by reason, not of the existence, but of the exer- cise of the federal power had no application to the regulation of the right to carry on commerce among the states. Thus the close of the first one hundred years of the gov- ernment was marked by the distinct judicial declaration of the freedom of interstate commerce from any control or regulation by the states, either by police or taxing power, and the way was logically opened for the direct exercise by congress of the power of regulation conferred by the constitution. § 44. The railroad act of 1866. — Although congress had frequently legislated on the subject of water transporta- tion {supra, § 13), its first legislation in regard to railroad transportation, other than the incorporation of the land grant and government aided Pacific railroads in 1862, 1 Robbins v. Shelby County Tax- « Wabash, St. L. & P. R. Co. v. ing District, supra. Ilhnois, supra. 2 Bowman v. Railway Co., supra; Leisy v. Hardin, supra. § 44] FEDERAL REGULATION OF INTERSTATE COMMERCE. 79 was the act of June 15, 1866, since incorporated in the revised statutes as section 5258. This act was entitled in its preamble, "Whereas the constitution of the United States confers upon congress in express terms the power to regulate com- merce among the several states, to establish post-roads, and to raise and support armies," and it provided as follows: "Every railroad company in the United States, whose road is operated by steam, its successors and assigns, is hereby authorized to carry upon or over its road, boats, bridges and ferries, all passengers, troops, government supplies, mails, freight and property on their way from any state to another state, and to receive compensation therefor, and to connect with roads of other states, so as to form continuous lines for the transportation of the same to the place of destina- tion. . . . "This section shall not be construed to. authorize any rail- road company to build any new road, or any connection with another road, without authority from the state in which such railroad or connection shall be proposed." The purpose of this act, as declared by the Supreme Court, was to remove trammels upon transportation which had previously existed, and to prevent the creation of such trammels in the future, ^ and also to be a declaration by congress in favor of the great poUcy of continuous lines, and therefore as favoring such business arrangements be- tween companies as would make such connections effective,'^ and as indicating an intent that interstate commercial inter- course should be free.^ The statute however imposes no duties upon carriers so as to compel through routing of interstate traffic, and merely permits or authorizes the carriage of freight or traffic from ' Railroad Co. v. Richmond, 19 clared by congress and that it is Wall. 584 (1873), 22 L. Ed. 173. an effectuation of such policy that 2 Union Pacific R. Co. v. Chicago, such business arrangements as etc., R. Co., 163 U. S. 564 (1896), will make such connections elTect- 41 L. Ed. 265, 274, where the Court ive, are made." said: "It is impossible for us to 'Bowman v. C. & N. W. R. R., ignore the great public policy in 125 U. S. 465 (1888), 31 L. Ed. 700. favor of continuous lines thus de- 80 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 44 one state to another and the formation of continuous hnes by mutual agreement.! The act was only intended to remove trammels upon transportation between different states imposed by «state enactments or the then existing laws of congress, and did not prevent the operatioji of police laws of the states affecting interstate railways. ^ This statute has been invoked in a number of cases, wherein the validity of state legislation affecting interstate railways was involved; and it has been uniformly held by the Supreme Court that the statute was not intended to interfere with the authority of the states to enact such regu- lations with respect at least to a railroad corporation of its own creation, as were not directed against interstate com- merce, but which only incidentally or remotely affected such commerce, and were not in themselves regulations of interstate commerce, but were designed reasonably to sub- serve the convenience of the public.^ Thus, the statute did not interfere with state enactments, as to the running of trains on Sunday,* or excluding diseased cattle.^ Neither did this declaration of the national policy, favoring con- tinuous transportation, exempt railroad cars employed in interstate transportation from the attachment laws of the states, nor the railroad companies from the process of gar- nishment therein.^ § 46. State control of local business and incorpora- tion of interstate railroads. — Though this statutory declaration of national policy in 1866 was not directly involved, the principle is applicable to recent decisions of the Supreme Court holding invahd the attempted state revocation of the license of interstate railroads and tele- graph companies to do a local business in the state, notwithstanding the admitted state control over the ad- mission of foreign corporations engaged in general business and its attempted control over the local business of inter- 1 Kentucky & Indiana Bridge Co. Ohio, 173 U. S. 285, 43 L. Ed. 702 V. L. & N. R. Co., 37 Fed. Rep. 567, (1899) . 1. c. p. 633 (1889). * Hennington v. Georgia, supra. 2 R. R. Co. V. Fuller, 17 Wall. 560 ^ M. K. & T. R. Co. v. Haber, 169 (1873), 21 L. Ed. 710. U. S. 613 (1898), 42 L. Ed. 878. ' Lake Shore & M. S. Ry. Co. v. " See supra, § 41. §46] FEDERAL REGULATION OF INTERSTATE COMMERCE. 81 state railroads and telegraph companies. Thus a statute of Missouri forfeiting the right of a railroad company to do a local business in the state, when under the sanction of the state it had come into the state and acquired a large amount of property therein, in case it should bring a suit in the federal court or remove from the state to the federal courts, was held void.^ The statute of Kansas was also held void which exacted from a foreign telegraph company a charter fee of a given per cent of the entire authorized capital stock of the com- pany as a condition of continuing to do local business in the state. ^ Both these cases involved the right of corporations in the state, which had made investments therein for the purpose of doing both an interstate and local business. A broader question of the right of the state to prevent an interstate railroad or telegraph company of another state from enter- ing the state, or to require reincorporation as a state cor- poration as a condition of entering the state, was not decided. It would seem however that the right of an interstate rail- road or other interstate company to do a local business under reasonable state regulation is an incident of the right to transact an interstate business, and that congress is the only authority which can prescribe the limitation of the right of a corporation directly engaged as an instrumentality of interstate commerce to enter a state. § 46. State regulation of railways in the United States. — With this judicial declaration of the freedom of interstate commerce from state control also came the dis- tinct judicial recognition of the governmental power of regulation over public carriers. This principle had been already estabhshed both in the states of this country and in England. Thus in this country prior to the adoption of the inter- state commerce act railway commissions had been estab- 'Herndon v. C. P. I. & P. Ry. » Western Union Telegraph Co. Co., 218 U. S. p. 135; 54 L. Ed. p. v. Kansas ex rel., 216 U. S. 1, 54 970 (1910), affirming 157 Fed. 783 L. Ed. 355, reversing 75 Kan. 609 (1910). (1910). J-«. 82 FEDERAL EEGULATION OF INTERSTATE COMMERCE. [§47 lished in several states, some with powers of regulation, and others only with powers of investigation and recom- mendation. It was established in the Granger cases, ^ that railroad companies were carriers for hire, and as such were engaged in the public employment affecting the public interests and were subject to legislative control as to their rates of fare and freight, unless protected by their own charters therefrom. As carriers they must carry when called upon to do so, and can charge only a reasonable sum for the carriage. The principle was also distinctly declared, that when property had been clothed with a public interest, the legislature may fix a limit to that which in law shall be reasonable for its use, and that this limit binds the courts as well as the people. It was urged in these cases that the statutes of the states regulating ratee amounted to a regulation of commerce among the states; but it was held that where the railroad was employed in state as well as in interstate commerce, and until congress acted, the states must be permitted to establish such rules and regulations as may be necessary for the promotion of the general wel- fare of the people within its own jurisdiction, even though in doing so those without may be indirectly affected. While there has been some difference of judicial opinion as to what classes of business- were affected with a pubhc use so as to warrant state regulation of charges, there has been no such difference as to the application of the principle to common carriers, and their subjection to public regula- tion has been uniformly conceded.^ § 47. Governmental regulation of railways in Eng- land. — The principle of governmental regulation of railways was adopted in England soon after the first introduction of railways in that country. Thus, the Railways Clauses ' Munn V. Illinois, 94 U. S. 113 North Dakota, 153 U. S.- 391 (1876), 24 L. Ed. 77; Railroad Co. (1894), 38 L. Ed. 757; State ex rel. V. Iowa, 94 U. S. 155 (1876), 24 L. v. Associated Press; 159 Mo. 410 Ed. 94; Peik v. Railway Co., 94 U. (1901); Minneapolis & St. Louis R. S. 164 (1876), 24 L. Ed. 97. Co. v. Minnesota, 186 U. S. 257 _ ' Budd V. New York, 143 U. S. (1902), 46 L. Ed. 1151. 517 (1892), 36 L. Ed. 247; Brass v. § 47] FEDERAL REGULATION OF INTERSTATE COMMERCE. 83 Consolidation Act of 1845, in granting the power to vary tolls upon railways so as to accommodate them to the cir- cumstances of the traffic, provided that tolls should be at all times charged equally to all persons, and that the power of varying should not be used for the purpose of prejudicing or favoring particular parties, or for the purpose of collu- sively or unfairly creating a monopoly either in the hands of the company or of particular parties. The Railway and Canal Traffic Act of 1854i specifically provided that the railway company should make arrangements for receiving and forwarding freight, and prohibiting any undue or un- reasonable preference or advantage, using substantially the language adopted in the third section of the Interstate Com- merce Act, and authorized summary proceedings in the courts for the enforcement of its provisions. The act of 1868^ provided for securing equahty of treatment where the railway company operates its steam vessels; and finally the Regulation of Railways Act of 1873' authorized the appointment of not more than three commissioners, one of whom should be of experience in the law and one of exper- ience in the railway business, and not more than two assist- ant commissioners, and this commission was granted very comprehensive powers, including the power of making through routes and apportioning through rates thereon. As will be hereafter seen, some of the provisions of the Inter- state Commerce Act are based upon the English statutes, and the English decisions construing those statutes have been frequently cited in the federal courts.'' English pre- cedents however in the matter of public regulation of rail- ways are of limited value in this country, in view of the vast difference in the conditions of railroad service. In the one there is compact population in a limited area; in the other a great continent, with immense tracts of sparsely settled and newly opened territory, covered with a great network of railroads and with numerous competing communities. ' 17 and 18 Vic, c. 31. * Infra, Interstate Commerce « 31 and 32 Vic, c. 119. Act, sees. 2 and 3. ' 36 and 37 Vic, c. 48. 84 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 48 § 48. The common law in interstate commerce. — There is no federal common law in the sense of a national customary law distinct from the common law of England, such as the common law adopted by the several states, each for itself, appHed to its local law and subject to such altera- tions as may be provided by its own statutes.' There are therefore no crimes of the United States, and no pains and penalties are enforced by its courts, except as enacted in the statutes of the United States. Under section 721 of the Judiciary Act the laws of the sev- eral states are enforced in the courts of the United States.^ In this section, by. the "laws of the states" is meant the stat- ute laws of the states as construed by the local tribunals, and not the rules of law declared by the decisions of the states in matters of general jurisprudence.^ The federal courts are not bound to follow the rulings of the state courts on questions of general commercial law or of equity jurisprudence, but they declare their own views of the law, irrespective of the courts of the state,* and the same ruling has been made as to the legal principles controlling the liability of railroad companies to employes. There was no federal statutory regulation of interstate commerce prior to the enactment of the interstate commerce law in 1887. It was ruled in some of the circuit courts, that in the absence of a distinct federal common law or statute, there was no law prior to 1887 controlling the regulations of carriers and shippers in interstate commerce and warranting a recovery on account of discriminating charges therein, and iWheaton v. Peters, 8 'Pet. United States, in cases where they 1. c. 658, 8 L. Ed. 1079 (1834); apply." (Act Sept. 24, 1789, c. 20, Smith V. Alabama, 124 U. S. 465 § 34, 1 Stat. 92.) (1888), 31 L. Ed. 508, ' Railroad Co. v. Baugh, 149 U. 2 "Sec. 721. Laws of the states; S. 368 (1893), 37 L. Ed. 772. rules of decision. The laws of the ' Swift v. Tyson, 16 Pet. 1 and several states, except where the 18 (1842), 10, L. Ed. 865, 871; constitution, treaties, or statutes Dates v. Bank, 100 U. S. 239 of the United States otherwise re- (1879), 25 L. Ed. 580; Railroad quire or provide, shall be regarded Co. v. National Bank, 102 U. S. 14 as rules of decision in trials at (1880), 26 L. Ed. 61. common law, in the courts of the § 48] FEDERAL EEGULATION OF INTERSTATE COMMERCE. 85 that this was a matter of exclusive federal jurisdiction, which was not exercised prior to the enactment of the Interstate Commerce Act.^ It was therefore held that the state courts had no jurisdiction in such cases, and as the courts of the United States in removed cases had no wider jurisdiction than the courts from which they were removed, the federal courts had no jurisdiction therein. This question of the common law in interstate commerce was presented to the Supreme Court in 1901 in a case from Nebraska,^ where the supreme court of that state had sus- tained a recovery against an interstate telegraph company, for alleged discrimination in charges. The company claimed that as there was no federal regulation of interstate telegraph rates, there could be no recovery, as there was no controlling statute or common law for such recovery. The Supreme Court however sustained the recovery, holding that there was a common law in force generally throughout the United States, and that the countless multitude of interstate commercial transactions were subject to the rules of common law except so far as they were modified by congressional enactment. The jurisdiction of the state court to enforce these principles of the common law in interstate commercial transactions was therefore sustained. The Court in its opinion in these cases refers approvingly to an opinion of Judge Shiras in the Iowa circuit,' where the subject had been exhaustively discussed in a suit for damages against a railroad carrier on account of alleged discrimination in interstate shipments prior to the enactment of the Inter- state Commerce Act. This case had been filed in the state court and removed to the United States circuit court, and it was held that the state court had jurisdiction of the subject- matter, and therefore the United States court had jurisdic- tion over the removed case, as congress had not declared any exclusive jurisdiction in such cases for the federal courts. • Swift V. Railroad Co., 58 Fed. navey v. Terminal Association, 81 Rep. 858; Sheldon v. Railroad Co., Fed. 802. 105 Fed. Rep. 785. See contra, « Western Union Tel. Co. v. Call Murry v. Railroad Co., 62 Fed. Pub. Co., 181 U. S. 92 (1901), 45 L. Rep. 24, 35 C. C. A. 62 (1899), 92 Ed. 765. Fed. Rep. 868; Adams, J., in Kin- ^ Murray v. Railroad Co., suprw 86 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 49 Under the law as declared in these cases, the principles of the common law were enforced as to matters of national con- trol as well as to matters of state control, and in this sense there is a common law of the United States controUing the relations of interstate carriers and the public, and the enact- ments of congress in the regulation of those relations are to be construed in the light of the principles of the common law. This applies to interstate commerce on land. Interstate commerce carried on by water, whether on the seas or on the inland navigable waters of the United States, is subject to the rules of the maritime law where applicable. § 49. Federal and state courts in the federal regula- tion of interstate commerce. — Under the constitution of the United States the judicial power of the United States is extended to cases arising under the constitution and laws of the United States, and this jurisdiction may be made exclu- sive in the federal courts by congress either by express enact- ment or by necessary implication therein.' It was at one time questioned whether the state courts could exercise con- current jurisdiction with the federal courts in cases arising under the constitution, laws and treaties of the United States; but it was said by the Supreme Court in the case cited that the laws of the United States were laws in the several states, and just as much binding therein on the citizens and courts thereof as were the laws of the states. Rights, whether legal or equitable, acquired under the laws of the United States may be prosecuted in the courts of the United States, or in the state courts competent to decide questions of hke character and class, subject however to the qualifica- tion that when a right arises under a law of the United States, congress may give to the courts of the United States exclu- sive jurisdiction. 2 Under the act of 1887,3 the circuit courts of the United States were given original cognizance, concurrent with the courts of the several states, of all suits of a civil nature in ' Claflin V. Houseman, 93 U. S. ^ See Act of March 3, 1887, and 130 (1876), 23 L. Ed. 833. August 13, 1888, 1 Compiled Stats. 2 See Mr. Hamilton in 82d Fed- 508. eralist. § 49] FEDERAL REGULATION OF INTERSTATE COMMERCE. 87 common law or equity, not only in cases of diverse citizen- ship, but also in cases arising under the constitution and laws of the United States, or treaties made, or which shall be made, under their authority. This is subject to the reservation of the exclusive jurisdiction of the United States courts under section 711, R. S. U. S.,^ in criminal, patent, admiralty cases, and suits for penalties and forfeitures under the laws of the United States. Not only such suits brought to enforce the provisions of specific acts of congress, but also all suits based upon and asserting federal rights in interstate commerce, are suits arising under the constitution and laws of the United States, and the circuit courts of the United States have juris- diction thereof irrespective of diverse citizenship. The Su- preme Court held in an application for habeas corpus by a party committed for contempt for violating an injunction granted to an interstate railroad to prevent interference with its interstate traffic, that the circuit court had jurisdiction irrespective of citizenship, and that a case arose under the constitution and laws of the United States, whenever the plaintiff sets up a right to which he is entitled under such laws and the correct decision of the case depends upon the construction of such laws.^ In suits brought for the enforcement of rights in interstate commerce and not for the specific enforcement of the provi- sions of the Interstate Commerce Act or the Anti-Trust Act, the state courts have concurrent jurisdiction with the federal courts, and such suits may be brought in the United States circuit courts irrespective of citizenship' if there is the juris- dictional amount in controversy $3,000.00. The fact that interstate commerce is beyond state legislative control does not ipso facto prevent the courts of the state from exercising jurisdiction over cases growing out of that commerce,' but the state jurisdiction is excluded, if congress has made exclusive the jurisdiction of the federal courts. Both in the Interstate Commerce Act and the Anti-Trust Act of 1890 there is an express vesting of jurisdiction in the » Compiled Statutes, p. 577. ' See section 8 of Interstate " In re Lennon, 166 U. S. 548, I. Commerce Act, infra. c. 553, 41 L. Ed. 1110. * Murray v. Chicago & N. W. R. Co., 62 Fed. Rep. 25, 1. c. 43. 88 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 50 United States courts of suits brought to enforce the provisions of the act. As to such suits brought to enforce the provisions of the Interstate CommerGe Act, it has been held, both in the federal and in the state courts, that the jurisdiction is exclu- sive in the United States courts.^ The same ruling would doubtless be made as to suits brought to enforce the Anti- Trust Act of 1890.2 A suit arises under the constitution and laws of the United States only when the plaintiff's statement of his own cause of action shows that it was based thereon. It is not enough that the defendant may find in the constitution or laws of the United States some grounds of defense. It is also settled that no cause can be removed from the state court to the circuit court of the United States unless it could have been originally brought in the latter court.' § 60. Federal causes of action in the state courts. — As the laws enacted by congress in its regulation of interstate commerce are the laws in the several states, rights created thereby may be enforced in the state courts in the absence of exclusive legislation vested in congress; and the judgments of the state courts in the enforcement of said rights are subject to review by the Supreme Court when a federal right, duly asserted, is denied through the appellate jurisdiction of the Supreme Court over the state courts under the Judiciary Act. ' See sections 8 and 9 of Inter- in interstate rates on the ground state Commerce Act, infra; Van that relief should have been sought Patten v. Railroad Co., 74 Fed. before the Interstate Commerce 981 (1896); Swift v. Railroad Co., Commission. See § 9. Interstate 58 I^ed. Rep. 858 (1894); Edmunds Commerce Act, infra. V. 111. Central R. R. Co., 80 Fed. ^ See sections 4 and 7 of the act Rep. 79 (1897); Sheldon v. Wabash of 1890, infra. Ry. Co., 105 Fed. Rep. 785; Ord- » In re Winn, 213 U. S. 458, 53 way V. Central Nat. Bank, 47 L. Ed. 873 (1909). As to appel- Md. 243; Copp v. Railway Co., 43 late jurisdiction, where the juris- La. Ann. 511, 12 L. R. A. 725, 52; diction of a circuit court attaches Gulf, C. & S. F. R. R. Co. V. Moore both on the ground of diverse cit- (Texas), 83 S. W. Rep. 362. In the izenship and also on the separate Abilene Cotton Oil Co. and Cisco federal ground, see Mississippi Oil Mill cases the Supreme Court Railroad Commission v. 111. Cent, reversed the judgments in the state R. R. Co., 203 U. S. 335, 51 L. Ed. courts for alleged excessive charges 209 (1906). § 50] FEDERAL REGULATION OF INTERSTATE COMMERCE. 89 Thus, the judgment of the Supreme Court of Pennsylvania, in non-suiting a plaintiff in an action for personal injuries, was reversed by the Supreme Court of the United States because, in holding plaintiff barred by contributory negli- gence, it had failed to give effect to the provision of the Federal Safety Apphance Act and the rule of non-assumption of risk therein declared. ' Under the amendment of the Interstate Commerce Act of 1910 the right to sue in the state courts is specifically given in actions of reparation^ and in the 1910 amendment of the Em- ployer's Liabihty Act suits in state courts under the act are not subject to removal to the federal court. The right of the state courts to exercise this jurisdiction may not carry with it in all cases the duty to exercise it. Thus, the procedure of the state court may not be suited to the enforcement of the right in the form congress directs; and the relation of master and employe as established and en- forced in the courts of the state under the laws of the state may be different from that enjoined by congress, and con- fusion and embarrassment may result from the enforcement of both in the same tribunals. In a recent case the supreme court of Connecticut declined to assume jurisdiction in a suit under the Employer's Liability Act of 1908 prior to its amendment of the act of 1910 supra, both on the ground that congress did not intend to confer such jurisdiction on the state court, and on the further ground that if it did so intend the state court, in the absence of state legislation, was not bound to assume it.' As to this latter ground, how- ever, whatever the embarrassment in exercising jurisdiction, owing to statutory forms of procedure, a state court in the enforcement of a right created by federal law is controlled by the provision of the constitution of the United States, that this constitution and the laws of the United States which should be made in pursuance thereof * * * shall ' Schlemmer v. R. R., 205 U. S. ' See Section 16 of Act, infra. 1; 51 L. Ed. 681 (1907), four ' Hoxsie v. N. Y. & N. H. H. R. judges dissenting, reversing 207 Co., 82 Conn. 352 (1909). See in- Pa. 198. See same case on sec- fra, § 624. ond writ of error 220 U. S. 590, 55 L. Ed. 596. (1911), affirming 222 Pa. 470. 90 FEDERAL REGULATION OP INTERSTATE COMMERCE. [§51 be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the constitutional laws of any state to the contrary notwithstanding: ' In invoking the federal jurisdiction for the assertion of a federal right by a private litigant, the amount of |3,000.00 must be involved in the controversy. § 61. Genesis of the Interstate Commerce Act. — The recognition of the governmental power in controUing interstate commerce immediately preceded the judicial decla- ration that interstate railway transportation was beyond state control. The question of interference with interstate commerce had been raised in the Granger cases, and the Supreme Court had held^ that the act regulating fares was valid in the absence of regulation by congress, and that until congress undertook to legislate for those who were without the state, the state could provide for those within, even though those without might be indirectly affected. The supreme court of Illinois' cited these cases in sustain- ing a state statute as to so much of interstate transportation as was within the limits of the state of Illinois. But the Su- preme Court in the same case {supra, § 39), said that in the Granger cases the importance of the question of the govern- mental power of regulation and of the company's contract right of exemption therefrom overshadowed all others, so that the question of freedom of interstate commerce received but little attention at the hands of the court. This decision of the Supreme Court reversing the supreme court of lUinois, was rendered in 1886, in the same year that the freedom of interstate commerce from the state taxing power was declared in the Tennessee drummer case, and broadly affirmed that the statute of a state enacted to regulate and tax, or to impose any other restriction upon the transmission of persons or property or telegraph messages from one state to another was not within the class of legislation which the state, in the absence of legislation by congress, could enact, and that the state statute was void as to all interstate shipments, including • Constitution, Art. VI., par. 2. ' Wabash, St. L. & P. R. Co. v. ' Peik V. Chicago, etc., R. Co., 94 Illinois, 104 111. 476. U. S. 1. c. 177 (1876), 24 L. Ed. 98. §51] FEDERAL REGULATION OF INTERSTATE COMMERCE. 9 1 that part of the transmission of such shipments which was within the state. The decision in this case demonstrated the lack of power in the states to regulate interstate shipments,' and the demand for the exercise of this power by congress becoming irresisti- ble, the interstate commerce bill which had been pending for several years in congress became a law February 4, 1887.^ The discussion in the two houses of congress and in the pubhc press was mainly directed to the long and short haul clause contained in the fourth section, and the prohibition of poohng contained in the fifth section of the act. Differences of opinion developed between the house and the senate, the former insisting on the prohibition of poohng and on a qualified long and short haul clause. The bill was finally en- acted in the form reported by the conference committee of the two houses of congress. Frequent references were made in the debates to the then recent decision of the Supreme Court in the Wabash case denying to the states any power in the regulation of interstate traffic. A very wide difference of opinion was developed in the discussion as to the proper construction of the act, particularly as to what were the "substantially similar circumstances and conditions" in the fourth section, and one of the members of the house in the final debate described the bill as "one which nobody under- stands, nobody wants, and everybody is going to vote for."^ ' This case was decided October (Senate Report No. 307, 43rd Con- 25, 1886. gress, 1st Session). Cullom Re- 2 The interstate commerce com- port (Senate Report No. 46, 49th mission was established March 22, Congress, 1st Session). Hepburn 1887, but the terms of the commis- Report, New York legislature of sioners were computed from Jan- 1879. uary 1st. See 19 Opinion of Attor- In the Import Rate Case, 162 U. ney Generals, p. 47, 1887. S. 211, 40 L. Ed. 944, the Supreme ' For a comprehensive and ac- Court in referring to the causes for curate statement of the condition the enactment said: of the state regulation of railroads "They chiefly grew out of the at and prior to the adoption of the use of railroads as the principal interstate commerce act, see Had- modern instrumentalities of com- ley's "Railroad Transportation, its merce. While shippers of merchan- History and its Laws," first pub- dise were under no legal necessity lished in 1885. See also report of to use railroads, practically they Windom to U. S. Senate, 1874, were. . . . From the very na- 92 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§52 § 52. The successive amendments of the Interstate Commerce Act. — The act to regulate commerce was so clearly within the power of congress that no serious question was raised as to its constitutionahty. Very grave questions however were made as to what powers were conferred upon the commission by the terms of the act and as to the con- struction of the different sections of the act in relation there- to, and the discussion and determination of these questions led to continuous agitation for amendments to the act. Thus, it will be seen under the different sections of the act {infra, part II), the powers of the commission were construed by the Supreme Court to be materially different from the powers claimed and exercised by the commission during the first years of its existence. Thus it was held that the commission under the act as orig- inally framed had no power to make maximum and minimum rates for the future, ' and that the competition between the ture of the case, therefore, rail- roads were monopolies, and the evils that usually accompany mo- nopolies soon began to show them- selves, and were the cause of loud complaints. The companies own- ing the railroads were charged, and sometimes truthfully, with making unjust discriminations be- tween shippers and localities, with making secret agreements with some to the detriment of other patrons, and with making pools or combinations with each other, leading to oppression of entire communities. ... As the pow- ers of states were restricted to their own territories and did not enable them efficiently to control the management of great corpora- tions, whose roads extend through- out the entire country, there was a general demand that congress, in the exercise of its plenary power over the subject of foreign and in- terstate commerce, should deal with the evils complained of by a general enactment, and the stat- ute in question was the result." ' Social Circle Case, 162 U. S. 184, 40 L. Ed. 935 (1895). In this case the Court quoted from the opinion of Justice Jackson in the circuit court (43 Fed. 47) as to the scope of the act as follows: "Subject to the two leading pro- hibitions that their charges shall not be unjust or unreasonable, and that they shall not unjustly dis- criminate, so as to give undue preference or disadvantage to per- sons or trafTic similarly circum- stanced, the act to regulate com- merce leaves common carriers as they were at the common law, free to make special contracts looking to the increase of their business, to classify their tralTic, to adjust and apportion their rates so as to meet the necessities of commerce, and generally to manage their impor- tant interests upon the same prin- ciples which are regarded as sound, and adopted in other trades and § 52] FEDERAL REGULATION OF INTERSTATE COMMERCE. 93 carriers created substantially different circumstances and conditions within the meaning of section 4, known as the long and short haul clause. ^ Amendatory acts have been passed by congress in 1889, 1893, 1903, 1906, 1908 and 1910.2 xhat of 1889 gave the shipper an additional summary and effective remedy by writ of mandamus to compel the carrier to furnish equal facihties (infra, § 516);' that of 1893 remedied the defect growing out of the difficulty to enforce self-incriminating testimony (infra, § 420); the act of 1903, known as the Elkins Law, made very important changes, materially enforced the provisions against discriminations, in that it made the pubhc rates conclusive against the carrier, every deviation therefrom being punish- able. The scope of the act was also materially extended as to the parties subject to its provisions. Fine was substituted for imprisonment in the penal provisions of the act (infra, § 519). In 1903 was also enacted the so-called Expedition Act (infra, § 610) which materially expedited the procedure in suits brought by the United States or suits prosecuted by the attorney-general in the name of the Interstate Commerce Commission. The most important amendments were. those of 1906 and 1910. The act of 1906, known as the Hepburn Act,* not only pursuits." Cincinnati Freight Townsend Bill, had been passed in Bureau case, 167 U. S. 479, 42 L. the House of Representatives in Ed. 243 (1896). the Fifty-eighth Congress, but did ' Import Rate case, 162 U. S. not come to a vote in the senate, 197, 40 L. Ed. 940 (1895). Very exhaustive hearings were 2 The Interstate Commerce Act had by the Interstate Commerce was also amended by the Panama Committees in both the house and Canal Act of 1912, see infra sees, senate, containing the testimony of act 5 and 6. Also of the Cum- of railroad officials, shippers, econo- mings Act of 1915, infra § 501. mists, and members of the Inler- ' See B. & O. R. R. v. U. S. ex state Commerce Commission, rep- rel., 215 U. S. 481, 54 L. Ed. 292 resenting all shades of opinion. (1910). The discussions in congress, espe- * The Hepburn or Rate Bill of cially in the senate, related mainly 1906 became a law on June 29, to the increased powers given 1906, and, under joint resolution, to the commission and the judicial took effect sixty days after its ap- review provided in the act. proval, that is, on August 28, 1906. In the course of the senate hear- A bill embodying many of the ing, Attorney-General Moody, at same features, known as the Esch- the request of the committee, ren- 94 FEDERAL EKGULATION OF INTERSTATE COMMERCE. [§52 broadened the scope of the act by the inclusion of pipe Unes, express companies and sleeping car companies and all the in- strumentalities and facilities of shipment or carriage, with the prohibition of free passes and the so-called commodity clause, seeking to prohibit the carrier from transporting its own commodities, compelling switch connections, restoring the punishment of imprisonment, authorizing the commission to establish through routes, imposing liability upon the initial carrier for damage on a through shipment and, most important of all, authorizing the commission in determining that any rate was unreasonable to also determine and prescribe the just and reasonable rate or rates to be thereafter charged as the maximum to be charged, and what regulation in respect to the transportation is just, fair and reasonable to be thereafter followed, the limit of two years being fixed for the time wherein any order should be in force. Another important amendment in this act of 1906, was a very substantial enlargement of the powers of the commission dered an opinion May 5, 1905 (Vol. II of Senate Reports, p. 1674), embodying the following conclu- sions: "1. There is a governmental power to fix the maximum future charges of carriers by railroad, vested in the legislatures of the states with regard to transporta- tion exclusively within the states, and vested in congress with re- gard to all other transportation. "2. Although legislative power, properly speaking, cannot be dele- gated, the law-making body, hav- ing enacted into law the standard of charges which shall control, may intrust to an administrative body not exercising in the true sense judicial power, the duty to fix rates in conformity with that standard. "3. The rate-making power is not a judicial function and cannot be conferred constitutionally upon the courts of the United States, either by way of original or appel- late jurisdiction. "4. The courts, however, have the power to investigate any rate or rates fixed by legislative author- ity and to determine whether they are such as would be confiscatory of the property of the carrier, and if they are judicially found to be confiscatory in their effect, to re- strain their enforcement. "5. Any law which attempts to deprive the courts of this power is unconstitutional." He also advised that reasonable rates determined by the legislative authority would not constitute a preference between the ports of different states within the pro- hibition of article I, section 9, paragraph 6, of the Constitution, even though they resulted in a varying charge per ton per mile to and from the ports of the different states. § 52] FEDERAL REGULATION OF INTERSTATE COMMERCE. 95 in the requirement of annual reports from the carriers show- ing the details of their financial operations, authorizing the commission in its discretion to describe the forms of the ac- counts and records to be kept by the carrier, making it un- lawful for them to keep any other accounts than those prescribed by the commission, and further authorizing the commission to employ special agents or commissioners for the inspection of any and all accounts carried.' The commission in its report in 1907 said of the amendment of 1906 "substantive provisions of the original act prohibiting the exaction of unreasonable charges and prohibiting dis- crimination between persons and places were unchanged by the legislation of 1906. The main purpose of that legislation was to provide more adequate means for the enforcement of rights and duties declared to exist." The act of June 18, 1910 (36 Stats. L. 539), commonly known as the Mann-Elkins Law, in the language of the com- mission (24th Annual Report, 1910) "enlarged the substan- tive provisions of the act to regulate commerce, corrected numerous defects, which experience had disclosed, conferred upon the public new rights and remedies and correspondingly increased the jurisdiction and authority of the commission." The most important feature of the act of 1910 was the au- thorization of the commission to investigate any new schedule of rates or single rate proposed by a carrier and pending such investigation, to suspend the taking effect of such schedule or rate, for a period not exceeding one hundred and twenty days. ' For the action of the commis- to permit conferences and agree- sion in the enforcement of this ments of carriers as to rates under provision with the co-operation of the regulating supervision of the the state commission, see infra. Interstate Commerce Commission. § 499. It was recommended by This was advocated on the ground Presidents Roosevelt and Taft in that unregulated competition re- their messages to congress and garding rate wars was detrimental strongly urged in the discussions of to the public as well as to the rail- the amendments of 1906 and 1910, roads and that the public good re- that the prohibition of pooling in quired not only reasonableness but section 5 of the Interstate Com- stability in railroad rates. This merce Act should be modified and view has not as yet prevailed in railroads exempted from the re- legislation, straints of the Anti-trust Act, so as 96 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 53 § 63. The enlarged powers and jurisdiction of the Interstate Commerce Commission. — ^While the substan- tive provisions of the act to regulate commerce, that is, the requirement that charges should be reasonable and the pro- hibition of unjust discriminations or undue preferences or disadvantages to persons or traffic similarly circumstanced have remained unchanged since the first enactment, very great changes have been made by these successive amend- ments as to the scope of the act, the parties subject thereto and in what may be termed its "adjective" provisions, making effective these fundamental requirements and pro- visions of the act, and these successive amendments have added very materially to the powers and responsibility of the Interstate Commerce Commission. ^ Not only have the powers of the commission been directly enlarged in their inquisitorial authority in the requirement of reports from the railroads, in the employment of examiners in making investigations, and in compelling the attendance of witnesses in the production of testimony, as will be seen from the detailed construction of these statutory provisions, but there is also through the judicial construction of the statute, by the recent decisions of the Supreme Court, a very great in- crease of the jurisdiction and responsibility of the commis- sion. Thus, the privilege to a party claiming to be damaged, given by section 9 of the act, either to make complaint to the commission or to bring suit for the recovery of the damages in a district or circuit court, has been construed so that this right of election does not exist in any case where the wrong involves violation of the act, which is subject to the jurisdic- tion of the commission, and any such case must therefore be determined by the commission before any action can be brought in court.^ The same principle has been appHed by the Supreme Court to the specific remedy of mandamus authorized by section 23 of the act for the enforcement of duties of the carrier; and the 'The membership of the com- with terms of seven years and mission has been increased from salaries of $10,000. Infra, § 489. five members in the original act ^T. & P. R. R. Co. v. Abilene with terms of six years and salaries Cotton Oil Co., 204 U. S. 426, 51 L. of $7,500 to seven commissioners Ed. 553 (1907). [§53 FEDERAL REGULATION OF INTERSTATE COMMERCE. 97 right to this remedy is construed with the other provisions of the act and practically with the enlarged powers of the com- mission under the amendment of 1906, so as to be very materially abridged.' The comprehensive power of the commission to investigate and determine the reasonableness of rates, extends to cases where the existing rates are dependent upon certain basing points estabhshed by the railroads, and so-called zones of traffic are dependent thereon ; and the commission may deter- mine that the rates are unreasonable, although the reduction may involve a change in such basing points. Thus, a reduc- tion in that part of the through rates on Atlantic seaboard shipments to Missouri river cities which applied to the haul between the Mississippi and Missouri rivers, was held not beyond the power of the commission where the commission by its order, intended only to correct through rates; which it had found upon complaint were unreasonable in themselves, by substituting therefor reasonable rates, and that the find- ings of the commission that certain through rates were un- reasonable in themselves carried with them a presumption of correctness in so ruling.^ But while the Court in determining whether an administrative order of the commission should be suspended or set aside will consider whether the order was within the commission's lawful jurisdiction, and not whether IB. & 0. R. R. Co. V. U. S. ex. proceedings on a bill seeking re- rel., 215 U. S. 481, 54 L. Ed. 292 lief from an advance in freight (1910). It was said in this case rates pending action by the com- that the decision in Southern R. R. mission could grant relief under Co. V. Tift, 206 U. S. 428, 51 L. Ed. section 16 of the Interstate Com- 1124, (1907), did not qualify the merce Act after the commission ruling in the Abilene Oil case and had acted, where defendants had did not support the right to resort stipulated in open court that in to the courts in advance of action case complainants prevailed de- by the commission for relief against cree of restitution might be made, unreasonable rates or unjust dis- See infra, Part II, sec. 9 and sec. criminatory practices which from 23 of Interstate Commerce Act. their nature primarily require ''Interstate Commerce Commis- action by the commission. In sion v. Chicago, R. I. & P. R. Co., the Tift case the Court, affirm- 218 U. S. 88, 54 L. Ed. 946 (1910), ing 138 Fed. 753, held that a cir- reversing 171 Fed. 680. cuit court which had suspended 98 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§53 the administrative power has been wisely exercised, ^ on the other hand, where the power of the commission is expressly conditioned by the act as in establishing a through route and joint rates when no reasonable or satisfactory through route exists, the courts will review the determination of the com- mission; and it was held that the personal preferences of many travelers for another through route to the Pacific, did not justify the Interstate Commerce Commission in establish- ing a through route and joint rates to the Pacific where one through route existed available for the public.^ While the commission has authority to condemn unjust and unreasonable rates and fix reasonable rates, it has no right to make a change in the rates for the purpose of prot-ect- ' Interstate Commerce Commis- sion V. Illinois Central R. R. Co., 215 U. S. 452, 54 L. Ed. 281 (1910), reversing 173 Fed. 930. where the Court said: "Beyond controversy, in determining whether an order of the commis- sion shall be suspended or set aside, we must consider (a) all relevant questions of constitu- tional power or right; (b) all per- tinent questions as to whether the administrative order is within the scope of the delegated authority under which it purports to have been made; and (c) a proposition which we state independently, al- though in its essence it may be contained in the previous one, viz., whether, even although the order be in form within the delegated power, nevertheless it must be treated as not embraced therein, because the exertion of authority which is questioned has been mani- fested in such an unreasonable manner as to cause it, in truth, to be within the elementary rule that the substance, and not the shadow, determines the validity of the exer- cise of the power. Postal Teleg. Cable Co. v. Adams, 155 U. S. 688, 698, 39 L. Ed. 311 (1901), 316, 5 Inter. Com. Rep. 1, 15 Sup. Ct. Rep. 268, 360. Plain as it is that the powers just stated are of the essence of judicial authority, and which, therefore, may not be cur- tailed, and whose discharge may not be by us in a proper case avoided, it is equally plain that such peren- nial powers lend no support what- ever to the proposition that we may, under the guise of exerting judicial power, usurp merely ad- ministrative functions by setting aside a lawful administrative order upon our conception as to whethei the administrative power has been wisely exercised. "Power to make the order, and not the mere expediency or wis- dom of having made it, is the question." ^ Interstate Commerce Commis- sion V. Northern Pacific R. R., 216 U. S. 538, 54 L. Ed. 608 (1910), affirming the circuit court in re- straining the enforcement of the order of the Interstate Commerce Commission, 16 Inters. Com. Rep. For amendment of statute, follow- ing this decision, see Part II, sec- tion 15. [§53' FEDERAL REGULATION OF INTERSTATE COMMERCE. 99 ing certain interests or encouraging certain industries where the rates were reasonable in themselves. The court, there- fore, will review the orders of the commission not only on the constitutional ground that changes may be confiscatory, but on the further ground that the commission is not acting within its lawful jurisdiction. 1 With its power thus enlarged by statute as well as by judi- cial construction the Interstate Commerce Commission is a unique illustration of an administrative board invested with the different powers of government.^ As an administrative body it enforces the executive power of investigation and prosecution. As a Q'uasj-judicial body it exercises the judicial function of determining the reasonableness of existing rates and of suspending proposed increases of rate pending in- vestigation, and also of declaring the existence of undue dis- crimination or preference, entitling the complainant to reparation ; and its findings in awards of damages for repara- tion are given prima facie weight in any judicial proceeding to enforce the same. It also exercises what has been repeatedly adjudged to be essentially a legislative power in fixing a maximum of rates for the future.' This department of administration is in effect a distinct de- partment of government recognized as developed ev necessi- ' Southern P. Co. v. Interstate the courts regard the conclusions Commerce Com., 219 U. S. 433, 55 of the commission on question of L. Ed. 283 (1911), reversing 177 fact as final. There is an appeal Fed. 963. upon questions of law by the car- ^ From Opinion of Commission riers to the courts, but unless a in the "Investigation of advances constitutional guaranty is violated in Rates by Western Trunk Lines, the order of this commissioft is 20 I. C. C, R. 9 (1911). final, provided, of course, the com- "By its decisions in the Abelinc mission does not overstep the ju- Cotton Oil case, the Illinois Cen- risdictional limits placed upon it tral case, the Supreme Court has by the statutes. And as to the erected this commission into what shipper this tribunal is his one and has been termed 'an economic only resort against injustice." See court,' or to give it a more com- also part II, sec. 1& of Interstate monplace definition, but one of Commerce Act, infra. perhaps of stricter legal analogy, ^ See Maximum Rate Cases, 167 a select jui-y to pass upon the U. S. 505, 42 L. Ed. 255 (1901). reasonableness and justness of Also the Virginia Rate Cases, 211 railroad rates, rules and practices. U. S. 210, 53 L. Ed. 150 (1908). Within broad lines of discretion 100 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§54 tafe from the complexity of the functions of modern govern- ment in regulating the details of commercial intercourse. We are thus compelled to revise our time honored conception of the distribution of the powers of government, as we have not only executive, legislative, and judicial departments, but also the department of administration, distinct from, and yet to a degree exercising the functions, which have been deemed appropriate to each of the others. ' § 54. The Short Life of the Commerce Court. — The amendatory act of 1910 established a Commerce Court, com- posed of five Circuit judges, with exclusive jurisdiction over the enforcement of orders of the Interstate Commerce Com- mission, other than for the payment of money, subject to appeal to the Supreme Court. It was at first proposed that the jurisdiction of this Commerce Court should include the judicial or quasi-judicial jurisdiction, now exercised by the Interstate Commerce Commission, thus reheving that body of the anomaly of being an investigator, prosecutor, and judge. This plan was not adopted, however, and the juris- diction of the Commerce Court was taken from the Circuit (now District) Courts. The Court was organized, but had a brief existence, as it was abolished by Act of Congress from and after December 31, 1913, the judges being retained as Circuit judges, and the jurisdiction of the Court being vested in the District Courts.^ 1 There is a blending of the ju- Heat Co. v. Ott (Dist. of W. (lical legislative and administra- Va.) 215 Fed. 940 (1914). tive" powers in the powers of ' Act of October, 1913. See railroad commissions in several appendix for full text of act. of the states. The constitutional- The opinions of the Commerce ity of such acts has been sustained Court are reported in the Federal both in the state and federal Reporter. courts. See Express Co. v. Rail- In L. & N. R. Co. v. U. S., road Co., Ill N. C. 463; Burling- it was held by the District Court ton, etc. R. Co. v. Dey, 82 Iowa, of Tennessee, three judges sitting, 312; Chicago, etc. R. Co. v. Jones, 227 Fed. 273, that the inherent 149 111. 361; Georgia, etc. R. Co. V. power of a court of equity to Smith, 70 Ga. 694. See also the maintain the status quo pending Railroad Commission Cases, 116 an appeal, was not impaired or les- U. S. 307, 29 L. Ed. 636, and infra, sened by any of the several pro- § 119. Manufacturers' Light & visions of the Interstate Commerce ' .V 6 V 11 ) § 55] FEDERAL REGULATION OF INTERSTATE CQJ^mC^^J^ 101 § 65. Regulation of bridges and ferries over navig- able rivers. — The broadened conception of the federal power over interstate commerce in this direct regulation of such commerce is illustrated in the ruHngs of the Supreme Court with reference to the building of bridges and estabhshment of ferries over navigable rivers, as also in the exercise of the legislative power in authorizing improvements, alterations and obstructions in public navigable waters. The power of the state to estabhsh bridges over navigable and tide waters was admitted, subject however to the paramount authority of congress to declare a bridge an obstruction to navigation, the paramount authority of regulating bridges that affect the navigation of the navigable waters of the United States being admittedly in congress. ^ Thus in the case cited the Wheeling bridge constructed across the Ohio river under an act of Virginia had by decree of the Supreme Court at the suit of the state of Pennsylvania been declared in its then condition an unlawful obstruction of the navigation of the river and in con- flict with the acts of congress regulating such navigation, and therefore ordered to be elevated or abated. Congress there- upon passed an act declaring the bridge to be a lawful struc- ture in its then condition and elevation, and this act was sus- tained as giving full authority to maintain the bridge. The practice thereupon grew up of building bridges by state cor- porations — where the rivers constituted the boundary of states, securing the concurrent action of both states, — and at Act, the Act creating the Com- Kansas 272, the Court held that merce Court, or the Act abolishing the police power of a state cannot the Commerce Court and trans- justify a direct interference with f erring its jurisdiction to the interstate commerce, and the re- District Courts of the United moval of the existing railroad States, and that this power could bridges over a navigable stream, be exercised by the Judges of the which joined necessary parts of District Court exercising this juris- lines of interstate commerce, can- diclion that was taken from the not be ordered by a state court Commerce Court. even in the avowed expectation 1 Pennsylvania v. Wheeling, etc. that such order will lead to the Bridge Co., 18 How. 421 (1855), 15 desired elevation of the bridges, L. Ed. 435. In Kansas City which the state court could not Southern R. Co. v. Kaws Valley order directly without the authority Drainage Co. 233 U. S. 75, 58 of the secretary of War. L. Ed. 857. (1913) reversing 87 102 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§ 55 the same time obtaining an act of congress that the bridge, when constructed according to its provisions, should be a law- ful structure and not an obstruction to navigation. In 1894 however it was held^ that congress had full author- ity to incorporate a bridge company for the construction of a bridge across a navigable river, and sustained the validity of the North River Bridge Company for the construction of a bridge across the Hudson river between the states of New York and New Jersey. The Court said that it was not neces- sary for congress to recognize and approve bridges erected by authority of two states across navigable waters between them, but could, at its discretion, use its sovereign power, directly, or through a corporation created for that object, to construct bridges for the accommodation of interstate traffic by land,^ as it undoubtedly may do to improve the navigation of rivers for the convenience of such traffic by water. In the case of this North River Bridge Company the act made pro- vision for the condemnation of lands, for the construction and maintenance of the bridge and its approaches, and for just compensation to the owners. In the case of ferries there is no necessity of securing the sanction of Congress as there is no such obstruction to navi- gation.* Ferries as well as bridges are instrumentalities of Interstate Commerce when they cross rivers which are boundaries of states, but ferries have always been regarded as instruments of local convenience, which for the proper protection of the public are subject to local regulation, and where the ferry is conducted over a boundary stream each jurisdiction with respect to the ferriage from its shore has exercised its protective power. The Supreme Court has therefore ruled that in the absence of regulation by Congress a state may fix reasonable rates of ferriage from its shore to the shore of another state over a boundary stream, and the fact that ferry rates over the boundry stream were fixed 1 Luxton V. North River Bridge Co., 127 U. S. 1 (1888), 32 L. Ed. Co., 153 U. S. 525 (1894), 38 L. Ed. 150. 808. ' Covington & Cincinnati Bridge 2 Willamette Bridge Co. v. Co. v. Kentucky, 154 U. S. 204 Hatch, 125 U. S. 1 (1888), 31 L. (1899), 38 L. Ed. 962. Ed. 629; Cahfornia v. Pacific Ry. §55] FEDEEAL REGULATION OF INTERSTATE COMMERCE. 103 by the state or incorporation did not preclude the state on the other side of such stream from establishing, subject to the paramount authority of Congress, the rates to be charged for ferriage from its own shore to the shore of the other state. * 'The transportation of person and property, however, from one state to another is none the less interstate commerce because conducted by ferry, and it therefore follows that no state can impose a direct burden upon interstate commerce as conducted by ferries. Thus in the Gloucester Ferry case,^ the Supreme Court held void a tax levied upon the receiving and landing of passengers and freight at the wharf in Phila- delphia, and which the Court found was a tax upon the trans- portation. It was also held that an unconstitutional burden was imposed on Interstate Commerce by an lUinois statute penalizing the carrying on of a ferry without a license, when applied to the transportation of loaded or unloaded railroad cars across the Mississippi River from the Illinois to the Missouri side. The Court said there was an essential dis- tinction between a ferry in the restricted and legal sense of the term, and the transportation, of railroad cars across a boundary river between two states, constituting interstate commerce, and that such transportation could not be sub- jected to burdens imposed by a state-, which were direct burdens upon Interstate Commerce.^ Neither can a state or a municipality acting under its authority require a Canadian corporation, operating a ferry over the boundary stream lying between said state and Canada, to take out a license and pay a license fee as a con- dition to receiving and landing persons and property at its wharf in such municipality.'' 1 P. R. & B. F. R. Co. V. Board * SaulfSt. Marie v. International of Freeholders, 234 U. S. 317, 58 Transit Co. 234 U. S. 333, 58 L. L. Ed. 1330, (1914) affirming 82 Ed. 1337, (1914) affirming 194 N. J. L. 536. Fed. 552. * Gloucester Ferry Co. v. Penn- As to the police power of the sylvania, 114 U. S. 196, 29 L. Ed. state in granting ferry franchises, 158, (1885). see Fanning v. Gregoire, 16 How. » St. Clair County v. Interstate 524, 14 L. Ed. 1043. (1853). Transfer Co. 192 U. S. 454, 48 Conway v. Taylor, Executor, 1 L. Ed. 518. Black 603, 17 L. Ed. 191. (1861). 104 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§56 § 56. No rate regulation of water transportation. — Although the Federal power over water transportation, not only on the high seas, but in all the navigable waters of the United States, is reinforced by the admiralty jurisdiction under the Constitution, and Congress has frequently legis- lated in regard to transportation by water in the navigation acts, it is also true that the actual regulation of rates under the Interstate Commerce Act only extends to water trans- portation when connected with railroad transportation. Carriers of interstate commerce by water are subject to the act to regulate commerce only in respect to traffic trans- ported under a common control or management or arrange- ment with a rail carrier for a continuous carriage or ship- ment; and in respect to traffic not so transported they are exempted from its provisions. Congress therefore has not exercised its power to regulate interstate or foreign commerce by any regulation of rates of water carriers either among the states or in foreign commerce. In its anti-trust legislation, however. Congress has pro- hibited combinations in restraint of trade in water trans- portation both on high seas and in the inland waters of thp United States in interstate and foreign commerce. The absence of federal regulation of rates for water trans- portation unconnected with transportation by railroad, leaves a state free to prescribe reasonable rates for the transportation of passengers and goods wholly by water between two ports in the same state, over a course which traverses the high seas.^ The Supreme Court said in the case cited that this came within the rule apphed in the case of pilots and ferries, where the state, in the absence of regulation by Congress, could make a reasonable exercise of State power to meet the needs of suitable local protection. The Court limited its decision to the case of transportation between two points in the same state. 1 See Wilmington Transportation Co. v. R. R. Commissioners, 18 Co. V. R. R. Commission, 236 U. S. Fed. 10 (1883) where a different 151 59 L. Ed. 508 (1915), affirming conclusion was reached by Justices 166 Cal. 741. The Court in this Field & Sawyer, case disapproved Pacific Coast S. S. §57] FEDERAL REGULATION OF INTERSTATE COMMERCE. 105 § 67. Regulation of telegraph and telephone com- panies. — The amendment to the Interstate Commerce Act of 1910, extended for the first time the regulation of the act to interstate telegraph and telephone companies. Prior to this it had been recognized in a number of cases that the inter- state business of such companies was interstate commerce; and before their inclusion under the Interstate Commerce Act their business was controlled by the rules of common law which are operative upon all interstate commercial trans- actions, except as they were modified by congressional enactment. Congress has legislated from time to time in relation to tele- graph lines in interstate commerce, but more particularly with reference to the grant of telegraph privileges to the gov- ernment aided railroads. Thus, in 1862, congress included • the right to construct, maintain and operate telegraph lines in its grant of the charters to build Pacific railroads. Subsequently, in 1866,^ congress granted to any telegraph company organized under the laws of any state the right to construct, maintain and operate lines of telegraph through and over any portion of the public domain of the United States, over and along any of the military or post roads of the United States which have been or may hereafter be declared such by law, and over, along and across any of the navigable waters of the United States. ^ 1 3 Compiled Statutes, p. 3579, lected. It was held in New title 65. England Telegraph Co. vs. Tonw ^ The act also provided for the of Essex, District Court of Massa- use of materials from the public chusetts, 206 Fed. 926, (1913) lands, reserved to the government that a city or town within the priority over other business and State could not include a telegraph further provided for the purchase company, though organized under by the United States for postal, the laws of the State, which is military or other purposes, all the engaged in transmitting interstate property and effects of companies and government messages and has acting under the act at an ap- accepted the terms imposed by the praised value to be ascertained by national government, since because five competent, disinterested per- of this power to regulate interstate sons, two of whom were to be se- and foreign commerce and the lected by the postmaster general, operation of the national postal two by the company interested and service, the legislation of Congress one by the four previously se- is supreme. 106 FEDERAL EEGULATION OF INTERSTATE COMMERCE. [§57 This act of 1866 was construed by the Supreme Court* as, in effect, amounting to a prohibition of all state monopolies in the telegraph business between the states. The Court said that it was a legitimate regulation of commercial intercourse, between the states and was proper legislation to carry into execution the powers of congress over the postal service. The statute extended not only to such military and post roads as were upon the public domain, but to all the post roads and navigable waters of the United States. The state law of Florida conferring exclusive privileges upon a state telegraph company was declared to be in conflict with the legislation of congress. This act of 1866 was permissive only. The privilege con- ferred carried with it no exemption from the ordinary burdens of taxation in a state where the companies owned or operated lines of telegraph, ^ nor did it carry with it any unrestricted right to appropriate public property of a state or city, but it was like any other franchise, to be exercised in subordination to pubhc as well as private rights.' The act of 1866 does not grant to telegraph companies ac- cepting its provisions the power of eminent domain over the private property of railroad companies. A railroad right of way is not public property though often called a highway and subject to a certain extent to state and federal control. A telegraph company cannot, therefore, under the act of 1866, occupy a railroad right of way except by the consent of the railroad or under the power of eminent domain; and in the absence of federal or state provision for the exercise of such right of eminent domain, the railroad right of way can be occupied with telegraph poles only with the consent of the railroad company.* The Interstate Commerce Commission is vested with juris- diction over the government-aided telegraph lines con- 1 Pensacola Telegraph Co. v. Tel. Co., 148 U. S. 92 (1893), 37 L. Western Union Telegraph Co., 96 Ed. 380; Western Union Tel. Co. v. U. S. 1 (1877), 24 L. Ed. 708. 711. Ann Arbor R. R. Co., 178 U. S. 239, 2 Western Union Tel. Co. v. 44 L. Ed. 1052 (1900). Massachusetts, 125 U. S. 530 * Western Union Tel.. Co. v. (1888), 31 L. Ed. 790. Pennsylvania R. Co., 195 U. S. ' St. Louis V. Western Union 540, 594, 49 L. Ed. 312, 332 (1905). §57] FEDERAL REGULATION OP INTERSTATE COMMERCE. 107 structed under the Pacific Railroad Act by the act of 1888,* whereunder the commission is required to ascertain the facts and determine and order what arrangement should be made for the interchange of business required by the act, and it was made the duty of the railroad and telegraph companies to file with the Interstate Commerce Commission all contracts re- lating to the control and use of their telegraph lines and to file annual reports with the commission as to their condition and business. The Supreme Court, construing^this act, held that it was a lawful exercise of the powers of congress and that a contract between the Union Pacific Railway and the Western Union Telegraph Company, giving the latter company con- trol of all telegraph business on its roads, was void. The act in this case required that the railroads should exercise by themselves alone all the telegraph franchises conferred upon them, and to allow equal facihties to connecting lines on terms just and equitable; the right of connection with equal facilities being given to any railroad which had accepted the provisions of the act of 1866.^ The provisions of the Telegraph Act of July 24, 1866, did not apply to interstate telephone companies whose business is that of transmitting articulate speech between different points,' as it was held by the Supreme Court that in 1866 noth- ing was known of the telephone; and when therefore the act 'Act of Aug. 7, 1888, 25 Stat, line, free of charge. This decree* L. 382. was reversed by the Circuit Court ^ In U. S. V. Northern Pacific of Appeals for the 8th Circuit with R. R., 120 Fed. 546 (1903), the Cir- directions to dismiss the com- cuit Court held that a contract of plainant's bill without prejudice, as the Northern Pacific Railroad Co. it was held that the plea of the with the Western Union Telegraph Western Union Telegraph Co. to Company was not violative of the the jurisdiction should have been Act, and was distinguished from sustained, and the court was there- the Union Pacific case as it provided fore without jurisdiction. 134 Fed. for the exclusive use of one of the 715 (1905). two wires by the railroad com- ' Richmond v. Southern Bell pany for which the railroad com- Telegraph & Telephone Co., 174 U. pany agreed to pay one-third the S. 761, 43 L. Ed. 1162 (1899), re- actual cost of construction and to versing the circuit court, 78 Fed. transport the property and em- 858 (1897), and the circuit court of ployes of the telegraph company in appeals, 85 Fed. 19, (1900) and constructing and maintaining the 28 C. C. A. 659. 108 FEDERAL REGULATION OP INTERSTATE COMMERCE. [§58 of 1866 spoke of telegraph companies, it only meant such companies as employed the means thus used or embraced by then existing inventions for transmitting by sounds or by signs in writing. § 58. The release of the federal regulating power. — Interstate commerce may be regulated not only by the action of congress, but also by its inaction, as where the subjects re- quire uniform regulation, the inaction is equivalent to a declaration that the commerce must be free. There is also a form of regulation, already referred to, where congress divests particular subjects of their commercial character, thus sub- jecting them, when delivered to their consignees in the original packages, to the police power of the state. It was contended in the Rahrer Case^ that the Wilson Act of 1890 was void, as the power of regulation vested in congress could not be delegated to the states. The Court held that this was not a delegation of the federal power, but was merely a designation that certain subjects of interstate commerce should be governed by a rule which divested them of that character at an earlier period of time than would otherwise be the case. Congress, said the Court, did not use terms of permission to the states to act, but simply removed an im- pediment to the enforcement of the state laws created by an absence of specific utterance on its part in respect to im- .ported packages in their original condition. It imparted no power to the state not then possessed, but allowed imported property to-fall at once upon arrival within the local juris- diction. In the later Iowa case,'' in 1898, the Court, in holding that the term "arrival" meant delivery to the consignee, said that the act of 1890 was not to be construed as authorizing states or state laws to forbid the bringing into the state at all. In other words, the power of the state did not attach to the acts until the termination of the interstate commerce ship- ment, and that did not occur until the actual dehvery of the shipment to the consignee. The Court said this construction of the act of 1890 rendered it unnecessary to consider whether, if the act of congress had submitted the right to 1 Supra, § 18. 2 Rhodes v. Iowa, supra, p. §59] FEDERAL REGULATION OF INTERSTATE COMMERCE. 109 make interstate commerce shipments to state control, it would be repugnant to the constitution. The right of congress therefore, as adjudged in these cases, to surrender its regulating power only extends to the limita- tion of the original package rule as to a certain class of com- modities, so that they should lose their interstate character and become subject to the police power of the state when de- livered to the consignee, and not when, as is the case with other shipments, the original package is broken up or sold and thus becomes merged in the general mass of property in the state. § 59. Regulation by the delegation of power. — Con- gress in its legislation upon interstate commerce has vested in the Interstate Commerce Commission certain discretionary power in the enforcement of the statutes. Thus, in the Inter- state Commerce Act, in section 4, the commission is author- ized in special cases, after investigation, to grant an exemp- tion to the carriers from the requirement of the section, that no greater rate shall be charged under substantially similar circumstances and conditions for a shorter than for a longer distance over the same line, and the commission is authorized from time to time to prescribe the extent to which such carrier may be relieved from the operation of said statute. Also in the socalled Safety Appliance Act, the commission is, under section 7, authorized to grant an extension of time within which the common carrier may comply with the requirement of equipment with automatic car couplings prescribed by the act. Under the act of March 3, 1899, concerning the construc- tion of bridges over navigable rivers, the secretary of war is not only vested with the duty of approving plans for the con- struction of bridges, but is, under section 11, given the power to establish harbor lines, and under section 3 to permit in his discretion temporary deposits in the rivers. These cases seem to be within the rule declared by the Su- preme Court' in sustaining the powers conferred upon the ' Field V. Clark, 143 U. S. 649 general subject of delegation of (1892), 36 L. Ed. 294. See also legislative power, see State v. At- Butfield V. Stranahan, 192 U. S. lantic Coast Line, 56 Fla. 617, 32 470 (1904), 48 L. Ed. 525. On L. R. A. (N. S.) 639 (1908). • 110 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§59 president by section 3 of the act of 1890 to suspend by proc- lamation the free introduction of certain articles when satis- fied that the country producing them imposes duties upon the products of the United States. The Court said this was not a delegation of legislative power, but merely made the presi- dent the agent of the law-making department to ascertain and declare the event upon which its expressed will was to take effect. He had no discretion in the premises except in respect to the duration of the supension order, and that re- lated only to the enforcement of the poHcy estabhshed by congress. There is no unconstitutional delegation of legislative and judicial power in the authorization of the secretary of war, under the River and Harbor Act of March 3, 1899, to require, after a hearing, such changes or alterations in a bridge as would render navigation reasonably free and unobstructed, when he was bound to give a hearing to the parties before tak- ing action, and there was in this proceeding no taking of pri- vate property for public use without compensation. ' A legislative body may delegate to an executive or adminis- tration officer the power to find some fact or situation on which the operation of a law is conditioned, or to make and enforce regulations for the execution of a statute according to its terms, but it cannot delegate its law-making power, its power to exercise the indispensable discretion to make, to add to, to take from, or to modify the law. It was therefore held that congress did not in fact delegate, and could not delegate to the secretary of agriculture or to any other executive officer, the power to add to the class of railroad companies, or to the acts punishable under a penal statute, such others as in his judgment ought to be punished thereunder.^ ' Monongahela Bridge Co. v. U. 3, 1899; and that a notice to the S., 216 U. S. 177, 54 L. Ed. 435 bridge company to make certain (1910). In Hannibal Bridge Co. v. alterations, signed by the assistant U. S., 221 U. S. 194, 55 L. Ed. 699 secretary of war, and showing that (1911), the Court held that a it came from the War Department, bridge over the Mississippi river, was sufficient notice under the act. constructed under authority of ^ Merchants' Bridge T. Ry. Co. special act of congress, was sub- v. United States, C. C. A. 8th Cir- ject to the authority of the sec- cuit, 188 Fed. 191 (1911). See retary of war under Act of March also United States v. B. & 0. S. § 60] FEDERAL REGULATION OF INTERSTATE COMMERCE. Ill § 60. Additional acts of congress in the regulation of commerce. — Congress in recent years has enacted several laws in the regulation of interstate commerce. The act estab- lishing a Bureau of Animal Industry, for preventing the ex- portation of diseased cattle, and for the extirpation of dis- ease among domestic animals, enacted May 29, 1884, was held by the Supreme Court' not to cover the subject of trans- portation of hve stock from state to state, so as to preclude the enactment of state legislation for the protection of the property of the state. Congress in recent years has passed a number of acts pri- marily for the promotion of the safety of employes and thus for the safety of travelers on interstate railroads.^ Thus, it has required railroads to equip their cars with automatic couplers and brakes, imposing an absolute duty and liabiUty in that regard. It has required locomotives to be equipped with ashpans which can be emptied or cleaned without the necessity of an employe going under the locomotive. See Appendix. Congress has also legislated in regard to the liability of in- terstate railroads to their employes. The first act, approved June, 11, 1906, having been adjudged invalid, in that it did not limit the recovery to employes engaged in interstate com- merce,' another act was passed in 1908 to cure this defect.^ An act has also been passed^ limiting the hours of service of trainmen, and telephone and telegraph operators in inter- state service, and congress has also (1911) ordered an investi- gation by a commission of the question of substituting the W. R. Co. 222 U. S. 11. 56 L, (1907), Justices Moody, Harlan, Ed. 68 (1911) wherein the Supreme and Holmes dissenting. Three of Court sustained this ruling. the justices, Peckham, Fuller, and ' Reid V. Colorado, supra, § 35. Brewer, did not concur in holding 2 The Interstate Commerce Com- that congress had power to legis- mission in its annual report for late on the subject of the relation 1904 discusses at length the sub- between master and servant in ject of the increasing number the railroad service, of railroad accidents and strongly * See Act of April 22, 1908, U. recommends legislation by con- S. Compiled Stat. 1901, 1909 Supp. gress requiring the adoption of the p. 1171, and Act of April 5, 1910, block system and the block signal. See infra, § 615 et seq. ' See Howard v. 111. Cent. R. R. > See infra, appendix. Co., 207 U. S. 463, 52 L. Ed. 297 112 FEDERAL REGULATION OF INTERSTATE COMMERCE. [§60 rule of compensation in place of a liability for negligence where employes are injured in interstate railroad service. Congress has also required railroads engaged in interstate commerce to make full reports of all accidents to the Inter- state Commerce Commission. ^ This requirement, is not lim- ited to accidents on trains engaged in interstate commerce, but includes all accidents on the railroads engaged in inter- state commerce; and a railroad is so engaged within the reg- ulating power of congress when it makes shipments by through routing in interstate commerce. Recent legislation by congress in the regulation of inter- state commerce includes the prohibition of interstate carriage of obscene literature,^ of game killed in violation of state laws,' condemned carcasses of animals,^ lottery tickets,* dairy products falsely labeled or branded as to the state or territory in which produced,^ and also what is known as the White Slave Act,' the transfer of women for immoral pur- poses from state to state. Congress has also empowered the secretary of agriculture to establish rules concerning exportation and transportation of hve stock and issue certificate of freedom from disease, and providing for admission of cattle so certified into any state without further inspection or fees.^ The police power of the state was extended to oleomargar- ine, butterine, etc., as it had theretofore been extended to hquors in the "original package."^ As to the anti-trust legislation of congress and also legisla- tion in relation to the relations of labor and capital in inter- state commerce, see chapter V, infra, "Business Combina- tions in Interstate Commerce" and chapter VI "Labor Combinations in Interstate Commerce." 'Actof March 3, 1901, m/ra. -Act of July 1, 1902, Supp. ^Act of February 8, 1897, 3 Comp. Stat., p. 1182. § 540. 7 Act of June 25, 1910. See ' Act of May 25, 1900, 3 Comp, supra, sec. 7. Stat. 3180 § 181. 8 Act of February 2, 1903, Supp. ^ Act of May 2, 1895, 3 Comp. Comp. Stat., p. 1183. Stat. 3192. 9 Act of May 9, 1902, Supp. ' Sec. 6, supra. Act of March 3, Comp. Stat. p. 369. 1895, 3 Comp. Stat. 3178. § 61] FEDERAL REGULATION OF INTERSTATE COMMERCE. 113 In 1906 important statutes were enacted, to-wit the Meat Inspection Act' the Food and Drugs Act^ and the National Quarantine Laws,' all illustrating the trend for the enlarge- ment of federal power through its extension to classes of sub- jects, wherein the states have hitherto exercised concurrent jurisdiction during the non-action of congress. Of these the most important is the Food and Drugs Act, commonly known as the Pure Food Act, approved June 30th, 1906. This act makes it unlawful to manufacture within any territory or the District of Columbia or to introduce into any state or territory or District of Columbia from any other state or territory or District of Columbiaor from any foreign country or to ship to any foreign country, any article of food or drugs which is adulterated or misbranded, within the meaning of the act.^ Congress has also enacted in 1910 what is known as the insecticide act^ prohibiting under penalties the introduction into any state or territory of any insecticide which is adul- terated or misbranded, and in 1913 what is known as the Migratory Birds Act.^ § 61. The Bureau of Corporations and the Federal Trade Commission. — In 1903 Congress established a Bureau of Corporations in the then newly created department of commerce and labor, and this bureau was vested with the same power and authority of investigation in respect to industrial corporations as was vested in the Interstate Commerce Commission with respect to railroads. The 1 Act of June 30, 1906, Supp. This act as amended by Act Comp. Stat. 1106. of August 23, 1912, prohibiting '' Act of June 30, 1906, Supp. false and fraudulent misbranding, Comp. Stat. 1106. was sustained by the Supreme ^ Act of June 19, 1906, Supp. Court in Seven Cases v. U. S. Comp. Stat. 1244. U. S., (1916) 239 U. S. 90; 60 * The constitutionahty of this L. Ed. p. . act and the enforcibility of the » Act of April 26, 1910, 36 remedy in rem provided therein Stat. 331. was sustained by the Supreme » See supra, § 11. Court in Hipolite Egg Co. v. United States, 220 U. S. 45, 55 L. Ed. 364. (1911). J-8. 114 FEDERAL HEGULATION OF INTERSTATE COMMERCE. [§61 Bureau was given the right to summon witnesses and call for the production of books and papers subject to the same immunities against the enforcement of self incriminating testimony as was contained in the Act of 1893 concerning the Interstate Commerce Act.^ By the Federal Trade Commission Act which was approved Sept. 26, 1914, upon the organization of that commission, the Bureau of Corporations ceased to exist and all pending investigations and proceedings of the bureau of corporations were to be continued by the Commission. This Commission consists of five commissioners, not more than three of whom shall be members of the same political party, and are ap- pointed for a term of seven years, the first commissioners appointed continuing in office for terms of three, four, five, six, and seven years, and their successors to be appointed for the term of seven years. The office of the Commission is in Washington but it may exercise all its powers at any other place, and may, by one or more of its members, or by such examiners as it may designate, prosecute any inquiry neces- sary to its duties in any part of the United States. It is em- powered and directed, (Section 5), to prevent persons, partnerships or corporations, except banks and common carriers subject to the acts regulating commerce, from using "unfair methods of competition and commerce." These orders are issued only after hearings, and are enforcible through decrees of the Circuit Courts of Appeal. The new 'Act of Feb. 14, 1903. Com- dishonest practices. Legitmate missioner Garfield said in his business law respecting persons report of December, 1904, "In and corporations have nothing to brief, the policy of the bureau in fear from the proposed exercise of the accomplishment of the pur- this governmental power of in- poses of its creation is to co-oper- quiry." It was held in U. S. v. ate, and not antagonize, thebusi- Armour, 142 Fed. 808 (N. D. of 111.) ness world. The immediate object 1906, that the immunity under act of its inquiries is the suggestion of congress extended to an indi- of constructive legislation, not the vidual who gave self-incriminating institution of criminal legislation, statements to the commissioner of It proposes through exhaustive in- corporations in an investigation vestigations of law and fact to se- under this section. See infra cure conservative action, to avoid section 12 of Act. See also Act of ill considered attack upon corpora- June 13, 1906. tions which will avoid unfair and §61] FEDERAL REGULATION OF INTERSTATE COMMERCE. 115 Commission has an independent status like that of the Inter- state Commerce Commission, and it is directed to assist the Attorney General in investigating any corporation alleged to be violating the anti-trust laws and to assist in such prosecu- tions. The Commission may also investigate the affairs of industrial and trading corporations and may require annual or special reports of interstate corporations. The informa- tion it obtains may be made public at its own discretion, "except trade secrets and names of customers." The Com- mission is also empowered to investigate from time to time trade conditions in and with foreign countries and to report to Congress thereon with its recommendations. In general terms it may be said that the Commission is charged with the same duties and powers with relation to industrial corporations, that is, as to investigation, as are vested in the Interstate Commerce Commission with reference to railroads. ^ ' For full text of the Trade Com- The names of the first commis- mission Act, see appendix p. . sioners appointed under the act For rules of procedure adopted are, Joseph E. Davies, Chairman, by Commission, see appendix p. George Rublee, William H. Parry, For the relations of Trade Commis- William H. Harris, Edward H. sion Act to Anti-trust act of 1890 Hurley, and 1914, see Chapter V. itifra. CHAPTER IV. THE FEDERAL POWER OF REGULATION IN INTERSTATE COMMERCE. § 62. No judicial formulation of extent of power. 63. The supremacy of federal regulation. 64. Federal regulation of employes performing both intrastate and interstate service. 65. Federal control over intrastate rates in preventing discrimination in interstate commerce. 66. The federal regulating power and state corporations. 67. The commerce clause and the police power. 68. Limitations upon the federal authority in interstate commerce. 69. Prohibition as a means of regulation. 70. Regulation of commerce through the taxing power. 71. The federal power of granting corporate charters. 72. Federal incorporation as a means in the exercise of the commerce power. 73. Relation of the states to federal corporations. 74. The Federal incorporation of business companies. 75. The requirement of federal franchise for business corporations in interstate commerce. 76. The development of the latent federal power in the regulation of commerce. § 62. No judicial formulation of extent of power. — The exercise of the federal power, as new conditions develop in interstate and foreign commerce, does not require any "new nationalism" in the expansion of the constitution by amendment or judicial construction. Fortunately the framers of the constitution wisely stated the federal power in language so broad and comprehensive, that it is as clearly applicable to the complex conditions and agencies of the commerce of the present day, as it was to the simple condi- tions and agencies when the constitution was adopted. ' The constitution of the United States marks only the great out- lines of power to be possessed by the government without attempting to enumerate in detail and specify each and every ' See U. S. V. Debs, Sec. 1, supra. § 63] FEDERAL POWER OF REGULATION. 117 one.' This great principle of constitutional law is happily illustrated in the simple and comprehensive phrase of the commerce clause. Until recent years we were compelled to rely, in determin- ing the possible limits of the federal power in interstate com- merce, upon the language of the Court in deciding the Hmits of the authority of the states ; but the activity of federal legis- lation of late has presented directly the question of the authority of congress. The Supreme Court has frequently dechned to formulate a general rule as to the precise line where the power of con- gress begins and the power of the state ends.^ It was on this question of the conflict between the admitted powers of the federal government and the states that Chief Justice Mar- shall said that the power and the restriction on it, though quite distinguishable, when they did not approach each other, may well, like the intervening colors between white and black, approach so nearly as to perplex the understanding, as colors perplex the vision in making the distinction between them.' This extent of the federal power was directly presented in the Lottery cases, where there was a close division of the Court; but it was said in the prevailing opinion that the whole subject was too important, and the question suggested by its consideration too difficult of solution to justify any attempt to lay down a rule for determining in advance what legisla- tion could be enacted under the commerce clause of the constitution.* § 63. The supremacy of federal regulation. — While no general judicial rule as to the extent of the federal power in interstate commerce has been formulated, one principle has been distinctly declared by the Supreme Court, and that is the supremacy of the federal power over state legislation where exercised as appropriate means in the regulation of interstate commerce. ' Marshall, C. J., McCuUough v. De Cuer, 95 U. S. 485, 24 L. Ed. Maryland, 4 Wheat. 316, 4 L. Ed. 547 (1876). 579. 3 Brown v. Maryland, 12 Wheat. " Walton V. Missouri, 91 U. S. 419, 6 L. Ed. 678 (1827). 275, 23 L. Ed. 347 (1875); Hall v. * See Lottery Cases, supra. 118 FEDERAL POWER OF REGULATION. [§ 64 This supremacy is illustrated when congress acts in that class of cases, wherein the Court has adjudged that the states have a concurrent power of legislation in the non-action of congress; that is, where congress has exercised its power of regulation by non-action. There is thus a wide legislative discretion in congress to determine when a subject is capable of uniform legislation in interstate commerce ; and when it is so determined, all state legislation in respect to such matters, inconsistent therewith, ceases to have force, whether formally abrogated or not, and the regulations prescribed by congress alone control. It is for the Supreme Court to determine, when a question arises, as to whether a state law is thus abrogated by the exercise of the power by congress. The power thus exercised by the states will in this way be suspended until the national control is abolished by congress, and the subject is thereby, by the non-action of congress, again left under the control of the states. ^ As repeatedly declared by the Supreme Court the power to regulate commerce is vested in congress as absolutely as it would be in a single government, and is limited only by the constitution. 2 The paramount authority of congress, when it legislates in interstate commerce, is recognized by the deci- sions of the state courts in declaring the statutes of their own states abrogated by the action of congress.' § 64. Federal regulation of employes performing both intrastate and interstate service. — Congress can- not, as was determined in the first Employers' Liability case, legislate directly concerning the liability of railroads to their employes, engaged in intrastate trafTic, but it is no objection to legislation enacted for the protection of interstate em- ployes, that such employes owing to the conditions of railroad ' Reid V. Colorado, 187 U. S. 137, whether at the time carrying state 47 L. Ed. 108 (1902). or interstate traffic. See infra, * Lottery Cases, supra. This § 646. supremacy of the Federal power ' See supra, § 36, as to effect was also illustrated in the deci- of Hours of Service Act in Wis- sion by the Supreme Court in the consin and Missouri, and Employ- case of Southern Railway, that the er's Liability Act in Arkansas and Safety Act was applicable to all Georgia, equipment of an interstate railroad § 64] FEDERAL POWER OF REGULATION. 119 service, also render service in intrastate operations. Thus, it was urged against the constitutionality of the Hours of Service Law of 1907, limiting the hours of service of interstate employes, that the interstate and the intrastate operations of the interstate railroads were so interwoven, that it was utterly impracticable to divide their employes in such manner, that the duties of those who are engaged in connec- tion with interstate commerce, shall be confined to that commerce exclusively. But the Supreme Court said' that congress could not be thus denied the effective exercise of its constitutional authority. The length of hours of service of railroad employes had a direct relation to the efficiency of the human agencies, upon which protection of life and property of passengers as well as employes necessarily depends. If then it is assumed that congress can limit the hours of labor of employes engaged in interstate transportation, it followed that this power could not be defeated by prolonging the period of service, through other requirements of the carrier, or by the commanding of duties relating to interstate and intrastate operations. This principle that the federal authority, when appropri- ately exercised, is not impaired by incidental application of such regulation to intrastate service, is seen to be of far reach- ing importance when the complex conditions of railroad serv- ice are considered. An interstate railroad system is operated as a unit irrespective of state boundaries, has but one corps of officers and employes, and one equipment, and its operat- ing employes are engaged in whatever capacity the exigencies of the service require. This was forcibly illustrated in the unanimous opinion of the Supreme Court, holding, without dissent, that congress could penalize the absence of required safety appliances on cars of an interstate highway, whether used in moving state or interstate traffic, the Court saying ' B. & 0. R. R. Co. V. Interstate 3, 1908, requiring monthly reports Commerce Commission, 221 U. S. under oath, showing the instances 612, 55 L. Ed. 878 (1911). In this where employes subject to the act case the Court sustained the order had been on duty for a longer of the Commission of March period than that allowed. 120 FEDERAL POWER OF REGULATION. [§65 that the menace was not merely to that car and train but to others. ' § 66. The Federal Control over Intrastate rates in preventing discrimination in Interstate Commerce. — The Supreme Court has declared in emphatic terms the supremacy of the federal control in Interstate Commerce as against the state authority in intrastate commerce when the exercise of this latter authority involved discrimination in interstate commerce. This was declared in the Shreveport rate case.^ In this case the commission had found that a discrimination existed between the rates from Shreveport to Texas points, and those that were enforced in cities of Texas to such Texas points and the carriers were ordered to remove this discrimination which could only be done by charging higher rates between Texas points. It was strongly con- tended that admitting that the Shreveport rates were reason- able, and that the discrimination existed, yet that its correc- tion was beyond the power of the commission, as the Texas rates were maintained under state authority in Texas. The Supreme Court held it was no defense to the carrier when called upon to correct the discrimination in interstate com- merce to assert that it was based on state authority, and that notwithstanding the proviso in Sec. 1, of the Interstate Commerce act that its "provisions should not apply to intrastate traflfic," Congress in the exercise of its paramount power could control the intrastate rates maintained by the carrier under state authority necessary to remove the result- ing discrimination against interstate commerce, arising out of the relation between such intrastate rates and interstate rates, which are reasonable in themselves. The Court said: ^ Southern R. R. Co. v. U. S., ney dissenting. The Court in its 222 U. S. 20, 56 L. Ed. 72. (1911) opinion distinguished the Minne- affirming 164 Fed. 347. sota rate cases, 230 U. S. 352, 57 2 Houston E. & W. Tex. R. Co. L. Ed. 1511, infra, on the ground V. United States, 234 U. S. 342, that there had been no finding of 58 L. Ed. 1341, (1914) affirming discrimination and in its absence the commerce court 205 Fed. 380, the court was asked to declare an dismissing petitions in suit brought entire scheme of state rates, other- to enjoin the order of the Interstate wise validly established, invalid Commerce Commission, 23 I. C. because of the effect upon inter- C. R. 31. Justice Lurton and Pit- state rates. §66] FEDERAL POWER OF REGULATION. 121 "Whenever the interstate and intrastate transactions are so related that the government of the one involves the con- trol of the other, it is Congress, and not the state that is en- titled to prescribe the final and dominant rule, for otherwise Congress would be denied the exercise of its constitutional authority, and the state and not the nation would be su- preme in the national field." The Court held that power had been delegated to the Interstate Commerce Commission to control the intra- state rates maintained by a carrier under state authority so as to remove discriminations in interstate commerce growing out of the relation between the intrastate and interstate rates, when the latter were reasonable in themselves, and said: "In the view that, the commission was entitled to make the order, there is no longer compulsion upon the carriers by virtue of any inconsistent local requirement. We are not un- mindful of the gravity of the question there is presented when state and federal views conflict. But it was recog- nized in the beginning that the nation could not prosper if interstate and foreign trade were governed by many masters and where the interests of the freedom of interstate commerce are involved, the judgment of congress and of the agencies it lawfully establishes must control." § 66. The federal regulating power and state cor- porations. — While the regulating power over interstate com- merce is vested in congress, transportation agencies whereby that commerce is carried on, railroad, express, telegraph and telephone companies are incorporated or organized under state laws, so that congress has no visitorial or charter power over them. These state organizations are, however, the agencies recognized and adopted by congress for carrying on interstate commerce, and the power of regulation is as effective over railroad operations, as if the corporations were organized by the federal government. The federal government has also controlled and terminated the corporate life of state corporations for violation of federal law. In the Northern Securities case,' a holding company organized under the laws of New Jersey, with the charter power to hold and acquire the stocks of other companies, ' Infra, § 348. 122 FEDERAL POWER OP EEGULATION. [§66 was adjudged an unlawful combination in restraint of inter- state commerce in its holding of the stocks of competing inter- state railways, and its dissolution was decreed and enforced by the federal courts. The prohibitions and penalties of the Anti-Trust Act have been enforced against state business corporations engaged in interstate commerce and corporations offending against that act have been dissolved by the federal courts, as unlawful combinations. The production of the corporate books and papers of state corporations before federal grand juries and other investigating bodies has been enforced and congress has imposed an excise tax upon the doing of business as a corporation under state laws.' Although the power of regulation of interstate business has been thus effectively exercised over interstate railroad opera- tions, the control of the capitalization of the railroads and other corporations acting as federal agencies in interstate commerce remains in the states whereunder they are incor- porated. It has been urged that the control by the federal government of interstate rates cannot be effective, without the control of the stocks and bond issues of the carriers; and that the exercise of the state authority in limiting such securities issued by an interstate railroad may interfere with and embarrass interstate commerce, when the issue of such securities is essential for raising funds for necessary facilities in interstate traffic. In other words such a control may con- cern not only the state of incorporation, but all the states in which the railroad is operated, and therefore may become a subject of federal and not state control.^ ' Infra, § 70. provisions of the act to regulate ' Under section 16 of the Com- commerce, and the power of con- merce Court Act of June 18, 1910, gress to regulate or affect the the president appointed a com- same. The report of this Com- mission of which President Ar- mission, submitted to Congress by thur T. Hadley of Yale Univer- the President, Dec. 1911, recom- sity was chairman, to investigate mended the enforcement of pub- questions pertaining to the issu- licity through federal authority of ance of stocks and bonds by rail- all such security issues of inter- road corporations subject to the state railroads. §67] FEDERAL POWER OF EEGTILATION. 123 § 67. The Commerce Clause and the Police Power. — On July 31, 1912, Congress passed an act declaring it unlaw- ful to deposit in the mails, or with any express company or common carrier, for interstate transportation, * * * qj. to bring, or cause to be brought into the United States from abroad, any film or other pictorial representation of any prize fight * * * for purposes of pubhc exhibition, and punishing any violation of the act by fine or imprisonment. ' The collector of a port declining to allow the entry of certain picture films of a prize fight on the Island of Cuba, an injunction was filed to enjoin the collector from persisting in such refusal on the ground that Congress, while in form exercising its power under. the Commerce Clause, was really attempting to exercise the police power that belongs to the states. It was ruled by the Circuit Court of Appeals of the 3rd Circuit'' that this statute belonged to the class of which numerous examples exist which fall directly under the commerce clause but affect indirectly the field of the police power, quoting from the Supreme Court:' "The power to regulate commerce with foreign nations is expressly conferred upon Congress and, being an enumer- ated power, is complete in itself, acknowledging no limita- tions other than those prescribed in the constitution. What- ever difference of opinion, if any, may have existed or does exist concerning the limitations of the power resulting from other provisions of the Constitution, so far as interstate commerce is concerned, it is not to be doubted that from the beginning Congress has exercised a plenary power in respect to the merchandise brought from foreign countries, not only by the enactment of embargo statutes, but, indirectly, as a necessary result of provisions contained in tariff legislation. It has also in other than tariff legislation exerted a police power over foreign commerce by provisions which in and of themselves amounted to the assertion of the right to exclude merchandise at discretion." The court said that the claim that the films were intended not for sale, but solely for exhibition, was not controlling. ' See sub-section 380 of Sec. 1 of ^ Butfield v. Stranahan, 192 U. Tariff Act of 1913. S. 470, 48 L. Ed. 525, (1913) ' Weber v. Freed, 224 Fed. 355. quoted in Brolan v. U. S., 236 AfTirmed by Supreme Court (1915). U. S. 216, 59 L. Ed. 544 (1914). 124 FEDERAL POWER OF REGULATION. [§68 In any event the films were articles of commerce, capable of being sold or leased, and the mere fact that plaintiff had no present intention of using them for any other purpose than exhibition, did not change their essential character, and the act was therefore held to be within the lawful power of Congress. It was said by the Supreme Court, in sustaining the con- stitutionality of the Food and Drug Act against the con- tention that it was an invasion of the police power of the States, that Congress was not to be denied the exercise of its constitutional authority over interstate commerce, and the power to adopt not only the means necessary, but con- venient to its exercise, because these means may have the quality of police regulations.' § 68. Limitations upon the federal authority of interstate commerce. — While the authority of congress to regulate rates or to delegate that authority to a commis- sion has been uniformly sustained, since the passage of the Act of 1887, and in effect conceded, this power and all regulat- ing legislation must be exercised subject to the constitutional requirement of due process of law, "and against the taking of private property for public use without compensation." In the exercise of this regulating power congress or the commerce commission is restrained also by the provision of the constitu- tion, that "no preference shall be given by any regulation of commerce or revenue to the ports of one state over those of another." "Ports of entry," established under the customs laws are now not only on the seaboard as formerly and at the time of the adoption of the constitution, but are scattered throughout the interior as land ports. The construction of this constitutional apphcation to the regulation of carriers charges, in the recognition of differentials in favor of compet- ing ports has not been judicially determined. Congress was advised by the attorney general when the amendment of 1906 to the Interstate Commerce Act was under consideration that "reasonable rates" determined by the legislative authority would not constitute a preference within the prohibitions of ' See Seven Cases v. U. S., 239 U. S. 190. 60 L. Ed. (1916). §69] FEDERAL POWER OF REGULATION. r 125 this section of the constitution, even though they resulted in a varying charge per ton, per mife, to and from the ports of the different states.' The power of congress in the regulation of commerce is lim- ited, as are all the powers of the federal government, by the terms of the grant, as the government is one of enumerated powers, and the powers not granted to congress are reserved for the states and the people. While the power to regulate interstate commerce can be exercised by congress as effect- ively as by a single government with a wide discretion in the selection of means appropriate to the end, this power is limited by the terms of the constitutional grant. Congress is, therefore, without power to control commerce within a state. ^ Neither congress nor the federal courts could deal with commercial combinations in a state not affecting inter- state commerce, but where the combinations do affect inter- state commerce it is immaterial that they are organized under state laws. § 69 Prohibition as a means of regulation. — An im- portant and far reaching question involved in the extension of the federal regulation of commerce was discussed in the Lottery cases. It was there strongly contended by four dis- senting judges' that the power to regulate commerce did not include the power to prohibit certain classes of traffic on dis- tinctly .moral grounds which were properly consignable by the local police authority of the states, as the power delegated to congress was for the purpose of securing the freedom of in- terstate commerce and preventing the hostile or discriminat- ing action of the states interfering therewith, and was thereby distinguished from the sovereign control over foreign com- merce, and that congress had no general police powers, such as are reserved in the states. The prevailing opinion did not directly dispute or discuss these positions and declined to formulate any rule as to the ' Opinion of Attorney-General See also U. S. v. Knight Co., 156 Moodey to senate, May 5, 1905, U. S. 1, 39 L. Ed. 325 (1894). Vol. 2, Senate Documents, p. 1674. ' Justices Fuller, Brewer, Shiras ' See Addyston Pipe & Steam and Peckham. Co. V. U. S., 175 U. S. 211, 44 L. Ed. 136 (1899). 126 FEDERAL POWER OF REGULA'nON. [§70 power of congress, but based the conclusion upon what was essentially the moral view, that the lottery business had grown into disrepute and had become offensive to the people of the country, was a kind of traffic that no one was entitled to pursue as a right, and that under the circumstances of the particular case prohibition of this class of traffic was an appropriate method of regulation for congress to adopt. The decision was therefore limited to the points that lottery tickets were subject of traffic, and that congress could law- fully prohibit such traffic in interstate commerce. ^ Congress can therefore prohibit in interstate commerce a specific class of traffic which is deemed injurious or offensive to the public, and it may also prohibit unlawful combinations and monopolies on the ground that such prohibition is neces- sary for the protection of the freedom of interstate commerce. The power to prohibit is necessarily involved in any effect- ive federal control of the corporate agencies engaged in the conduct of commerce, whether through federal incorporation or any form of federal franchise, that is, where in order to make the federal system effective its adoption must be made compulsory. Congress has thus far legislated with reference to the subjects of commerce, and not concerning the cor- porate relations of parties engaged in such commerce. § 70. Regulation of commerce through the taxing power. — Interstate commerce may also be regulated through the exercise of the taxing power by congress. While congress has not an unlimited power as to the purpose of taxation, and can levy taxes only in order to pay the debts and provide for the common defense and general welfare of the United States,'' it is also true that under the permanent revenue system of the government, taxes are levied, not for specific purposes, but by continuing laws estabUshing the rate of ^ The Court had sustained a it had the right to say what statute excluding lottery tickets should be carried therein. But from the mails. See In re Jack- it was said that congress could son, 96 U. S. 727, 24 L. Ed. 877 not prevent the carriage of such (1878), and In re Rapier, 143 U. S. tickets by other means, though 110, 36 L. Ed. 93 (1892). This they were excluded from the mails, was on the ground that as con- « story on the Constitution, gress furnished postal facilities sec. 907. §70] FEDERAL POWER OF REGULATION. 127 customs duties and internal revenue taxes, and questions relating to the lawful purposes of taxation do not arise in levying revenue taxes but in the appropriation of public funds for public needs. It is well recognized that the power of taxation is some- times invoked with no purpose of revenue in view, but solely to destroy the interest or business upon which the tax is levied by taxing it out of existence. Thus the notes of the state banks were taxed out of existence in order to open the means for circulating the notes of the national banks. This act was sustained by the Supreme Court. ' The Court said that it was immaterial that the tax destroyed the business or franchise exercised under state authority. While the only lawful purpose of taxation is revenue, the amount of the tax on any subject within the scope of the taxing power is for the legislative discretion to determine. In the words of Chief Justice Marshall in McCulloch v. Maryland, ^ "it is a perplexing inquiry unfit for the judicial department, what degree of taxation is a legitimate use and what degree may amount to an abuse of the power?" A tax on oleomargarine, as is well known, was imposed for the avowed purpose of destroying the business. It therefore follows that congress, subject to the constitutional requirement of geographical uniformity' and to the limitations of direct taxation,* could impose indirect taxes and excises on subjects and facilities of commerce or upon the privilege of carrying on such com- merce, whether by individuals or corporations, and that the amount of such taxes would be determined by the discretion of congress.* 1 Veazie Bank v. Fenno, 118 'The extent of this taxing Wall. 533 (1869), 19 L. Ed. 482. power was illustrated in the deci- ' Supra, § 5. sion sustaining the tax upon the 'Head Money Cases, 112 U. S. net earnings of state corporations. 580, 28 L. Ed. 798 (1884) ;• Knowl- Flint v. Stone-Tracy Co., 220 U. ton V. Moore, 178 U. S. 41, 44 L. S. 107, 55 L. Ed. 389 (1911). Ed. 969 (1900). This tax was advocated in con- * Income Tax Cases, 158 U. S. gress not only as a revenue meas- 601, 39 L. Ed. 1108 (1894); Nicol ure, but because of the regulation V. Ames, 173 U. S. 509, 43 L. Ed. through • incidental publicity of 786 (1899); Knowlton v. Moore, corporate business which would be supra. Brushaber v. Union Pac. R. secured. R. Co. 240 U. S. 1, 60 L. Ed. 1916. 128 FEDERAL POWER OF REGULATION. [§71 § 71. The federal power of granting corporate char- ters. — The unexercised or undeveloped power of congress in interstate commerce is now discussed more particularly with reference to the power of congress in federal incorporation of business or trading companies. Interstate and foreign com- merce under modern business conditions are almost wholly carried on by corporations chartered by the several states. The states therefore have the sole visitorial control of the organization of the business associations, through and by which the interstate and foreign business, subject to the ex- clusive jurisdiction of congress, is carried on. The difficulty of effectual governmental regulation of such commerce is apparent. The power to charter a corporation is not among the enu- merated powers of congress, but in the great case of McCul- loch V. Maryland 1 the Court based the power to charter a na- tional bank upon the right of congress to adopt incorporation as a reasonable means of carrying into effect its enumerated powers. "Incorporation," said the. Court, "is never made the end for which their powers are exercised, but a means by which their objects are accomplished." . . . "The power of creating a corporation is never used for its own sake, but for the purpose of affecting something else." The bank, therefore, was lawfully incorporated as a means of managing the great fiscal concerns of the government. The constitu- tionality of the national banking act of 1864 was based on the same principle. The national banks organized under the act, said the Court, were the instruments designed to be used to aid the government in the administration of an important branch of the public service. They are ineans appropriate to that end.^ The power of congress to incorporate railroad companies to carry on interstate commerce, has not only been conceded, but has been exercised in the incorporation of the Pacific Railroad companies ;3 and the chartering of a corporation for M Wheat. 316, supra. 'Pacific R. Cases, 115 U. S. 2, 2 Farmers, etc.. National Bank 29 L. Ed. 319 (1885); California v. V. Dearing, 91 U. S. 29 (1875), 23 Pacific Railroads, 127 U. S. 1, 32 L. L. Ed. 196. Ed. 150 (1888); Decker v. R. R. Co., 30 Fed. 723 (1887). § 72] FEDERAL POWER OF REGULATION. 129 constructing a bridge over a navigable stream forming the boundary of two states and condemning the property for approaches thereto, has been directly sustained. ' The power of incorporation in these cases was upheld as a reasonable and proper means of regulating commerce between the states, as these corporations were direct instrumentalities for carrying on interstate commerce. A corporate franchise involves the power to be, and also the power to do. Congress has the power to grant a corporate franchise for the construction of national highways. The Su- preme Court in the Pacific Railroad Tax cases, said that in former times this power was exercised very little, as com- merce was then conducted wholly by water, and many of our statesmen had entertained doubts as to the existence of the power to establish ways of communication over land. But since the expansion of the commerce of the country, the mul- tiplication of its products and the invention of railroads and locomotion by steam, land transportation has so vastly increased, that a sounder consideration of the subject has prevailed and led to the conclusion that congress had plenary power over the whole subject. Congress has granted charters of incorporation with fran- chises to be exercised in the District of Columbia, as assur- ance companies,^ and savings banks and trust companies.' A federal charter was also granted to the Maritime Nicar- augua Canal Company for facilitating intercourse between the Atlantic and Pacific oceans.^ The National Trades Union Incorporation Act, infra. Appendix, contains no reference to interstate commerce except that the members must be resident in two or more states. No incorporation had been formed under this act up to January 1, 1916. § 72. Federal incorporation as a means in the exer- cise of the commerce power. — As congress can exercise this power of incorporation as a means and not as an end, its 1 Luxton V. North River Bridge = Act of March 3, 1865, 13 Stats. Co., 153 U. S. 525, 38 L. Ed. 808 510. (1894). 3 Comp. Stats, p. 3205. This 161, 52 L. Ed. 436 (1908). Justices repealed the earlier statute of McKenna and Holmes dissented. Oct. 1, 1888, providing for boards The judgment of conviction was of arbitration for settling con- reversed with directions to sustain troversies between interstate car- the demurrer to the indictment riers and their employes. and dismiss the cause, reversing 2 See Adair v. U. S., 208 U. S. 152 Fed. 736. §100] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 175 In a later case^ the Court held that the statute of Kansas, which, as construed by the Kansas Court, provided for the criminal punishment of an employer or his agent for pre- scribing as a condition of employment that the employe should make an agreement not to become or remain a member of a labor organization while so employed, the employe being subject to no incapacity or disability, but, on the contrary, free to exercise a voluntary choice, was violative of the liberty secured by the Fourteenth Amendment. ^ The decision was held not to involve other and independent provisions of the act, such as provisions relating to arbitra- tion, as the section upon which the defendant was convicted was separable from the other provisions of the act; so that it would seem that the provisions for voluntary arbitration referred to in the preceding section continued in force.' By the act of July 15, 1913, this act of 1898 was repealed and a new act was passed entitled "an act providing for mediation, conciliation and arbitration in controversies between certain employers and their employees." The act by its terms applies to the employees of common carriers engaged in interstate commerce, but does not apply to employes of street railroads. A board of mediation and concihation is provided for, one of the three members being a commissioner of mediation and conciliation appointed by the President, and two other officials of the Government ap- pointed by the President, are to act with this commissioner on this board. Any party to a controversy concerning the conditions of employment may apply to this board for its services in mediation. A provision is also made for arbitra- ' Coppage V. Kansas, 236 U. S. 1, 'In the labor legislation of 59 L. Ed. 441, reversing 87 Kansas congress should also be included 752. (1915). the Employer's Liability Acts and " The opinion in this casefoUowed other acts for the safety of em- the Adair case, supra, (Justice ployes of interstate carriers. See Holmes and Hughes dissenting). infra, § 527 et seq. 176 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§101 tion by a board of three or six arbitrators to be named by the parties. These arbitrators are authorized to invoke the aid of United States courts to compel the attendance of witnesses and the production of books and papers. ^ § 101. The courts on labor combinations in relation to interstate commerce. — As there has been no national incorporation of trade unions, there has been no judicial con- struction or practical application of that act. It was said, however, by Justice Harlan, in an opinion rendered in 1894,^ with reference to the original act of 1886 legalizing the in- corporation of national trade unions, that it did not in any degree sanction illegal combinations, but that its purpose in authorizing working people to better their own conditions by such conbinations was most praiseworthy and should be sus- tained by the courts whenever their power to that end was properly invoked. An agreement for arbitration between an interstate carrier and its employes under the act of 1908, is essentially a com- mon-law arbitration and rests solely on the written agree- ment of arbitration entered into between the parties, which limits and determines not only the rights of the parties there- to but also the extent of the power of the arbitrators, and is to be construed in accordance with the rules governing the construction of contracts rather than those applicable to pleadings.^ iThis Act provides: Sec. 8. han, 121 Fed. 536 (1903), Judge * * * "Nothing in this act con- Adams, in dissolving the injunc- tained shall be construed to require tion against railroad employes, ex- an employe to render personal pressed the hope that the parties, service without his consent, and no if unable to adjust their differences, injunction or other legal process would submit the questions in shall be issued which shall compel dispute to the Board of Arbitration the performance by any employe provided by this act. against his will of a contract for An attempt was made in Eng- personal labor or service." See land in 1824 (5 Geo. IV, c. 96), and appendix. again in 1867 (30, 31 Vic, c. 105), 2 Arthur v. Oakes, infra. and in 1872 (35, 36 Vic, c 46), to ' In re Southern Pacific Co., C. provide for settlements 6f trade C. Eastern District Cal., 155 Fed. disputes. The acts were not used 1001 (1907), ruling on exception to and were finally replaced by the award of arbitrators under this act. Conciliation Act of 1896 (59, 60 In Wabash R. R. Co. v. Hanni- Vic, c. 30). §102] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 177 §102 Interstate commerce and labor organizations. While the jurisdiction of the federal courts has frequently been invoked in cases of trade disputes between the employ- ers and employes where the jurisdiction is based upon diverse citizenship and no federal question is involved therein, the questions in relation to interstate commerce have usually been presented in cases involving the contentions of inter- state carriers with their employes. ^ Railroad labor organizations have been considered in the judicial construction and application of both the Interstate Commerce Act of 1887 and the Anti-Trust Act of 1890. In the industrial disturbances of 1893 and 1894 there were a number of injunctions sued out in the different circuit courts enjoining interference with interstate commerce, some of these by railroad companies enjoining interference with the interchange of traffic with connecting railroads;'' some by receivers of railroads applying for protection against inter- ference with their possession and operation,' and also in direct suits by the United States under the provisions of the ' Southern Ry. Co. v. Machinists Local Union, 111 Fed. Rep. 49 (West. Dist. of Tenn. 1901); AUis-Chalmers Co. v. Reliable Lodge, 111 Fed. Rep. 264 (1901); Elder v. Whiteside, 72 Fed. Rep. 724 (La. 1895); Consolidated Steel & Wire Co. v. Murray, 80 Fed. Rep 811 (1897); Makall v. Ratch- ford, 82 Fed. Rep. 41 (W. Va. 1897) ; Coeur d' Alene Consolidated Mining Co. v. Miners Union, 51 Fed. Rep. 260 (Idaho 1892) American Steel & Wire Co. v Wire Drawers, etc., 90 Fed. Rep 608 (No. Dist. of Tenn. 1898) United States v. Weber, 114 Fed Rep. "950 (West Dist. of Va. 1902) Otis Steel Co. v. Local Union No. 18, 110 Fed. Rep. 698 (1901) Hopkins v. Oxley Stave Co., 28 C C. A. 99, 83 Fed. Rep. 912 (1897) affirming 72 Fed. Rep. 695; The AUis-Chalmers Co. v. Iron Moul- ders Union, 150 Fed. 155, C. C. of Wis. (1906), decree modified in C. C. A., 7th Circuit, 166 Fed. Rep. 45 (1908); Barnes v. Berry, 156 Fed. Rep. 72, C. C, S. D. of Ohio (1907); Delaware & W. R. Co. v. Switchmen's Union, et al., 158 Fed. 541 (1907); KoUey v. Robinson (C. C. A. 8th Cir.), 187 Fed. 415 (1911). 2 Toledo, A. A. & N. R. Co. v. Penn Co. et al., 54 Fed. Rep. 730 (1893) (Taft, J., in Northern Dist. of Ohio); see also 54 Fed. Rep. 746 (1898); Southern Cal. R. Co. V. Rutherford, 62 Fed. Rep. 796 (1894) (So. Dist. of Cal.). » Thomas v. C, N. 0. & T. P. R. Co., 62 Fed. Rep. 803 (1894) (Taft, J., in Southern District of Ohio). J-12. 178 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§103 Anti-Trust Act enjoining unlawful interference with inter- state commerce and the mails.' It was held in these cases that the Anti-Trust Act was ap- plicable to any combinations restraining trade, whether of labor or of capital,^ and that the penalties prescribed by sec. 10 of the Interstate Commerce Act were applicable to the employes of an interstate railroad who, while continuing in their positions as employes, refused to handle the freight re- ceived from other roads. Such refusal, when made in con- sequence of a boycott declared by their union against such road, was an unlawful conspiracy and punishable as such under the laws of the United States, and also punishable as a contempt when their employing road was under an injunc- tion prohibiting it from refusing to exchange interstate traffic with such boycotted road. The Supreme Court, in the Debs case,' while not dissenting from the conclusion of the circuit court in holding the Anti- Trust Act applicable to a labor combination interfering with interstate commerce, affirmed the jurisdiction of the federal court to grant an injunction against such interference on the broader ground of the federal power over interstate com- merce, which included the power to remove anything put upon the highways, natural or artificial, to obstruct the pas- sage of such commerce, and that this federal power was en- forcible by injunction. § 103. Business boycotts in interstate commerce. — The Anti-Trust Act, of 1890, has also been held applicable to labor combinations other than the employes of interstate 1 United States v. Workingmen's ^ See authorities, supra, and In Amalgamated Council, 54 Fed. re Debs, 64 Fed. Rep. 724 (1894). Rep. 994 (Dist. of La.) (1893); In United States v. Cassiday, 67 United States V. Eliot, 64 Fed. Rep. Fed. Rep. 698 (1895), it was held 27 (1894) (West. Dist. of Mo.); that the provisions of the Anti- United States V. Agler, 62 Fed, Trust Law were broad enough to Rep. 826 (Dist of Ind.) (1894); reach the combination or con- Charge to Grand Jury, Grosscup, spiracy that would interrupt the J., 62 Fed. Rep. 828 (1894); Ross, transportation of property or per- J., 62 Fed. Rep. 834; Waterhouse sons from one state to another. V. Comer, 55 Fed. Rep. 149 (S. ^ i5g u. S. 564, 1. c. 600, 39 L. Dist of Ga.), (1893). Ed. 1092 (1894). 103] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 179 carriers, and it has been held by the Supreme Courts that any combination which essentially obstructs the free flow of com- merce among the states and restricts in that regard the lib- erty of a trader engaged in business is violative of the act, and the averments of a petition setting forth such a combina- tion destroying by means of a boycott an existing interstate business, and preventing vendees in other states from resell- ing the manufactured products when transported, stated a cause of action for damages under the act. The same principle was applied to a bill in equity enjoining a boycott interfering with the conduct of an interstate busi- ness.^ The Court said that it was immaterial that the instruc- mentalities of the boycott were spoken words or written mat- ter. The principle announced by the Court was held to apply to any unlawful combinations resulting in restraint of inter- state commerce, and covered any illegal means by which in- terstate commerce is restrained, whether by unlawful com- binations of capital or unlawful combinations of labor, and whether the restraint be occasioned by unlawful contracts. ' This was what is known as the Danbury Hat case, Loewe v. Lawlor, 208 U. S. 274, 52 L. Ed. 488 (1908), reversing 148 Fed. Rep. 924. The question of the right of action was certified by the court of appeals of the 2nd circuit to the Supreme Court; and the Supreme Court, on the application of the parties, required the whole record to be sent up under section 6 of the Judiciary Act of 1891. In Lawler v. Loewe, 235 U. S. 522, 59 L. Ed. p. 341, (1915). The Court afTirmed 209 Fed. 721, which was a judgment of affirmance of the District Court of Connecticut in favor of plaintifT in suit to recover treble damages under the anti-trust act. This was the case wherein the declaration was held good on demurrer in 208 U. S. 74. The Court held it was correct to allow damages accruing since the action began" which were a con- sequence of, and constituted part of the cause of action declared on. The judgment for treble damages was therefore affirmed. Held also that the members who paid their dues and delegated authority to their officers to interfere unlaw- fully with plaintiff's business, were jointly liable. '' Gompers v. Buck Stove & Range Co., 221 U. S. 418, 55 L. Ed. 797 (1911). The Court said in its opinion as to the right to an injunction and its violation, "in the case of an unlawful conspiracy, the agreement to act in concert when the signal is published gives the words 'unfair' 'we don't pat- ronize,' or similar expressions, a force not inhering in the words themselves and therefore exceed- ing any possible right of speech which a single individual might 180 LABOR COMBINATIONS IN INTBESTATE COMMERCE. [§104 trusts, pooling arrangements, black-lists, boycotts, threats, intimidations and whether this be effected in whole or in part by acts, words or printed matter, and that the court's pro- tective and restraining powers extended to any device whereby property is irreparably damaged or commerce is illegally restrained. The first of these cases, the Danbury Hat case, was an action at law for recovery of damages under the seventh sec- tion of the Anti-Trust Act, and it was therefore strictly within the statute. The equity suit, however, was brought to restrain the interruption of existing business and asked no relief under the Anti-Trust Act. It was therefore sus- tained under the general equity jurisdiction of the court in protection of interstate commerce which existed irrespective of the Anti-Trust Act. § 104. Strikes and boycotts by employes of inter- state carriers. — The right to strike, that is to enforce de- mands for the betterment of their own conditions by con- certed ceasing from employment on the part of employes di- rectly engaged in interstate commerce, has been uniformly sus- tained, but has been broadly distinguished from the right to boycott or engage in a so-called sympathy strike. The inci- dental interference with commerce resulting from a strike, when a body of laborers by concerted action leave their em- ployment does not constitute an unlawful conspiracy, nor is it violative of the Interstate Commerce Act or the Anti-Trust Act.i Laborers directly engaged in interstate commerce have have." Under such circumstances v. California State Fed. of Labor, they become what have been called 189 Fed. 714. (1911). 'verbal acts,' and as much subject ' Hopkins v. United States, 171 to injunction as the use of any U. S. 578, 1. c. 593, 43 L. Ed. 290 other force whereby property is (1898). As to the lawfulness of a unlawfully damaged. When the strike, per se, by railroad em- facts in such cases warrant it, a ployes, see opinion of Hon. Richard court having jurisdiction of the Olney, then attorney general of parties and subject matter, has the United States, in the case power to grant an injunction." As of the Philadelphia & Reading to entry on the contempt charge R. Co., in the proposed adop- in this case see infra, § 103. See tion of a rule by the receivers also as to labor controversy, Loewe excluding members of railroad §104] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 181 the right, singly or in concert, to cease from their employment whenever they deem such action necessary for the better- ment of their own conditions, and it is immaterial, if their demands are made in good faith for the betterment of their own conditions, that is, as to wages or other conditions of employment, whether such demands are reasonable or un- reasonable, provided of course that they act within the limit of their lawful rights, and do not interfere with those who continue in the employment or who are employed to take their places; that is, within these hmits they have the same right with others to determine the reasonableness of their own demands for the betterment of their own conditions. On the other hand, a boycott, or a sympathetic strike, that is the ceasing from employment, not for the purpose of bet- tering their own conditions, but for the purpose of enforcing the employing company to refuse traffic from a connecting carrier, or to refuse to handle some boycotted traffic, is un- lawful. It was said by Judge Taft,' in speaking of the Brotherhoods from employment, printed in p. 504 of Hearings on House Bill No. 89, before the com- mittee on the judiciary of the 58th congress. The court in this case, 65 Fed. Rep. 660 (1894), declined to direct the receivers to abrogate such a rule, which they believed was advantageous to the manage- ment of the property. But see Taft, J., in the Phelan case, supra that "the employes of the re- ceiver had the right to organize into or join a labor union which should take action as to the terms of their employment. It is a bene- fit to them and to the public that laborers should unite for their common interest and for lawful purposes. They have labor to sell. If they stand together they are often able, all of them, to com- mand better prices for their labor, than all dealing singly with rich employers, because the necessities of the single employe may compel him to accept any prices that are offered. The accumulation of a fund for those who feel that the wages offered are below the legiti- mate market value of such labor is desirable. They have the right to appoint ofTicers who shall ad- vise them as to the course to be taken in their relations with their employers. They may unite with other unions. The officers they appoint, or any other person whom they choose to listen to, may advise them as to the proper course to be taken, both in regard to their common employment, or if they choose to appoint any one, may order them, on pain of expul- sion from their union, peacefully to leave the employ of their em- ployer because any of the terms of their employment are unsatis- factory." 1 Thomas v. C, N. 0. & T. P. R. Co., supra. 182 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§105 attempted boycott of the Pullman cars, that it was im- material that such boycott was unaccompanied by violence or intimidation. "The purpose, shortly stated, was to starve the railroad companies and the public into compelling Pullman to do something which they had no lawful right to compel him to _ do; certainly the starvation of a nation cannot be the lawful purpose of a combination, and it is utterly immaterial whether the purpose be effected by means usually lawful or otherwise." The distinction was drawn in another case^ between a com- bination of the employes of the complainant railway company which was seeking an injunction from the combination of the employes of the defendant company. The court said the for- mer was lawful, as the employes of that company were simply exercising their lawful right to cease from employment, that is, to strike, while the latter combination for the refusal of the traffic of the former was unlawful, as it involved a boy- cott for no grievances of their own, thus making a direct in- terference with interstate commerce, which was the intended result of their act, and not the incidental result of their exer- cise of a lawful right. It was also ruled, that a combination to compel railroad companies to break their contracts with the owners of certain cars for the use thereof was an action- able conspiracy and unlawful. It will be observed that in these cases there was not what is known as a simple or primary boycott, as in the case of an organized withdrawal of patronage from a trader for the pur- pose of injuring the business, but it was a "sympathetic strike" of the employes of one interstate carrier for the pur- pose of forcing a refusal of business relations with another interstate carrier in violation of law. § 106. Injunctions in labor controversies under the Clayton Act. It has thus been declared by the Supreme Court under the act of 1890, that any combination, whether of labor or of capital, which restrains the free and natural flow of tirade in the channels of interstate commerce was 1 Toledo, A. A. & M. R. Co. v. Pennsylvania Co., 54 Fed. Rep. 730, 1. c. 738. §105] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 183 violative of the anti-trust law, and that the government, irrespective of that law, had power to protect the right of the citizens to engage in commerce among the states. The Court said in the Eastern States Retail Lumber Dealers Association case,i referring to the rule established in the so-called labor cases: "But the principle announced by the Court was general. It (the Sherman Act) covered any illegal means by which interstate commerce is restrained, whether by unlawful com- binations of capital, or unlawful combinations of labor, and we think also whether the restraints be occasioned by un- lawful contracts, trusts, pooUng, arrangements, black list, boycotts, coercion, threats, intimidation, or whether these be made effective in whole or in part, by acts, words, or printed matter." In the Act of 1914, Section 6, it is provided: "The labor of a human being is not a commodity or article of commerce. Nothing contained in the anti-trust laws shall be construed to forbid the existence and operation of labor, agricultural and horticultural organizations, instituted *for the purposes of mutual help, and not having capital stock or conducted for profit, or to forbid or restrain individual mem- bers of such organizations from lawfully carrying out the legitimate objects thereof; nor shall such organizations, or the members thereof, be held or construed to be illegal com- binations or conspiracies in restraint of trade, under the anti-trust laws." The act further makes detailed provision for the issuance of restraining orders and injunctions, and further pro- vides in Section 20, that no restraining order or injunction shall be granted by a Court of the United States in any case. Court or Judge of the United States in any case between an employer or employees, or between persons employed, or persons seeking employment, involving a dispute concerning terms and conditions of employment, unless necessary to prevent irreparable injury to property or to a property right of the party making the application, for which injury there is no adequate remedy at law, and such property or property right must be described with particularity in the application and sworn to; and it is provided: 1 Supra, p. 156. 184 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§106 "And no such restraining order or injunction shall prohibit any person or persons, whether singly or in concert, from terminating any relation of employment, or from ceasing to perform any work or labor, or from recommending, advising, or persuading others by peaceful means so to do; or from attending at any place where any such person or persons may lawfully be, for the purpose of peacefully obtaining or com- municating information, or from peacefully persuading any person to work or to abstain from working; or from ceasing to patronize or to employ any party to such dispute, or from recommending, advising or persuading others by peaceful and lawful means so to do, or from paying or giving to, or withholding from, any person engaged in such dispute, any strike benefits or other moneys or things of value, or from peaceably assembling in a lawful manner, and for lawful purposes; or from doing any act or thing which might law- fully be done in the absence of such dispute by any party thereto; nor shall any of the acts specified in this paragraph be considered or held to be violations of any law of the United States." This section has not been judicially construed, but it seems clear that there is no substantial change from the existing law in the provision that no injunction shall issue against peaceful and lawful acts, and these are the acts which are not to be considered or held to be violations of any law of the United States. The injunctive power of the Federal courts of equity is obviously limited to the prevention of irreparable injury by any wrongful or unlawful acts, and not by lawful acts. § 106. The law of conspiracy in interstate com- merce. — The law of conspiracy has been extensively dis- cussed in relation to the combinations of both labor and capital in interstate commerce. As there are no common- law offenses in the United States, criminal conspiracies are punishable only as such when they are distinctly declared in the laws of the United States. There are certain specific conspiracies made punishable by the statute, but the section invoked in relation to interstate commerce is what is known as the general conspiracy statute, section 5440, R. S., U. S., which is as follows:^ 1 Section 5440, R. S. U. S., 3 was first enacted in 1867 as a part Comp. Stats., p. 3676. This statute of the Internal Revenue Act, the §106] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 185 "If two or more persons conspire either to commit any of- fense against the United States, or to defraud the United States in any manner or for any purpose, and one or more such parties do any act to affect the object of the conspiracy all the parties to such conspiracy shall be liable to a penalty of not more than ten thousand dollars, or to an imprison- ment of not more than two years, or to both fine and im- prisonment, in the discretion of the court." A conspiracy was defined by the Supreme Court as a combi- nation of two or more persons by concerted action to accom- plish a criminal or unlawful purpose, or some purpose not in itself criminal or unlawful, by criminal or unlawful means. ^ This section has been held to include all conspiracies for affecting private rights and interests, where they are under the protection of the criminal laws of the United States as well as the rights and interests of the government itself. ^ While the offense of conspiracy is an "infamous crime" within the meaning of the fifth amendment to the constitution, re- quiring presentment or indictment of a grand jury,^ it is yet a misdemeanor and not a felony, and an indictment is not defective by reason of failing to aver that the conspiracy was "feloniously" entered into.^ As the offense is a misdemeanor, penalty therein being not less of justice by intimidation and than one thousand nor more than violence in a strike, on the ground ten thousand dollars, and im- that the indictment failed to show prisonment for not more than two that the defendants had notice of years; subsequently incorporated the pendency of proceedings in in the revised statutes and amended the United States courts which into its present form by act of they were charged with combin- May 17, 1879. It has been held ing to obstruct, to apply to all crimes under ^ United States v. Sanche, supra. the laws of the United States. See ' Mackin v. United States, 117 United States v. Sanche, 7 Fed. U. S. 348, 29 L. Ed. 909 (1886); Rep. 715 (W. Dist. of Tenn.) Callan v. Wilson,- 127 U. S. 540, 32 (1881). L. Ed. 223 (1888), where held that ' Pettibone v. United States, a conspiracy at common law for 148 U. S. 197, 37 L. Ed. 419 (1892), alleged boycott in the District of citing Shaw, C. J., in Common- Columbia was not triable sum- wealth v. Hunt, 4 Metcalf 111. marily before a police magistrate, In this case the Court quashed an but that jury trial was demand- indictment whereunder a convic- able as a right, tion had been had for conspiring ' Bannon v. United States, 156 to obstruct the due administration U. S. 464, 39 L. Ed. (1895), 464. 186 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§106 the doctrine of merger has been held not applicable, so that an acquittal of the offense of conspiracy is not a bar to the prosecution for the crime itself. ^ A conviction under this statute for conspiracy to obstruct the United States mails^ was aflfirmed, and the conspiracy was held to be a separate offense for which congress had power to provide a greater punishment than for the offense itself for which the conspiracy was formed.' The law of conspiracy was invoked in connection with the labor disturbances of 1893 and 1894, and a number of crimi- nal prosecutions were instituted and indictments found for criminal conspiracy to commit offenses of violation of the Interstate Commerce and Anti-Trust Acts.* These statutes, as will be seen, prohibit and make criminal interferences with or combinations in restraint of trade in interstate commerce.^ The subject was exhaustively discussed also in the injunc- tion and contempt proceedings growing out of the same dis- turbances. The law of conspiracy has been applied in deter- mining the responsibility of persons not parties to the record for contempt of court in violation of an injunction under the rule, that when a conspiracy is shown, each conspirator is responsible for the acts of his co-conspirators.' It was held by Taft, J., in the Toledo, A. A. & N. W. Railroad case,- supra, that threatening action to withhold labor from an- other, for the purpose of inducing, procuring or compelling the other to commit an unlawful act was itself a criminal or unlawful act. As the Interstate Commerce Act, section 3, prohibited the carrier from refusing to interchange traffic with another carrier, the threatening to withhold labor for the purpose of compelling him to refuse such traffic was it- self a criminal or unlawful act. The enforcement of a rule of the Brotherhood of Engineers requiring its members to re- 'Berkowitz v. United States, 62 Fed. Rep. 838; United States 3rd Circuit, 35 C. C. A. 379, 93 v. Cassiday, 67 Fed. Rep. 698; Fed. Rep. 452 (1899). In re Debs, supra. 2 Sec. 3995 R. S. of U. S., 3 * As to criminal conspiracy under Comp. Stat., 2716. Anti-Trust Act, and its distinction ' Clune V. United States, 159 U. from conpiracy under sec. 5440, S. 590, 40 L. Ed. 269 (1895). see infra, § 568. *See Charge to Grand Jury « In re Bessette, 111 Fed. Rep. Grosscup, J., supra, and Ross, J., 417 (1901). § 106] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 187 fuse to handle property of a railroad system with which the brotherhood was at issue was held to constitute a criminal conspiracy under the laws of the United States, and the officers and all members of the brotherhood engaged in en- forcing the rule were held equally guilty and subject to the penalties of the section. The courts have allowed proof of the character and pur- poses of a conspiracy to be made by oflTicial proclamation, newspapers and reports, and other matters of public current history.^ It was also held in these cases that the parties to a criminal conspiracy are liable for any actual loss to private parties in- flicted in pursuance of their conspiracy. The gist of any such action however is not as in criminal cases in the combination, but in the fact of injury, and no civil Uabihty arises unless injury is done. Ordinarily the only difference between the civil liability for an injury from one person and from the same acts done by a conspiracy is in the greater probability of injury in the latter case. The threat of such injury from which irreparable injury would flow warranted the relief by injunction to prevent the injury. It should be observed however that a conspiracy may con- sist in a conbination to accomplish a lawful end by means which are unlawful, though not criminal in the sense that they are made punishable by statute. All criminal acts are unlawful, but unlawful acts are not all criminal. As a con- certed peaceful cessation from labor is lawful, there can be no basis of a charge of conspiracy in such cases, unless un- lawful means are employed in furtherance of the purposes of the strike. There can be no conspiracy in the exercise of a lawful right by lawful means, and it is immaterial in such a case what may be the motive in this exercise of a lawful right. As men may leave their employment at will, when not under contract, so the employer may exercise his right of terminating the relation, where there is no contract, what- ever the motive, and no charge of conspiracy can be based upon such exercise of a lawful right. ^ ' In re Debs, supra; U. S. v. ^ Boyer v. Western Union Tel. Amalgamated Ass'n, supra; Clune Co., 124 Fed. Rep. 246 (E. Dist. V. U. S., supra. of Mo. 1903). 188 LABOR cOmbiUaTions in interstate commerce. [§ 107 § 107. Distinguished from common-law conspiracy. Conspiracy under the laws of the United States as applied in interstate commerce cases is to be distinguished from com- mon-law conspiracy, which is in force in some of the states. Thus, in England it was found necessary to legalize strikes of workingmen by the enactment of the "Conspiracy and Protection of Property Act" of 1875.' The law of the United States requires an act to be done affecting the object of the conspiracy, that is, an overt act, and the conspiracy must relate to an offense against the United States or the defraud- ing the United States., Not only obstruction of the mails, but any direct and intended interference with interstate com- merce, if committed by one person, is an offense against the United States, and punishable as such.^ The law of conspi- racy therefore in such a case is not the basis of the criminal action, as the offense is not made by the combination, but by the illegality of the end proposed, whether the means em- ployed are lawful or unlawful. The enactment of the English statute by congress would have no material bearing upon the law of conspiracy as now applied in interstate commerce cases. As a concerted peaceable cessation from labor is lawful, in interstate employment as in any other, there is in such cases no illegality in the object sought, and no statute is required to legalize such action. The English statute only applies to criminal prosecutions for conspiracies, and combinations for unlawful, though not criminal ends, as the destruction or injury of another's prop- 1 38, 39 Vic. c. 86, providing It was held in Regina v. Bauld, that an agreement or combination 13 Cox C. C, 282 (1876), that un- by two or more persons to do or to der this act neither master nor procure to be done any act in con- men had a right to taken any pro- templation or furtherance of a ceedings to compel other masters trade dispute between employers or men to adopt their views on any and workingmen shall not be in- trade question. With this section dictable as a conspiracy, for such were also enacted certain limita- act, if committed by one person, tions and restrictions upon the would not be punishable as a "besetting" by picketing and solic- crime. Nothing in this section itation in case of strikes, shall exempt from punishment any ^ Sgg jq gf interstate Commerce person guilty of a conspiracy for Act, infra. which a punishment is awarded by act of parliament. §108] LABOR COMBINATIONS IN INTEESTATE COMMERCE. 189 erty or business, without justifiable reason, are still unlawful in England, and still constitute the basis of civil liability. § 108. Interstate commerce in relation to employes therein. — There has been some difference of judicial opinion as to the illegality of boycotts when unattended with vio- lence, intimidation or other illegal methods, that is whether in the absence of statute, the act which one might lawfully do, as the withholding of patronage from another, is made illegal by combinations with others to do the same act. Thus it has been said that malice or the specific intent to injure the party may constitute a combination an illegal conspiracy, while other authorities have based the legal right to rehef upon the greater probability of injury in the case of a combination, and it has been denied that private malice can be an ingredi- ent in making a civil action, ' except in certain recognized exceptions where maUce is essential, as in malicious prose- cution. This distinction, however, is academic rather than prac- tical in its relations to interstate commerce. There is an obvious distinction between the relations of quasi-puhlic corporations, such as carriers to their employes, — ^which is emphasized by their connection with interstate commerce, 'See prevailing and dissenting ever, with distinctly illegal opinions in Hopkins v. Oxley Stave "means." See State v. Glidden, 55 Co., supra, and Vegelhan v. Hun- Conn. 46 (1887); Crump v. Com- ter, 167 Mass. 92 (1886); Taft, J., monwealth, 84 Va. 927 (1889); on the state bench of Ohio, in State v. Stewart, 59 Vt. 273 (1887); Moores v. Bricklayers' Union, 23 State v. Donaldson, 32 N. J. Law, Weekly Law Bui. 48, and 7 Rail- 151, where indictments for con- way & Corp. Law Journal, 108 spiracy in boycott cases were sus- (1890); Allen v. Flood, 67 L. J. tained. See also Casey v. Central Q. B. Rep. 119; (1898), App. Typo. Union, 45 Fed. Rep. 135 Cases 1; Paper of L. C. Karuthoff (1891); Old Dominion S. S. Co. v. on Malice as an Ingredient of McKenna, 30 Fed. Rep. 49 (1887) Civil Actions, American Bar As- (So. Dist. of Ohio); Carew v. sociationof 1898. Rutherford, 106 Mass. 1; Walker The weight of American author- v. Cronin, 107 Mass. 555; Doremus ity is condemnatory of "boycotts," v. Hennesy, 176 111. 608; Lucke v. that is, of organized efforts to de- Clothing Cutters & Trimmers As- stroy another's business. The sembly, 77 Md. 396. cases are usually complicated, how- 190 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§108 and thus a matter of direct federal concern, — and that of private employers to their employes, which grows out of the peculiar relations of such carriers to the public. The former cannot "lock out" their employes by suspending business for a time because of unsatisfactory labor conditions which pre- vent then from doing business profitably, and in such matter they have not the rights which may be exercised by private manufacturers. The cars must continue to move and traffic must continue to flow. Any interference with the traffic therefore except that which is the incidental result of the exercise of a lawful right, as the ceasing from employment for the betterment of one's own conditions, is unlawful. This principle does not require the existence of through routing arrangements between carriers, but rests on the broad declaration of national policy which requires the interchange of traffic, whether through routing under contractual ar- rangements exists, or not. This immunity of interstate commerce from direct inter- ference not justified by the lawful exercise of rights is not limited to railroads or other interstate carriers, but is applic- able to any parties engaged in transporting or handling inter- state traffic, such as teamsters, draymen, transfer employes, or others, that is wherever the services are essential to the continued moving of interstate traffic from the point of ship- ment by the consignor in one state to the delivery to the consignee in another state. ^ Thus combinations in restraint of interstate commerce are obnoxious to the federal law, though the subjects of such contracts are within the juris- diction of the state. 2 A boycott involving any form of in- terference with interstate traffic at any stage would be un- lawful.* Thus, a combination in New Orleans to enforce the employment of none but union men in all departments of labor became a combination in restraint of interstate com- merce within the meaning of the statute when, in order to gain its ends, it sought to bring about a discontinuance of 1 See Rhodes v. Iowa, 170 U. S. v. Swift, 122 Fed. Rep. 529 (N. 412, 42 L. Ed. 1088 (1897). Dist. of 111.) (1903). 2 Addyston Pipe & SLeel Co. v. = See Knudson V. Benn (Dist. of United States, sUjDT-a; United States Minn.), 123 Fed. Rep. 636 (1903). §109] LABOR COMBINATIONS IN INTEHSTATE COMMERCE. 191 labor in all departments of business including the transpor- tation of goods from state to state and from foreign nations. ' § 109. "Picketing" and "soliciting" in interstate commerce. — The same distinction is to be applied and the same distinction recognized in determining the rights of striking employes in picketing the approaches to stations or besetting, by soliciting or otherwise, their fellow-employes who do not strike, or those who are employed to take their places. It is not within the scope of this work to consider what is the extent or what are the limitations of the right to picket or solicit in private employment. Such questions are frequently presented to the state courts, and also in the federal courts in cases where their jurisdiction is invoked on grounds of diverse citizenship, and no distrinctly federal question is involved.^ The public interest, which is not con- sidered paramount in ordinary trade disputes, that is, the public convenience and even the public necessities, are often not given the weight that they should have. But wherever interstate or foreign commerce is involved, this public interest is made paramount by the laws of the United States. All classes of the community, workingmen as well as capitalists, are interested in the prompt transmission of the mails and the uninterrupted carriage of persons and freight. Any form of interference therefore with the free movement of interstate traffic, whether by picketing or sohciting, or any form of obstruction, would be a direct interference with interstate commerce and unlawful as such, when it is not the incidental result of the exercise of a lawful right, as the concerted cessation from employment. It is true that a con- certed cessation from employment, as in strikes, results also in an interference with interstate commerce, and may involve widespread public inconvenience and suffering, but that is the incidental result of the exercise of a lawful right. After this right is exercised, the interference thereafter resulting from boycotting any interstate traffic, or soliciting or besetting em- * United States v. Workingmen's ' KoUey v. Robinson (C. C. A. Amalgamated Council of New 8th Cir.), 187 Fed. 415; Iron Orleans (E. D. of La.), supra. Moulders' Union v. AUis-Chal- mers (C. C. A., 7th Cir.), supra. 192 LABOR COMBINATIONS IN INTEESTATE COMMERCE. [§110 ployes in such commerce to leave their employment, is not incidental, but is caused by a direct interference with inter- state commerce. This distinction is not based upon any favor to the carrier, or for any abridgment of the rights of employes, but because the public interest, which concerns all citizens alike, is paramount. ^ What has been said applies to the employes of interstate carriers, and not to ordinary trade disputes where the Federal jurisdiction is invoked solely on the ground of diverse citizen- ship. As to the latter class of cases, the Clayton act of 1914 specifically provides in section 20 that an injunction shall not issue against peacefully persuading any person to abstain from working, and that such peaceable persuasion shall not be considered in violation of any law of the United States. § 110. The status of interstate railroad employes is that of free contract. — The relation of interstate carriers to their employes is that of free contract, terminable by either party, subject to the terms of the contract. This relation therefore is not analogous to that of seamen in the maritime service, who to a certain extent surrender their liberty in their employment and are punishable for an unlawful deser- tion. 2 It was said in Arthur v. Oakes' that, in the absence of legislation to the contrary, the right of one in the service of a ^uasi-public corporation to withdraw himself at such time as he sees fit, and the right of the managers of the corporation to ' United States v. Workingmen's that full and intelligent responsi- Amalgamated Council, supra; bility for their acts which is ac- Knudson v. Benn, supra (Minn.); credited to ordinary adults, and as Union Pacific R. Co. v. Ruef needing the protection of the law, (Dist. of Neb.), 120 Fed. Rep. in the same sense in which minors 102 (1902). and wards are entitled to the pro- " The Supreme Court said in Rob- tection of their parents and guard- ertson v. Baldwin 165 U. S. 1. c. ians." Harlan, J., dissented, say- 287, 41 L. Ed. 715 (1896), in sus- ing that the holding of any person taining the constitutionality of in custody for the purpose of corn- sections 4598 and 4599, R. S. U. S., pelling him to render personal 3 Comp. Stat. p. 3115, authorizing service in a private business was apprehension of deserting seamen, "involuntary servitude," prohibited that "seamen are treated by con- by the constitution, gress, as well as by the parliament '11 C. C. A. 209, and 63 Fed. of Great Britain, as deficient in Rep. 310 (1894). §110] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 193 discharge an employe whenever they see fit, must be deemed so far absolute that no court could compel the continuance of the employment on the demand of either party. It has been suggested that there are limits upon the right of the employes of a railroad to abandon their employment ; that is, that it should not be exercised at a time or under circum- stances indicating a purpose to obstruct commerce or to pre- vent its operation, rather than to exercise the lawful right of withdrawal from employment. ' Thus the Supreme Court, in affirming the jurisdiction of the circuit court in punishing an engineer for contempt of an inj unction, ^ said that it was not necessary to decide whether an engineer may suddenly and without notice quit the service of a railroad company at an intermediate station or between stations, though cases may be imagined where the sudden abandonment of a train- load of passengers might imperil their safety or even their lives, as in this case the court below had found from the testiinony that the petitioner did not quit in good faith, but intended to continue in the company's service, and that his conduct was a device to avoid obeying the order of the court. This subject of the exercise of the right to leave employ- ' While there is no federal statute on the subject, there are special statutory provisions in the several states, Maine, Pennsyl- vania, Illinois, New Jersey, Kansas, Delaware and Mississippi, the pur- pose of which is to prevent such sudden abandonment of employ- ment as should endanger life or seriously obstruct the actual physi- cal use of the railroad. In several of the states the provision is made that no locomotive engineer, and in some states conductors and train- men, shall abandon the locomotive and train at any other place than the regular scheduled end of the road. Ilfinois Revised Statutes, 3 Starr & Curtis, p. 3297; Maine R. S, 1903, p. 927, sec. 7; Pennsylvania R. S. Pardon's Dig. 920; New Jer- sey R. S. 1895, p. 2696, sec. 245; Kansas R. S. 1909, sec. 2384; Dela- ware R. S., p. 928; Mississippi R. S. 1906, sec. 1345. See also Re- port of Industrial Commission, vol. 5, p. 132; vol. 17, p. 601. See also Report of Board of Arbitration between the Brotherhood of Loco- motive Engineers and the Eastern Railroads, 1912, wherein they com- ment on the danger to the public involved in the concerted leaving of employment by all the engineers of this section of the country, thus paralyzing transportation, and in- sisting that this public danger required some provision for adjust- ing controversies as to compensa- tion and terms of employment, of such employes of public carriers. 2 In re Lennon, 166 U. S. 548 (1897), 41 L. Ed. 1110. J-13. 1 94 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§111 ment was discussed by the circuit court of appeals for the seventh circuit in an opinion by Justice Harlan' in a case wherein the court below had made an order enjoining em- ployes from so quitting the service of the receivers, " with or without notice, as to cripple the property or prevent the operation of the railroad." The court said that the latter words, "as to cripple the property," etc., should be stricken out. The fact that employes of railroads may quit under circumstances which would show bad faith or reckless dis- regard of their contracts, or the convenience or interests of both the employer and the public, did not justify a departure from the general rule that equity would not require employes against their will to remain in the personal service of the employer. The court ruled however that the injunction properly prohibited the employes from combining and con- spiring to quit with or without notice the service of the receivers, "with the object and intent of crippling the prop- erty in their custody or embarrassing the operation of the railroad." This case was not based upon either the Interstate Com- merce Act or the Anti-Trust Act, but, as the court said, upon the general principles which controlled the exercise of juris- diction by courts of equity. § 111. The right of labor organization includes the right of representation. — The right of organization into unions or brotherhoods by the employes of interstate rail- roads is recognized both by the federal statutes ^ and by the courts, and this right carries with it the recognition of the right of "collective bargaining" by employes through their organizations in the betterment of their own conditions of service. Incidental to this right thus recognized is the right of representation of employes by their own ofTicials selected by them in the presentation of their demands for the better- ment of their conditions of service. A distinction is properly made between such representatives of employes who seek the redress of the grievances of those represented by them, and the status of those not connected with employes who seek - ' Arthur v. Oakes, supra. i See National statute of arbi- tration, supra. § 1 12] LABOK COMBINATIONS IN INTERSTATE COMMERCE. 195 to induce them to break their contracts of employment for other purposes than their own betterment." This right of representation was directly involved in a case decided by Judge Adams in the eastern district of Missouri. ^ In this case an injunction was sought by the railroad company against the officials of the railroad brotherhoods of trainmen and firemen enjoining them from calling a strike on an inter- state railroad on the ground, among others, that these officials were not employes of the railroad, and that their action in calling a strike would be a direct interference with inter- state commerce. The court found from the evidence that there was an existing dispute about the conditions of em- ployment and that the officers of the brotherhood had been directed by the employes on the road to call a strike and therefore held that the employes had a right to act by their representatives, and the injunction was dissolved. § 112. Injunctions in interstate commerce. — In a progressive industrial civilization preventive remedies are frequently the only adequate remedies when business or prop- erty rights are invaded, particularly when there is any ques- tion as to the pecuniary responsibility of the parties charged with the wrong. This is the case with labor disturbances which involve a direct interruption of business and damages, which are in the nature of things irreparable, because they cannot be accurately ascertained, even if the defendants were responsible. Where the public interest intervenes, as in the case of interstate commerce, where the traffic must continue to be moved and the cars continue to run, some form of pre- ventive relief, usually that of injunction, is ordinarily the only available remedy. The influence upon our jurisprudence of the ancient historic jealousy of courts of chancery' is illustrated in the conten- ' Thomas v. C, N. 0. & T. P. R. lished in the English- courts than Co., supra; see also charge of in our own. The distinction be- Judge Grosscup to grand jury, tween the powers of courts of law supra. and courts of equity has there ' Wabash R. R. Co. v. Hannahan now only historical interest. All et al., supra. divisions of the Supreme court of ' The use of preventive reme- Judicature have jurisdiction to dies seems more firmly estab- grant injunctions' when it shall 196 LABOE COMBINATIONS IN INTERSTATE COMMERCE. [§112 tion that where the trespasses or other wrongs to' business or other property involve a violation of criminal law, there is no jurisdiction in equity to enjoin the commission of the acts. This contention is obviously unsound. The injunction re- strains not the crime, but the irreparable injury to property. The question was definitely settled by the Supreme Court in the Debs case,^ where the Court held that while a chancellor had no criminal jurisdiction, and something more than the threatened commission of an offense against the laws of the land was necessary to call into exercise the injunctive power of the court, that when interference with property, actual or threatened, appeared, the jurisdiction of the court of equity arises, and is not destroyed by the fact that the interferences are accompanied by or are themselves a violation of the crim- inal law. The jurisdiction of the civil court is invoked, not to enforce the criminal law and to punish the wrong-doer, but to compensate the injured party for the damages which he has suffered, or to protect him from irreparable injury, and it is no defense to the civil action that the same act by defendant ex- poses him also to indictment and punishment in a court of criminal jurisdiction. In this case the injunction was sought by the government itself, and it is obvious that the right of any other litigant to preventive relief in the case of threat- ened irreparable injury to property by criminal trespass would be also available. The same remedy of injunction was invoked by the govern- ment against the railroads of the country in the proceedings under the Anti-Trust Act,^ and also against combinations of capitalists under the same statute.' In the Beef Trust case,* appear to the court to be just or the federal judiciary, American convenient that such shall be Bar Association, 1895. made (subsec. 8, sec. 25 Judi- ' 158 U. S. 1. c. p. 593, 39 L. Ed. cature Act, 1873), and to award 1106, supra. (1894). damages in addition to or in sub- ^ See United States v. Trans- stitution for such injunction. Missouri Freight Association; On the general subject of the United States v. Joint Traffic Asso- modern use of injunctions, see F. elation, and United States v. J. Stimson in Political Science Northern Securities Co., supra; Quarterly, June, 1895; Charles Swift v. United States, 196 U. S. Claflin Allen at American Bar Asso- 375, 49 L. Ed. 518 (1905). ciatiqn, 1894; Hon. Wm. H. Taft, « See Anti-Trust Law, infra. then circuit judge, in defense of * Swift v. United States, infra. §112] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 197 the Supreme Court affirmed the decree of the circuit of IIH- nois enjoining the defendants in a suit by the United States against certain specific acts in restraint of competition in interstate commerce. In this latter case however the Court directed a modifica- tion of the injunction by striking out the general words "or by any other method or device, the purpose and effect of which is to restrain commerce as aforesaid," saying that the defendants ought to be informed as accurately as the case per- mitted what they were forbidden to do. The Court said that while it was bound to enforce the act, it was also bound by the first principles of justice not to sanction a decree so vague as to put the whole conduct of defendant's business at the peril of a summons for contempt, and that it could not issue a general injunction against all possible breaches of the law. There has been considerable discussion in the courts and also in the committees of congress as to the scope of injunc- tions rendered in trade disputes. Thus, in the Debs case the injunction order included all persons whatsoever, not named therein, from and after the time when they shall severally have notice of such order. The question as to the scope of the order was not definitely determined, as the order was issued and served upon the defendant, so that this feature of the order was not discussed in the Supreme Court, although the power of the court under such an order was sustained in the circuit court. ^ Persons who are in privity with the defendant as agents, servants or employes are to be distinguished from independ- ent tort-feasors who are not shown to be in any wise allied with the defendants. ^ The Supreme Court sustained the j uris- diction of the circuit court in the case of In re Lennon,' saying that it was sufficient that he had actual notice, although he was not a party to the suit, nor served with process; in ' Toledo, etc. R. Co. v. Penn. R. cedure thereunder, see Anti-Trust Co., supra; In re Debs, supra. Act, infra, section 4. As to the jurisdiction of the courts ^ In re Reese, 98 Fed. Rep. 984, in issuing injunctions under the 47 C. C. A. 87, and 107 Fed. Rep. Interstate Commerce Act, see sees. 942 (1900). 8 and 9 of Act, infra; and as to ^ Supra. the Anti-Trust Act and the pro- 198 LABOE COMBINATIONS IN INTERf?TATE COMMERCE. [§113 that case however Lennon was an employe of the defendant, which had been enjoined from refusing to interchange traffic with the complainant, and he was shown, with full knowledge of the injunction, to have refused to obey it. Other questions have been raised as to the proper scope of injunctions in trade disputes, particularly with reference to the conduct of striking employes, but these have been in cases, where the jurisdiction of the federal courts was based on diverse citizenship as in mining, manufacturing and other local industries where interstate commerce was in no wise involved. The Clayton act of 1914 in the section already referred to, makes provision for restraining orders and injunctions to prevent irreparable injury to tangible property or property rights, and for the issuance of restraining orders to prevent immediate injury, and provides in detail for the procedure in such cases. § 113. Contempt in United States courts. — A con- tempt proceeding, said the Supreme Court^ is criminal in its nature in that the party is charged with doing some- thing forbidden, and if found guilty, is punished. Yet it may be resorted to in civil as well as in criminal actions, and also independently of civil or criminal action. While the power to punish for contempts is inherent in all courts, the exercise of the power by the courts of the United States has been regulated by statute, as follows i^ "Courts of the United States shall have power to impose and administer all necessary oaths and to punish by fine or imprisonment at the discretion of the courts contempt of their authority; provided that such power to punish for con- tempt shall not be construed to extend to any case except the misbehavior of any person in their presence, or so near thereto as to obstruct the officers of said court in their official transactions, and the disobedience or resistance by such officer or by any party, juror, witness or other person to any lawful order, process, rule, decree, or command of said court." 1 Bessette v. Conkey Co., 194 U. ^ Sec. 725, R. S. U. S.. 1 Comp. S. 324, 48 L. Ed. 997 (1904). Stats, p. 583. §113] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 199 Whether a particular act constitutes a contempt, as well as the mode of proceeding against the offender, are left to be de- termined according to such established rules of the common law as are applicable to the situation. A federal court may punish for contempt in its presence, or so near as to obstruct justice though the offense is indictable.^ The interference with the operation of a road by a receiver appointed by the federal court is itself a contempt, as the re- ceiver is an officer of the court, and no specific injunction order in such case is required.^ The power of the court to punish disobedience of an injunction order by a party to the case as a contempt has been repeatedly adjudged.' The power to punish for contempt is inherent in all courts of record, and it has been held that in the case of courts estab- lished by the constitution this power cannot be abridged by the legislature, as this is the inherent power of a co-ordinate branch of the government.^ It was intimated by the Supreme Court however^ that the power of the circuit courts and district courts of the United States to punish for contempt could be regulated by congress, and that their power is limited by the act of 1831, cited above, and that the power to punish by fine and imprisonment is negative of all other forms of punishment. The circuit court said in the Debs case' that the power of the court to make an order carries with it the equal power to punish for dis- obedience of that order and the inquiry as to the question of disobedience has been from time immemorial within the dis- cretion of the court. It was also held that a case of contempt was not triable by jury, nor is a judgment on such charge a substitute for, or any defense to a criminal prosecution for the same act. ' In re Savin, 131 U. S. 267, 33 * Carter v. Commonwealth, 96 L. Ed. 150 (1889). Va. 791 (1899). 2 United States v. Kane, 23 Fed. <■ Ex parte Robinson, 19 Wall. Rep. 748 (1885); In re Doolittle, 23 513, 22 L. Ed. 205 (1874). Fed. Rep. 544(1885);InreHiggins, "158 U. S., 1. c. 594. See the 27Fed. Rep. 443 (1886); Thomas V. order made in In re. Steiner 195 R. Co., supra. Fed. 303. ' Ex Parte Lennort, supra; In re Debs, supra. 200 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§115 § 114. Direct And indirect contempts. — ^The increas- ing use of injunctions in the federal courts in trade disputes, has led to a discussion on the inherent distinction between direct and indirect contempts, that is, between those com- mitted in the presence of the court and properly subject as such to- summary hearing and punishment and requiring no hearing, as the acts are committed in the view of the court, and on the other hand those of alleged disobedience to the orders of the court not committed in its presence, and therefore necessarily requiring proof before punishment can be imposed. It has been urged as to this latter class of cases, particularly where parties are charged with the re- sponsibility of the acts of others under the law of conspiracy, that the hearing should not be summary, but that process should be served, and that the procedure should be regulated by law in accordance with constitutional guarantees in criminal hearings. § 115. Criminal and civil contempts. — Contempts are also classified as criminal contempts, which are prosecuted to preserve the power and vindicate the dignity of the court in punishing the defendant, and as civil contempts, which are prosecuted to preserve and enforce the rights of private parties and to compel obedience to orders and decrees so as to enforce the rights and administer the remedies to which the court has found such parties to be entitled. A criminal contempt, said the court of appeals in the Nevitt case,i involves no element of personal injury. It is directed against the power and dignity of the court and pri- vate parties have little, if any, interest in the proceedings for its punishment. ' In re Nevitt, Gir. Ct. App., reversible by writ of error only, 8th Circuit, 55 C. C. A. 622, 117 and that a judgment against a Fed. Rep. 448 (1902), quoted by the party to a suit in equity for a Supreme Court in Bessette v. W. civil contempt committed therein R. Conkey Co., supra. before final decree, is reversible In Clay v. Waters, 178 Fed. 385 by appeal from the final decree (1910), C. C. A. 8th circuit, it only, and that judgment against was held that a judgment for a a party for a civil contempt com- criminal contempt committed in mitted after the decree is reversible the course of a suit in equity, is by appeal. §115] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 201 It was said hy the Supreme Court in the Bessette case/ which was a trade dispute not involving interstate commerce, that it may not be always easy to classify the particular act as belonging to either of these two classes and that it may partake of the characteristics of both. In combinations in- terfering with interstate commerce whether the proceedings are filed directly by government or by public carriers, it would seem that the violation of the injunction order made for the promotion of public and not private ends would fall in the class of criminal rather than civil contempts. The fact that a part of the fine imposed in punishment of a contempt is made payable to the government is not conclu- sive that it is a criminal and not a civil contempt.^ The dis- tinguishing characteristic between the civil and criminal con- tempt is the dominating object of the prosecution and the party chiefly interested therein. In the language of the cir- cuit court of appeals,' if the chief purpose of the proceeding for contempt is to enforce the rights and administer the ' 1. c. p. 329. ^ In re Christensen Engineering Co., 194 U. S. 459, 48 L. Ed. 1072 (1904), the Court held that an order of the circuit court ad- judging the defendant in a patent suit guilty of a contempt in dis- obeying a preliminary injunction, and ordering him to pay a fine one-half to the complainant and one-half to the United States was clearly a criminal contempt, and as such reviewable on writ of error by the circuit court of ap- peals without waiting for final decree and mandamus was issued directing that court to reinstate and hear the case. In Merchant's Stock & Grain Co. v. Board of Trade, 187 Fed. 893 (1911), the circuit court of appeals, 8th cir- cuit, distinguished from the Chris- tensen case a judgment against a party for violation of a temporary injunction, although one-fourth of the fine imposed was paid to the United States, and the balance to the complainant, and held that the violation of the order was a civil contempt, as the chief and dominating purpose was the protection of the party complain- ant, and that while a judgment for a criminal contempt was review- able by writ of error, a judgment for a civil contempt committed before final decree was reviewable by appeal from the final decree only, and if it was committed after the final decree it was review- able by appeal. In Gompers v. U. S. 233 U. S. 604, 58 L. Ed. 1115. (1913), reversing 40 App. D. C. 293, the Court held that criminal con- tempts are crimes within the mean- ing of U. S. R. S. 1044 prescribing a three years' limitation for criminal prosecution. 2 Merchant's Stock & Grain Co. Case, supra. 202 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§115 remedies to which courts have adjudged or may adjudge a private party to be entitled, and if such private party is the person chiefly interested in it, the proceeding is for a civil con- tempt. If the chief object of the prosecution as in cases of inisconduct in court, or the disobedience of a subpoena, will be punishment of the offender to preserve the right and vindi- cate the dignity of the court, and if the party chiefly inter- ested in the prosecution is the government or the public, the proceeding is for a criminal contempt. The distinction between civil and criminal contempts was forcibly illustrated in the contempt proceedings growing out of the litigation between the Buck Stove & Range Co. and the American Federation of Labor. ^ Individual ofTicials of the federation were charged with contempt of the injunction in publishing references to the complainants under the headings "unfair" or "we don't patronize" and were found guilty of contempt and sentenced to imprisonment. Subsequently the litigation between the parties to the suit was adjusted and the case was dismissed. The Supreme Court held that a contempt proceeding was as a rule neither wholly civil nor wholly crim- inal, but this proceeding under the facts of this case was dis- tinctively civil, and that there was nothing in the record indicating that it was a proceeding with the court or the government on one side and the defendant on the other. As it was a civil proceeding, imprisonment could only be im- posed as a coercive means to compel the doing of some act commanded by the court for the benefit of the other party. The proceeding therefore necessarily ended with the settle- 1 Gompers v. Buck Stove & left in doubt as to whether reUef Range Co., 221 U. S. 418, 55 L. Ed. or punishment was the object in 797, (1911), reversing 33 App. view. In a criminal contempt the D. C. 516. The Court in this defendant is entitled to the con- case said proceedings at law for stitutional protection against self criminal contempt should be en- incrimination but not in a pro- titled as a separate action. That ceeding for civil contempt. In a this was not a mere matter of form, civil case the complainant is en- as the citizen was entitled to know titled to the costs, but in a crim- by a mere inspection of the pro- inal contempt the costs collected ceedings whether it was instituted go to the government for the use for private litigation or for public of its officials, prosecution. He should not be §117] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 203 ment of the main case of which it was a part; and it was therefore dismissed without prejudice to the right of the court to punish by a proper proceeding any contempt which had been committed against its own authority. § 116. Conspiracy and contempt. — The law of con- spiracy has been applied in proceedings for contempt, and persons not parties to the record have been charged with contempt as co-conspirators with the defendants, and there- fore in law responsible for their acts. ' The liability to punish- ment for contempt is not limited to parties to the record, but any person, who knowingly assists in defeating the order of a court, may be charged with contempt therefor. In such cases, however, where the injunction has been issued for the benefit of a private person with no public interest involved, the offense of the person not a party is solely that of resist- ance to the authority and dignity of the court, and he should be proceeded against upon that theory, and not upon the theory of being bound by the injunction as a party thereto.^ An order of a federal circuit court, adjudging a person not a party to a suit guilty of contempt for conspiring to violate an injunction in a trade dispute, was held reviewable by writ of error in the circuit court of appeals, but in such a writ only matters of law can be considered, the decision of the trial tribunal being conclusive of the facts.^ § 117. Contempt under the Act of 1914. — The cases cited in the two preceding sections were decided before the passage of the Clayton Act of 1914, which in sections 21 to 25 enacts new provisions concerning contempt in the federal courts. Section 21 provides that a person who wilfully dis- obeys any lawful order of the court, if the act done by him is of such a character as to constitute also a criminal ofTense under any statute of the United States or any law of the State where the act is committed, he shall be proceeded against for his contempt. The act also provides that the 'See In re Bessette, 111 Fed. 'Bessette v. Conkey Co., supra Rep. 417. (1904). 2 See In re Reese, 98 Fed. Rep. 984, supra. 204 LABOR COMBINATIONS IN INTERSTATE COMMERCE. [§118 trial on the charge on contempt may be by the Court, or upon demand of the accused, by a jury, in which latter case the Court may impanel the jury from the jurors then in attendance, or cause a jury to be summoned, and the jury shall be selected and impaneled as upon the trial of a mis- demeanor, and the trial conform as near as may be as upon a trial after indictment. The act further provides that nothing therein contained concerning contempts relates to contempts committed in the presence of the Court, or so near thereto as to obstruct the administration of justice, nor the contempts committed in disobedience of any lawful writ or order, rule, decree or com- mand, entered in any suit or action brought or prosecuted in the name or on behalf of the United States, but the same as in all other cases of contempt, not specifically embraced in section 21, may be punished in conformity to the usages or the laws thereto now prevailing. As nearly all contempts are based upon the charge of obstructing the administration of justice by disobeying the orders of the Court, it would seem that such cases are expressly excepted from the regu- lations prescribed. The act also makes specific provision for the punishment in cases of contempt by a fine not to exceed, in case the ac- cused is a natural person, the sum of one thousand dollars, or imprisonment not to exceed the term of six months. § 118. Mandatory injunctions in interstate com- merce. — As a preventive remedy is the only adequate rem- edy in the case of a threatening of interference with inter- state commerce, the form of the preventive relief must be adapted to the emergency, and the injunction mandatory in its terms is therefore often the only remedy which meets the emergency. A mandatory injunction is one that compels the defendant to restore things to their former condition, and virtually directs him to perform the act. Specific pro- vision is made in the Interstate Commerce Act for a man- damus to compel the performance of the duties of a carrier. Section 23 of the Interstate Commerce Act, infra. Such an injunction may be issued as well upon a proper showing on a preliminary as on a final hearing. It was said §118] LABOR COMBINATIONS IN INTERSTATE COMMERCE. 205 by Taft, J.," that the office of a preliminary injunction is to perserve the status quo until upon final hearing the court may grant full relief, and generally this can be accomplished by an injunction prohibitory in form. It may sometimes hap- pen, however, that the status quo is not a condition of rest, but of action, and the condition of rest is exactly what will inflict an irreparable injury upon the complainant. In such cases therefore it is only a mandatory injunction, compelling the traffic to flow as it is wont to flow, which will protect the complainant from injury. It was said by the Supreme Court^ that it is one of the most useful functions of a court of equity that its methods of pro- cedure are capable of being made such as to accommodate themselves to the development of the interests of the public in the progress of trade and traffic by new methods of inter- course and transportation, and it may be added, in securing the uninterrupted movement of commerce.' ' Toledo, A. A., etc., R. Co. Case, to perform all their regular and supra. accustomed duties as long as they ' Joy V. St. Louis, 138 U. S. 1, 1. remain in the employment of c. p. 50, 34 L. Ed. 859 (1891). the complainant company. This ' In So. Cal. Co. v. Rutherford, was in a case where the employes, supra, the court granted an injunc- while continuing in the service, tion to a railroad company against had boycotted the Pullman Car Co. its employees, compelling them CHAPTER VII. FEDERAL CONTROL OF STATE RAILROAD REGULATION. § 119 State regulation of railroads through state commissions. 120. Assessment of expense of state regulation upon railroads. 121. State regulation not dependent upon state incorporation. 122. State cannot regulate any part of interstate rates. 123. State regulation of local rates of interstate commerce. 124. The Fourteenth Amendment. 125. Federal review of state regulation of railroads. 126. The Federal jurisdiction must be invoked on substantial grounds. 127. Jurisdiction of the federal courts not limited by state legislation. 128. Injunctions against state officials not violative of the eleventh amendment. 129. The regulating orders of state commissions legislative, not judicial. 130. Procedure in federal review of state legislation. 131. Temporary injunctions in federal control of state legislation. 132. Interlocutory injunction against state officials. 133. Reasonableness and confiscation in regulation of rates. 134. State rates determined without reference to interstate traffic. 135. The Supreme Court on state regulation. 136. Schedules of rates and special rates. 137. A state cannot impose a confiscatory rate upon any class of traffic. 138. The valuation of railroad property in state regulation. 139. The apportionment of railroad property in state regulation. 140. Confiscation in state regulation; how proved. 141. The Minnesota Rate case on the proof of value. 142. The apportionment of cost in the Minnesota rate case. 143. The practical testing of state rates. 144. Rate of profit necessary to avoid charge of confiscation. 145. Protection of the carrier against discriminating state regulation. 146. The state power of regulation not limited to rates. 147. The enforcement of excursion rates — when unreasonable. 148. The state anti-trust laws and the fourteenth amendment. 149. Classification in state railroad legislation. § 119. State regulation of railroads through state commissions. — The complexity of our dual form of govern- ment is nowhere more forcibly illustrated than in the administration of the railway systems of the country under §119] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 207 the state commissions as to their state trafTic, and under the Interstate Commerce Commission as to their interstate traffic. The power of the states to regulate the rates of railroads and other quasi public business had been definitely established in the Granger cases, as already seen, prior to the adoption of the Interstate Commerce Act. This power of the states could be exercised either directly by the legis- lature fixing the rates, or could be delegated to a commission acting for the state. Commissions had been estabhshed in many of the states prior to 1887, some with advisory powers and others with powers to fix maximum rates. ' A railroad forming a continuous line in two or more states, and owned and managed by a corporation, whose corporate powers are derived from the legislatures of each state in which the road is situated,^ is as to the domestic traffic of each state a corporation of that state, subject to the laws of the state not in conflict with the constitution of the United States, and an authorization of a commission by a state to fix a schedule of rates for a railroad is not an unconstitutional delegation of legislative power.' Justice Brewer said in the case first cited that the line of demarcation between .legislative and admini- strative functions was not easily discernable and that the reasonableness of a rate was constantly changing with changing circumstances, and therefore was peculiarly a subject for an administrative board to determine. ' See review of state commis- sion to fix rates, concluded that sion statutes in Maximum Rate congress did not attempt to exer- Case, 167 U. S. 1. c. 495 (1897), 42 cise the power, but assumed the L. Ed. 251. existence of the power, saying, ' Railroad Commission Cases, "There were three obvious and 116 U. S. 307 (1886), 29 L.Ed. 636. dissimilar courses open for con- ' Chicago & N. W. R. Co. v. Dey, sideration. Congress might itself 35 Fed. 866 (1888); also Railroad prescribe the rates; or it might Commission Cases, supra; Regan commit to some subordinate tri- V. Farmers Loan & Trust Co., bunal this duty, or it might leave supra. In the Maximum Rate with the companies the right to Case, 167 U. S. supra, the Court, in fix rates, subject to regulations considering the question whether and restrictions as well as to that in the original Interstate Com- rule, which is as old as the exist- merce Act, before th« amendment ence of common carriers, to-wit: of 1906, power was delegated to that rates must be reasonable." the Interstate Commerce Commis- 208 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§121 § 120. Assessment of expense of state regulation upon railroads. — The entire expenses of a state railroad commission, including the expenses and salaries of the rail- road commissioners, may be lawfully assessed upon railroads operating within a state according to their gross income pro- portionate to the number of miles of their roads in the state. ^ This tax was claimed to be an unlawful discrimination im- posing a new burden and therefore a denial of equal protec- tion of the laws, as it was beyond that levied upon other corporations, and was in addition to the general property tax levied upon the property of the railroads in like manner as upon similar property of individuals in proportion to value. The court said that the services of the commission were for the benefit of the railroad corporations as well as of the public. It was therefore reasonable that the expenses should be so apportioned, and in this there was no violation of the state constitution providing for uniformity in taxation or of the guarantees of the federal constitution for due process of law and the equal protection of the law. § 121. State regulation not dependent upon state incorporation. — This power of regulation under state com- missions, as that of the Interstate Commerce Commission under the Interstate Commerce Act, is dependent upon the character of the trafTic, whether intrastate or interstate, and not upon the state or federal incorporation of the carrier. The same railroad is subject as to these two classes of traffic to the state and federal authority respectively. Thus the power of the Interstate Commerce Commission extends to railroads organized under state and federal authority as well as to corporations organized under the laws of Canada and operating in the United States. In the Northern Securities case a corporation organized under state authority, for the purpose of holding the stock of competing interstate rail- roads, was adjudged an unlawful combination under the Anti-Trust Act of 1890.^ I See Charlotte C. & A. R. R. Co. ' Supra, § 93. V. Gibbs, 142 U. S. 386, 35 L. Ed. page 1051 (1892). §122] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 209 On the other hand, a railroad incorporated by act of con- gress is subject to the control of the state in all matters of taxation rates on domestic traffic and to all reasonable police regulations in the absence of anything in the act indicating an intention on the part of congress to remove the corporation from such state control. The silence of congress in this respect, said the Supreme Court in the Texas rate case, is satisfactory assurance that so far as the corporation should transact business wholly within the state, congress intended that it should be subjected to the ordinary control exercised by the state over such business.^ The subjection of the corporation to the law of the state therefore is not based on the acceptance by the railroad company of state regulation but results from the failure of congress to express any inten- tion in the act of incorporation that it should be exempt from state control. This state power of regulation of domestic traffic must be distinguished from the concurrent power exercised by the state in the absence of legislation by congress in that class of cases (see supra. Chapter II) where the authority of the state is limited not by the existence, but by the exercise of the power of congress: In the class of c'ases now under considera- tion the power of the state is independent of congressional action. § 122. State cannot regulate any part of interstate rates. — It was held in the leading case of the "Wabash Rail- way Company^ that a state commission had no regulating power over a through interstate rate, that is, over even that ' Reagan v. Mercantile Trust Reagan opinion cited the Pacific Company, supra; Smythe v. Ames, Railroad tax case, Railroad Co. v. 169 U. S. 466, 42 L. Ed. 819 (1898). Pemiston, 18 Wallace, 5 (1873). As the Court based its opinion 21 L. Ed. 787, wherein it was upon the construction of the con- held that the taxing power of the gressional act of incorporation, state as one of its attributes of the question of the power of con- sovereignty extended to the prop- gress to limit and control, the erty (though not to the federal police power of the state over the franchises) of the Union Pac. property of federally incorporated Railroad incorporated under act interstate carriers, located within of congress, the state, was not discussed. The * Supra. § 39. J-U. 210 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§123 part of it which was within the state. The limitations of the state authority were further illustrated in the two Kentucky cases decided in 1901. In the first of these,' the Court afTirmed the Kentucky court in sustaining a conviction of the railroad company for violation of the long and short haul clause of the Kentucky statute in a rate on an intrastate shipment. The court below had excluded evidence that the rates were reasonable per se, and held that it was immaterial that the less charge for the longer haul was induced by com- petition, on the ground that the state had authorized the state commission to give relief on application. In the other case at the same term,^ the Supreme Court held the Kentucky statute unconstitutional as construed by the state court in its application to a long and short haul, where the short haul was wholly within the state and the long haul was partly within and partly without the state. The Court said that the direct effect of the statute so construed was to regulate the inter- state rate, for it was impossible for the carrier to do any interstate business at the local rate, and so it must give up its interstate business, or else reduce the local rate in pro- portion. The result therefore was a direct interference with commerce between the states, carried on through it may be by a single company. The fact which vitiated the provision, the Court said, was that it compelled the carrier to regulate, adjust or fix his interstate rates within the state, thus enabling the state to directly affect, and in that way to regulate to some extent, the interstate commerce of the carrier, which power of regula- tion the constitution of the United States gives to the federal congress. § 123. State regulation of State rates of interstate carriers. — The right of the state to establish maximum intrastate rates for interstate carriers which are reasonable in themselves, that is, not confiscatory, in the absence of legislation by Congress, is not affected by the fact that such 1 L. & N. R. Co. V. Kentucky, 183 » L. & N. R. Co. v. Eubank, 184 U. S. (1902), 46 L. Ed. 298, re- U. S. 27 (1902), 46 L. Ed. 416, versing 103 Fed. Rep. 216. (Justices Brewer and Gray dis- senting). §124] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 211 rates may disturb the existing relation between intrastate and interstate rates as to places within the zones of competi- tion crossed by the State boundary line.^ The Supreme Court admitted the practical embarrassment of a railroad growing out of the fact that it was operated as one system, and through competition the interstate rates were neces- sarily affected by the intrastate rates. The Court said, how- ever, that while Congress could regulate that matter it had not done so, and had made an express reservation in Section 1 of the Interstate Commerce Act that the act should not apply to the transportation of persons or property wholly within the State. But this uncontrolled power of the State does not extend to cases where the Interstate Commerce Commission has found that the existing state rates caused a discrimination at a point without the state, where the interstate rates of the carrier have been pronounced reasonable, and the discrimina- tion can only be remedied by a change in the intrastate rates which are made under State authority. The Court said that in this case the federal power must control.'' § 124. The fourteenth amendment. — Prior to the adoption of the fourteenth amendment in 1868 there was no appeal to the federal courts against any violation by state power of due process of law or of the equal protection of the laws, which did not involve an interference with national authority or a violation of some provision of the federal con- stitution. The federal courts administered the state laws and followed, as they still do, the decision given by the state courts as to the construction of the state statutes. The fourteenth amendment provided in its first clause, that no state should deprive any person of hfe, liberty or property without due process of law, nor deny to any person 1 Simpson v. Shepard, 230 U. S. Co. v. Siler, 186 Fed. 176, affirmed 352,57 L.Ed. 1511, (1913), revers- in 231 U. S. 298, 58 L. Ed. 229 ing 184 Fed. 765. See also Brewer, (1913) (1911); Oregon R. & Nav. J., in Nebraska Case, 64 Fed. 174, (1894). McPherson, J. in Missouri 173 Fed. 957, (1909), affirmed in Rate Case, 168 Fed. 343, (1911) Woodside v. Topona R. R. Co. 184 Fed. 358, (1911); L. & N. R Co. V. Campbell, District of Oregon, 230 U. -S. 525, 57 L. Ed. 1604 (1912). ' See supra, § 65. 212 FEDERAL CONTROL OF STATE RAILROAD EEGULATION. [§125 within its jurisdiction the equal protection of the laws. Cor- porations are persons under this amendment and are there- fore entitled to due process of law and to the equal protection of the laws, ^ and a state has no more power to deny due proc- ess of law or the equal protection of the laws to a corporation than it has to individual citizens.^ This far-reaching change in our judicial system, where- under the fundamental rights of property are protected by the federal power against state invasion, was adopted shortly before the judicial declaration of the freedom of interstate commerce against state interference opened the way for the direct exercise of the federal regulating power. § 125. Federal review of state regulation of rail- roads. — The comprehensive power of the state in the regu- lation of the intrastate traffic of carriers, whether exercised directly under legislative act of the state or through a com- mission of the state, is subject to the jurisdiction of the courts of the United States under the provisions of the four- teenth amendment guaranteeing due process of law and the equal protection of the laws to all persons against any in- vasion by state authority.' The jurisdiction of the courts of the United States in such cases does not depend upon the unconstitutionality of the state statute, as a valid law may be wrongfully administered by the officers of the state. If the statute of the state, as construed by the highest court of the state having jurisdic- tion — and this construction by the state courts is conclusive — denies due process of law or equal protection of the laws, the federal jurisdiction under the fourteenth amendment may be invoked.* ' Santa Clara County v. Southern v. Greensboro Ice & Coal Co., 134 Pacific R. Co., 118 U. S. 394 Fed. Rep. 82 (1904). (1886), 30 L. Ed. 118. ■" Reagan v. Farmers Loan & 'Railroad Co. v. Ellis, 165 U. Trust Co., supra; Smythe v. S. 1. c. 154 (1897), 41 L. Ed. 667. Ames, supra; Barrow S. S. Co. v. ' Chirago, Milwaukee & St. Paul Kane, 170 U. S. Ill, 42 L. Ed. R. Co. V. Becker, 35 Fed. 883 964 (1898). As to the powers con- (1888); Reagan v. Farmers Loan ferred upon the commission by the & Trust Co., supra; So. Ry. Co. state, the Supreme Court will follow §125] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 213 While the construction by the state court of its own con- stitution or statute is accepted as conclusive by the federal court as a local question, in the absence of any such construc- tion by the state court the federal court must construe the state law for itself. Thus where the validity of an order of the state commission was assailed not only on distinctly federal grounds under the fourteenth amendment, but also under the further ground that the commission was not au- thorized under the state statute to make the order com- plained of, the Supreme Court held that the circuit court ob- tained jurisdiction over the case by virtue of the federal questions; and as the court usually decided a case without reference to questions arising under the federal constitution, where it could be so decided, and in the absence of a definite construction of the statute by the state court, the Supreme Court concluded that the statute did not grant the commis- sion the power to make a general schedule of rates and affirmed the decree against the enforcement of the commis- sion's order on that ground.^ A state statute providing for the establishment of railroad rates, without giving the corporation an opportunity to be heard, which fixes penalties for disobedience of its provisions by fine so enormous and imprisonment so severe as to intimi- date the corporations and their officers from resorting to the courts to test the validity of the rates, is unconstitutional as depriving the corporation of the equal protection of the laws.^ If reasonable access to the courts is afforded to contest the validity of an administrative order of a Railroad Commis- sion, the fact that the penalty is excessive will not prevent the enforcement of the order.' the ruling of the state court; if in enforcing a penalty imposed by the question has not been passed State statute upon a railroad com- upon by the state court, the su- pany for its violation of an admin- preme court will decide it for it- istrative order directing the com- self. Siler v. L. & N. R. R., 213 pany to discontinue its practices of U. S. 175, 53 L. Ed. 753 (1909). demanding prepayment of freight ' Siler V. L. & N. R. Co., supra, from one carrier while not exacting ' Ex parte Young, supra. it in another. The penalty was held ' Wadley Southern Ry. Co., v. clearly separable, L. & N. R. Co. Georgia, 235 U. S. 651, 59 L. Ed. v. Garrett, 231 U. S. 298, 58 L. 405, (1915) affirming 137 Ga. 497, Ed. 229, (1913). 214 FEDERAL CONTROL OF STATE RAILEOAD REGULATION. [§126 § 126. The federal jurisdiction must be invoked on substantial grounds. — The district court of the United States^ has jurisdiction irrespective of diverse citizenship in a case when the constitution or law of a state is claimed to violate the constitution of the United States, but the claim must be real and substantial. The state may act through different agencies, through its legislative, executive or judi- cial authority, and a municipal corporation may be such an agency, when it acts as a political subdivision of the state. A municipal ordinance passed pursuant to the authority of the state, abridiging the privileges or immunities of the citizen or depriving a person of a corporation of property without due process of law, would be an act of the state prohibited by the constitution. When the federal jurisdiction is therefore in- voked on the ground that the suit arises under the constitution and laws of the United States, it must appear that the suit really and substantially involves such a controversy. A mere claim in words is not enough. ^ Thus if it appears that the real controversy between the parties is whether a municipal ordinance was enacted in conformity with the state constitu- tion, the federal jurisdiction cannot be sustained.' Under this principle the circuit court of appeals of the ninth cir- cuit^ dismissed a bill of complaint which alleged that a certain municipal ordinance would take property and privilege with- out due process of law, and in contravention of the laws of the United States, and that the alleged ordinance is without authority of law, null and void, and of no force or effect, as it appeared that under the provision of the state constitution the ordinance would be as invalid as under the federal con- stitution, and the court would presume that the state court would not deny to any of its citizens the equal protection of the laws. The court said further that if they were mistaken 1 This original jurisdiction of Tel. Co., 218 U. S. 624, 54 L. Ed. the circuit court is vested in the 1185 (1910). district court of the United States ' Hamilton Gas Light Co. v. under the revised judiciary act Hamilton City, 146 U. S. 258, 36 L. taking effect Jan. 1, 1912. Ed. 963 (1892); Barney v. City of 2 Western Union Tel. Co. v, New York, 193 U. S. 430, 48 L. Ed. Ann Arbor R. R. Co., 178 U. S. 737 (1904). 239, 44 L. Ed. 1052 (1900); City of * Seattle Electric v. Seattle R. Memphis v. Cumberland Tel. & & S. Co., 185 Fed. 365 (1911). §127] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 215 the complainant would have his remedy in the appeal from the highest state court to the Supreme Court of the United States. § 127. Jurisdiction of the federal courts not limited by state legislation. — This power of the federal courts cannot be limited by state legislation. One who is entitled to sue in the federal circuit court may invoke its jurisdiction in equity whenever the established principles and rules of equity permit such a suit in that court; and he cannot be deprived of that right by reason of his being allowed to sue at law in a state court on the same cause of action. Thus a state statute, authorizing any railroad company in a proper action to show in an action brought in the supreme court of the state that the rates prescribed by a statute were unreason- able and unjust and to obtain relief therefrom, did not deprive the railroad company of its right to invoke the equity jurisdiction of the federal court. ^ This right to resort to the federal courts however irrespect- ive of any remedy in a state court is to be distingusihed from a case where the proceedings in the state court are not judicial, but are legislative or administrative in character. This was illustrated in the Virginia rate case, where the constitution of the state provided that the state corporation commission, which was styled a court, should fix rates sub- ject to the right of appeal by the railroads to the supreme appellate court of the state, who should determine the case upon the facts certified by the commission, and if it reversed the order of the commission, should substitute such order as, in its opinion, the commission should have made. The Court said that these were proceedings essentially legislative in character. As a matter of comity therefore a federal cir- cuit court should not entertain a suit to enjoin the enforce- ment of rates fixed by the state corporation commission in advance of the appeal to the highest state court, so that the final voice of the state should have been declared before the federal authority was invoked.^ ' Smythe v. Ames, supra. the suits were prematurely brought; ' Prentiss v. Atlantic Coast Line, Justice Brewer dissenting, and 211 U. S. 210, 53 L. Ed. 150 Justices Puller and Harlan holding (1908). The Court held that that the suits should be dismissed. 216 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§128 An act of a state providing that the rates charged, estab- lished by a commission, shall be final and conclusive as to what are reasonable charges, and which, as construed by the supreme court of the state, precludes any judicial inquiry as to the reasonableness of the rates, deprives the company of its property without due process of law and of the equal pro- tection of the laws.i The carrier is thus secured under the fourteenth amendment, not only in a judicial hearing upon the question of his intrastate rates, but also in his right to charge reasonable rates ; and the reasonableness or unreason- ableness of the rates established under state authority will be reviewed by the federal courts in determining whether or not the company is deprived of its property without due process of law.* Due process of law does not require that a railroad should have notice of specific time of fixing rates if dates of meeting of the commission are fixed by law,' nor is it essential that a judicial review of the order of the commission should be pro- vided in the statute.* § 128. Injunctions against state officials not viola- tive of the eleventh amendment. — A suit against a state commission or a state attorney general or any other state officials, acting under the authority of the state in fixing rates or enforcing regulations of a state, to enjoin them from proceeding in such enforcement on ground of the invalidity of such regulation, is not a suit against the state within the meaning of the eleventh amendment.^ This 1 Chicago, etc. R. Co. v. Minne- ^ L. & N. R. R. Co. v. Siler, 186 sota, 134 U. S. 418 (1890), 33 L. Fed. 176, supra affirmed 231 U. S. Ed. 970. 298, 58 L. Ed. 229, (1913). ^ Smyths V. Ames, supra; Reagan 'Ex parte Young, 209 U. S. V. Farmers Loan & Trust Co. 123, 52 L. Ed. 714 (1908), Har- supra; Chicago, Milwaukee & St. Ian, J., dissenting. The opinion Paul R. Co. V. Tompkins, 176 U. of this case contains an exhaust- S. 167, 44 L. Ed. 417 (1900); ive review of the authorities, and Covington & Lexington Turnpike distinguished the case of Fitts v. Co. V. Sandford, 164 U. S. 578 McGhee, 172 U. S. 516, 43 L. Ed. (1896), 41 L. Ed. 560. 535 (1899), which was claimed to ' San Diego Land Co. v. Na- overrule or limit the doctrine of tional City, 174 U. S. 739, 43 L, Smyth v. Ames, supra; Central R. Ed. 1154 (1899) — a water rate case. R. of Georgia v. McLendon, 157 §129] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 217 principle was enforced by the Supreme Court in a case where the attorney general of a state was held properly cited with contempt of a circuit court of the United States, when he had proceeded in his official capacity by suit in a state court in enforcing a state statute regulating state rates, after he had been enjoined by the circuit court from taking steps towards the enforcement of such statute, which was claimed to be un- constitutional. The Court said: "Individuals who, as officers of the state, are clothed with some duty in regard to the enforcement of the laws of the state, and who threaten and are about to commence proceedings, either of a con- stitutional or a criminal nature to enforce against parties affected an unconstitutional act violating the federal con- stitution, may be enjoined by a federal court of equity from such action." While the power of the federal court does not extend to enjoining a state court from acting in a case brought before it, the action of an attorney general of a state in attempting to enforce an enactment void under the con- stitution of the United States was illegal, as in conflict with the federal constitution; and the prohibition against his pro- ceeding did not affect the state in its governmental capacity. § 129. The regulating orders of state commissions are legislative, not judicial. — It is immaterial that the state commission or other authority charged with the duty of making rates is styled a court, and is made a court of record by the express terms of the constitution of the state. A suit to enjoin the members of such a commission is not a suit to enjoin a state court within the meaning of Section 720, R. S. U. S., nor does the decision of such a commission make the legality of the rates fixed or affirmed by them res ad- judicate. The establishment of a rate is the making of a rule for the future, and therefore is an act legislative, not judicial, in kind. In the language of the Supreme Court, a judicial inquiry investigates, declares, and enforces liabilities as they stand on present or past facts and under laws sup- posed already to exist. Legislation, on the other hand, looks to the future, and changes existing conditions by making a Fed. Rep. 961 (1907); McNeill v. 543 (1906), SOL. Ed. 1142, modify- Southern Railway Co., 202 U. S. ing and affirming 134 Fed. Rep. 82. 218 FEDERAL CONTROL OP STATE EAILROAD REGULATION. [§130 new rule to be applied thereafter to all or some part of those subject to its power. It follows, that when a state supreme court is vested with the rate making power' on appeal from such a commission, its action is essentially administrative or legislative, and not judicial, and, therefore, is not constituted an adjudication in the judicial sbnse of the word;i and the en- forcement of a rate or regulation thus made and affirmed, may be enjoined by the federal court, if found to be violative of the constitutional rights of the railroad. It is immaterial that investigations or hearings are made by the commission or court, on appeal therefrom if such appeal is provided, as such matters are but preliminary and inducive "to the exercise of the legislative power in the adoption of the new rule of action to be formulated and applied.^ But where a state statute does not attempt to confer legislative power upon a state court, but only provides the alternative of a more expeditious way of doing what might be done ty a bill in equity, then it is immaterial that the com- pany did not take an appeal from the order of the Commis- sion to the state court, and under the rule of law laid down in the Virginia rate case, the railroad company is free to assert its rights in the courts of the United States.^ § 130. Procedure in federal review of state legisla- tion. — The question of the validity of state rates or other regulation may be raised by carrier in defense to an action at law for the penalties imposed by the law,* but preferably by bill in equity directly challenging the validity of the rates or regulation. It was said by the Supreme Court in the Minnesota rate case^ that the remedy at law in such a case was ^plainly inadequate, particularly when it involved a great risk of fines and imprisonment if it should finally be determined that the act was valid and that a railroad company should not 1 See the Virginia Rate Case, L. & N. R. Co. v. Garrett, 231 U. S. Prentiss v. Atlantic Coast Line, 298, 58 L. Ed. 229 (1913). supra. «See St. Louis & S. F. R. R. ■^ L. & N. R. R. Co. V. Siler, Co. v. Gill, 156 U. S. 649 (1895) supra. 39 L. Ed. 567. ' Bacon v. Rutland R. Co., 232 « Ex parte Young, supra. U. S. 134, 58 L. Ed. 538 (1913), § 1 30] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 219 be required to take this risk, and that all these objections will be obviated by a suit in equity, making all who are directly interested parties to the suit. The district court of the United States has jurisdiction of an action by non-resident stockholders of such companies against the companies and the state ofTicial contesting said imposed rates.' As the federal court has jurisdiction irres- pective of citizenship, where the basis of complaint is that the state rates or regulation are violative of due process of law under the fourteenth amendment, the court would have juris- diction irrespective of citizenship, and the bringing of such an action in the name of the non-resident stockholders is therefore unnecessary. ^ The federal jurisdiction may also be invoked through a writ of error from the Supreme Court to the highest court of the state where the federal right invoked is decided adversely to the claimant by the state court,' or the jurisdiction may be exercised in a direct proceeding in the assertion of the federal right in the U. S. district court, and this latter procedure is ordinarily the only adequate remedy.* As to the procedure in an equity cause, it was remarked by the Supreme Court^ that it was a better practice in such cases where the reasonableness of rates was involved, to refer the cause to some competent master to make all needed computa- tions and to find fully the facts, and that in view of the difficulties and importance of such a case it was imperative that the most competent and rehable master, general or special, should be selected; for it is not a hght matter, said the Court, to interfere with the legislation of the state in ' Reagan v. Farmers Loan & manner or reason for the refusal Trust Co., supra. of the directors was not disclosed. ' As to the compliance with ' Or by certiorari if allowed by equity rule 94 in a stockholder's the Supreme Court under the recent suil, see Poor v. Iowa Central amendment to the Judiciary Act, R. R. Co., 155 Fed. Rep. 226 however the Federal claim is (1907), where the court held that decided, supra, § 42. such a suit could not be main- ■■ See Ex parte Young, supra. tained where the only effort of ' See South Dakota Rate Case, the plaintiff to secure his action 176 U. S. 167 (1900), 44 L. Ed. from the company was a demand 417, reversing 90 Fed. Rep. 363. on the stockholders, and that the 220 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 130 respect to prescribing rates, nor a light matter to permit such state regulation to wreck large property interests. ^ The Supreme Court has declared a modification of the ordi- nary procedure in equity causes in a case involving the alleged confiscatory rates fixed by a municipal ordinance of a local public service company, in that the general rule respect- ing the conclusiveness of a master's finding of fact when con- firmed by the court would not be applied by the Supreme Court on appeal, that is, the Court would not fetter its dis- cretion or judgment by any artificial rules as to the weight of the master's findings, however useful and well settled these rules might be in ordinary litigation.^ Where the order of the commission, sought to be enjoined, commands the repayment by the railroad of excessive past rates to certain shippers, such shippers are necessary parties to a bill seeking to set aside the award. ^ The exceptional character of this litigation is also peculiar in the provision of the decree which the Supreme Court said in the Nebraska case was wisely inserted,'' that the members of the state board had the right to -show at any time that the conditions of business were so changed, that the rates en- joined would yield the railroads a just compensation; and in such case it would be the duty of the court to discharge the injunction. This precedent thus approved by the Supreme Court, has been usually followed in decrees in this class of litigation.^ 1 As to sufRciency of allega- ' Supra L. & N. R. Co. v. tions in the bill of complaint to Garrett, 231 U. S. 298, 58 L. Ed. restrain enforcement of an order 229 (1913). of the commission reducing rates, ■* See Smythe v. Ames, supra. see Wilmington & W. R. Co. v. 'The necessity of adjusting Board of R. R. Commissions, 90 orders concerning rates to the Fed. Rep. 33 (1898). See also probability of changing business Houston &T. C. R. R. V. Story, 149 conditions, is shown in the provi- Fed. Rep. p. 499 (1906); Oregon sion of the Interstate Commerce R. R. & Navigation Co. v. Camp- Act limiting the orders of the bell, 173 Fed. 957, circuit court of commission for periods of two Oregon (1909), also 177 Fed. 318. years. 2 Knoxville v. Knoxville Water Co., 212 U. S. 1, 53 L. Ed. 371 (1909). §131] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 221 § 131. Temporary injunctions in federal control of state legislation. — Where a federal court has jurisdiction to permanently enjoin the enforcement of railroad rates or other regulations, it also has power, while the inquiry is pending, to grant a temporary injunction to the same effect. * Such temporary relief is granted upon the same grounds rec- ognized as authorizing such relief in other cases, that is, to preserve the status quo and prevent a change of conditions during the litigation, which may result in irremediable injury to some of the parties before their claims can be investigated and adjudicated.^ This principle has been applied by the courts in determin- ing the right to a temporary injunction in railroad rate cases.' In what is known as the Alabama rate case, the circuit court of appeals, fifth circuit, reversed the order of temporary in- junction granted by the circuit court where the rates had not gone into effect.^ The circuit court of Minnesota declined to issue a preliminary injunction, where the rates had been accepted and put in operation by the railroad companies, but allowed a temporary injunction as to certain rates which had not been put into effect, for the reason that they operated so as to preserve the status quo as to whether or not the rates were confiscatory until the final hearing.^ Where the enforcement of rates has been restrained by a restraining order pending the hearing of application for tem- porary injunction, the court, in denying the injunction, may ' Ex parte Young, supra. Fed. Rep. 445 (1907). See also St. 2 City of Newton v. Lewis, 79 L. & S. F. R. R. Co. v. Hadley (a Fed. Rep. 715 (1897); Stevens v. Missouri rate case), 155 Fed. Rep. M. K. & T. R. R., 106 Fed. Rep. 220, where the temporary injunc- 771 (1901), C. C. A. 2nd circuit; tion was denied because the rates Cartersville L. & N. Co. v. Carters- had not been tested. In the Okla- ville, 114 Fed. Rep. 699 (1901), honia rate cases a temporary in- same court; Louisville v. Cum- junction was granted by Hook, J., berland Tel. Co., Ill Fed. Rep. 663 on the ground that the passenger, (1901), C. B. A. 6th circuit. and freight rates had been en- ' Central of Georgia Ry. Co. v. forced for two years, and, on the McLendon, 155 Fed. Rep. 974 affidavits, were held to be confis- (1907), and 157 Fed. Rep. 961. catory. A. T. & S. F. R. R. Co. v. < 170 Fed. Rep. 225, reversing Love, 177 Fed. 493, affirmed by 161 Fed. Rep. 925. Circuit Court of Appeals (8th ' Perkins v. Northern Pac, 155 Cir.), 185 Fed. 321 (1911). 222 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 132 in its discretion continue the restraining order upon condi- tion, pending an appeal. ^ § 132. Interlocutory injunction against State Offi- cials.— Under the Act of 1913 Sec. 206 of the Judicial Code was amended by providing that no interlocutory injunction against the enforcement of the state statute or the order of any state board in the enforcement of such statute shall be granted in the United States court, unless the application shall be presented to and heard by three j udges, one of whom must be a Justice of the Supreme Court or a Circuit Judge, and at least five days notice of the hearing must be given to the Governor and the Attorney General of the state, and an appeal may be taken directly to the Supreme Court of the United States from the order granting or denying an interlocutory injunc- tion in such case,^ and if before the final hearing of such application a suit shall have been brought in a state, court to enforce such statutory order accompanied by a stay in such state court proceedings under such statute or order pending the determination of such suit in such state court, all pro- ceeding in any court of the United States to restrain the exe- cution of such statute shall be stayed, pending the final de- termination of such suit in the courts of the state. Such stay may be vacated upon proof that the suit in the state courts is not being prosecuted with diligence and good faith.^ It was held by the Supreme Court under this act that all the questions in a case, local as well as Federal, could be de- termined by the Federal Circuit Court, or by the Supreme > L. & N. R. R. Co. vs. Siler, 186 Code was to extend the original Fed. Rep. 176, supra. statute so as to have it include ' The act abolishing the com- an order made by the administra- merce court, see Act of Oct. 22, tive board or commission acting 1914, provides that an interlocu- under and pursuant to the statute tory injunction setting aside an of the state. See L. & N. R. Co. order of the Interstate Commerce v. R. R. Com. of Ala. 208 Fed. 35. Commission must be heard and Also held in this case that the three determined by three judges of judges or a majority of them may whom at least one shall be a circuit not, after refusing a temporary in- judge. See infra, appendix. junction and granting an appeal, ' The effect of the amendment of continue a temporary restraining 1913 of Sec. 266 of the Judicial order after the appeal is decided. §133] FEDERAL CONTROL OP STATE RAILROAD REGULATION. 223 Court on appeal, on an application for a temporary injunc- tion, i Under this act, an acting district judge cannot sit alone, either in granting an injunction order, or in vacating one which has been made, but he must call to his assistance two other judges, as required by the statute, to hear an applica- tion, either to grant or to vacate such an injunction. Manda- mus to compel the judge to comply with the law is the proper remedy, where a single judge takes any action on such an injunction, as the right of appeal in such action by a single judge is not given by statute. ^ § 133. Reasonableness and confiscation in regula- tion of rates. — The standard of reasonableness in rates considered by the courts when the carrier complains of state imposed rates on intrastate traffic as confiscatory, in viola- tion of the fourteenth amendment, is not the same as that involved in the determination of what is reasonable between a carrier and his patrons, whether the issue is raised under the interstate commerce act or otherwise. It is not what the carrier can exact or what the shipper can be forced to pay under the common law rule of reasonableness, but what limit the state can lawfully impose upon the carrier in making rates without violating the federal protection against taking of property without due process of law. 1 L. & N. R. Co. V. Garrett, 231 In Calhoun v. City of Seattle, U. S. 298, supra, affirming 186 (Dist. of Wash.), 215 Fed. 226, Fed. 176. Also 214 Fed. 465, (1914) it was held that the word (1914). "Statute" in this act of 1910 meant ' Ex parte, in re Metropolitan an act of the Legislature and did Water Co. of West Virginia, 220 not include city ordinances. Three U. S. 539, 55 L. Ed. 575 (1911), judges therefore were not required where a mandamus was issued, in the latter case, directing the acting district judge See also Jewel Tea Co. v. Lee's of the district of Kansas to set Summit, (West. Dist. of Mo.) 189 aside an order vacating an injunc- Fed. 280 (1912), where complainant tion order, and directing him to sued to enjoin the enforcement of a call to his assistance two other municipal ordinance alleged to im- judges, as provided by the act, for pose a license tax on interstate hearing and determining an ap- commerceMt, It was held that the plication for an interlocutory in- jurisdiction was determined by the junction. value of the right to be protected, and not by the amount of the tax. 224 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§133 The burden of proof necessarily differs in the different classes of cases. When the federal authority is invoked against state imposed rates the presumption is that the state rates, whether made by the legislature or a commission, are presumed to be reasonable, and the burden is therefore upon the railroad to prove that the rates are unreasonable, that is confiscatory, in that they deprive the railroad of the rightful return to which it is entitled upon its property. If the rail- road fails to prove this contention the suit must fail.' The term "reasonable" in this class of actions is used in the sense of being non-confiscatory, that is, above the minimum which the railroad could be compelled to accept; and such a rate may be well within the maximum rate which a railroad could exact from its patrons as reasonable. ^ On this issue therefore of the minimum rate which the carrier can be forced to charge, the proof is necessarily di- rected to show that the rates will not permit the carrier to realize the adequate return to which it is lawfully entitled, upon its property devoted to the public use. On the other hand neither the statutes nor the common law nor judicial decisions concerning state imposed rates furnish any definite standard for the determination of what is reason- able as between a carrier and its patrons. In ordinary busi- ness transactions a reasonable charge for a personal service is the resultant of the free economic forces of supply and ' In Northern Pacific R. R. v. ^ "What may be a reasonable North Dakota, 216 U. S. 579, 54 L. rate or return as in the matter of E. 624 (1910), the Supreme Court, legal policy, ha\dng due regard to in affirming the judgment of the encourage the investment of capi- slate court which sustained a coal tal in railroad enterprises, is one rate which was alleged to be con- question; but when the inquiry fiscatory, said that while the becomes a judicial problem to be argument of the railroad seemed considered as involving the tak- lo have considerable probability, ing or not taking the railroad's the evidence left the matter so property, it is essentially a different much in doubt, that the decree question." Opinion of circuit court was affirmed without prejudice to in L. & N. R. Co. v. Siler, supra. the rights of the company to re- See also C. B. & Q. Co. vs. open the case, if after adequate Ogelsby (Western Dist. of Mo.) trial, it thought it could prove the 198 Fed. 153. (1912.) confiscatory character of the rate more clearly. §134] FEDERAL CONTROL OF STATE HAILROAD REGULATION. 225 demand. It is obvious that under the compHcated condi- tions of railway transportation this free play of the economic forces of supply and demand does not ordinarily exist. When competition does act in determining railway rates, it is only at certain points, as terminal centers, where the rate may be made unreasonable from the carrier's point of view, while at local points on the same line it may not exist at all. The standard of reasonableness therefore is one thing for the railroad manager who wishes to secure at all times a reason- able profit upon the cost of services, and a very different thing for the shipper who wishes to secure at all times a reasonable profit for his own business as against his competitors in other communities.! § 134. State rates determined without reference to interstate traffic. — The complexity of our governmental system is illustrated in the regulation of the intrastate and interstate business of our railroads. Though the railroad may extend through several states, it is an entity operated as an entirety, all its income coming into and all its expendi- tures going out of a common fund, its capitalization includes all its property in and out of the state, and all its business, state or interstate, is transacted by the same employes and with the same equipment. All this, says the Supreme Court, has no application in determining the limits of the state power of regulation. 2 The reasonableness of state rates, that ' The Supreme Court said in ter what standard is adopted, that the Trans-Missouri Freight Asso- the individual shipper would be ciation case, supra, "What is a practically remediless. It is also proper standard by which to judge true that the complexity of the the fact of reasonable rates?" problem requires for its solution And after commenting upon the the largest experience, and the different factors to be considered, fullest knowledge of the details of saidr "That it is quite apparent the cost of service, and all the that it is exceedingly difficult to conditions of traffic." The ques- formulate even the terms of the tion of reasonableness in railroad rule itself which should govern in rates and the different factors in- the matter of determining what volved in its determination is would be reasonable rates for fully discussed in the opinions of transportation, and that there was the Interstate Commerce Commis- such an infinite variety of facts sion, see infra, § 199 et seq. entering into the question of ^ Smyth v. Ames, supra. what is a reasonable rate, no mat- J-15. * 226 FEDERAL CONTROL OP STATE RAILROAD REGULATION. [§ 135 is, whether or not confiscatory, must therefore be determined by the revenue from and the cost of traffic within the state without reference to the interstate traffic within the state over which the state has no control. A state cannot justify unreasonably low rates on the ground that the railroad is earning large profits in its interstate business, nor can the railroad justify unreasonably large rates on domestic busi- ness in order to make up losses on its interstate business. This principle precludes the state from claiming that traffic beginning or ending in the state should be divided upon the mileage basis, as such interstate traffic under the decision in the Wabash case,' is subject only to the regulation of congress.^ The judicial investigation of the validity of state rates therefore requires what is in effect a statement of account of the state business of the railroad, and its segregation from the other business of the railroad, conducted with the same equip- ment. The railroad property in the state must be ascertained and apportioned to the state and interstate business, and if the case requires it, separately apportioned to the freight and passenger business, both state and interstate. It was said by the Supreme Court in holding that in such a case the cost and net profits of the state traffic must be ascertained' and that few cases are so difficult and perplexing as those which in- volve an inquiry whether the rates prescribed by the state legislature for the carriage of passengers and freight are un- reasonable, but that the facts could not be determined with mathematical accuracy afforded no excuse for a failure to examine and solve the question involved. § 135. The Supreme Court on state regulation. — The regulation by the states of intrastate rates in the exercise of / its authority over domestic commerce has been reviewed by the Supreme Court in this jurisdiction under the fourteenth ' See § 39, supra. ' See South Dakota Rate Case, 2 See Northern Pacific Railroad C. N. & St. P. R. Co. v. Tompkins, Co. V. Keyes, C. C. D. of North supra. Dakota, 91 Fed. 47 (1898). §135] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 227 amendment in cases from Texas/ Nebraska,^ South Dakota,' Arkansas,* Michigan,^ Minnesota,^ Florida,'' and Vir- ginia, ' and more recently in cases again from South Dakota, Minnesota and Arkansas, and also from North Dakota, Missouri, Kentucky, West Virginia and Oregon. ^ The principles applied in determining the validity of rail- road rate regulation have also been discussed in connection with the rates imposed by the states or municipalities under state authority upon other public service corporations.'" In the Texas rate case, the Supreme Court reversed the decision of the circuit court in so far as it restrained the rail- road commission from discharging the duties imposed by the legislative act and from proceeding to estabhsh reasonable rates, but affirmed the decree in so far as it restrained the commission from enforcing the rates already established, as it was found upon the admitted facts that the rates failed to return an adequate compensation. The enforcement of the state rates was also enjoined in the Nebraska case on the same ground; and in the South Dakota case the decree of the circuit court refusing to enjoin and dismissing the bill of the railroad company was reversed on the ground that the circuit court had failed to determine the reasonableness of the rates, and the case was remanded with directions for such determination by ascertaining the cost of the state business. ' Reagan v. Trust Co., supra. Line v. Florida, 203 U. S. 261, 51 2 Smyth V. Ames, supra. L. Ed. 176 (1906). ' Chicago, M. & St. P. R. Co. v. * Virginia Rate Case, supra, Thompkins, supra. § 114. < St. L. & S. F. R. Co. V. Gill, » See infra, § 143, note V. supra; Dow v. Bidelman, 125 U. S. '" See Kentucky Turnpike Case, 680, 31 L. Ed. 841 (1888). 164 U. S. 578, 41 L. Ed. 560 (1896); ' Chicago Grand Trunk R. Co. and San Diego Water Rate Case, V. Wellman, 143 U. S. 339 (1892), 174 U. S. 739, 43 L. Ed. 1155 36 L. Ed. 176. (1899); The Stockyards Case, 183 « Chicago, etc., R. Co. v. Minne- U. S. 79, 46 L. Ed. 92 (1902); the sota, 134 U. S. 418, 33 L. Ed. 970 Knoxville Water Case, 212 U. S. (1890); Minn. & St. L. R. Co. v. 12, 53 L. Ed. 371 (1908); the Con- Minnesota, 186 U. S. 257, 46 L. Ed. solidated Gas Case, 212 U. S. 19, 1151 (1902). 53 L. Ed. 382 (1908). ' Atlantic Coast Line R. Co. v. In Norfolk & Western R. Co. v. Florida, 203 U. S. 256, 51 L. Ed. Conley, 236 U. S. 605 59 L. Ed. 174 (1906); also Seaboard Air 745 (1915), the Court held that a 228 FEDERAL CONTROL OF STATE RAILROAD REGULATION: [§136 In the other railroad cases, where the merits of the appeals were considered, it was ruled that the railroad companies had failed to overcome the presumption of reasonableness of the rates fixed by the state authority. § 136. Schedules of rates and special rates.— The federal authority as illustrated in the cases determined by the Supreme Court has been invoked in two distinct classes of cases. That is, where the entire schedule of maximum rates, both freight and passenger, is fixed by state authority, and where there is not an entire schedule, but the maximum rates are fixed upon specific classes of commodities. In cases under the Interstate Commerce Act, as will be hereafter seen, it is as a rule the latter class of cases which is involved ; that is, the reasonableness of the rates on specific commodities, or to or from specific localities, or more usually the relation of rates as between competing communities or kinds of traffic is brought under review. ' When the state authority is challenged on the ground that the railroad is deprived of an adequate return upon its prop- erty, the difficulty of determining this issue is very much increased when the reduction complained of is only upon a single commodity or a single class of freight. Such a reduc- tion cannot be shown to be unreasonable, that is confiscatory, simply by proving that if the same reduction were applied to all classes of freight the railroad would fail to receive a proper return; and in such cases the railroad must show that this reduction would of itself prevent its securing an adequate rate of two cents per mile on traffic and require it to transfer it passenger traffic fixed by West at less than cost; tliat the Supreme Virginia in 1907 was confiscatory, Court had analyzed the facts and as it appeared on the entire intra- determined on the propriety of the state business of the carrier sepa- finding, but that was so interwoven rately considered, such a rate with the Federal question as to be would be a very narrow margin in substance a decision on that above cost. The Court in this question. case reaffirmed the rule declared in ' In such cases as in the recent the North Dakota coal rate case, proposed general advance of rates, that the State had no arbitrary general schedules are of course power over rates and could not involved, see infra, § 196. compel the carrier to select any §137] FEDERAI. CONTROL OF STATE RAILROAD REGULATION. 229 return upon its property in the state. The Supreme Court said "in such a case the great difficulty in the attempt to measure the reasonableness of charges with reference to the cost of transporting a particular class of freight is well known and has been often remarked. "^ § 137. A state cannot impose a confiscatory rate upon any class of traffic. — While the burden of proof is upon the carrier to show that the rate upon a particular traffic is unreasonable and confiscatory, the state cannot compel the carrier to estabhsh a rate upon a particular com- modity which is less than reasonable in order to build up a local enterprise, and which would compel the carrier to trans- port the commodity for less than cost, or without substantial compensation in addition to cost, and such a rate would be confiscatory, although the return to the carrier from its entire intrastate rate might be adequate. ^ Each case however must depend upon its special facts. It is not sufficient when deter- mining the rates for any class of intrastate traffic to show the ratio of the total operating expenses of the railroad, or of the railroad division, to the entire receipts of such railroad. There must be evidence to justify the conclusion that the cost ' Northern Pac. R. Co. v. North the State, requiring the transfer Dakota, 216 U. S. 579, 54 L. Ed. from one railroad to another. The 624, (1910). Court said the state could authorize 2 Northern Pac. R. Co. v. North its Railroad Commission to reduce Dakota, 236 U. S. 585, 59 L. Ed. the unreasonable joint through rate 735, (1915), reversing 26 N. Dak. agreed upon between two or more 438. In earlier case from the same roads and apportion the same be- State involving the same traffic, In- tween the railroads interested, and /ra, the Supreme Court said that the added: "It was not necessarily evidence left the question of the entitled to earn the same percentage reasonableness of the charges so of profit upon all classes of freight much in doubt that the decree of carried and the burden was upon the State court was affirmed with- the railroad to impeach the action out prejudice to the right of the of the Commission. It was not railroad to reopen the case so as bound to reduce the rate upon all to prove more fairly the confisca- classes of freight." tory character of the rates. As to the difficulty of making rn Minneapolis & St. Paul R. provision as to the cost of trans- V. Railroad Commission, supra, porting a single article, see Atlantic the Court sustained the rate on Coast Line v. Florida, supra, coal from the northern corner of affirming 48 Fla. 146. the State to the southern part of 230 FEDERAL CONTROL OF STATE RAILROAD REGXiLATION. [§138 of transportation in proportion to the revenue is substantially the same as for the particular trafTic in question, or if there is a material difference, satisfactorily showing its nature and extent.! In the North Dakota case the Supreme Court said: "Broad, as is the power of regulation, the state does not enjoy the freedom of an owner. * * * The constitu- tional guaranty protects the carrier from arbitrary action and from the appropriation of its property to public pur- poses outside the undertaking assumed, and where it is established that a commodity of a class of traffic has been segregated and a rate imposed which would compel the car- rier to transport it for less than the proper cost of transporta- tion, or virtually at cost, and thus the carrier would be de- nied a reasonable reward for its service, after taking into account the entire traflTic to which the rate applies, it must be concluded that the state has exceeded its authority." § 138. The valuation of railroad property in state regulation. — Where the validity of a regulation of rates under state authority is questioned and a railroad or any public service corporation is involved, the valuation of the property of the company must necessarily be ascertained. The Supreme Court has laid down the general rule that in determining value in cases of state regulation, it is not the original cost of the property, but the value at the time of regulation; that is, the cost of reproduction, which is the test; that is, not the expenditure which was made to produce, but the expenditure that will be necessary to reproduce the property.^ This principle that it is the present value of property that must be considered involves the further ques- tion of the right of the railroad or other quasi public corpora- tion to demand a return upon the increased value of its prop- erty, including what is termed the "unearned increment."^ This right, however, is obviously controlled by the limi-- tation of the carrier to reasonable rates; that is, no increase in the value of property can justify the carrier in a rate which is unreasonable to the pubUc. This qualification was dis- ' Wood V. Vandalia R. Co., 231 by the Interstate Commerce Com- U. S. 1, 58 L. Ed. 97 (1913). mission with reference to the 2 See Smyth v. Ames, supra. recent proposed advance of freight 2 See discussion of this subject rates, infra, § 195. §138] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 231 tinctly declared by the Supreme Court in the consolidated gas case.i In the valuation of property for rate regulation the ulti- mate fact of value and the relevancy of evidence to prove value must be distinguished. Thus in the Nebraska rate case,^ the Court said that in determining value as the basis for making rates, capitalization/ the original cost of con- struction, the amount expended in permanent improvements, the amount and market value of bonds and stocks, the present as compared with the original cost of construction, the probable earning capacity under the rates, the sum re- quired to operate the business, are all matters to be consid- ered and must be given such weight as may be just and right in each case, and the court concluded by saying: "We do not say that there will not be other matters to be regarded in estimating values." The decisions of the Supreme Court and other tribunals on questions of valuation in the rate cases, where the question at issue is as to the reasonable return a corporation is entitled to receive under a public regulation of rates, must be distin- guished from eminent domain and analogous cases, where a 1 From opinion of Supreme Court case does not present it. We refer in Ifiis case, 212 U. S. 52 (1909): to the matter only for the purpose "And we concur with the court of stating that the decision herein below in holding that the value does not prevent an inquiry into of the property is to be determined the question when, if ever, it should as of the time when the inquiry be necessarily presented, is made regarding the rates. If the ' Smyth v. Ames, supra. property which legally enters in to ' In the Knoxville Water Case, the consideration of the question of supra, involving the validity of rates has increased in value since it the rates imposed upon a municipal was acquired, the company is en- water company, the Court said titled to the benefit of such increase, that capitalization afforded no This is, at any rate, the general guide to the present value of the rule. We do not say there may property, where substantially all not possibly be an exception to it the common and preferred stock where the property may have in- was issued under construction con- creased so enormously in value as tracts entered into with persons to render a rate permitting a reason- who controlled the corporate action, able return upon such increased and was generally in excess of the value unjust to the pubhc. How true value of the property furnished such facts should be treated is not under the contracts, a question now before us, as this 232 FEDERAL CONTROL OF STATJfi RAILROAD REGULATION. [§139 right of purchase of the property of public utility companies is exercised by municipalities under reserved contract rights ;■- and also from cases of valuation for taxation, where the ascertainment of relative value under construction of statu- tory standards is involved. § 139. The apportionment of railroad property in state regulation.^In the case of an interstate railroad where the lines may extend over several states, the problem is complicated as the value of that part of the property which is located in the state must be ascertained, and when ascer- tained, must be apportioned as between the state and federal business which is conducted with the same tracks and the same equipment. The most direct and simple method of apportioning to a state the value of the interstate railroad located therein is on a basis of mileage, and this method has been approved as a prima facie basis for taxation, both. as to tangible and in- tangible property. 2 But this basis has obvious limitations both in rate regulation and in taxation, and its appUcation may do grave injustice. Thus where the railroad extends through a state where it has very valuable terminal property and runs through a rich populous section, while, in another state it has no such proporty and runs through a poorly de- veloped country, the apportionment on a mileage basis would be clearly inapplicable.' Other methods therefore are sug- 1 See Omaha v. Omaha Water '^ West. Union Tel. Co. v. Massa- Co., 218 U. S. 180, 54 L. Ed. 991 chusetts, 125 U. S. 530 (1888), 31 (1910), where the Court said that L. Ed. 790; Adams Express Co. v. an option to purchase excluded Ohio, 165 U. S. 194 (1897), 41 L. any value on account of unexpired Ed. 683. franchise, but did not include the ' See an interesting and able value as a going concern; Knox- discussion of this subject by Prof, ville Water Co. Case, supra; Wil- B. H. Meyer, now of the Interstate cox V. Consolidated Gas Co., supra; Commerce Commission and form- The Kansas City Waterworks Case, erly of the Wisconsin Railroad 62 Fed. Rep. 853, B. B. A. (1894), Commission, in "The Methods for 8th Circuit; San Diego Co. v. the Distribution of Railway Values Jasper, 189 U. S. 439 (1903), 47 Among States, Bulletin No. 21 L. Ed. 892,' affirming 110 Fed. Census Bureau (1905) Government Rep. 702, as to municipal regula- Printing Office." tion of irrigation rates. § 140 I FEDERAL CONTROL OF STATE RAILROAD REGULATION. 233 gested, such as the apportionment basis upon the gross or net revenues. Not only must there be an apportionment in determining the state value, if it is based upon the general value of the railroad system, but on the issue of an alleged confiscatory state regulation there must be an apportionment of that state value to the state and interstate business carried on with the same property and equipment. This has been done on what is known as the revenue basis ; that is, the value of the prop- erty apportioned according to the state and interstate busi- ness. Where the regulation complained of affects only the passenger or freight business, there must be a still further apportionment of this state and interstate value of the state property as between the passenger and the freight business, both state and interstate. ' § 140. Confiscation in state regulation; how proved. Assuming that the proportionate property in the state has been approximately ascertained and apportioned to the dif- ferent classes of traffic, state and interstate, the determina- tion of a claim of confiscation then requires that the net reve- nues of the state as distinguished from the interstate busi- ness, must be ascertained. The sources of the different classes of revenue, whether state or interstate, passenger or freight, can be determined with accuracy from the records of the railroad company. In order to ascertain the net revenues derived from the intrastate business the cost of conducting the intrastate as distinguished from the state business must still be ascer- tained.'' As the property and equipment are used for all classes of traffic, there is no separate record in the company's books of the cost of doing any specific class of business; and such sep- 1 See Arkansas Rate Case supra; ure to ascertain the cost of doing Missouri Rate Case, supra; Minne- a local business, the Court said sota Rate Case, supra. that the inability to ascertain the > In the South Dakota Rate cost with mathematical accuracy Case, supra, where the Court re- was no reason for not determining versed the judgment of the circuit the cost from the best evidence court, 90 Fed. Rep. 636, the fail- obtainable. 234 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§140 arate cost, therefore, has Jaeen ascertained by what is known as the revenue theory, wherein the cost of each class of traffic is estimated by apportioning the total cost in proportion to the revenue derived from each class of traffic, or the cost of each class of traffic has been estimated by "allocating" such expenses as can properly be charged to any class of traffic and distributing the remaining cost upon such determined units as the cost per ton mile and the cost per passenger mile.^ ' The revenue theory and ton mile theonj. See a very thorough discussion of these different meth- ods of estimating the cost of dif- ferent classes of traffic by the Wis- consin State Commission in Buell V. C. M. & St. P. R. R., 1 Wis. Commission R. R. Report, 324. See also McPherson, J., in St. Louis & S. F. R. Co. v. Hadley, Missouri Rate Case, supra; Far- rington, J., in the Nevada Rate Case, supra; Vandeventer, J., in Arkansas Rate Cases, 163 Fed. Rep. 141; Sanborn, J., in Minne- sota Rate Case, 184 Fed. Rep. 765. See also report of Master in this case. In the Oklahoma Rate Case the circuit court of appeals, 8th cir- cuit (1911), 185 Fed. 329, approved the revenue theory as the more reasonable and equitable. It was conceded that cases could be imag- ined as suggested by the Supreme Court in the South Dakota Case, 176 U. S. 167, wherein the results did not seem to be perfect, but the ton mile theory was open to ob- jections, and the revenue basis ap- pealed more persuasively to the reason than any other. See Hook, J., in same case, in circuit court, 177 Fed. 1. c. p. 498. In the Arkansas Rate Case, 187 Fed. Rep. 292, 1. c. 320 (1911), the court, Trieber, J., said that a care- ful consideration of the facts showed that neither of these theories would produce approxi- mately correct results if no other factors were taken into considera- tion. The straight revenue theory did not take into consideration the increased rates charged for intra- state traffic. The ton mile theory did not consider the additional ex- pense of the local business. The court concluded that the fairest method was to apportion the cost of maintaining the way and struc- tures of the railroad between the intrastate and interstate business on the earnings from the two classes of business, while the cost of locomotive and car maintenance which should be charged to each class of business, could be more nearly approximated by using the car mile basis. Such expenditures as could be definitely assigned to the intrastate and interstate busi- ness, were allocated accordingly. This case was reversed by the Supreme Court in 230 U. S. 553, 57 L. Ed. 1625 (1912), the Court saying that though the calculations of the court below represented a most serious effort to effect a reasonable apportionment, they had the same infirmity, lacking cer- tainty, found to exist in the Minnesota and Missouri rate cases. In Trust Company of America §141j FEDERAL CONTROL OF STATE RAILROAD REGULATION. 235 The Supreme Court in the Minnesota rate case of 1913, criticised and condemned the estimating the cost of the intra- state and interstate trafTic because such estimates lacked the defmiteness and certainty necessary for legal proof, i § 141. The Minnesota Rate Case of 1913 on the Proof of Value. — The Supreme Court in the Minnesota rate case of 1913, exhaustively considered the determination of the value of a state property of a railroad in determining whether the state rates were confiscatory.^ In this case the V. Chicago, B. & St. L. R. Co., 199 Fed. 593, (Cir. Ct. of 111., 1912), in a petition by railroad receivers appointed by the Federal Court in a foreclosure suit to restrain the fen- forcement of a State statute fixing rates, the application was held to be ancillary within the jurisdiction of the court; that the revenue train mileage basis was the most satis- factory apportionment, and the two cent passenger rate of Illinois was held confiscatory as to this railroad. 1 The court in the South Dakota case quoted from the opinion where Justice Brewer in the opinion of the court, criticised the "revenue theory." While local rates are usually intrastate rates and through rates interstate rates, this is not always the case, particularly in respect to passenger traffic. Where a large city is located at or near a state boundary extensive suburban local business may be interstate business while through express trains from one end of the state to another would be interstate. In the cases in the District courts the estimates of experts as to the in- creased cost of intrastate business in the reported cases differ widely, dependent in some states largely upon local conditions. See T. & P. R. Co. v. Railroad Commission, 192 Fed. 280, (C. C. A. 5th Circuit, 1911) involving the Louisiana rates on cotton and cotton seed. It was held that the aggregate amount of outstanding stock and bonds of the railroad company was not a proper measure of the value of the railroad for rate fixing purposes. As to Alabama rates, see L. & N. R. Co. vs. Railroad Commission of Alabama, District Court of Alabama, 208 Fed. 35, (1913). As to the Washington rate, see Southern Pacific R. Co. v. Lee, District Court of Washington, 199 Fed. 621, (1912). As to the rates of California, see Southern Pacific R. Co. v. Rail- road Commission of California, 193 Fed. 699, (1912). In each of the above cases the proof of confiscation was held insufficient. ^ Simpson v. Shepard, 230 U. S. 232, 57 L. Ed. 1511 (1913), revers- ing in part 184 Fed. 765. In this case the Court directed the dis- missal of the bill without prejudice as to two of the companies, but affirmed the judgment as to one without prejudice to a renewed application by the State authorities under changed conditions. 236 FEDERAL CONTROL OF STATE RAILROAD REGULATION. f§ 141 subject had been thoroughly considered by a master. The Supreme Court held that the master and circuit court correctly found that the market value of the stock and bonds representing the entire property of a railway company, which included assets of considerable value which did not form part of the operating property of the carrier, such, as coal mines and the like, furnished no criterion for testing the reasonableness of state regulation of rates. The Court reaffirmed the rule that it is the value, and not the cost of railroad property which should be considered, and that it is the present value, whether it has been increased or decreased. In the case of the former, the public would be protected against the imposition of unreasonable rates. The Court, however, found that it was not proper to compute the cost of reproduction with allowance for consequential and other damages, such as legal fees and interest during the time of construction. Neither should estimates be made of the value of property upon its supposed value for railway purposes in excess of the fair market value of contiguous and similarly situated property. The cost of reproduction, the Court said, was the basis in ascertaining the present value of a plant as to service when it is reasonably apphed and when the cost of reproducing the property could be ascertained with reasonalsle certainty. But it did not justify the acceptance of results which de- pended upon mere conjecture. The Court also found that the physical valuation of the property of the railway company, that is, its right of way and terminals, on the basis of the cost of reproduction, was in- complete where a general finding was made that the deprecia- tion had been more than offset by appreciation, without showing the specific items of appreciation and depreciation. The Court said as the burden was upon the company to show the invahdity of the state rates, it devolved upon the com- pany to furnish, not conjecturally but reasonably accurate proof of present value. The complainants were therefore held to have failed to make the proper proof. ' ' In the same case, however, the Louis, that despite the inadequacy Court held as to one of the rail- of the methods of proof, the peculiar roads, the MinneapoUs & St. position of the road was such and its §142] FEDERAL CONTROL OF STATE EjULROAD HEGULATION. 237 In the Missouri rate case, decided at the same time/ an effort was made to show the true value by multiplying the value fixed by the Tax Assessing Board of the state by three, it being claimed that that was the basis of assessment, to take one-third of the true value. The Court however held that this was too indefinite and lacking in the necessary certainty, and that there was not sufTicient proof of value. ^ § 142. The Apportionment of Cost in the Minne- sota Rate Case. — As the railroads kept no separate record of the costs of intrastate and interstate business, or of any particular class of traffic, the same property and equipment are used for all the business of the company, it has been found difficult to make satisfactory proof of the inadequacy of state rates. It has been strongly contended that state business is conducted at a greater cost than interstate busi- ness, and resort has therefore been had to estimates and conjectures as to the amount of additional cost which should be apportioned to the state business in determining the net revenues from the business.' In the Minnesota rate case of 1913 where the facts had been very exhaustively investigated by a master in the cir- cuit court, and an estimate had been made as to this extra cost of intrastate traffic, the Court held that such general estimates without the aid of any accurate test, would not be accepted as adequate proof to sustain a finding that rates of intrastate freights, as fixed by the state, are confiscatory. The Court held that such estimates of the greater cost of intrastate freights, varying from three to six times the cost of interstate freight, was wholly lacking in the definiteness and certainty for legal proof of such an issue.* weakness was so obvious that the ' See the Oklahoma Rate Case, Court affirmed the judgment en- 177 Fed. 493, and in the Circuit joining the rates, giving the right Court of Appeals, 185 Fed. 321. however to the State authorities (1911). to make a new application if * The Court in its opinion quoted conditions changed. from Justice Brewer's opinion in '230 U. S. 474, 57 L. Ed. 1572, the first South Dakota Case, 186 (1913) reversing 168 Fed. 317. U. S. 167, where he had criticised ' In this case also the Court held the methods of apportioning the in the case of three railroads the cost of interstate and local business, cost was made out despite the in- adequacy of the methods employed. 238 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 143 § 143. The Practical Testing of State Rates. — It was suggested by the Supreme Court in the Minnesota rate case of 1913 that proper proof of the extra cost might be made of intrastate business of the carrier by accurate data from test periods under proper conditions. Such a trial test of a month was made or sought to be made, in the Arkansas rate case.' The parties, however, did not agree as to the computation to be made from these tests, it being claimed on one side that the traffic was abnormal and when the proper charges were made the annual rate would be less than one per cent for one railroad and 2.6 per cent for the other, while it was contended by the state that the calcula- tions would show 7.9 for one railroad and 9.16 for the other. The Court said that it was incumbent upon the complainants to establish the facts by clear and convincing proof, and that the computation of value was open to the same objection as found in the Minnesota and Missouri rate cases. The decrees were reversed with directions to dismiss the bills without prejudice.^ § 144. Rate of profit necessary to avoid charge of confiscation. — When the value of the investment in the state and the net revenue realized thereon under the estab- lished rates have been ascertained, this net revenue must be compared with the rate of profit which the railroad is en- titled to realize upon such an investment. The rule is laid down by the Supreme Court in the New York City gas case,^ that there is no particular rate of compensation which must ' See Allen v. St. L. I.' M. & S. « As to trial of rates, see Cumber- R. Co., 230 U. S. 553, 57 L. Ed. land Telegraph & Telephone Co. v. 1625 (1913) reversing 187 Fed. 290. Louisville, 225 U. S. 430, 56 L. Ed. TheCourtconsidered the Oregon 1151(1912). See also Bellamy v. Rates, Or. R. &N. Co. v. Campbell, ^- * N. R. Co., (C. C. AO (8th 230 U. S. 525, 57 L. Ed. 1605, ^ir.), 215 Fed. 18, where it ap- affirming 173 Fed. 957, and also P<=f ^d that the complamant had „ ^, _ .. _ ' , „ put a statutory rate into eflect and Southern Pacific Co. v. Campbell, though operating its road econo- 230 U. S. 537, 57 L. Ed. 1611, mically, was unable to pay operat- affirmmg 189 Fed. 182. In both ing expenses, and an injunction of these cases, demurrers were held was granted, properly sustained to the bills. » Wilcox v. Consolidated Gas Co., supra. § 144] FEDERAL CONTKOL OF STATE RAILROAD REGULATION. 239 in all cases and in all parts of the country be regarded as sufficient for capital invested in business enterprises. Such compensation must depend greatly upon circumstances and locality and above all upon the amount of hazard in the enter- prise. Under the facts of that case in view of the absence of competition the Court held that a rate which would permit a return of 6 per cent would be enough to avoid a charge of confiscation. In the California water rate case' the Supreme Court held that a reduction of water rates by a board of supervisors so as to give an annual income of 6 per cent, of the then value of the property of the water company actually used to supply water to the public, did not necessarily amount to a taking of property without due process of law. In the Minnesota rate case^ where the state legal rate of interest was 6 per cent, in the absence of contract and 10 per cent, under contract, the court, Sanborn, J., affirmed the report of the master holding that the railroad companies were entitled to a net return of 7 per cent, per annum upon their respective properties. The court said that in view of the fact that the business was subject to public regulation a railroad should be permitted to receive a return sufficient to accumulate a reasonable surplus for times of depression and to maintain the character of their service. The court, therefore, held that 7 per cent, upon the values of the property in Minnesota was no more than the railroads were entitled to under the constitution of the United States. In these cases in the Supreme Court, the question of the rate of profit was not reached as to two of the cases, the Court holding that complainants had failed to make out a case, but in the one case in which the judgment was affirmed, the Court held that a return of four per cent was unreasonable and confiscatory. 3 In the Arkansas rate case* the Court based its conclusion that the railroads were entitled to a return of 6 per cent, upon » Stanislaus v. Joaquin, 192 U. ' See Minnesota Rate Case (1913) S. 204, 48 L. Ed. 406 (1904), re- supra. versing 113 Fed. Rep. 390. « See 187 Fed. Rep. 290 (1911). 2 See Shepard v. Northern Pac. In L. & N. R. Co. vs. Railroad R. Co., supra. Commission of Alabama, it was 240 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 144 the actual value of the investment in that state, regardless of capitalization, upon the finding that the roads were efficiently and honestly managed and traversed a fertile agricultural section with natural resources sufficient to justify their con- struction and that the cost of building was not greater than the average cost of roads in the southwest. In this case, in addition to the 6 per cent., an allowance of 1| per cent, additional in prosperous times where there were no extra- ordinary losses by casualty was made. ^ The Supreme Court reversed without prejudice an injunc- tion granted by the circuit court of Kentucky against the enforcement of a municipal ordinance fixing telephone rates. The Court said it would not decide whether the cutting down of the company to 6% would be confiscatory; that the result in this case of the findings of the master was "too near the dividing line not to make actual experiment necessary," and "the evidence left the question too much in the air" for them to allow the injunction to stand, and the decree enjoining enforcement of the ordinance was therefore re- versed without prejudice.^ The principle announced in all of these cases is that no uni- form rule as to rate of profit can be declared, but that each case must be judged upon its own facts. In the words of the Supreme Court, the public service corporation, which owes held by the District Court of ern cases, and 20 I. C. C. R. 243 Alabama, 196 Fed. 800, (1912), as to the Eastern cases. In the that the railroads of Alabama were latter case it was said on the as- entitled to earn a net profit of 8% sumption that the capital did not on the value of the property em- exceed its actual value, that the ployed by them in intrastate busi- sum remaining after permitting ness, and that the railroad had the of fixed charges including as a right to change rates which from an fixed charge the dividend upon the exigency had been so low as to be preferred stock should be equiva- unremunerative, when the necessity lent to between seven and eight therefor had ceased to exist, and percent on the common stock in- that a statute which prohibited an eluding amount carried to surplus increase of such rates was uncon- fund. stitutional as confiscatory. « City of Louisville v. Cumber- 1 See also discussion of this land Tel. & Tel. Co. 225 U. S. 432, subject in the investigation of ad- 56 L. Ed. 1151 (1912), reversing vances in rates by the Interstate for dismissal without prejudice 187 Commerce Commission (1911), 20 Fed. 637. I. C. C. R. 307, 336 as to the West- §145] FEDERAL CONTROL OF STATE RAILKOAD REGULATION. 241 duties to the public as well as to the stockholders, has no right to any specific rate of dividend upon its capital stock,^ without reference to the rights of the public, and that the public could not properly be subjected to unreasonable rates in order simply that stockholders may earn dividends. § 145. Protection of the carrier against discriminat- ing state regulation.T— The fourteenth amendment pro- tects the carrier not only against unreasonable state limita- tion of rates, but also against any state legislation, which unreasonably interferes with the carrier's right to carry on and manage its concerns. This federal guaranty may be invoked, irrespective of whether there is any contract between the state and the company exempting it in any measure from state control. While the carrier is subject to the general police power of the state in the general con- duct of its affairs, the running of its trains and providing for the proper accommodation of the public, it cannot be sub- jected to discriminating or class legislation. Thus, a statute of Michigan which provided that the railroads should keep for sale one-thousand mile tickets good for two years at a reduced rate, such tickets to be issued in the name of the purchaser's wife and children when desired, and redeemable by the company if not used, was held violative of due process of law and the equal protection of the laws. The Court said that such legislation was not included in the power to fix maximum rates, and that the company had the right to insist that all persons should be compelled to pay alike and that no discrimination against it in favor of certain classes of married men with families, excursionists or others should be made by the legislature.* ' Turnpike Road Go. v. San- case of the same company, at the ford 164 U. S. 578, 41 L. Ed. 560. same term. R. R. Co. v. Ohio, 173 » Lake Shore & M. So. R. Co. v. U. S. 285, 43 L. Ed. 702 (1899), Smith, 173 U. S. 684 (1899), 43 where it sustained the statute of L. Ed. 858. Three justices dis- Ohio requiring a railroad com- senting. The Court in this case pany to cause three of its regular distinguished the lawful exercise passenger trains to stop at a station of the state power in the enact- containing over 3,000 inhabitants, ment of reasonable state regula- See supra, § 32. tions for the public interest in a J-16. 242 FEDERAL CONTROL OF STATE RAILROAD EEGTJLATION. [§ 145 The same principle has been applied in holding invalid a statute requiring a railroad company to deliver its cars to another company from and to any point, where there was a physical connection between the tracks, without adequate protection of the law or undue detention and without secur- ing due compensation. It was held that adequate provision for compensation should be made in the law itself, and the defect could not be cured by inserting such provisions in judgments in the discretion of the court. ^ A railroad company cannot be compelled, at its own ex- pense and without preliminary hearing, to construct side tracks or swtiches necessary to reach grain elevators which may be erected adjacent to the right of way, even if the statute was construed as only providing for cases where the demand for the facility was reasonable. The court based its opinion however, upon the absence of preliminary hearing and compensation. 2 The court said in its opinion that it did not intend to prejudice a later amendment providing for a preliminary hearing and compensation, which was said to have been passed. The state power of regulation in the absence of legislation by Congress also extends to the subject of terminals, and the Supreme Court affirmed the refusal to restrain the order of the Michigan Commission making the tariff rates and pro- viding for the extended traffic within the corporate limits of Detroit.' The court said in that case that the possible in- validity of the penalty clause did not affect the validity of the action of the Commission. The general police power of the State by reasonable ordinances in regulating the use of switches by railroads within the corporate limits of cities has been affirmed.* iL. & N. R. Co. V. Central 457, L. Ed. 310 (1913), affirming Stock Yards Co., 212 U. S. 133 198 Fed. 1009. (1908), 53 L. Ed. 441, reversing « Atlantic C. L. R. Co. v. Gold- 30 Ky. L. R. 18. borough, 232 U. S. 548, 58 L. i* Missouri Pacific Ry. Co. v. Ed. 721 (1913), affirming 155 Nebraska, 217 U. S. 196, 54 L. N. C. 356. In L. & N: R. Co. v. Ed. 727 (1910), reversing 81 Neb. Finn, 235 U. S. 601, 59 L. Ed. 379, P- 51. (1915), the court affirmed 214 Fed. ' Grand Trunk Ry. Co. v. Michi- 265 in refusing to enjoin the en- gan Railway Commission, 231 U. S. forcement of the rate making § 146] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 243 § 146. The state power of regulation not limited to rates. — The power of the state, in its control of domestic commerce, to fix maximum rates subject to the judicial de- termination of their reasonableness also includes the power to make any reasonable regulations for the conduct of the carriers' business, subject to the judicial determination of what is reasonable. Thus discriminations may be prohibited, the requirement of facilities for the transfer of freight by direct connection at the intersection of railroads may be re- quired,' and the reasonableness of contracts of the carriers, whether such contracts be made directly with the patrons of the road or for a general arrangement between railroads in the transportation of persons and property, are properly subject to state control.'' The consolidation of parallel or competing lines of railway may be prohibited.' While a charter contract not containing a reservation on the part of the state of the right to alter or amend is pro- tected by the federal constitution against impairment by subsequent legislation, the right may be reserved by the state to alter, amend or repeal the charter contract. In such cases the rights vested in the corporation by the terms of the charter contract may be modified by subsequent legislation, though this right of impairment or annulment does not ex- tend to vested rights in property or contract acquired by user of corporate powers and franchises. Thus where by a rail- road charter the general power is given to consolidate with, purchase, lease or acquire the stock of other roads, which had remained unexecuted, the legislature may declare by subse- quent acts that this power shall not extend to the purchase, lease or consolidation with parallel or competing lines.* reparation orders of the State ' Minneapolis & St. Louis R. Railroad Commission of Kentucky, Co. v. Minnesota, 186 U. S. 257 being the same case reported in 231 (1902), 46 L. Ed. 1151. U. S. 298. The Court held there ^ Louisville & Nashville R. Co. was no denial of due process of law. v. Kentucky, 161 U. S. 677 (1896), •Atchison, etc., R. Co. v. Den- 40 L. Ed. 849. ver, etc., R. Co., 110 U. S. 667 < Piersall v. Great Northern R. (1884), 28 L. Ed. 291; Wisconsin, Co., 161 U. S. 646 (1896), 40 L. Ed. etc., R. Co. V. Jacobson, 179 U. S. 838. 287 (1900), 45 L. Ed. 194. 244 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§146 Where a railroad corporation is organized under state law by the purchasers of the property of a railroad corporation at foreclosure sale, there is no contract right created pro- tected by the federal constitution against the enforcement of subsequent statutory regulations respecting railroad rates existing when the new company was incorporated, though not in force when the mortgage was executed, and the rail- road company, by incorporating under a general law of the state is estopped to contest the validity under the federal constitution of the provisions of an act regulating railroad rates, which form one of the burdens imposed by the state as a condition of becoming an incorporated body.' It is the proper duty of a railroad company to establish stations at proper places on its lines, and it is therefore within the power of a state to make it the prima facie duty of the company to establish stations at all villages and boroughs on their respective lines. A state statute requiring such erection of stations by railroad companies on the order of the state railway and warehouse commission, the burden being imposed upon the company of meeting the presumption that the order of the commission is correct, does not amount to an invasion of the rights of private property and is not repug- nant to the constitution of the United States.^ The subject of the state power of raUroad regulation where affecting interstate commerce has been considered in chapter 2 in connection with the concurrent and exclusive powers. In such cases the power of the state is sustained as a lawful regulation of interstate commerce in the absence of legisla- tion by congress. In the class of cases now under considera- tion the state legislation is assailed, not on the ground of in- terference with interstate commerce, but as an impairment of the property rights of the railroad violative of due process of law and the equal protection of the laws as secured by the constitution of the United States. State regulations have been sustained requiring railroads to adjust and pay claims on intrastate shipments within forty ' Grand Rapids & Indiana R. ^ Minneapolis, etc., R. Co. v. Co. V. Osborne, 193 U. S. 17, 48 L. Minnesota, 193 U. S. 53 (1904), Ed. 598 (1904). See also People 48 L. Ed. 614. of New York v. Cook, 148 U. S. 397, 37 L. Ed. 498 (1892). § 146] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 245 days after the filing of the claim under the penalty of $50.00 for each failure, where there could be no award of penalty unless there was a recovery for the full amount of the claim. ^ The order of a state commission, requiring a railroad to re- store a connection at a given point with the train of another road, was within the power of the state, if other connections were inadequate for public convenience, although compli- ance with the order might necessitate the running of an extra train or the extent of the run of the local train, as long as the income of the railroad from its business in the state afforded adequate remuneration. ^ A railroad conpany in Kansas was compelled by peremp- tory mandamus by the supreme court of the state to operate a passenger train between a given point and the state line; and this was held within the lawful power of the state.' The state also has the right to insist upon equality between all its citizens and to require a rate for all where the railroad, under the guise of a rebilling rate, gives anyone such rate,^ and may require a railway to operate a particular line, although con- pliance may entail expense and require the exercise of emi- nent domain, and may require a railway company to broaden and standardize a narrow guage railroad throughout its length.^ A state may also lawfully legislate for the safety of those engaged in railroad business within its hmits, and may enact reasonable regulations to that end which will be valid as to all within its jurisdiction in the absence of legislation by congress." ' Seaboard Air Line v. Seeders, York could compel an interstate 207 U. S. 73, 52 L. Ed. 108, affirm- railroad to put on additional ing 73 N. C. 71 (1907). trains when required for local 2 Atlantic Coast Line R. R. v. purposes. Corporation Commission, 206 U. S. •■ Alabama & Vicksburg R. R. 1, 51 L. Ed. 933 (1906), affirming Co. v. Commission of Mississippi, 137 N. C. 18, citing Wisconsin R. 203 U. S. 496, 51 L. Ed. 289 (1906). Co. V. Jacobson, supra. ' Mobile J. & K. C. R. R. Co. v. ' Missouri Pacific R. R. v. Kan- Mississippi, 210 U. S. 187, 52 L. sas, 216 U. S. p. 262, 54 L. Ed. 472 Ed. 1016 (1908), affirming 86 Miss. (1910). In D. L. & W. R. Co. v. 172 and 89 Miss. 724. Stevens, 172 Fed. 595, N. D. of N. « Chicago, R. I. & P. v. Arkan- Y. (1909), it was held that the State sas, 219 U. S. 453, 55 L. Ed. 290, Public Service Commission of New affirming 86 Ark. 412 (1910), sus- 246 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 147 A state may through the ordinances of its municipalities, adopted by legislative authority, require railway companies to construct at their own expense viaducts over street cross- ings which are to be built along one side of the street only, and in this requirement there is no violation of due process of law.^ The state authority however does not extend to the requirement to erect scales in stock yards when the scales have no direct part in transportation, but are merely a convenience, giving the station possessing one an advantage over the place where none exists, and the compelling of a railroad to erect such scales without giving them any oppor- tunity to abate existing discriminations by discontinuing such scales at other shipping stations was a denial of due process of law. ^ § 147. The Enforcement of Excursion Rates — When Unreasonable. — This question was presented in the state of Iowa by the act of the general assembly requiring round trip tickets from any point in the state to any town or city in the state where an annual fair or exposition was held, at which the attendance of the preceding year was seventy-five thousand, to be sold by all railroads during the continuance of such fair at prescribed rates, which were materially less than those fixed by the general statute. It was held by the judges of the eighth circuit' that the rates fixed by the general statute were presumed to be just and reasonable, and that taining a statute prescribing a tion of transverse openings in minimum of three brakemen for railway rights of way in roadbeds freight trains of more than twenty- to take care of the surface water, five cars, regardless of any equip- C. & A. R. Co. v. Tranbarger, 238 ment with automatic couplers and U. S. 67, 59 L. Ed. 1204, affirming air brakes. the judgment in 250 Mo. 46, sus- ' Missouri Pac. R. Co. v. Omaha, taining the Missouri statute of 235 U. S. 121, 59 L. Ed. 157 (1914), 1907, page 169. affirming U. S. Court of Appeals, For regulation held unreasonable 8th Circuit, 197 Fed. 516. for delivery of cars at arrival, see 2 Great Northern Ry. Co. v. Yazo & Miss. Railroad Co. v. Minnesota, 238 U. S. 340, 59 L. Ed. Greenwood Co., 227, U. S. 1, 1337, (1915). 57 L. Ed. 389. (1913). The equal protection of the laws ^ Chicago, R. I & P. R. Co. v. was not denied by a statute of Ketchum, Dist. Ct. Iowa (1912) Missouri compelhng the construe- 212 Fed. 986. § 148] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 247 the legislation having prescribed such rates, it had no power to make exceptions thereto in favor of a particular class of passengers or of a particular locality. That the act was an illegal interference with the right of the railroad companies to fix their own rates of fares within the general limits of the statute, and deprived them of their property without due process of law. The court said that, conceding that the state had a right to compel railroads to grant reduced and excursion rates to persons attending the state fair on the ground that it was an educational institution, there was no constitutional provision, national or state, which required the extension of such rates to all passengers going to or from the city where the fair was held during its continuance, re- gardless of whether or not they attended. But on 'the con- trary, such extension was not only not within the reason of the law, but operated as a clear discrimination against the industries and business interests of the other cities of the state. The court said it was immaterial whether the carriers had in the past voluntarily established rates for the fair, as they could not for that reason be compelled to do so again. 1 § 148. The state Anti-Trust Laws and the Four- teenth amendment. — The power of the state in the enact- ment of socalled anti-trust legislation, prohibiting contracts and combinations in restraint of trade, has been discussed by the federal courts in connection with the regulation and control of railroads and other public service corporations; and it has been held that such statutes are within the 1 In C. B. & Q. R. Co. v. of Alabama requiring the railroad Ogelsby, 198 Fed. 153, (1912) an company to stop all of its trains at order of the Missouri Railroad the so-called Union Station at Commission requiring a railroad Mobile, involving cost and delay, operating a road continuously into when it had an adequate station of another State to run an additional its own, was unreasonable and was train on a local branch was under enjoined. And in the same State, the circumstances unreasonable, in Lusk v. Town of Dora, 224 and was enjoined. Fed. 650, an ordinance limiting the In L. & N. R. Co. v. Railroad speed of interstate trains to six Commission of Alabama, 191 Fed. miles in a town of six thousand 757, (1911) it was held that an inhabitants, was held unreasonable, order by the Railroad Commission 248 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§148 constitutional power of the state when not violative of the federal guarantees of the due process of law and the equal protection of the laws or other constitutional guarantees. The extent of the state power in the enactment of such statutes is illustrated in the decision of the Supreme Court/ holding that a statute of Wisconsin which punished combin- ing for the purpose of wilfully or maliciously injuring another in his business, and construed by the supreme court of the state as requiring malicious, as distinguished from mere wilful injury, was not violative of the lawful right to contract protected by the fourteenth amendment. The Court said that malicious mischief was a proper subject for legislative repression, and still more were combinations for the purpose of inflicting it, and that it would be impossible to hold that the liberty to combine to inflict such mischief, even upon such intangibles as business or reputation, was among the rights which the fourteenth amendment was intended to preserve.^ The Court did not decide what would be the force of the constitutional objection if the statute was con- strued to embrace combining to effect wilful, as distinguished from malicious, injury. The Texas Anti-Trust Law had been adjudged defective on account of discriminatory features' and it was held by the Supreme Court,^ in affirming the judgment of the Texas court, forfeiting the license of a foreign corporation to do business in the state because of its violation of the anti-trust laws in entering into an agreement to fix the price of cotton seeds, that it was bound by the con- struction of the Texas statutes, made by the Texas courts, which held that the discriminatory features of the act had been repealed. 1 Aikens v. Wisconsin, 195 U. S. fixed by such rival, except at a 194, 49 L. Ed. 154 (1904); Smiley corresponding increase, but to per- V. Kansas, 196 U. S. 447, 49 L. Ed. mit those to advertise in their 546 (1905). papers at the old rate who should * The conviction affirmed in this refuse to pay their rival the new case was that of certain newspaper rate. managers who, it was alleged, ' In re Grice (No. Dist. of had combined to maliciously in- Texas), 79 Fed. 627 (1897). jure a rival paper by agreeing to * National Oil Co. v. Texas, 197 refuse space to advertisers who U. S. 115, 49 L. Ed. 689 (1905), should pay the increased rates affirming 72 S. W. 615. § 148] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 249 Such a law is invalid when it attempts to exempt a certain class of the community, such exemption being on no reason- able basis of classification. Thus, the Anti-Trust Law of Illinois was held invalid on the ground that agricultural products or live stock in the hands of the producer or raiser are exempted from the operation of the statute, which pro- hibited the recovery of the price of the article sold by any trust or combination if in restraint of trade or commerce in violation of the act. The Supreme Court said that this dis- crimination was a denial of the equal protection of the laws.'^ The Court said that such a statute was not a legitimate exertion of the power of taxation, rested upon no reasonable basis, was plainly arbitrary and clearly denied the equal protection of the laws to those against whom it discriminated; as this exemption was such a material feature of the law, that presumably it would not have been enacted without it, the whole law was held void. The Tennessee Anti-Trust Act, which provided that cor- porate violators should be proceeded against by bill in equity on relation of the attorney general, while any persons offend- ing its provisions could not be tried without a grand jury investigation and indictment or presentment and a trial by jury with the requirement of establishing guilt beyond a reasonable doubt and to the benefit of the statute of limita- tions of one year, did not deny the equal protection of the laws. The Supreme Court said that the fourteenth amend- ment did not introduce a factitious equality without regard to practical difference, that are best met by corresponding differences of treatment. The use of fine and imprisonment was likely to be efficient for men, while the latter was im- possible, and the former less serious to corporations.'' The Arkansas Anti-Trust Act of 1905 was also held valid as to foreign corporations, and the possible invalidity of the act as to individuals did not make the provisions invalid as to corporations, and no contract rights of domestic cor- porations were impaired by the imposition of a penalty on corporations doing business in the state while members of a ' Connolly v. Union Sewer Pipe ' Standard Oil Co. of Ky. v. Co., 184 U. S. 540 (1902), 46 L. Tenn., 217 U. S. 413, 54 L. Ed. 817 Ed. 679. (1910). 250 FEDERAL CONTROL OF STATE RAILROAD REGULATION. [§ 149 trust or combination to control prices, where the legislature was empowered to repeal, alter or amend corporate charters, provided no injustice was done to the incorporators. Neither was due process of law denied by an order under this statute directing the production of books and papers by a foreign corporation, nor by striking from the files an answer of a foreign corporation on a refusal to produce such books and papers, nor did such order amount to an unreasonable search or seizure. 1 The Missouri anti-trust law requiring corporations to make affidavits setting forth non-participation in any pool or trust, and so forth, without including individuals and partnerships in such requirement, was held not a denial of the equal protection of the laws.^ The same anti-trust law was held valid against the objec- tion that the combinations had benefited and not injured the public, and the prohibition was extended to manufacturers and not to purchasers, and combinations of wage earners were excluded. The Court said this did not come within the rule of the Connolly case.' § 149. Classification in state railroad legislation. — Where classification is reasonable, that is, based upon legiti- mate considerations of public policy, it is valid, as legislation must necessarily be specialized in its adaption to the subjects of legislation. The question is thus left open for determina- tion in every case of classification for legislation, whether the discrimination is natural and reasonable or arbitrary and ' Hammond Packing Co. v. Ark., In case of the same Company, 212 U. S. 322, 53 L. Ed. 530 (1909), a conviction was set aside, 234 affirming 81 Ark. 519. U. S. 216, 58 L. Ed. 1284 (1912), 2 Mallankrodt Chemical Works reversing 147 Ky. 564, as there vs. Missouri, 238 U. S. 41, 59 L. was an uncertainty as to what Ed. 1192, (1915), affirming 249 the sale price of the article would Mo. 702. have been had there been no com- ' International Harvester Co. v. bination. Missouri, 234 U. S. 199, 58 L. See also American Seeding Co. Ed. 1276, (1914), affirming 237 v. Kentucky, 236 U. S. 660, 59 Mo. 369. L. Ed. 892, (1915) reversing 152 International Harvester Co. v. Ky. 589. Kentucky, 234, U. S. 577, 58 L. Ed. 1479, §149] FEDERAL CONTROL OP STATE RAILROAD REGULATION. 251 oppressive, and therefore a denial of the equal protection of the laws guaranteed by the fourteenth amendment. ' The diflTicuIty of determining these questions of classifica- tion was illustrated in the division of the Supreme Court in two recent cases. In one'' the Court held invalid a statute of Texas which required railroad companies in all cases of claims under $50.00 to pay an attorney's fee not exceeding |10.00 to the party successfully suing, provided the suit was brought thirty days after the refusal of the company to pay the claim. The Court said that this was an arbitrary selection which could not be justified by calling it classification. In the other case' a Kansas statute providing that in all actions brought for damages caused by fire from the operation of the railroad the court should allow the plaintiff on recovery a reasonable attorney's fee, which should become a part of the judgment, was sustained, the opinion of the Court being rendered by the same ju'dge. Justice Brewer, in both cases. It was said in the latter case that while the principles of separation between the classes were not difficult, yet their application often became very troublesome, especially when the case was near the dividing line. "It is easy to distinguish," said the Court, "between the full light of day and the darkness of midnight, but often very difficult to determine whether the given moment in the twilight hour is before or after that in which the light predominates over the darkness." In a later case from Kansas, a statute allowing a "reason- able attorney's fee" to a shipper who successfully sues a rail- road company for failure to furnish cars, while no such allowance was made in behalf of the railway company in the ' In Niagara Falls Fire Ins. mission were entitled to invoke Co. V. Cornell, 110 Fed. 816 the protection of the federal law (1901), the circuit court of Ne- and challenge the validity of stat- braska held the anti-trust law of utes which affected their business that state void on account of its equally with state companies, exemption of assemblies and as- ' Railroad Co. v. Ellis, 165 U. sociations of working men and re- S. 150, 41 L. Ed. 667 (1897), three serving to them all their rights judges dissenting, and privileges now accorded to ' A., T. & S. R. R. Co. v. Mat- them by law. This case also held thews, 174 U. S. 96, 43 L. Ed. 909 that foreign insurance companies (1899), four judges dissenting, doing business in the state by per- 252 FEDEEAL REGULATION OF STATE RAILROAD REGULATION. [§149 event of its successful prosecution of the shipper under that statute who failed to use the cars promptly when furnished, was a denial of the equal protection of the laws.' The Court said this case was fairly distinguishable from the Texas statute sustained in the Cade case,^ as it was there held that the mere fact that attorney's fees were allowed the successful plaintiffs and not to successful defendants, did not render the statute repugnant to the equal protection of the laws. But this Kansas case was different, in that the statute here dis- criminated between the railroad companies and the shippers when subjected to the same burden.^ The statute of Kansas regulating charges in public stock- yards, and applying only to one corporation and not to other companies or corporations engaged in hke business, was held to deny the equal protection of the laws.^ A law of Texas directed solely against railroad companies and imposing a penalty for permitting Johnson grass or Russian thistle upon their roadway was sustained,Hhe Court saying: "Great constitutional provisions must be admin- istered with caution. Some play must be allowed for the joints of the machine, and it must be remembered that the 1 Santa Fe R. Co. v. Vosberg, usually allowed for paying in 238 U. S. 56, 59 L. Ed. 1199 (1915). advance of a designated time, takes 'i M. K. & T. R. Co. V. Cade, 233 the company's property without U. S. 642, 58 L. Ed. 355, 1914. due process of law, where such " The application of the Four- regulation was not expressly pro- teenth Amendment in interstate hibited by the statute and there was commerce in other than railroad no judicial decision in the state cases, is illustrated in Southwestern holding or indicating that it was Telegraph & Telephone Co. v, unreasonable, and it had been Danoher, 238 U. S. p. 482, 59 L. adopted in good faith and had been Ed. 1419 (1915), reversing 94 informally and impartially en- Ark. 443, 102 Ark. 547, where it forced for many years, was held that the imposition upon * Missouri, Kansas & Texas R. a telephone company under the Co. v. May, 194 U. S. 267 (1904), Arkansas Statute of penalties ag- 48 L. Ed. 971, two judges dissent- gregating $6300, because of its ing. See decisions of Supreme impartial enforcement against one Court of United States on Wiscon- of its patrons of a regulation that it sin Anti-Trust Law, November 4, would not furnish telephone service 1904, 195 U. S. 194, 49 L. Ed. 154. to any patron in arrears fov past ' Cotting v. Kansas City Stock- service, and would not accord to a yards Co., 183 U. S. 79, 46 L. Ed. patron so in arrears the discount 92 (1901). §149] FEDERAL CONTROL OF STATE RAILROAD REGULATION. 253 legislatures are the ultimate guardians of the liberties of the people in quite as great a degree as the courts." It was held to be no denial of the equal protection of the laws in the exception from the two cent passenger rate al- lowed to electric lines and street railways, or to railroads in the State under fifty miles in length and not a part of or un- der the control of another road, and the penal provisions of the law were held not open to attack because the supreme court of the state had held that the railway company was excepted from the penalty, as long as it tested in good faith the validity of the act.^ A law of Iowa excepting "sales by jobbers and wholesalers in doing an interstate business with customers outside of the stale" from a license tax imposed upon dealers in cigarettes was sustained,^ the Court saying that there was a clear dis- tinction in occupations warranting the classification. The modification of the fellow-servant rule as to railway employes by a state statute does not violate the equal protec- tion of the law; and a general classification of railroad em- ployes as subject to such statute is a proper exercise of the police power of the state. Neither does a statute prohibiting drumming and soliciting of business upon railroad trains and premises violate the equal protection of the laws, though it singles out certain business and professions for which solicit- ing of patronage is prohibited.' ' Chesapeake & Ohio R. Co. v. v. Arkansas, supra, where the ex- Connolly, 230 U. S. 153, 57 L. Ed. elusion of railroads less than fifty 1597, (1913). miles in length from a statute pre- ' Cook V. County of Marshall, scribing the minimum of brakc- 196 U. S. 261, 49 L. Ed. 471 (1905). men for certain freight trains, did 'Williams v. Arkansas, 217 U. not deny the equal protection of S. 79, 54 L. Ed. 673 (1910). See the laws, affirming 86 Ark. 412. also Chicago, R. I. & Pac. Ry. Co. PART 11. INTERSTATE COMMERCE ACT. Section 1. 150. Section 1 of the Act of 1887. 151. Section 1 as amended by Act of June 18, 1910. 152. Amendments to the section. 153. The inclusion of telegraph, telephone and cable companies. 154. All of interstate commerce not included. 155. Parties subject to the act. 156. Standard Oil pipes properly included in the act. 157. Common carriers under the act. 158. Who is a common carrier. 159. Express companies under the act. 160. Sleeping car companies. 161. Under common control, management, or arrangement for a continuous carriage. 162. Transportation through a state. 163. Territorial transportation. 161. Interstate street railroads. 165. Interstate street railways and interurban electric railroads trans- porting freight, distinguished. 166. Receivers, lessees, and purchasers pendente lite. 167. Foreign commerce. 168. Place of incorporation of carrier immaterial. 169. The intention of interstate shipment not sufficient. 170. All instrumentalities of shipment or carriage. 171. Delivery, cartage, storage, and demurrage charges. 172. Terminal facilities and plant facilities. 173. Bulk grain storage as part of transportation. 174. The amendments of section as to accessory charges. 175. Carriage of live stock and perishable property. 176. Refrigeration in transit. 177. Private cars. 178. The enforcement of the duty of carriers to furnish cars. 179. Prohibition of passes. 180. Stipulations in passes against liability sustained. 181. The commodities clause. 182. Switch connections. 183. The estabUshment of through rates. 256 THE INTEHSTATE COMMERCE ACT. [SECTION 1 184. Classifications, regulations, and practices. 185. Unlawful use of peddler cars. 186. Charges must be reasonable and just. 187. Practical difficulties in the enforcement of reasonableness in rates. 188. Standard of reasonableness under state statutes. 189. Standard of reasonableness under the act. 190. The power of the commission in fixing rates. 191. Rates, and not systems of rates, determined by the commission. 192. No power in the courts to fix rates. 193. The federal courts on reasonableness of railroad rates. 194. The value of railroad property as a basis for rate regulation. 195. The unearned increment in valuation of railroad property in rate regulation. 196. The relation of railroad rates to investment of earnings in prop- erty. 197. Reasonableness under sections 1 and 3. 198. Consideration of reasonableness in the courts. 199. Rulings of the commission upon the reasonableness of rates. 200. Considerations in the advance of rates. 201. Limitation of the commission's power in fixing rates. 202. Presumptions of reasonableness from established rates. 203. Burden of proof. 204. Considerations in the determination of reasonableness. 205. Review of the commission's rulings on rates. 206. What is a reasonable rate. 207. Res Judicata with respect to rates. 208. Through rates and local rates. 209. Reasonableness in commutation rates. 210. Relation of interstate to state rates. 211. Rates as affected by development of country. 212. Supreme Court on the considerations admissible in fixing rates. 213. Commission on the interdependence of rates. 214. No vested interest in rates. 215. Reasonableness of rates as dependent on character of traffic. 216. Distance as a factor in rates. 217. The commission on comparison of rates. 218. Reasonableness of rates as relating to cost of service and needs of the shipper. 219. Reasonableness and proportion. 220. The commission on rate wars and reasonableness of rates. § 150. Section 1 of the Act of 1887.— Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That the provisions of this [Carriers and transportation subject to the act.] act shall apply to any common carrier or carriers engaged in the transportation of passengers or property wholly by rail- §151] THE INTERSTATE COMMERCE ACT. 257 road, or partly by railroad and partly by water when both are used, under a common control, management, or arrange- ment, for a continuous carriage or shipment, from one State or Territory of the United States, or the District of Colum- bia, to any other State or Territory of the United States, to an adj acent foreign country, or from any place in the United States through a foreign country to any other place in the United States, and also to the transportation in like manner of property shipped from any place in the United States to a foreign country and carried from such place to a port of transshipment, or shipped from a foreign country to any place in the United States and carried to such place from a port of entry either in the United States or an adjacent for- eign country ; Proyjrferf, however. That the provision of this Act [Act does not apply to transportation irholly within one state.] shall not apply to the transportation of passengers or prop- erty, or to the receiving, delivering, storage, or handling of property, wholly within one State, and not shipped to or from a foreign country from or to any State or Territory as aforesaid. [What the terms "railroad" and "transportation" in- clude.] The term "railroad" as used in this act shall include all bridges and ferries used or operated in connection with any railroad, and also all the road in use by any corporation operating a railroad, whether owned or operated under a con- tract, agreement, or lease; and the term "transporation" shall include all instrumentalities of S'hipment or carriage. [Charges must be reasonable and just.] All charges made for any service rendered or to be ren- dered in the transportation of passengers or property as aforesaid, or in connection therewith, or for the receiving, delivering, storage, or handling of such property, shall be reasonable and just; and every unjust and unreasonable charge for such service is prohibited and declared to be un- lawful. § 151. Section 1 as amended and in force (1916). — Sec- tion (As amended June 29, 1906, April 13, 1903, and June 18, 1910.) V. That the provisions of this Act shall apply to any corporation or any person or persons engaged in the trans- portation of oil or other commodity except water and except natural or artificial gas, by means of pipe lines, or partly by pipe lines and partly by railroad, or partly by pipe hues and partly by water, and to telegraph, telephone, and cable com- [Carriers, telegraph, telephone, and cable companies, and transportation subject to the act.] J-17. 258 THE INTERSTATE COMMERCE ACT. [SECTION 1 panics {whether wire or wireless) engaged in sending messages from one State, Territory, or District of the United States, or to any other State, Territory, or District of the United States, or to any foreign country, who shall be considered and held to be common carriers within the meaning and purpose of this Act, and to any common carrier or carriers engaged in the transportation of passengers or property wholly by rail- road (or partly by railroad and partly by water when both are used under a common control, management, or arrange- ment for a continuous carriage or shipment), from one State or Territory of the United States or the District of Colum- bia, to any other State or Territory of the United States or the District of Columbia, or from one place in a Territory to another place in the same territory, or from any place in the United States to an adjacent foreign country, or from any place in the United States through a foreign country to any other place in the United States, and also to the transportation in like manner of property shipped from any place in the United States to a foreign country and carried from such place to a port of transshipment, or shipped from a foreign country to any place in the United States and carried to such place from a port of entry either in the United States or an adjacent for- [Act does not apply to transportation or to transmission of messages ivholly within one state.] eign country: Provided, however. That the provisions of this Act shall not apply to the transportation of passengers or property, or to the receiving, delivering, storage, or handling of property wholly within one State and not shipped to or from a foreign country from or to any State or Territory as aforesaid, nor shall they apply to the transmission of messages by telephone, telegraph, or cable wholly within one State and not transmitted to or from a foreign country from or to any State or Territory as aforesaid. [Express companies and sleeping car companies included.] [What the term "railroad" includes.] The term "common carrier" as used in this Act shall in- clude express companies and sleeping car companies. The term "railroad" as used in this Act shall include all bridges and ferries used or operated in connection with any railroad, and also all the road in use by any corporation operating a railroad, whether owned or operated under a contract, agreement, or lease, and shall also include all switches, spurs, tracks, and terminal facilities of every kind used or neces- sary in the transportation of the persons or property desig- nated herein, and also all freight depots, yards, and grounds used or necessary in the transportation or delivery of any of [What the term "transportation" includes.] said property; and the term "transportation" shall include §151] THE INTERSTATE COMMERCE ACT. 259 cars and other vehicles and all instrumentalities and facili- ties of shipment or (tarriage, irrespective of ownership or of any contract, express or implied, for the use thereof and all services in connection with the receipt, delivery, elevation, and transfer in transit, ventilation, refrigeration, or icing, storage, and handling of property transported; and it shall [Duty of carrier.] be the duty of every carrier subject to the provisions of this Act to provide and furnish such transportation upon reason- able request therefor, and to establish through routes and just and reasonable rates applicable thereto; and to provide reasonable facilities for operating such through routes and to make reasonable rules and regulations with respect to the ex- change, interchange, and return of cars used therein, and for the operation of such through routes, and providing for reason- able compensation to those entitled thereto. [Charges must be just and reasonable.] All charges made for any service rendered or to be rendered in the transportation of passengers or property and for the transmission of messages by telegraph, telephone, or cable, as aforesaid, or in connection therewith, shall be just and rea- sonable; and every unjust and unreasonable charge for such service or any part thereof is prohibited and declared to be unlawful: Provided, That messages by telegraph, telephone, or cable, subject to the provisions of this Act, may be classified into day, night, repeated, unrepealed, letter, commercial, press. Government, and such other classes as are just and reasonable, and different rates may be charged for the different classes of [Exchange of services.] messages: And provided further. That nothing in this Act shall be construed to prevent telephone, telegraph, and cable compa- nies from entering into contracts with common carriers, for the exchange of services. [Further duty of carrier.] And it is hereby made the duty of all common carriers subject to the provisions of this Act to establish, observe, and enforce just and reasonable classifications of property for transporta- tion, with reference to which rates, tariffs, regulations, or prac- tices are or may be made or prescribed, and just and reasonable regulations and practices affecting classifications, rates, or tar- iffs, the issuance, form, and substance of tickets, receipts, and bills of lading, the manner and method of presenting, markirig, packing, and delivering property for transportation, the facili- ties for transportation, the carrying of personal, sample, and ex- cess baggage, and all other matters relating to or connected with the receiving, handling, transporting, storing, and delivery of property subject to the provisions of this Act which may be nec- essary or proper to secure the safe and prompt receipt, handling 260 THE INTERSTATE COMMERCE ACT. [SECTION 1 transportation, and delivery of property subject to the provisions of this Act upon just and reasonable terms, and every such un- just and unreasonable classification, regulation, and practice with reference to commerce between the States and with foreign countries is prohibited and declared to be unlawful. [Free passes and free transportation prohibited.] No common carrier subject to the provisions of this Act shall, after January first, nineteen hundred and seven, di- rectly or indirectly, issue or give any interstate free tickets, [Excepted classes.] free pass, or free transportation for passengers, except to its employees and their families, its officers, agents, surgeons, physicians, and attorneys at law; to ministers of religion, traveling secretaries of railroad Young Men's Christian Asso- ciations, inmates of hospitals and charitable and eleemosy- nary institutions, and persons exclusively engaged in chari- table and eleemosynary work; to indigent, destitute, and homeless persons, and to such persons when transported by charitable societies or hospitals, and the necessary agents employed in such transportation ; to inmates of the National Homes or State Homes for Disabled Volunteer Soldiers, and of Soldiers' and Sailors' Homes, including those about to enter and those returning home after discharge; to necessary care takers of live stock, poultry, milk, -and fruit; to em- ployees on sleeping cars, express cars, and to linemen of tele- graph and telephone companies; to Railway Mail Service employees postofRce inspectors, customs inspectors, and im- migration inspectors ; to newsboys on trains, baggage agents, witnesses attending any legal investigation in which the common carrier is interested, persons injured in wrecks and [Interchange of authorized passes and franks.] physicians and nurses attending such persons: Provided, That this provision shall not be construed to prohibit the interchange of passes for the officers, agents, and employees of common carriers, and their families; nor to prohibit any common carrier from carrying passengers free with the ob- ject of providing relief in cases of general epidemic, pesti- lence, or other calamitous visitation : And provided further. That this provision shall not be construed to prohibit the privi- lege of passes or franks, or the exchange thereof with each other, for the officers, agents, employees, and their families of such telegraph, telephone, and cable lines, and the officers, agents, employees and their families of other common carriers subject to the provisions of this Act: Provided, further. That the term [Amendment of April 13, 1908, and June 18, 1910.] [What term "employees*' and ''families" include.] "employees" as used in this paragraph shall include fur- §151] THE INTEESTaTJ COMMERCE ACT. 261 loughed, pensioned, and superannuated employees, persons who have become disabled or infirm in the service of any such common carrier, and the remains of a person killed in the employment of a carrier, and ex-employees traveling for the purpose of entering the service of any such common carrier; and the term "families" as used in this paragraph shall include the families of those persons named in this pro- viso, also the f amihes of persons killed, and the widows during widowhood and minor children during minority of persons who died, while in the service of any such common carrier. Any [Jurisdiction and penalty for violation.] common carrier violating this provision shall be deemed guilty of a misdemeanor, and for each offense, on conviction, shall pay to the United States a penalty of not less than one hundred dollars nor more than two thousand dollars, and any person, other than the persons excepted in this provision, who uses any such interstate free ticket, free pass, or free transportation shall be subject to a like penalty. Jurisdic- tion of offenses under this provision shall be the same as that provided for offenses in an Act entitled "An Act to further regulate commerce with foreign nations and among the States," approved February nineteenth, nineteen hundred and three, and any amendment thereof. From and after May first, nineteen hundred and eight, it shall be unlawful for any railroad company to transport from [Commodities clause. [ any State, Territory, or the District of Columbia, to any other State, Territory, or the District of Columbia, or to any foreign country, any article or commodity, other than tim- ber and the manufactured products thereof, manufactured, mined, or produced by it, or under its authority, or which it may own in whole or in part, or in which it may have any interest, direct or indirect, except such articles or commodi- ties as may be necessary and intended for its use in the con- duct of its business as a common carrier. Any common carrier subject to the provisions of this Act, upon application of any lateral, branch line of railroad, or of any shipper tendering interstate traffic for transportation, [Switch connections.] shall construct, maintain, and operate upon reasonable terms a switch connection with any such lateral, branch line of railroad, or private side track which may be constructed to connect with its railroad, where such connection is reason- ably practicable and can be put in with safety and will fur- nish sufficient business to justify the construction and main- tenance of the same ; and shall furnish cars for the movement 262 THE INTERSTATE COMMERCE ACT. [SECTION 1 of such traffic to the best of its ability without discrimination in favor of or against any such shipper. If any common car- [Switch connections may be ordered by tbe commission.] rier shall fail to install and operate any such switch or con- nection as aforesaid, on application therefor in writing by any shipper or owner of such lateral, branch line of railroad, such shipper or owner of such lateral, branch line of railroad may make complaint to the commission, as provided in section thirteen of this Act, and the Commission shall hqar and in- vestigate the same and shall determine as to the safety and practicability thereof and justification and reasonable com- pensation therefor, and the Commission may make an order, as provided in section fifteen of this Act, directing the com- mon carrier to comply with the provisions of this section in accordance with such order, and such order shall be enforced as hereinafter provided for the enforcement of all other orders by the Commission, other than orders for the payment of money. § 162. Amendments to the section. — For convenience of reference section 1 is given above as it appeared in the original act of 1887 and as amended June 18, 1910. No change was made in this section, as first enacted, until the passage of the Hepburn act in 1906, the text of which can be followed substantially by reading the roman type of the print of the act of 1910 as above given. The amendment of 1908 with respect to passes is noted in the margin and the additions of 1910 are printed in italics. It will be seen that the scope of the act was greatly enlarged in 1906 and further materially extended in 1910. From 1887 to 1906 the purview of the act was limited to commerce be- tween the states in which rail carriers participated in the through transportation. By the Hepburn act of 1906 oil pipe-lines, express companies and sleeping car companies were brought within its scope; the terms "railroad" and "transportation" were more elaborately defined; the obliga- tion to establish through routes imposed; a specific prohibi- tion of free passes was declared, provision being made for certain exceptions therefrom; the "commodities clause" in- serted; and, under certain conditions, switch-connections made imperative. The act of 1910, commonly called the Mann-Elkins act, added telegraph, telephone and cable com- panies to those subject to this regulation, making the neces- §154] THE INTERSTATE COMMERCE ACT. 263 sary changes in the succeeding portions of the section. There is a striking addition also in the inclusion, among matters subject to the jurisdiction of the commission, of classifica- tions, regulations and practices of the carriers with respect to various forms of transportation and of the evidences of con- tracts having relation thereto. § 153. The inclusion of telegraph, telephone and cable companies. — Under the amendments to the act interstate messages by telegraph, telephone and cable are included with the proviso that messages may be classified into day, night, repeated, unrepeated, letter, commercial, press, government, and. such other classes as are just and reasonable, and different rates may be charged for the different classes of messages; and provided further that nothing in this act shall be construed to prevent telegraph, telephone and cable companies from entering into contracts with common carriers for the exchange of services. As such companies are thus included in the act the reason- ableness of these provisions thus authorized to be made for the classification of messages, is subject to the determination of the Interstate Commerce Commission; and under the construction of Sec. 9 of the act, such question must first be raised before the Interstate Commerce Commission before it can be litigated in court. See Williams v. Western Union Tel. Co., 203 Fed. 140 (1914) and see infra § 399 et seq. § 154. All of interstate commerce not included.— As defined in this section all carriers engaged in interstate com- merce are not subject to the act; nor is all "transportation," or "transmission," between the states included. Clearly the intention of the act is to regulate all carriers engaged in the transportation of passengers or property by railroad, or by rail and water when said rail and water transportation is under a common control, management, or arrangement for a continuous carriage. The amendment of 1906 subjects pipe lines transporting "oil or other commodity" to regulation; by the inclusion of "express companies and sleeping car companies" in the term common carrier and the further elaboration of the definition of the term "transportation" 264 THB INTERSTATE COMMERCE ACT. [SeCTION 1 merely show the determination of congress to embrace all transportation by rail between the states. This section as it now stands, shows the growing purpose of the act to be federal regulation of all means of interstate commerce that by nature are subject to monopoly or combination. Interstate transportation wholly by water is not included nor is that moving by team or wagon. 7 I. C. C. 286. Con- gress had repeatedly legislated with respect to water trans- portation, but in this enactment its attention was directed mainly to the abuses in railroad transportation. The pooling of traffic by water carriers is a matter over which the com- mission has no jurisdiction (13 I. C. C. 266); and an ocean carrier established under the laws of Cuba and transporting traffic between Havana and Galveston, is not subject to the act. 13 I. C. C. 310. Carriers of interstate commerce by water are subject to the act to regulate commerce only in respect to traffic transported under a common control, management or arrangement with the rail carrier for a continuous carriage or shipment; and in respect to traffic not so transported they are exempt from its provisions. 15 I. C. C. 205 and 21 I. C. C. 207. See also amendments to sees. 5 and 6 of act by Panama Canal Act of 1912, infra. This limitation of the scope of the act extends to the power of the commission in requiring reports. See infra, sees. 15 and 20 of act. It was held by the commerce court (1911) 190, Fed. 943, in the cases of the Goodrich Transit Company, Interstate Commerce Commission and other companies operating steamers in the Great Lakes from Chicago, that the commission had authority to require reports with respect to their interstate business in connection with railroads, but that it had no authority to call for reports of their transactions relating exclusively to "port-to-port" interstate business or to intrastate traffic or affairs. A steamboat on a navigable river can only demand of a rail- road connecting with river points that it receive and deliver freight at the published local rates, as an independent water line is not included in the act. 4 I. C. C. 265, 3 I. C. Rep. 278.' A carrier by water, which has not joined in a traffic and division sheet filed and published by connecting railroad carriers between two points, does not become a party to a common arrangement for the carriage of such a shipment. §156] THE INTERSTATE COMMERCE ACT. 265 Mutual Transit v. U. S., C. C. A. 2nd circuit (1910), 178 Fed. 664. Under the amendment of 1906 the commission is empowered to establish a through rate when one of the connecting carriers is a water line. See section 15, infra. The decisions of the courts on this question have been in ac- cord with the rulings of the commission. A railroad lying wholly within the state which transports freight, whether coming from within or without the state, solely on local bills of lading on a special contract limited to its own lines, and without dividing charges with any other carriers or assuming any obligations to or for them, does not come within the provisions of the act, and is not bound to make any reports of its business to the commission. United States v. Railroad Co., 81 Fed. 783 (1897), following, C. N. 0. & S. P. R. Co. v. Commission, 162 U. S. 184, 40 L. Ed. 935 (1896), and Com- mission V. B. Z. & C. R. Co., 77 Fed. 942 (1897). See also U. S. V. Geddes (6th Cir. C. C. A.) 131 Fed. 452 (1904), where the same ruling was made as to railroads subject to the Safety Act. § 155. Parties subject to the act. — Before the amend- ments of 1906, enlarging the scope of the act, it had been held that the jurisdiction of the commission only extended to the common carriers described in the section. Section 2 of the Elkins act of February 19, 1903, infra, § 519, specifically pro- vided that in any proceeding instituted before the commission or in the courts it should be lawful to include as parties in ad- tion to the carrier all who are interested in or affected by the rule, regulation, or practice under consideration. This is the warrant for the occasional inclusion among parties defendant in proceedings before the commission of natural persons acting as agents of the various carriers in the pubhcation of rates. § 156. Standard oil pipe lines properly included in the Act. — The application of the provisions of the act to pipe lines was made by the amendment of 1906. Owners of pipe lines were held to be common carriers when doing busi- ness for the public as such. The Interstate Commerce Com- mission on its own initiative instituted a proceeding to de- 266 THE INTERSTATE COMMERCE ACT. [SECTION 1 termine the application of these provisions relating to pipe lines under the act (24 I. C. C. 1) and ruled that the act imposed the obligation of a common carrier upon a pipe line engaged in the transportation of oil in Interstate Commerce, even though such pipe line was built over its privately ac- quired right of way and transported only its own oil, and that the traffic was not divested of its Interstate character vest- ing the ownership of the pipe line with a different corpora- tion in the state through which the transportation passed, and by transferring the title to the oil to one of the corpora- tions contemporaneously with the entrance of the oil of that corporation into the state line. The Commerce Court, 204 Fed. 798, concurred in this construction of the act, but held thai its enforcement would involve a taking of property with- out due process of law. This judgment was reversed by the Su- preme Court, (Justice McKenna dissenting), U. S. v. Ohio Oil Company, 234 U. S. 548, 58 L. Ed. 1459, (1914) as to all of the companies except the Uncle Sam Oil Company, which it seems used its pipe line solely for the purpose of conducting oil from its own wells in Oklahoma to its refinery in Kansas. In this case the transportation was merely an incident to use at the end. White, C. J. in concurring opinion said the in- clusion of this company would be violative of the Fifth amendment. As to the fines, however, of the Standard Oil Company and its associated companies, the Court held that the business was essentially interstate commerce, the court saying: "The pipe lines were common carriers now in everything but form. They carry everybody's oil to market, although they compel outsiders to sell it before taking it into their pipes." The Court said that was no "taking" in holding this to be interstate commerce, and it did not become necessary to consider how far Congress could subject the pipe lines to pecuniary loss without compensation in order to accomplish the end in view. As to these cases the ruling of the interstate commerce commission was sustained. § 157. Common carriers under the act. — This act limits its application with respect to transportation by rail §157] THE INTERSTATE COMMERCE ACT. 267 of persons and property to carriers by rail or partly by rail and partly by water, which are "common carriers." The act does not define what will necessarily constitute a person or a corporation a common carrier, nor does it empower the com- mission to lay down the tests. It follows that the expression "common carriers" used by congress means those carriers which are common carriers at common law, and which have complied with such requirements as may have been imposed by constitutional or legislative authority. This principle was declared and applied by the commission in the case of Manufacturers Railway of St. Louis, 21 I. C. C. R. 304. It was claimed that this company was not in fact a common carrier but a plant facility of a brewing associa- tion which latter owned the stock, and a very large propor- tion of the business of the railway company was that of the brewing association, and the traffic of the latter constituted one-thirtieth of the total traffic of the city of St. Louis. The case was presented on the application of the company that through routes be established to and from points on its lines in St. Louis and from and to points on its lines of each of the defendant's railway company and points beyond, also for the fixing of reasonable divisions or absorptions out of the St. Louis rates to be paid to the manufacturer's railway for terminal services rendered by it. The company operated about twenty miles of track of which two and one-half miles were claimed as main track and the remainder as side tracks, switches and yard tracks. Of the total twenty miles six miles were lines from the brewing association and used in part both for the services of the brewery and the public. It owned and operated four locomotives, and no passenger business or less than car load business originated on its lines. Out of the total of some 42,000 cars handled in the yard some 5,000 were handled by other industries or patrons and all of the remainder for the brewery association. It claimed, and the commission found that it was performing a business of a common carrier for the public, and the commission said that it was not within its authority to pronounce any carrier by rail not to be in fact or in law a common carrier, if it would have been held as such at common law. It was there- fore ruled that the company was within the provision of the 268 THE INTERSTATE COMMERCE ACT. [SECTION 1 first section of the act, and that the payment to it of a reason- able and just proportion of the St. Louis rate for terminal services was not unlawful. The status of the Manufacturers Railway Company was also considered in 28 I. C. C. 83 and in 32 I. C. C. 100, this latter report being in view of the decision of the Supreme Court in U. S. v. Terminal R. R. Association, supra, § 96. While the company was doing business as a common car- rier it was also a plant facility. There was nothing in the act however or in any of its amendments, which affected the right of ownership of a railroad by a shipper or shippers over the lines. The fact, however, did have a bearing on the de- termination of the amount of allowance of services under the principles declared by the commission in the investigation of "tap lines" and industrial lines (see infra, § 242) and the duty and responsibility, therefore, involved upon the carriers to guard closely these features so as not to make themselves liable under the statute for unjust discrimination or undue preference or advantages. The status of this road is still (1916) pending in the courts. § 158. What is a Common Carrier.— In 27 I. C. C. 275, the commission considered the complaint by a boat line ask- ing for the establishment of through rates and joint rates from certain river landings near Port Royal, South Carolina. The complainant was incorporated under the laws of South Carolina, and its charter provided that it should not do any business as a common carrier. The commission held that interstate commerce not being subject to State law, would not fall within the prohibition of the charter granted by the State legislature. Incorporation was not a condition precedent to the right to be a common carrier so far as interstate transportation was concerned, and the ques- tion of establishing joint rates or declining to do so rested in the judgment and discretion of the commission. The case was dismissed, however, on the ground that the record did not show that the complainant was capable financially and physically to assume the obligations which the through rout- ing would impose. In U. S. ex rel v. Union Stockyards & Transit Co. of Chicago, it was held by the commerce court, 192 Fed. 330, §159] THE INTERSTATE COMMERCE ACT, 269 (1912) that the Chicago Junction Railway Company which, as the lessee, operated a railroad owned by the Union Stock- yard & Transit Co. operating tracks in Chicago, which con- nected with the interstate trunk lines, was a common carrier within the meaning of the act, and therefore obliged to file schedules of rates. It was also held that the Stockyards Co. was not a common carrier, although authorized by its charter to build a railroad and operate one in interstate commerce, and it had leased its Hues and equipment for a term of years to an independent operating company, and that a holding company was not a common carrier within the meaning of the act because of the fact that it owned all the stock of a corporation which was a common carrier. Also held that the running of a railroad which was leased and operated by the lessee as a common carrier engaged in interstate commerce could be required by the Interstate Commerce Commission to make annual reports under the act. § 159. Express companies under the act. — Express companies were not included in the act prior to the amend- ment of 1906. U. S. V. Morsman, 42 Fed. 448 (1890); Southern Indiana Express Co. vs. U. S. Express Co., 31 C. C. A. 172, 92 Fed. 1022 (1899) affirming 88 Fed. 659. Before the passage of the Interstate Commerce Act of 1886, the Supreme Court in the Express Company Cases, 117 U. S. 1, 29 L. Ed. 791 (1886), had decided that railroad companies were not required by usage or the common law to transport express traffic for the independent companies over their lines, and that they were not obliged to do more as express carriers than to provide the public at large with reasonable accommo- dations, and in the absence of a statute they were not obliged to furnish equal facilities to all express companies. The commission has considered, in several cases, the regulation of express companies under the act. Thus, it is ruled that while express companies must serve their patrons under similar conditions without discrimination (12 I. C. C. 196, and 15 I. C. C. 15), it is also held (13 I. C. C. 475), that the main object of an express service is expedition; and express rates should not be so low as to attract business which might properly go by freight, and thereby congest and 270 THE INTERSTATE COMMERCE ACT. [SECTION 1 interfere with the service by express, and that the fact that express rates in and out of a particular business locaUty are higher than those in and out of a competing locality from a common source of supply is not of the same importance as in the case of freight rates, since the wholesaler ordinarily brings his merchandise in by freight and distributes it by freight; and that a comparison of express rates in one locality with those of another is of much greater value than a similar comparison between freight rates since the character of the business and the conditions under which it is transacted are more nearly the same. As to the conditions under which Pacific rates were found unreasonable, see 16 I. C. C. 32. It is also ruled that the rates made by express companies upon small packages in competition with the United States mail are not to be taken as standards by which to determine the reasonableness of their rates upon latger packages. 13 I. C. C. 475, 16 I. C. C. 32. The relation of the express companies to the railroads in the matter of free transporta- tion to their men and material, was discussed in 16 I. C. C. 246, and it was decided in American Express Company v. U. S., 212 U. S. 522, 53 L. Ed. 635 (1908), affirming 161 Fed. 606, that the express companies are prohibited from giving free transportation of personal baggage to their oflTicers and employes and members of their families, and to the officers of other transportation companies and members of their families in exchange for passes issued by the latter to the oflTicers of the express companies, by the Elkiiis Act of 1903 and by the Hepburn Act of 1906, which forbid all transporta- tion of property at less than the published rates ;. and that the proviso to the Hepburn Act relates solely to the carriage of passengers and does not embrace free transportation by express companies, although by the terms of the act express companies are deemed common carriers. In cases concerning express companies the commission has applied the same rule which is enforced in the case of other carriers. Thus, it was ruled in 15 I. C. C. 53, that it had no jurisdiction over claims for damages for delay in express shipments, as the obligation to deliver promptly and safely was enforced by common law and not by the Interstate Com- merce Act. In 17 I. C. C. 115, certain express rates from §160] THE INTERSTATE COMMERCE ACT. 271 New York city to Boise City, Idaho, were held unreasonable ; and it was ruled that express companies as other carriers could not lawfully make a difference in rate based upon the time of the payment of the charges, and that it was a general princilpe that a through rate should not exceed the lowest combination of locals between the same points. 16 I. C. C. 394. The subject of express rates, practices, and accounts and revenues was exhaustively considered by the Commission, 24 I. C. C. 380, and an order was made that cause should be shown on October 9, 1912, why the proposed rate should not be put in force. The subject was again considered, 28 I. C. C. 132, (1913). The Commission were of opinion that the establishment of the parcel post was not a justification for any higher schedule of rates than the one which they found was reasonable, and definite rates were therefore pre- scribed for a period of two years. (See later order of Com- mission, July, 1915), 35 I. C. C. 3. It was held in Barrett v. New York, 232 U. S. 14, 58 L. Ed. 483, (1914) that this action by Congress so far occupies the field of regulation with regard to Interstate express carriers as to invalidate, as applied to interstate business of an express company, the provisions of a muni- cipal ordinance requiring every owner of a public express to give a bond for each and every vehicle to be conditioned for the safe and prompt delivery of all baggage, etc. entrusted to the owner or driver of any such hcensed express. This was held to invalidate the municipal ordinance of New York in its requirement of a license for transacting interstate business, reversing 189 Fed. 268 and 183, Fed. 793 § 160. Sleeping car companies. — These companies were included in the act with express companies in the amendment of 1906. It was ruled, in 16 I. C. C. 410, that the Pullman company operating sleeping cars at the joint ex- pense of itself and the railroad company interested was a common carrier, subject to the jurisdiction of the commis- sion; that it was required to pubhsh its rates and the regula- tions governing the application of such rates; and that these, when published, were subject to the consideration and cor- 272 THE INTERSTATE COMMEECB ACT. [SECTION 1 rection of the commission. In this case the passenger offered a local ticket to an intermediate point and a mileage book beyond for transportation to his destination; thereupon the Pullman agent refused to sell sleeping-car accommodations on the ground that the tariff prohibited selling such accom- modations except upon a through ticket, the price of which in this case was greater than the combination of the locals. The commission ruled that the Pullman company was within its rights and declined relief, but at the same time condemned such conditions, saying it was the almost invariable rule of the commission that the through rate should not exceed the combination of the locals. In 18 I. C. C. 135, March, 1910, the commission consid- ered the reasonableness of the rates for sleeping cars and reduced the price of the upper berth from St. Paul to Chi- cago to $1.50 as compared with $2.00 for the lower berth; while the lower berth from St. Paul to Seattle was reduced from $12.00 to $10.00; the upper to $8.50. Two of the com- missioners dissented on the ground that existing passenger rates were in favor of the occupant of the sleeping car, and that existing discrimination was really against the day- coach passenger who did not enjoy the sleeping-car privileges. This order of the commission was modified, 20 I. C. C. Rep. 21, upon the Pullman company offering a general reduction in the rates for upper berths of about twenty per cent as compared with the rates for lower berths and a reduction also in the rates on long hauls, these reductions to apply all over the country. In 31 I. C. C. 654, the Commission considered~the subject of sleeping car rates, and held that the rate of $2.00 for a lower and $1.60 for an upper berth between St. Paul and Sioux Falls, South Dakota, was reasonable. The commis- sion said berth mile rates were of little comparative value and were not controlling in fixing rates for the occupancy of sleeping cars. In Pullman Co. v. Linke (Dis. Ct. of Ohio, 1913), 203 Fed. 1017, it was held that a sleeping car enroute from Columbus, Ohio, to Washington, D. C. while waiting with its passengers aboard to be picked up by a through train and carried to its destination could not be attached under a writ and detained §161] THK INTERSTATE COMMERCE ACT. 273 by the sheriff, compelling the passengers to disembark and accept other accommodations as the car was at the time an instrumentality of Interstate Commerce and not subject to attachment. See, supra, § 41. The Supreme Court held, in Chicago, etc., Ry. Co. vs. Wisconsin, 238 U. S. p. 491, 59 L. Ed. p. 1423 (1915), that a state statute of Wisconsin prohibiting the letting down of an unengaged and unoccupied upper berth in a sleeping car when the lower berth in the same section is occupied, takes property without due process of law and cannot be sustained as a reasonable exercise of the state's police power. Justices McKenna and Holmes dissenting. In 33 I. C. C. 521, the commission sustained the require- ment of one and one half first class railroad tickets for the exclusive use of the compartment on a California limited train, and in 36 I. C. C. R. 250, made the same ruling as to the requirement of two railroad tickets for the exclusive use of a drawing room. § 161. Under common control, management or ar- rangement for a continuous carriage. — The rulings of the commission as to what constitutes a common control, management or arrangement for a continuous carriage have been affirmed by the courts. The test of subjection to the act is through routing in interstate commerce. When a carrier unites with one or others in making a rate for inter- state traffic and a thorough bill is issued therefor, it is sub- ject to the act. In C, N. 0. & T. P. R. Co. v. Commission, 162 U. S. 184, 40 L. Ed. 935 (1896), the supreme court held that a railroad company whose road was wholly within the bounds of a single state, which had voluntarily engaged as a common carrier in interstate commerce, by making an ar- rangement for the continuous carriage of goods through an- other state, was subject as to such traffic to the provisions of the act. An express agreement for a through rate is not required, but the successive receipt and forwarding in the ordinary course of business by two or more carriers in inter- state traffic under through bills, or any arrangement for a continuous carriage over their lines, constitutes assent to such common arrangement for the carriage within the meaning of the act. J— 18. 274 THE INTERSTATE COMMERCE ACT. [SECTION 1 When there is a through bill of lading for a continuous carriage, it is immaterial that one of the roads party to the through bill received the sole benefit of the rate on its own line. Such a case was presented to the Supreme Court in L. & N. R. Co. V. Behlmer, 175 U. S. 648, 44 L. Ed. 309 (1900), where the courts said that the contention under this state of facts that the carriers did not constitute a continuous line bringing them within the control of the act to regulate com- merce was no longer open to controversy in that court. See also United States v. Seaboard Railway Co., 82 Fed. 563 (1897). A local switching company is not subject to the act where it makes no contracts of through shipment, but imposes a separate trackage charge upon the other companies for the use of its tracks in local transportation. But where such a company does become a party to such a contract for through shipment, it becomes as to such business subject to the act. See C, M., & St. P. R. Co. v. Becker, 32 Fed. 849 (1897). As to the evidencing of contracts for through shipments, see the ruling of the commission in 2 I. C. C. 553, and 2 Int. Com. Rep. 393. A railroad lying wholly within a state which transports freight, whether coming from within or without the state, solely on local bills of lading on a special contract limited with its own lines, and without dividing charges with any other carrier or assuming any obligations to or for them, does not come within the provisions of the act and is not bound to make any report of its business to the commission. U. S. V. Railroad Co., 81 Fed. 783, (1897), following 162 U. S. 184, supra, and Commission v. B. Z. & C. R., 77 Fed. 942. See also U. S. v. Geddes, sixth circuit, C. C. A., supra. Through routing by arrangement for continuous interstate traffic, is a matter of contract between the carriers, subject to the power of the commission to compel a through routing under the act as amended in 1906. See infra, § 452. It is the through bill of lading that marks the continuous interstate carriage; neither the intention of the shipper nor the actual movement of the goods has any bearing upon the matter. 162 U. S. 184, 40 L. Ed. 935 (1896); 204 U. S. 403, 51 L. Ed. 540 (1907); 21 I. C. C. R. 207. See infra, § 169. §162] THE INTERSTATE COMMERCE ACT. 275 Shipments of freight under local bills of lading to a port in the state there to be delivered to the shippers or con- signee's order, but intended by the shippers to be exported to foreign countries constituted foreign commerce, and as such are governed as to the intrastate transportation by the tariffs on file with the Interstate Commerce Commission to the exclusion of rates established by the State Railroad Com- mission. This was ruled by Railroad Commission of La. v. Texas & Pacific R. Co. 229 U. S. 336, 57 L. Ed. 1215 (1913) affirming 184 Fed. 989. See also Texas & N. 0. R. Co. v. Sabine Tram Co., 227 U. S. Ill, 57 L. Ed. 442. (1913). § 162. Transportation through a state. — Commerce between points in the same state, which is carried through an- other state, is interstate commerce and subject to the act. This was definitely determined by the Supreme Court in Hanley v. Kansas City Southern Railway Co., 187 U. S. 617, 47 L. Ed. 333 (1903), where the Court affirmed the judg- ment of the circuit court of Arkansas, enjoining the railroad commissioners of Arkansas from fixing and enforcing rates upbn that part of the route within the state of Arkansas of a shipment beginning and ending in the state of Arkansas. The Court held that there could be but one rate fixed by one authority, and that the case was analogous to that of navi- gation on the high seas between ports of the same state. The court distinguished this case from that of a tax which was sustained in Lehigh Valley Ry. Co. v. Pennsylvania, 145 U. S. 192, 36 L. Ed. 672 (1892), which was in respect of the receipts of the proportion of the transportation within the state. A tax may be thus apportioned according to mileage, but when a rate is estabhshed, it must be established as a whole. This was the view that had been sustained by the commission in several cases, 7 I. C. C. 92, and overrules United States v. Lehigh Valley R. Co., 115 Fed. Rep. 372, and several state decisions which had been based upon the decision of the supreme court in the Lehigh Valley case. In Ewing v. Leavenworth, 226 U. S. 464, 57 L. Ed. 303 (1913) affirming 80 Kansas 58, the court followed the Lehigh Valley case, and distinguished the Hanley case, in sustaining a municipal ordinance imposing a tax upon the business of 276 THE INTERSTATE COMMERCE ACT. [SECTION 1 express, companies where interstate business was excluded and the packages received were transported over a route which for a short distance passed out of the state. It was held in U. S. v. Powers- Weightman-Rosengarten Co., (Dist. Ct. N. Y. 1913) 211 Fed. 169 that under the in- secticide act of 1910 prohibiting the introduction into any state or territory of any insecticide which was adulterated or misbranded, the act was not violated by shipping and delivering a certain insecitcide for shipment from a point in New York to another point in the same state by a railroad passing through other states enroute to the destination, and that the cases cited above did not control this question. § 163. Territorial transportation. — The original act provided for the control of commerce between the states and territories. The power of congress within the territories, however, is general and plenary, combining the powers of state and federal governments under the express power to make all needful rules and regulations respecting the territory of the United States. Constitution, art. IV, sec. 3. See Mormon Church v. U. S., 136 U. S. 1, 34 L. Ed. 481 (1890). See also decision of the Supreme Court holding the Employer's Liability Act of 1906 valid in the territories and the District of Columbia, though invahd in the states. 215 U. S. 87, 54 L. Ed. p. 106 (1909). The inclusion of transportation within a territory was effected by the amendment of 1906. Thus the act, which was effective intra-territorially in Oklahoma from August 28, 1906, expired by its own force on November 16, 1907, when Oklahoma was admitted as a state. See 13 I. C. C. Rep. 366 and 473; Oklahoma vs. Railroad, 220 U. S. 302, 55 L. Ed. 474 (1911). Alaska is a territory of the United States within the meaning of^the act, and the authority of the Secretary of the Interior to review and modify railway rates in Alaska con- ferred upon him by the Act of May 14, 1898 was superseded by the amendment of 1906 to the Interstate Commerce Act. This was decided in the case of Interstate Commerce Commis- sion V. United States ex rel. Humboldt S. S. Co., 224 U. S. 472, 56 L. Ed. 849, (1912) affirming 37 App. D. C. 266;— a proceeding by mandamus to compel the commission to §164] THE INTEEBTATE COMMERCE ACT. 277 take jurisdiction and hear the complaint of the petitioner complaining of violations of the interstate commerce act by the White Pass & Yukon Railway Company. The com- mission had declined to take jurisdiction. See 19 I. C. C. 81, but the Court held that a peremptory writ of mandamus should be issued to compel the commission to hear the cause, and that this was the only remedy, as an appeal would not lie to the then existing commerce court to review the action of the commission in refusing to take jurisdiction. § 164. Interstate Street Railroads not included in the Act. — The question long debated in the commission and the courts as to whether interstate street railroads were" included in the terms of the act and subject to the juris- diction of the interstate commerce commission was finally decided by the Supreme Court in Omaha & Council Bluffs Street Railroad Co. v. Interstate Commerce Commission, (1913) 230 U. S. 324, 57 L. Ed. 1501, holding that such carriers were not included in the act, reversing the commerce court, 191 Fed. 40, which in turn had reversed the circuit judges of the eighth circuit, 179 Fed. 243, and this latter court had reversed the Interstate Commerce Commission, 17 I. C. C. 239, which had ruled that an interurban electric street railroad connecting Council Bluffs, Iowa, with Omaha Nebraska, was a common carrier engaged in interstate trans- portation of passengers and therefore amenable to the act. The commission had exercised its jurisdiction over inter- urban street railroads in other cases on the theory, that under the broad terms of the act such interstate roads were in- cluded in the act, (See 7 I. C. C. 83; 13 I. C. C. 20; 20 I. C. C. 232). Section 15 of the act of 1910 amending the interstate commerce act refers to electric passenger street railroads in the limitation of the power of the commission in through routing. The Supreme Court, however, said that this pro- vision was inserted out of abundant caution to prevent the establishing of through routes between railroads and street railroads of such a different character. The Court said also the new type of interurban railroad had been developed since the passage of the act of 1877 and were not included in the mischief sought to be corrected by the act to 278 THE INTERSTATE COMMERCE ACT. [SECTION 1 regulate commerce. While congress could have included that in the federal regulation it had not done so. § 165. Interstate Street Railways and Interurban Electric Railroads Transporting Freight, Distin- guished. — The commission has ruled that the decision of the Supreme Court in the Omaha & Council Bluffs Street Railway case, was not controlling where a company is en- gaged in transporting, by electric power, car load and less than car load freight and has joint rates with certain steam roads for both intrastate and interstate shipments. In a number of cases it has required the establishment of through routes and joint rates by street railroads with interurban electric roads engaged in the transportation of freight, 13 I. C. C, 250; 13 I. C. C, 20; 26 I. C. C, 226; 33 I. C. C, 573. In 33 I. C. C. 573 the commission ruled that electric rail- ways, other than street passenger railways, participating in the interstate movement of persons or property, are subject to the requirements of the commission relative to the fiUng of reports of finances and operations and accidents ; but that where companies engaged in both intrastate service and inter- state service, they should include in their report only accidents resulting from the operation of cars engaged in the transportation of persons and property in interstate com- merce. The commission said in this last case that while the framers of the act were chiefly concerned with steam railroads, it would seem that the promotion of safety of interstate travel by electric lines and the prevention of such abuses as may arise from their operation and management are also matters of concern to congress, and they should therefore continue to hold, with the quahfication resulting from the decision in the Omaha case and the amendment to Sec. 15, excluding street electric passenger railways, that electric railways engaged in interstate transportation, were subject to their jurisdiction. § 166. Receivers, lessees and purchasers pendente lite. — When railroad corporations are subject to the act, their receivers are also subject to its prohibitions, require- §167] THE INTERSTATE COMMERCE ACT. 279 ments and regulations. 6 I. C. C. 1; 6 I. C. C. 378; see also Erb V. Morash, 177 U. S. 584, 44 L. Ed. 897 (1900). Lessees of such corporations and purchasers at foreclosure sales are bound by orders of the commission made pending such foreclosure. Interstate Commerce Commission v. W., N. Y. & P. R. Co., W. D. of Pa., 82 Fed. Rep. 192 (1897). It was ruled by the commission in 6 I. C. C. R. 378, that a railroad company subject to the act, could not by leasing its road, free itself from liability for practices made illegal by the act, nor after resuming possession of its property, pending proceedings against it to enforce such statutory provisions, claim exemption from Uability during the time of the lease. See Elkins Act, infra, § 519. § 167. Foreign commerce. — The act includes trafTic "from any place in the United States to an adjacent foreign country, or from any place in the United States through a foreign country to any other place in the United States, and also to the transportation in like manner of property shipped from any place in the United States to a foreign country and carried from such place to a port of transshipment, or * * * from a foreign country to any place in the United States and carried to such place from a port of entry either in the United States or an adjacent foreign country." The supreme court said in the Import Rate Case, 162 U. S. 197, 40 L. Ed. 940 (1896), after quoting this part of the sec- tion: "It would be difficult to use language more unmistakably signifying that congress had in view the whole field of com- merce (excepting commerce wholly within a state) as well that between the states and territories as that going to or coming from foreign countries." The jurisdiction of the commission extends to only that part of the through import or export rate which apphes to the inland proportion received by the carrier. As to effect of competition in import and export rates making disimilar circumstances and conditions under sections 3 and 4, see infra. As to pubhcations of import and export rates, see I.e. C. 214; 10 I.e. C. 55. The commission has ruled (13 I. C. C. 266) that it has no jurisdiction as to shipments moving from ports of the United 280 THE. INTERSTATE COMMERCE ACT. [SECTION 1 States to a foreign country not adjacent, when such ship- ments are not carried by rail, or by rail and water, from an inland point of origin to a port of transshipment. An inland movement, by rail or by rail and water of exports or import traffic is a condition precedent to the jurisdiction. In the case of International Paper Co. 33 I. C. C. 270, re- affirmed in 36 I. C. C. 203, the commission ruled that its jurisdiction was over that portion of a foreign transportation which was within the confines of the United States. While the commission cannot prescribe joint through rates from Canada into the United States it can control the rates which the American lines charge from the ports of entry in the United States to destinations in the United States whether they are joint rates or separate established rates appUcable to through transportation. Adjacent foreign territory has been interpreted by the commission, 13 I. C. C. 310 as meaning one between which and the United States there is a possibility of substantial continuity of rails. As to the jurisdiction of the commission over export rates and bills of lading in the prohibition of discrimination and undue preferences in this country, see Sec. 3 infra. § 168. Place of incorporation of the carrier imma- terial. — ^The commission has ruled that a foreign railroad corporation such as the Grand Trunk Railroad Company, carrying on its traffic between the United States and Canada, was subject as to its business in the United States to the same rules and conditions as domestic carriers. 3 I. C. C. 89, and 2 Int. Com. Rep. 497; 4 I. C. C. 447, and 3 Int. Com. Rep. 417. But while a corporation engaged in interstate traffic in the states is subject to the act as to such traffic, the jurisdiction of the commission is necessarily limited to the United States and does not extend to a question of alleged local discrimination in a foreign country as Canada. 10 I. C. C. 217. § 169. The intention of interstate shipment not suf- ficient. — Transportation is not made interstate and subject to the jurisdiction of the commission by the intention of the §169] THE INTERSTATE COMMERCE ACT. 281 shipper that when the shipment is dehvered by the carrier in the same state it shall be further transported by another carrier into another state. 1 I. C. C. 30, and 1 Inter. 607. Thus, fruit delivered to a consignee at Jersey City under rates made to Jersey City on traffic originating in New Jersey, though destined for the state of New York, is not interstate traffic and the commission had no authority over such freight. 2 I. C. C. 142, and 2 Int. Com. Rep. 84. In Gulf C. & S. F. R. Co. v. Texas, 204 U. S.403, 51 L. Ed. 540 (1907), the Court affirmed 97 Texas, 274, in holding that the regulations of the state railroad commission applied to a shipment from one Texas point to another, although the shipment originally was from a point in South Dakota. The intention of the owner to forward the shipment from its original terminal point to another point in the same state did not make the shipment between the two latter points by a connecting carrier an interstate shipment. This was not a case of reconsignment, but the original bill of lading was taken up and a new bill of lading issued from Texarkana, Tex., to Goldthwaite, Tex. The state law, therefore, con- trolled. See also C, N. 0. & T. P. R. Co. v. I. C. C, 162 U. S. 184, 40 L. Ed. 935 (1896), and 21 I. C. C. 207. It was held in R. R. Commission of Louisiana v. the Texas Pacific Ry. Co., by Supreme Court, (1913), 229 U. S. 336 57 L. Ed. 1215, affirming 184 Fed. 989, Fifth Circuit, that ship- ments of freight under local bills of lading from interior state points to New Orleans, there to be delivered to the shipper's or consignee's order, but intended by the shippers to be ex- ported to foreign countries and treated accordingly by both shippers and carriers, constituted foreign commerce, and, as such, are governed as to the intra state transportation by the tariffs on file with the Interstate Commerce Commis- sion to the exclusion of the rates estabfished by the State R. R. Commission. It was said by the Supreme Court in C. M. & St. P. R. Co. V. Iowa, 233 U. S. 334, 58 L. Ed. 988 (1914) that the question whether commerce is interstate or intrastate must be determined by the essential character of the commerce and not by mere billing or forms of contract, but the fact that commodities received on interstate shipments are re-shipped 282 THE INTERSTATE COMMERCE ACT. [SECTION I by the consignees in the cars in which they are received to other points of destination does not necessarily estabhsh a continuity in movement, or prevent the re-shipment to a point within the same state from having an independent and in- trastate character. The court said the question is with re- spect to the nature of the vehicle's movement in the par- ticular case. The court affirmed 152 Iowa 217 granting a mandatory injunction requiring compliance with an order of a state railroad commission requiring a railway carrier to ac- cept shipments of coal in the cars of other carriers to points within the same state. § 170. All instrumentalities of shipment or car- riage. — The term "railroad" as used in the original act ex- pressly included "all bridges and ferries used or operated in connection with any railroad, and also all the road in use by any corporation operating a railroad, whether owned or operated under a contract, agreement or lease," and the term "transportation," the act declared, "shall include all instru- mentalities of shipment or carriage." It was held in the first important case arising under the act (Kentucky & In- diana Bridge Co. v. L. & N. R. Co., 37 Fed. Rep. 567 (1889), circuit court. Justice Jackson, afterwards of the Supreme Court), that this inclusion of bridges and ferries as subject to the act did not apply, where a bridge was not operated by the bridge company but by the railroad companies under contract with the bridge company. In such cases the court said the bridge company was not, either in law or fact, a common carrier within the scope and meaning of the section. The railroad company using the bridge, and not the bridge company was the common carrier. It was ruled by the commission in 1 I. C. C. 495, and 1 Int. Com. Rep. 775, that a railroad company chartered by the state of Tennessee, owning a short road wholly in that state, neither operating its road nor owning any rolling stock, but used and operated as a means of conducting interstate traffic in coal by the companies owning a connecting interstate road, was one of the instrumentalities of interstate com- merce and subject to the act. These definitions of what is included by the terms "railroad" and "transportation" have §171] THE INTERSTATE COMMERCE ACT. 283 been extended by the amendments to 1906 and 1910, and a reference to the amended section as printed above will show what is meant. § 171. Delivery, cartage, storage and demurrage charges. — Under the original act the inclusion in the re- quirement of reasonableness of charges for the services ren- dered in receiving, delivering, storing and handling property did not impose any additional duty upon the carrier in re- gard to the delivery or storage of property, and the carrier was not obliged under this section to deliver or store other- wise than as required by its common law duty as a carrier. These services, including any charges for demurrage and other terminal expenses, which have been included under the general term of accessorial services, are now subject to the act, whenever rendered in connection with interstate traffic, as to the reasonableness of the charges under this section. It also follows that such services must be rendered without dis- crimination as between individuals in violation of section 2, and without undue preference as between localities or kinds of traffic under section 3. It was said by the Supreme Court in the Grand Haven Cartage Case, Commission v. Railroad Co., 167 U. S. 633, .1 c. 645, 42 L. Ed. 306 (1897), that while cartage was not in gen- eral a terminal expense and not in general assumed by the carrier, the transportation as a rule being ended when the freight was received at the warehouse, that it was a reason- able exercise of the commission's power to direct in a general order that the railroad companies should thereafter regard cartage as one of the terminal charges to be published in their schedules, as required under section 6 (As to ruling of the commission thereunder, see infra § 385, and 7 I. C. C. 1. c. 591). The circuit court of appeals, in the same Grand Haven Cartage case, in their opinion, 21 C. C. A. 103, and 74 Fed. 803 (1896), which was approved by the Supreme Court, called attention to the distinction between the American and Eng- lish customs of delivery of goods by carriers. Free cartage had been developed in the acts of the English railways from their competition with the carrier companies who used their 284 THE INTERSTATE COMMERCE ACT. [SECTION 1 lines, but that no such conditions had been developed in the growth of our American system of transportation, where it was very exceptional for railroads to do the carting required for delivering and collecting the goods. The service was es- sentially a distinct and separate service from rail carriage and purely accessorial. The fact that a railroad company for many years had paid the charge for hauling freight from wharves to its station did not bind it to continue that practice, and, if not bound by contract, it might stop doing so at any time. 1 I. C. C. IO7, 1 Int. Com. Rep. 363. As to storage charges, it was ruled by the commission (10 I. C. C. 352), that a railroad freight depot and a public ware- house are not used for the same purposes, and a charge for storage in a railroad depot may properly be made higher than a public warehouse charge, with the object of compelling the expeditious removal of freight, without violation of this sec- tion. The reasonableness of the regulations for demurrage and other accessory services as well as the reasonableness of the charges, have been reviewed by the commission. In Hite v. Central R. R. of N. J., C. C. A. 3rd Circuit, 171 Fed. 370 (1909), reversing the judgment in 166 Fed.- 926, it was held that the circuit court had jurisdiction to determine the in- debtedness of a shipper to a railroad company for demurrage under the rules adopted by the company where it depended on the construction and not on the reasonableness of the rules, although the latter question, that of reasonableness, was one primarily for the commission. In Michie v. N. Y., N. H. & R. R. Co., 151 Fed. 694, C. C. A. of Mass. (1907), a suit brought to recover the amount of a demurrage charge of |1.00 per day for hay storage, the charge was held not unreasonable. It was ruled by the com- mission in 8 I. C. C. 531, that the making of demurrage charges to commence before the expiration of a reasonable time for loading or unloading was a violation of this section. As to charges of demurrage upon private cars, see infra, § 298. The District Court of N. J., in American Sugar Refining Co. V. D. L. & W. R. Co., 200 Fed. 652 (1912), ruled that the §173] THE INTERSTATE COMMERCE ACT. 285 cartage of sugar from the refinery to the cars did not con- stitute transportation or service connected with transporta- tion within the act for which the carrier was justified in making an allowance under Section 15, and that such allow- ance therefor would constitute a rebate. § 172. Terminal facilities and plant facilities. — The Supreme Court in Interstate Commerce Commission vs. Santa Fe Railroad, 234 U. S. 294, 58 L. Ed. 1319, (1914), re- versing the Commerce Court in 188 Fed. 229, sustained the finding of the commission that industrial spur tracks within the switching limits of Los Angeles constituted part of the carrier's terminal, and that under the conditions there ex- isting the receipt and delivery on these spurs of car load freight moving in interstate commerce was a like service as compared with such receipt and delivery at team tracks and freight sheds within such switching limits, and that a charge not found unreasonable in itself for this spur track service was under the facts an unreasonable and discrimina- tory charge. As this matter was within the jurisdiction of the commission the findings were conclusive upon the courts, there being evidence to sustain them. The shippers who were subject to this charge were not estopped from bringing this matter before the commission, because they consented to a special charge, when freight should be received and de- livered thereon. For ruling of the commission which was thus sustained by the Court see 18 I. C. C. 317. § 173. Bulk grain storage as part of transportation. The "elevation, and transfer in transit," of grain with such "storage" as may be incidental thereto is clearly a part of "transportation" both under the common law and as defined in this section. When performed by the carrier, or its agents, the charges must be just and reasonable. The elevator cases considered by the commission have arisen by reason of the carriers' contracting with certain large shippers to perform these services. The result has been that the shippers had a dual relationship to the grain they handled: (1) with respect to their personal ownership of the grain, and (2) as agents of the carriers for its transfer. In the process of transfer 286 THE INTERSTATE COMMERCE ACT. [SECTION 1 these shippers cleaned, sorted, graded, chpped, mixed and otherwise treated the grain with the result that when it moved forward to the various markets it was in condition for immediate inspection and sale. At first the commission ruled that the allowances made by certain of the carriers for such elevation and transfer, IJ cents per 100 pounds, notwith- standing the important advantages these elevator con- tractors had over competitors, did not constitute a violation of the act; upon reconsideration, the commission attempted to separate elevation as a part of "transportation" from commercial elevation which is necessary for cleaning, sorting, grading, clipping and mixing and held that the allowance for elevation or transfer in transit should not exceed three- fourths of a cent per 100 pounds; more recently however the commission has ruled that the commercial advantages de- rived from elevation in transit are so great, and the service of transfer in transit so interwoven with purely commercial elevation, that no allowance should be made therefor to the owners of the grain. This ruling was reversed by the United States circuit court (176 Fed. 409), and this decision was affirmed by the Supreme Court in Commission v. Diffenbaugh 222 U. S. 42, 56 L. Ed. 83, on the ground that such order was beyond the power of the commission. The court sus- tained the order of the commission reducing the allowance to costs of service, confining the allowance to grain reship- ped within ten days. See infra, § 287. For commission rulings see 10 I. C. C. 309; 12 I. C. C. 85 and 111; 13 I. C. C. 498; 14 I. C. C. 315, 317 and 551; 15 I. C. C. 90 and 147; 16 I. C. C. 337, 479 and 590; 17 I. C. C. 158; and 18 I. C. C. 364. § 174. The amendments of section as to accessory charges. — The third paragraph of this section was amended by the Hepburn Act by the omission of the words "or for receiving, delivering, storage, or handling of such property," and by changing the phrase "reasonable and just" to "just and reasonable." The latter change is without significance, and the omission noted was due to the fact that the definition of "railroad" and of "transportation" contained in the second paragraph, as amended supphed the omission. §175] THE INTERSTATE COMMERCE ACT. 287 § 175. Carriage of live stock and perishable prop- erty. — The character of the property may impose upon the carrier distinct obUgations with respect to the manner of carriage and dehvery. Thus in the case of Uve-stock, the company is under a legal obligation to provide suitable and necessary means and facilities for receiving live-stock offered for shipment, and this duty cannot be efficiently discharged, at least in a town or city, without the aid of enclosed yards in which the stock offered for shipment may be handled with convenience and safety and without inconvenience to the pubhc. The railroad company therefore cannot, in addition to the customary and legitimate charges for the transporta- tion, make a special charge for merely receiving and deliver- ing stock in and through the yards provided for the purpose. Covington Stockyards Co. v. Keith, 139 U. S. 128, 35 L. Ed. 73 (1909). The Court in this case applied the rule laid down in Northern Pennsylvania Railroad Co. v. Commercial Na- tional Bank of Chicago, 123 U. S. 727, 31 L. Ed. 287 (1907), that the undertaking of a carrier to transport livestock dif- fered in some respect from the responsibihty assumed in the cartage of ordinary goods and included the delivery of such live-stock, the difference referred to growing out of the nature of the particular property transported. A railroad carrier could make an exclusive contract with a stock yards for delivery of livestock, provided no charge was made for delivering when taken by consignee within reason- able time. Covington Stock Yards v. Keith, supra; Butchers & Drovers' Stock Yards Co. v. L. & N. R. Co., 14 C. C. A. 290, 31 U. S. App. 252, 67 Fed. Rep. 35, 10 I. C. C. 173; Cen- tral Stock Yards v. L. & N. R. Co., 192 U. S. 568, 48 L. Ed. 565 (1904). See infra, section 3. In the case of the Union Stock Yards of Chicago (Commission v. C. B. & Q. R. Co., 186 U. S, 320, 46 L. Ed. 1182) (1902), the Supreme Court affirmed the circuit court of appeals (43 C. C. A. 209, 103 Fed. 249), in refusing to enforce an order of the commission hold- ing unreasonable the charge of two dollars for the delivery of the live-stock to the stockyards. It seems that prior to 1894 no separate terminal charge was made; and the through rate existing prior to 1894 was presumed to have provided compensation for services for making deliveries to the stock- "288 THE INTERSTATE COMMERCE ACT. [SECTION 1 yards. The Court said that the defendants had the right to divide their rates, and that the terminal charge must be separately considered as a distinct charge, and if it was rea- sonable as a separate charge it did not follow that it should be reduced when the through rate was reduced. The Court therefore affirmed the decree of the court of appeals without prejudice to the commission's right thereafter to commence proceedings to correct any unreasonableness in the rate re- sulting from the additional terminal charge as to any terri- tory. As to reasonable charges for extra hazard to carrier in live-stock shipments, see 10 I. C. C. 327, and 333. A railroad company accustomed to deliver cars of cattle at stockyards off its line by transporting them over a line be- longing to a stockyards company, for which it pays a fixed sum per car, was held in Walker v. Keenan, 19 C. C. A. 668 and 73 Fed. 755 (1896), by the circuit court of appeals, sev- enth circuit, to be under no obligation to consignees whose business was located at the stockyards to supply unloading facilities at its own stations in a different part of the state, and hence was not bound in default thereof to deliver at the stockyards without a separate charge. It could on posting schedules to that effect, as required by section 6 of the Inter- state Commerce Act, make a charge for the freight to the station and a separate terminal charge of a fixed sum per car for delivery to the stockyards. Reversing 64 Fed. 922 (1896). The subject of terminal charges for delivering car loads of live stock was considered by the Supreme Court in Interstate Commerce Commission v. Stickney, 215 U. S. 98, 54 L. Ed. p. 112 (1909), where the court, affirming 164 Fed. 638, held that a terminal charge for delivering car loads of live stock at the Union Stock Yards, at Chicago, a point beyond the carrier's line, if in itself just and reasonable and separately stated in the tariff schedules as required by the act, could not be con- demned on the ground that if taken with the prior charges of transportation of the carrier or connecting carriers, it made a total charge unreasonable. The carrier was entitled to have a finding that any particular charge was unreason- able and unjust before it is required to make a change and that for any services that it may render §176] THE INTERSTATE COMMERCE ACT. 289 or procure to be rendered off its own line or outside the mere matter of transportation of its own line, it may charge and receive compensation. The Court, therefore, afTirmed the circuit court in enjoining the enforcement of the order of the Interstate Commerce Commission, requiring the reduction of the terminal charge from two dollars to one dollar per car. § 176. Refrigeration in transit. — Irrespective of the requirements of the Interstate Commerce Act, it is the duty of the carriers undertaking the transportation of perishable traffic requiring refrigeration in transit to provide ice and facilities for such transportation in connection with the traffic; and the charges therefor are charges in connection with the service and are subject to the requirement of reason- ableness contained in this section as to interstate shipments. Adequate refrigeration was held to be an incident of sea- worthiness under a bill of lading for ocean transportation of dressed beef. See Martin v. Southwark, 191 U. S. 1, 48 L. Ed. 65 (1904). See also the ruling of the commission, 6 I. C. C. 295. Under the amendment of 1906 the charges for "ventila- tion," "refrigeration," or "ice" must be separately published as other charges in connection with transportation. In Atlantic Coast Line v. Garaty, 166 Fed. Rep. 10 (1908), it was held by the circuit court of appeals of the fourth cir- cuit that where the carrier had facilities for furnishing ship- pers of vegetables refrigerating cars to transport the same, which cars the carrier did not own as a part of its equipment and plant, and the shipper in reliance thereon had raised vegetables which required refrigerator cars for transporta- tion to the market, he was entitled to recover damages sus- tained by the carrier's failure to furnish such cars for the transportation of plaintiff's vegetables on reasonable de- mand. The court in this case cited and relied on the ruling of the Supreme Court in Covington Stock Yards Co. v. Keith, 139 U. S. 129, 35 L. Ed. 73 (1891) where the Court said the carrier must at all times be in proper condition both to re- ceive from the shipper and deliver to the consignee according to the nature of the property to be transported as well as the J-IO. 290 THE INTERSTATE COMMERCE ACT. [SECTION 1 necessities of the respective localities in which it is received and delivered. It was held by the court of appeals of the eighth circuit in Knudson-Ferguson Co. v. Michigan Central Railroad Co., 148 Fed. 968 (1906), that a shipper could not recover in an action under section 8 an extra charge for icing service shown by the schedule, but separately, which had been collected from him, without proving that the charge was unreasonable. This case was cited and the principal approved in Penn. Ry. Co. v. International Coal Co.. 230 U. S. 184, 57 L. Ed. 1446 (1912). The carrier is therefore bound to furnish refrigeration cars by reason of the common-law duty, but it can provide such cars by purchase or lease, and if by lease, the lease can be made with one company. Charges for refrigeration of cars furnished should be published and adhered to, and in the transportation of the freight, the carrier must either furnish the ice for a reasonable price, or permit the shipper to do so. The exceptional conditions of refrigerator car service, such as the necessity for rapid transit, the expense of handling, the uncertainty of the crops, the frequent absence of return load, etc., are all factors to be considered in determining the rea- sonableness of the charges. In Cudahy Packing Co. v. Grand Trunk Western Railway Co. C. C. A. 7th Cir. (1914), 215 Fed. 93, it was held a carrier is not entitled to recover a charge for icing services without making and filing fixed and definite rates therefor, and where the tariff provided that the charge for icing should be the actual cost, but not less than $2.50 per short ton, though the provision for charging the actual cost was void for uncer- tainty, and hence the carrier was entitled to charge $2.50 per short ton, and whether these carrying and icing charges were reasonable was not in the case before the court. The subject of reasonable charges and regulations in pro- viding refrigeration has been considered by the commission in several cases. See the Georgia Peach Growers' Case, 10 I. C. C. 255, and 12 I. C. C. 178. In 20 I. C. C. 106, the Ar- lington Heights Fruit Exchange Case, the rates for icing service from California points were considered by the com- mission. The subject had become one of great importance §176] THE INTERSTATE COMMERCE ACT. 291 through the enormous development of the business of trans- porting fruits from Cahfornia and the southern points. In this case, on account of the difference of opinion as to the amount of ice required for refrigeration, the commission con- ducted a series of experiments to ascertain the fact. The commission found that the railroad charges for what is known as "standard refrigeration" of oranges in transit from Cali- fornia points east were not unreasonable; but that the pre- cooling charges made by the railroads were unreasonable, as those shippers who had devised and perfected the system of pre-cooling for shipment should not be compelled to pay for the privilege of using it more than a fair cost to the car- rier for providing the additional facilities, which were not included in the ventilated car rate, with a fair profit; and it was therefore reduced from thirty dollars per car to not ex- ceeding seven dollars and a half per car. The report in this case discussed in detail pre-cooling as done by the shipper, and as it may be by the carrier, as well as standard refriger- ation in transit. This order was affirmed by the commerce court (204 Fed. 647), (At L. & S. F. R. R. Co. v. U. S.) and on appeal by the Supreme Court, 232 U. S. 199, 58 L. Ed. 568 (1914), as within the administrative power of the com- mission. In the Georgia Fruit Exchange Case, 20 I. C. C. 623, the commission considered the actual condition of Georgia peaches as offered for refrigerator transportation, and ruled that without pre-coohng, satisfactory refrigeration was only possible for a portion of the carload required under the tariffs of the railroad. It seems from the investigations of the commission in these cases, that refrigeration in transit can properly be relied upon to keep the shipment cool during the journey, providing it was cool at the start of the journey, and should not be relied upon to reduce high temperature in the article as offered for transportation, and that the shipper should therefore pre- pare commodities offered for refrigeration by pre-cooling in order that the icing provided by the carriers may be effective. It seems also that where there is no preparation of the fruit by pre-cooling, the commission will not reduce the carload weight, if by so doing, without reducing the carload rate, the carrier's net earnings would be unduly reduced. The condi- 292 THE INTERSTATE COMMERCE ACT. [SECTION 1 tion of the article offered for refrigeration should be such that proper refrigeration is a possibility, and the carrier cannot be held responsible for deterioration due to inherent vices, hid- den defects, or a natural development of the article, such as normal ripening and subsequent rotting, providing the car- rier itself is without negligence in prompt transportation. See also discussion of this subject in 32 I. C. C. 17, 49 and 51. Also in 34 I. C. C. 140. § 177. Private cars. — The amendment of 1906 included "cars and other, vehicles and all instrumentalities and facili- ties of shipment or carriage, irrespective of ownership, or any contract, expressed or implied, for the use thereof." It would seem that the owners of equipment would have been included as parties subject to the act under the Elkins Act of 1903. Prior to this enactment, the commission had considered the general subject of private freight cars in its annual report for 1904, where it said that a practical monop- oly had been created in the use of private cars for the move- ment of certain commodities, which has enormously in- creased the cost of transportation to the public. Prior to the amendment of 1906, it had been held in Inter- state Commerce Commission v. Reichman, 145 Fed. 235, C. C. of 111. 1906 (1906), that a private car coinpany which has delivered cars to railroad companies for the use of ship- pers, receiving pay from the railroad companies on a mileage basis, was under the jurisdiction of the commission and that under the act as amended in 1903, it could inquire into the operation and tariffs of the company and compel the neces- sary testimony concerning the conduct of the business. For ruling of the commission and the commerce court sus- taining the exaction by railroads of demurrage on private cars, see infra, §§ 284, 285. § 178. The enforcement of the duty of carriers to furnish cars. — The provision of this section that "the term 'transportation' shall include cars * * * and it shall be the duty of every carrier subject to the provisions of this act to provide and furnish such transportation upon reasonable request therefor." * * * was considered by the commission §178] -THE INTERSTATE COMMERCE ACT. 293 in 33 I. C. C. 52, in a case where reparation was denaanded for an alleged failure to furnish coal cars, and it was claimed that under sections 8 and 9 of the act, and also section 22, the enforcement of this duty by the carrier was a judicial ques- tion for the courts. This provision of the act was inserted by the amendment of 1906. It was held by a majority of the commission, Clark, Harlan and Clements dissenting, that while the absolute refusal of a carrier to furnish a shipper cars would be a violation of duty requiring no administrative determination, and the courts could therefore take primary jurisdiction, the question as to the extent to which he had failed to comply with this duty owing to complaints, was an administrative one whereof the commission could take orig- inal jurisdiction; and the assumption of this jurisdiction was not inconsistent with the mandamus provision under sec. 23 of the act. It was held that a carrier must do more than provide itself with sufTicient equipment for a slack period, and he must assume the burden of explaining or excusing its fail- ure to furnish cars. As to the enforcement of car supply by mandamus, see sec. 23 of the act, infra. As to cases where resort may be had to the court for damages, see sec. 9 of the act, infra. In 34 I. C. C. 179, (1915), the commission reaffirmed this ruling and held that the same principle applied to the duty of the Pennsylvania Railroad Company to make an adequate pro- vision for tank cars, and that the shipment of petroleum di- rect in such cars did not call for such technical knowledge as would render unreasonable the complainant's request that defendant should furnish such cars, and that from the stand- point of economy to both the shipper and the railroad, tank cars were the only proper cars to use in the shipment of pe- troleum. In Pa. R. Co. v. U. S. (1915) 227 Fed. 911, (W. Dist. of Pa.), two of the three judges sitting. Judge Thomson dis- senting, granted an injunction, suspending the order of the Interstate Commerce Commission that the railroad company should provide and furnish tank cars for use by an oil refinery, when the company did not possess such cars, or not in num- ber sufficient to meet the requirement, holding that the duty under this section to provide and furnish such transportation, 294 THE INTERSTATE COMMERCE ACT. [SeGTION 1 upon reasonable request therefor, was no broader than that imposed by the common law. For the different opinions in the commission on this subject see the Vulcan Coal Mining Co. case, 33 I. C. C. R. 52. § 179. The prohibition of passes. — The anti-pass pro- vision of this act was first inserted by the amendment of 1906 and should be read with section 22 of the act, see infra, section 22. Under the original act there was no express prohibition of passes, but their issuance as a personal favor had been held both by the commission and the Supreme Court to be within the prohibition of section 2. Infra, § 252. Section 22 was originally adopted as an amendment to the act of 1889, with a proviso added in 1895. The Supreme Court said in the Party Rate Case, 145 U. S. 263, 36 L. Ed. 703 (1892), that its purpose settled beyond doubt that dis- crimination in favor of the persons therein named was not unjust. The provision of this section differs from section 22 in that it relates only to passengers, that is, there is no authorization thereunder for the free carriage of property belonging to persons of the excepted classes. This anti-pass amendment in section 1 substitutes an express statutory prohibition of interstate passes with specific exceptions. It is in effect a statutory declaration that the non-excepted passes are acts of unjust discrimination, as the recipient of a pass is subjected to a penalty as well as the carrier who gives one. See American Express Co. v. U. S., supra. In L. & N. R. R. Co. v. Mottley, 219 U. S. 467, 55 L. Ed. 297 (1911) reversing 133 Ky. 615, it was held by the Supreme Court that this section prohibited railroads from issuing passes for interstate transportation even on contracts made before the passage of the Hepburn rate law.* In this case the parties were injured on the railroad in 1871, and to settle their claims for damages the railroad agreed to carry them free as long as they lived. The Court said that the purpose of the statute was to cut up by the roots every form * This decision also in effect reversed the ruling of the circuit court of Kentucky in 150 Fed. 406, which was reversed and case dismissed for want of jurisdiction in 211 U. S. 149, 53 L. Ed. 126. §179] THE INTERSTATE COMMERCE ACT. 295 of discrimination, favoritism, and inequality, except in certain excepted classes, and that congress had not placed therein persons who had contracts for the issuance of passes, and that the Court could not add an exception based on equitable grounds when congress had forbore to make such an exception. The words of the act, therefore, mean that the carrier cannot charge, collect, or receive for transportation on its road anything but money. This ruling was followed in C. I. & L. R. Co. v. United States, 219 U. S. 486, 55 L. Ed. 305 (1911), affirming 163 Fed. 1 14, where the acceptance of advertising in payment of inter- state transportation under contract, though authorized by the state statute incorporating the company, was adjudged illegal. In U. S. v. Erie Railroad Co. 236 U. S. 259, 59 L. Ed. 567 (1914), the Court affirmed the district court of the southern district of New York, 213 Fed. 391, in dismissing bills filed by the United States to enjoin a railway company from issu- ing passes to employes of common carriers not subject to the interstate commerce act. The Court said that the statute should not be construed to prohibit the interchange of passes for the officials, agents and employees of common carriers and their families. Where a pass is issued to an employe and the employe de- livers it to a person not authorized to use it, and such party does use it on an interstate journey, he is guilty of violation of the act, and the employe is also guilty of aiding and abetting in such violation. United States v. Williams, 159 Fed. 310, D. C. of Ala. 1908. Also in the district court, of Iowa, United States v. Martin, 176 Fed. 110 (1910), the court held that one who had in his possession such pass and sold it to another knowing he was not the person named therein, with the intent that he should use it, which he does by riding an interstate journey, was guilty of violating the statute. The commission has ruled (12 I. C. C. 15) that newspaper employes on special newspaper trains are not included in the excepted list entitled to free transportation. Also that rail- road companies have no right to extend free transportation to the local transfer and baggage express company (12 I. C. 296 THE INTERSTATE COMMERCE ACT. [SeCTION 1 C. 39); that the local company not being subject to the regulating statute could give free transportation to whomever it wished, but that a carrier subject to the jurisdiction of the act could not lawfully grant free transportation to the officers of the local company. This was subject to the specific exceptions noted in the act as to baggage agents entering trains near a large terminal to arrange for baggage transfer. Land and immigration agents, unless they are bona fide and actual employes of carriers subject to the act, are not within the excepted classes. 12 I. C. C. 7. The commission has in several cases of its own motion in- vestigated the free pass situation in different states. Thus, in 26 I. C. G. 491, report was made on the situation as to passes issued in the state of Colorado, and in 29 I. C. C. 411, on the situation in Montana, and in 31 I. C. C. 261, in response to a Senate resolution of inquiry, report was made in regard to the issuance of passes by the Louisville & Nashville, Nashville, Chattanooga, Louisville R. R. and other carriers. § 180. Stipulations in passes against liability sus- tained. — The vaUdity in stipulations in passes that the company should be exempted from liability for negligent injuries was sustained by the Supreme Court in Northern Pac. R. Co. V. Adams 192 U. S. 440, 48 L. Ed. 513 (1904). Boering v. Chesapeake & Beach R. Co. 193 U. S. 442, 48 L. Ed. 742 (1904). In Charleston & Western Carolina Ry. Co. vs. Thompson, the Supreme Court, 234 U. S. 576, 58 L. Ed. 1476 (1914), reversed the court of appeals of Georgia, 79 S. E. 242, and held that a pass issued to the wife of an employe under this section must be deemed to have been gratuitous and not issued in consideration of the services of the employe, especially in view of the prohibition in Section 2 against discrimination, and she was therefore precluded from re- covery by the stipulation in the pass. § 181. The commodities clause. — The 4th paragraph of the 1st section of the act was inserted in the amendment of 1906, and is known as the "Commodities Clause," because it §181] THE INTERSTATE COMMERCE ACT. 297 declares that after May 1, 1908, "it shall be unlawful for any railroad company to transport "in interstate commerce" any article or commodity other than timber and the manu- factured products thereof" wherin it has an interest direct or indirect. The commodities clause was held valid by the Supreme Court in United States v. Del. & Hud. Co., 213 U. S. 366, 53 L. Ed. 836, in 1909; reversing the court of appeals of the third circuit, 164 Fed. 215., The Court decided that the provision was a lawful exercise of the power of congress and that the exception in favor of timber and the products thereof did not invalidate, the provision. As the Court construed the clause, however, the bona fide ownership by a carrier of stock in a producing company did not con- stitute a direct or indirect legal interest in the carrier in the commodity manufactured, mined or produced within the meaning of the act (Harlan, J., dissenting). The penalty clause of the act was not involved in the decision, but the Court ruled that in any event it was separable. In this case it was also decided that a company organized as a canal company and only operating a railroad as an incident to mining, was subject to the act as to its interstate business. This ruling as to the effect of stock ownership was very ma- terially qualified in the case of U. S. v. Lehigh Valley R. R. Co., 220 U. S. p. 257, 55 L. Ed. 458 (1911), which was in sub- stance but a sequel to the commodity cases of 1909. These cases having been reversed and remanded for further proceed- ings, application was made by the United States in one of them, the Lehigh Valley case, to file an amended bill, charg- ing that the railroad company was not only the owner of all the stock issued by the coal company, but that the railroad company so used the power of its stock ownership, as to deprive the coal company of all real independent existence, and to make it virtually but an agency of the railroad com- pany,^and that the coal company was not a bona fide mining company, but was merely an adjunct or instrumentahty of the defendant. The circuit court declined to permit this amendment to be filed, and entered a decree dismissing the bill. The Supreme Court held that this was an abuse of discretion, that the proposed amendment was germane to the original cause of action, and was not foreclosed by the 298 THE INTERSTATE COMMERCE ACT. [SECTION 1 previous decision. While the right of a railroad company as a stockholder to use its stock owjiership for the purpose of a bona fide separate administration of the affairs of a corpora- tion in which it has a stock interest may not be denied, yet the use of such stock ownership in substance for the purpose of destroying the entity of a producing corporation, and of commingling its affairs in administration with the affairs of the railroad compaiiy so as to make the two corporations virtually one, brings the railroad company so voluntarily acting as to such producing corporation within the prohibi- tion of the commodities clause. The decree of the circuit court was, therefore, reversed and the cause remanded for further proceedings. It seems a fair inference from these cases, that while a railroad company may own stock in a mining company, it cannot use such ownership for the control of such subsidiary company without falling within the prohibition' of the act. For rulings of the commission and the courts as to the rights and duties of a carrier in transporting its own products prior to the enactment of this statute, that is, as to a dis- crimination of a carrier in favor of itself as a shipper, see infra, § 246. And see also N. Y., N. H. & H. R. R. Co. v. Commission, 200 U. S. 361, 50 L. Ed. 515, (1906), where it was held that a railroad could not give a rebate on its own coal carried by it, and a contract for such delivery was void, and it was immaterial that the contract might not have been open to this objection when made, and that the inadequacy of the price was caused by strikes and other reasons beyond the control of the carrier. The carrier, therefore, could not lawfully stipulate to sell and transport coal at a rate of prices insufficient to yield the published freight rates, after deducting the cost of purchase and delivery. In Delaware L. & W. R. Co. vs. U. S. 231 U. S. 363,58 L. Ed. 296 (1913) the Court affirmed a conviction of the railroad which was chartered not only as a railroad but also to operate coal mines, and held that the transportation of hay for the use of animals employed in operating the coal mines was not necessary for the use of the company in the conduct of its business as a common carrier, and was a violation of this commodities clause in so far as the coal §182] THE INTERSTATE COMMERCE ACT. 299 was sold for the lise of the pubUc. It was also held that the receipt by the carrier of the hay under the agreement to pay for it after inspection and acceptance left the title in the railroad company, so that its transportation was a violation of the commodities clause; also that the prohibition of the defendant from operating its coal mines under its state charter was a valid exercise of the power of congress, and did not deny the due process of law under the federal consti- tution. Where a coal company is created for the express purpose that, with stockholders in common, it should be a party to a contract intended to enable the railroad company to meet the requirements of the commodity clause, and, at the same time, continue the business of buying, mining, sell- ing and transporting coal, the mere ownership of the stock of the coal company by the railway shareholders does not determine the legality of- the interstate trans- portation of the coal company's coal. This was ruled in th« case of U. S. v. Delaware L. & W. R. Co., 238 U. S. 516, 59 L. Ed. 1438 (1915) where the Court reversed the district court of New Jersey, 213 Fed. 240, and held that the contract made by the railway company with the coal company was invalid as a violation of this clause. The Court said there was no impropriety in the organization of such a company, nor in having the stockholders and ofTicers in common, but such contracts would be carefully examined to test their validity and good faith. The Court said that the railroad company, if it continues in the business of mining, must absolutely dissociate itself from the coal before the transportation begins, and the buyer must be as free as any other buyer who pays for what he has bought. The Court therefore ordered a decree enjoining the railroad from further transporting coal sold under the provisions of the contract in question. § 182. Switch connections. — The last paragraph of section 1 was added in 1906, the original act having no pro- vision with respect to switch connections. This paragraph has been strictly construed by the commission, not only because of its terms but by reason of the inadvisability of 300 THE INTERSTATE COMMERCE ACT. [SECTION I cutting the carriers' rails without grave necessity. It is to be noted that all the act requires is a "switch connection with any such lateral, branch line of railroad, or private side track." The act does not require the carrier in any case to build or furnish laterals, or branch lines of railroad, or private side tracks, but it does require the carrier to construct, maintain and operate a switch connection with private sidetracks, etc., which have been constructed to con- nect with its railroad, provided such connection is reasonably practicable, can be put in with safety and will furnish suffi- cient business to justify construction and maintenance. 16 I. C. C. 587. Safety, practicability and an offer of sufficient business are the necessary elements to a demand for a switch connection, but the commission's jurisdiction can only arise upon a complaint filed after a demand in writing upon the carrier has been made. It was ruled by the Supreme Court in McNeil v. Southern Ry. Co. 202 U. S. 543, 50 L. Ed. 1142, affirming 134 Fed. 82, (1906), prior to this amendment, that a state commission had no authority to compel a carrier to deliver cars containing in- terstate shipments beyond its right of way to a private siding. Whether such an order, applicable only to state business, would be repugnant to due process of law under the constitu- tion, was not decided. This amendment as enacted in 1906, made no provision for complaints by a lateral branch line railroad, but only by a shipper, and it was held by the Su- preme Court in I. C. C. v. D. L. & W. R. R. Co., 216 U. S. 531, 54 L. Ed. 605 (1910), affirming 166 Fed. 498, that a complaint by a lateral branch line was not within the statute. The paragraph was amended, therefore, in 1910, so that it now provides for the making of such complaint by any shipper or owner of a lateral branch railroad. The commission has ruled, 14 I. C. C. 191, that this pro- vision of the statute does not grant plenary discretion to the commission as to the advisability of switch connections. It is subjectto three conditions: (1) That the switch connection shall be reasonably practicable; (2) that it can be put in with safety; and, (3) that it will furnish sufficient business to justify the construction and maintenance of such switch connection. While retaining the right to control the loca- §184] THE INTERSTATE COMMERCE ACT. 301 tion of the switching track of private industries in accordance with the evidence, the commission has said that it is disposed, in recognition of the risk that arises from such interruption of through rails, to leave the location of such tracks largely to the discretion and wisdom of the carrier. 12 I. C. C. R. 503. It has also ruled that the connection should be made at the expense of the party asking for the same. 12 I. C. C. R. 270. For history of commission's rulings see 12 I. C. C. pages 193, 202 and 545; 18 I. C. C. 310; 20 I. C. C. pages 56 and 486; 21 I. C. C. 183. For the control of switch connections to avoid discrimina- tions and preferences, see Sections 2 and 3, infra. § 183. The establishment of through routes. — The amendment of 1906 made it the duty of the carrier to estab- lish through routes and just and reasonable rates applicable thereto, and the amendment of 1910, added th-ereto: "and to provide reasonable facilities for operating such through routes and to make reasonable rules and regulations with respect to the exchange, interchange and return of cars used therein, and for the operation of such through routes, and providing for reasonable compensation to those entitled thereto." This duty of establishing through routes that is thus im- posed upon the carrier, should be read with the provision of section 15, as amended, infra, § 452. § 184. Classifications, regulations and practices. — The amendment of 1910 inserted as the fourth paragraph of section 1, a new legislative declaration of the law with respect to classifications of property and the regulations and practices of the carriers concerning tickets, receipts, bills of lading; the methods of presenting, marking, packing and delivering property for transportation ; the facilities for trans- portation; the carrying of baggage of various kinds; and all other matters necessarily connected therewith. This clear announcement of the legislative intent has rendered obsolete the doubt sometimes expressed with respect to the juris- diction of the commission over these matters. Prior to the passage of the Hepburn Act in 1906, the jurisdiction of the 302 THE INTERSTATE COMMEECE ACT. [SECTION 1 commission over these matters was limited by the fact that the commission had no authority to make rates, or what would be equivalent thereto, for the future. But wherever a classification resulted in an unjust or unreasonable charge under section 1, or in undue prejudice or discrimination under sections 2 and 3, the commission has always had jurisdiction and has asserted such power from the very first. See infra, § 320 et seq. In 32 I. C. C. 152, the rates and charges of the Santa Fe Railroad for the transportation in interstate commerce on baggage excess value, were found to be unreasonable, and the tariffs were ordered amended so that the charges for excess value should not be greater than those fixed in the report. § 185. The unlawful use of peddler cars. Peddler cars, as they are called, have been in use in the Western Trunk Line country for many years. The original arrange- ment permitted the sale from the cars as peddlers from wagons of fresh meats and packing-house products; but the growth of the business and economy of operation demanded that sale should be made prior to the shipment of the car, and that each package should be consigned to a particular con- signee, each car containing on the average less than one hun- dred consignments : and such cars are equipped with refrig- erating plant, meat hooks and other necessary appliances. In 32 I. C. C. 428, the commission considered the subject of the use of these cars and held that the proposed increased minimum weight applicable to packing-house products and other commodities shipped in peddler cars between points in Western Trunk Line territory, was not justified. The commission found that the growth of the use of these cars (see annual report of commission, 1914, p. 11) had re- sulted in irregular practices and indictments for alleged un- lawful concessions from the railroads in shipments of carloads at less than carload rates, which were lawfully applicable. Indictments were returned in the Western District of Michi- gan and pleas of "guilty" were entered. The subject of peddler cases was further considered in 36 I. C. C. 62. § 186. Charges must be reasonable and just. — The last paragraph of the first section in its original form provid- §187] THE INTERSTATE COMMERCE ACT. 303 ing that all charges for any service rendered in the transpor- tation of persons and property, shall be reasonable and just, and prohibiting and declaring unlawful every unreasonable charge for such service, is only an alTirmance of the common law. In England, a common carrier was bound to carry for a reasonable remuneration as he was bound to carry all per- sons and property offered for transportation and suitable to be carried, though it was not uniformly held that the carrier was bound to carry for all at the same rate. In the Maximum Rate case, 167 U. S. 479, 42 L. Ed. 251 (1897), the Supreme Court said that this section was a simple enactment of the common law requirement, and that for more than a hundred years it had been the affirmative duty of the courts to exe- cute and enforce the common law requirement that al] charges should be reasonable and just. This requirement of reasonableness grew out of the relation of the carriers' occu- pation to the pubhc as was declared in the Granger cases, 94 U. S. 113, 24 L. Ed. 77 (1877), where the Court said that the carrier must carry when called upon to do so, and that he could charge only a reasonable sum for the carriage, and in the absence of any legislative regulation upon the subject, the courts must decide, as they did for private persons when controversies arose, what is reasonable. § 187. Practical difficulties in the enforcement of reasonableness in rates. — There are few if any cases wherein recovery has been had at law upon the common law liability of the carrier for charging excess over a reasonable rate. As said by the Supreme Court, in the Trans-Missouri case last cited, any individual shipper would in most cases be apt to abandon the effort to show the unreasonable character 3f the charge, because of the necessary expense of time and money to prove the fact, and the risk of incurring the ill-will of the road itself in all its future dealings with him. Furthermore, the question of what is reasonable is one of fact, dependent upon the special circumstances of each case, and as these circumstances are changing from time to time ; a rate which is unreasonable when paid, may become reason- able, through changed conditions, before the case is deter- mined in the court of last resort, or even in the trial court. 304 THE INTERSTATE COMMERCE ACT. [SECTION 1 See conclusion of opinion in Smyth v. Ames, 169 U. S. 1. c. 549, 42 L. Ed. 819 (1898). Another reason for the practical difficulty in the way of enforcement by shippers of this common law obligation of the carriers to charge only a "reasonable rate," lies not only in the delay and expense of litigation, and in the small amount involved in the payment of the charge for any one shipment, but in the fact that a party paying the unreason- able charge without protest, in the absence of any mistake or fraud, was denied any right of action. But see Cook v. C. R. I. & P. R. Co., 81 Iowa, 551, and 9 L. R. A. 764 (1890), where held that payments made by shippers in ignorance of discrim-ination and after the assertion of the carrier that no lower rates were given, are not voluntary payments within the rule that they could not be recovered back. Even assuming that recovery was had, the enforcement by difTerent juries of their own standards of reasonableness, — for it must be in each case a question of fact at last, — ^would be necessarily destructive of the uniformity which is essential in any permanent regulation of transportation for both shippers and carrier. See remarks of Phillips, J., in Windsor Coal Co. V. C. & A. R. Co., 52 Fed. 716 (1892). It was sug- gested, however, by the United States court of appeals in Southern Pacific R. Co. v. Colorado Fuel & Iron Co., 42 C. C. A. 12, 101 Fed. 779 (1900), that it was possible that a jury verdict would lead to a withdrawal of the rate adjudged unreasonable. The above discussion as to the practical difficulties in the enforcement of reasonableness in rates has been rendered his- torical and academic by the amendments of 1906 and 1910, and by the construction placed upon the law by the Supreme Court in the Abilene Cotton Oil Case, 204 U. S. 426, infra, sec. 9 of act. This case involved : The scope and effect of the act to regulate commerce upon the right of a shipper to maintain an action at law against a common carrier to recover damages because of the exaction of an alleged unreasonable rate, although the rate collected and complained of was the rate stated in the schedule fded with the Interstate Commerce Commission and pubhshed according to the requirements of the act to regulate com- §188] THE INTERSTATE COMMERCE ACT. 305 merce, and which it was the duty of the carrier under the law to enforce as against shippers. The Court unanimously held: That a shipper seeking reparation predicated upon the un- reasonableness of the established rate must, under the act to regulate commerce, primarily invoke redress through the Interstate Commerce Commission, which body alone is vested with power originally to entertain proceedings for the alteration of an estabhshed schedule, because the rates fixed therein are unreasonable. • In discussing the reasons why concurrent jurisdiction as to the propriety of rates under the act could not be had between the courts and the commission, the Court said : "For if, without previous action by the commission, power might be exerted by courts and juries generally to determine the reasonableness of an established rate, it would follow that unless all courts reached an identical conclusion a uniform standard of rates in the future would be impossible, as the standard would fluctuate and vary, dependent upon the divergent conclusions reached as to reasonableness by the various courts called upon to consider the subject as an original question. Indeed the recognition of such a right is wholly inconsistent with the administrative power conferred upon the commission and with the duty, which the statute casts upon that body, of seeing to it that the statutory re- quirement as to uniformity and equality of rates is observed." § 188. Standard of reasonableness under state statutes. — Under state statutes re-asserting this common law requirement of reasonableness and providing for the publication of tariffs and charges and their submission to and approval by state commissions, it has been held that the common law right is superseded by the statute and that there can be no recovery for alleged unreasonableness in the charges thus published and approved, as the pubhshed rates will be conclusively presumed to be reasonable. Young v. Kansas City, St. J. & C. B. R. Co., 33 Mo. App. 509 (1889); Windsor Coal Co. V. C. & A. R. Co., siipra; McGrew v. Missouri Pacific R. Co., 114 Mo. 210 (1893); Railroad Co. v. People, 77 III. 443; Sorrell v. Railroad Co., 75 Ga. 509; Burlington, C. R. & N. R. Co. V. Dey, 82 Iowa, 312. In the latter case, in answer to the claim that the commissioners' rate would not J-20. 306 THE INTERSTATE COMMERCE ACT. [SeCTION 1 secure the accused from conviction, if it was excessive, the court said that the state would be precluded from denying that the rate was reasonable. § 189. Standard of reasonableness under the act. — The principle whereon these decisions concerning state statutes were based was applied to the act to regulate com- merce in the case of Van Patten v. C, M. & St. P. R. Co., 81 Fed. 545, decided by Shiras, J., in the circuit court of the northern district of Iowa, and in Kennedy v. Terminal Railroad Ass'n, 81 Fed. 802, by Adams, J., in the circuit court of eastern district of Missouri. These cases were decided in 1897 before the amendment of the act in 1903, wherein the published schedule was made conclusive against the carrier. It was held in both cases that in order to recover it must be shown that the rate was unreasonable according to the provision of the acts, and that it was a good defense to an action for damages for unreasonable charges that the carrier had adopted and pqsted a properly proportionate schedule of rates under section 6. These cases were both brought under the assumed election given by sections 8 and 9, without appealing to the commission to adjudge the rate unreasonable and for reparation. Prior to these cases in 1893 in Swift v. R. R. Co., 64 Fed. 59 (N. Dist. of Illinois) it had been held by Grosscup, J., that there was no common law of recovery in the federal court, and that under the act plaintiff could not recover without averring that no rates were published as required by the act. Since the amendment of 1903, infra, § 519, the posted rate is the definite and conclusive standard of reasonableness subject to the finding of the commission that the rate so scheduled is unreasonable. As to the power to allow repara- tion in damages for unreasonable rates, see infra, sections of act 15 and 16; as to limitation of right of action under sections of act 8 and section 22 of act, see sec. 9, infra. There is no presumption, however, that a rate is reasonable in law, because it had been filed and published by the rail- road with the commission. Ilhnois Central R. R. Co. v. Commission. 206 U. S. 441. 51 L. Ed. 1128 (1907). §191] THE INTEESTATE COMMERCE ACT. 307 § 190. The power of the commission in fixing rates. — During the first ten years of its existence, the com- mission claimed and exercised the power of fixing rates in futuro; that is, when a rate was adjudged unreasonable, to determine what rate was reasonable, and to direct the carrier to reduce the rate to the designated maximum. Illu- strations of the decisions by the commission during this period will be found in their reports from 1887 to 1897. In 1896, it was decided by the Supreme Court, in what is known as the Social Circle Case, 162 U. S. 184, 40 L. Ed. 935 ; and the following year in the Cincinnati Freight Bureau Case, 167 U. S. 479, 42 L. Ed. 243, that congress had not con- ferred upon the commission the power to prescribe rates, whether maximum, minimum or absolute, and in the latter case it said that congress might have fixed the rate itself, or committed to some subordinate tribunal the duty, but that it had not done so. For statement by the commission of its powers under these decisions, see 7 I. C. C. 286, and report of the commission for 1898, pages 23 to 27. As the effect of these decisions was to give the carriers the power to establish rates independent of the judgment of the commission, leaving the commission only the power to pass upon the reasonableness of specific rates, the amendatory act of 1906 conferred upon the commission in express terms the power to determine and prescribe what would be the just and reasonable rate or rates, charge or charges to be there- after observed in such cases as the maximum to be charged. See sec. 15, infra. By the act of 1910, the power of the com- mission has been further enlarged so as to include the sus- pension of an increase of rate announced by the carrier before the same takes effect. See sec. 15, infra. ■ § 191. Rates, and not systems of rates, determined by the Commission. — In Lehigh Valley R. Co. v. U. S., Commerce Court, 204 Fed. 986, it was said by the court, in refusing an application of the railway company to enjoin certain rates upon coal made by the commission on the ground that the effect of the order of the commission would be to reduce the revenues of the company below the point which would give it a fair return, that it was primarily 308 THE INTERSTATE COMMERCE ACT. [SECTION 1 individual rates or joint rates, which should be investigated and determined by the Interstate Commerce Commission, and not system of rates; that the burden rested upon the carrier to prove that its rates other than the one involved in the order, are reasonably high and could not be advanced, but otherwise the courts could not interfere with the judg- ment of the commission. In this case it seemed that the orders of the commission affected less than 1 /ll of the freight traffic of the company. It was admitted that the rates fixed by the commission were not below the cost of the service and gave some substantial profit, and it did not appear whether the other rates were reasonable. Just compensation secured by the constitution of the United States did not mean a guarantee to the carrier of any fixed profit on the investment. § 192. No power in the courts to fix rates. — The fixing of rates for the future is a legislative or administrative, and not a judicial duty. This distinction and the limitations of judicial power in this matter were pointed out by the Supreme Court iij the decision in the Virginia Rate Case, 211 U. S. 210, 53 L. Ed. 150 (1908) supra: "A judicial inquiry investigates, declares and enforces liabilities as they stand on present or past facts, and under laws supposed to exist. That is its purpose and end. Legislation, on the other hand, looks to the future and changes existing conditions by making a new rule, to be applied thereafter to all or some part of those subject to its power. The establishment of a rate is the making of a rule for the future, and therefore is an act legislative not judicial in kind." It was ruled in this case that a corporation commission em- powered by state constitution to fix rates in futuro was not a court in the proper sense of the term, as such a power was not a judicial power. See also Southern Railway Co. v. Colorado Fuel & Iron Co., supra. Thus, it was ruled in 1897 (when the commission was not empowered to fix rates), by the circuit court of Washington, in Farmers Loan & Trust Co. v. Northern Pacific Ry. Co., 83 Fed. 249, that an order of the commission (5 Interstate Com- merce Rep. 478), that commodity rates must not be lower §193] THE INTERSTATE COMMERCE ACT. 309 than necessary to meet competition nor to be applied to articles not subject thereto, was a mere general statement of the duty of the railway company as defined by the law, and was too indefinite to be the basis of a decree by the court to enforce obedience. § 193. The federal courts on reasonableness of rail- road rates.— While it is not within the judicial power to fix rates for the future, it is a judicial duty to pass upon the reasonableness of rates when they are presented to the court. The question of reasonableness in railroad rates has been construed -by the federal courts in two distinct classes of cases. Thus, in the judicial review of state imposed rates upon intrastate business, supra. Chapter VII, the court deter- mined whether carriers have been depr'ived of their right to make reasonable charges, that is, whether the state imposed rates are in any sense confiscatory, thus depriving them of their property without compensation; while in questions arising under the commerce act the question is raised whether the rates charged by the carrier or which he seeks to impose exceed what is reasonable. In the first class of cases the burden of proof is upon the carrier to show that the state has fixed unreasonable limitation upon his rates; while in the other class of cases, where the shipper complains of an exist- ing rate, the burden is upon him to show that the carrier has exceeded a reasonable standard. Under the recent amend- ment to the act in 1910, when the carrier proposes an advance over existing rates and objection is made thereto, the burden is upon the carrier to show the reasonableness of the advance. The Supreme Court said in the Maximum Rate Case, supra, that a rate may be unreasonable because it is too low as well as because it is too high. In the former case it is unreason- able and unjust to the stockholder, and in the latter to the shipper. In Covington & Lexington Turnpike Rd. Co. v. Sandford, supra, 164 U. S. 578, 1. c. 597, 41 L. Ed. 560, the Court said, in determining the question of reasonableness, its duty was to take into consideration the interest both of the public and of the owner of the property. In the Minnesota Rate Case of 1902, 186 U. S. 257, 46 L. Ed. 1151, involving a specific state imposed rate, the Court 310 THE INTERSTATE COMMERCE ACT. [SECTION 1 said (p. 268) that each case must be determined by its own considerations, and while railroads were entitled to a fair return upon the capital invested they were not justified in charging exorbitant rates even in order to pay operating expenses if the conditions of the country do not permit it. It sometimes happens that, for purposes of ultimate profit and. for building up a future trade, railways carry both freight and passengers at a positive loss ; and while it may not be in the power of the commission to compel such a tariff, it could not upon the other hand be claimed that the railroads could in all cases be allowed to charge grossly exorbitant rates as compared with rates paid upon other roads, in order to pay dividends to stockholders. The subject of valuation of property for rate making has been thoroughly discussed in the federal courts in cases con- cerning the alleged confiscatory character of state imposed rates. See supra. Part I, Chapter VII. In the Turnpike Road Case, supra, the Court said that a corporation performing public services was not entitled as a right and without reference to the interests of the public, to realize a given per cent upon its capital stock; that stock- holders were not the only persons whose rights or interests were considered, and that the rights of the public were not to be ignored. In the San Diego Water Rate case, 174 U. S. 739, 43 L. Ed. 1155 (1899), the Court said it was "the real value of the property which should be taken into consideration. What the company is entitled to demand, in order that it may have just compensation, is a fair return upon the reasonable value of the property at the time it is being used for the public. The property may have cost more than it ought to have cost, and its outstanding bonds for money borrowed and which went into the plant may be in excess of the real value of the property." On the general subject see also Kansas City Stock Yards case, 183 U. S. 79, 46 L. Ed. p. 92 (1901), involving the rates in the Kansas City Stock Yards, and the Metropolitan Trust Co. V. R. R. Co., 90 Fed. 683 (1898), United States circuit court of Texas, on Texas state rates. §194] THE INTERSTATE COMMERCE ACT. 311 § 194. The value of railroad property as a basis for rate regulation. — The value of the property devoted to the public service is recognized as a factor, but not the only factor, in rate making. It has been uniformly held, both by the commission and the courts, that it is the present cost or, as it is sometimes phrased, the cost of reproduction, when the issue of the reasonableness of the rates is investigated, and not the original cost which is to be determined as a factor on the question of the reasonableness of rates. Evidence of the cost, however, may be admissible in determining the ulti- mate fact of present value; but where the cost is shown, evi- dence is admissible to show the depreciation of the property values. It is for the purpose of determining this actual present value that the commission has urged a physical valu- ation of the interstate railroads. It is in connection with this determination of the present value of the property that the matter of capitalization has been considered. The Supreme Court said, in the Nebraska Rate Case, supra, that in determining value as a basis for making rates, capitalization and the original cost of con- struction, the amount expended in permanent improvements, the market value of bonds and stocks, the probable earning capacity under the rates, and the sum required to operate the business, were all matters for consideration and should be given such weight as would be just and right in each case. The Court concluded by saying that there may be other mat- ters to be regarded in estimating the value. In the Knoxville Water case, 212 U. S. p. 12, 53 L. Ed. 371 (1909), which was a case involving the validity of maximum rates for a local water company, the Court said that the stock of the company which appeared to have been issued to a con- tractor for construction and in excess of the true value, was not the true measure or guide in determining valuation. The cost of the tangible property, it was said, must be diminished by depreciation; and it was intimated that the company should have the benefit of any appreciation of the tangible property. In the Consolidated Gas case, 212 U. S. 19, 53 L. Ed. 382, decided at the same term (1909), involving the rates of gas companies in New York, the Court said that the value of the 312 THE INTERSTATE COMMERCE ACT. [SECTION 1 property was to be determined as of the time when the in- quiry was made regarding rates, and that if the property which legally entered into the consideration of the question of rates had increased in value since it was acquired, the com- pany was entitled to the benefit of such increase. It added, however, that while such was the general rule there might be an exception where the property may have increased so enormously in value as to render a rate permitting a reason- able return upon such increased value unjust to the public. See also opinion in Minn. Rate case, of 1913, supra, § 141. § 196. The unearned increment in valuation of rail- road property in rate regulation. — In the Advance Rate Case (February 22, 1911) it was contended by the Burlington railroad, one of the applicants for the increased rate, West- ern Trunk Line case, 20 I. C. C. 307, that it was entitled as a matter of legal right to a fair return upon the actual value of its property used for transportation, which value, from what- ever source in the past created, is measured in its case by at least the cost of presently reproducing its physical plant. To obtain such fair return, it claimed the right to charge rates of transportation which, subject to the one limitation that the particular rates are themselves reasonable and just to the shipper, will produce such reasonable return upon the prop- erty employed. It was claimed that largely through the in- creased value of its real estate holdings as well as through the putting of earnings of the company into the property the actual fair value of the railroad far exceeded its capitalization and that therefore it was entitled to freight increase as a rea- sonable return upon the actual value of the property. But the commission declined to admit this contention and said whatever the true economic or legal view may be as to the right of a carrier to consider the increase in value of its land as a part of the value upon which it is entitled to a rea- sonable return, such increase in value does not of itself es- tablish the right of a carrier to increase the rate upon a given service. The commission said it was yet to be decided that a public agency created by public authority may continuously in- crease its rates in proportion to the increase of its value either §196] THE INTERSTATE COMMERCE ACT. 313 (1) because of betterments which are made out of income or (2) because of the growth of the property in value due to the increase in value of the land which the company owns. The Supreme Court said in the Consolidated Gas case, supra, that an increase in the value of the property of the carrier does not justify a rate which is unreasonable to the public. § 196. The relation of railroad rate to investment of earnings in property. — It was ruled by the Supreme Court in Illinois Central R. Co. v. Commission, 206 U. S. 441, 51 L. Ed. 1128 (1907), aflfirming the order of the commission in 10 I. C. C. 505 (the Yellow Pine Association Case), that im- provements which add to the permanent value of the prop- erty, and are paid from earnings, are not properly charged to operating expenses in determination of the reasonableness of rates. The Court said it would seem as if "expenditures for addi- tions to construction and equipment, as expenditures for original construction and equipment, should be reimbursed by all of the traffic they accommodate during the period of their duration, and improvements that will last many years, should not be charged against the revenue of a single year." The Court distinguished the Union Pac. R. R. Case, 99 U. S. 402, 25 L. Ed. 274, (1878) as not involving rates, or the rights of shippers. In the Advance Rate Case in Official Classification Terri- tory, 20 I. C. C. 243 (1910; see infra, § 458), the commission said that this principle seemed to apply also to non-revenue producing improvements, forced by public demand, such as expensive passenger stations, abolition of grade crossings in cities, adoption of safety appliances and the like. It was suggested however that while this seemed to be the law, public policy might under some conditions lead to a different conclusion, so far as favoring the accumulation of surplus from earnings in improving a system. The question whether the investment from earnings belonged to the public or to the stockholders was not determined ; the commission saying "until the status of this surplus is determined by legislative action or judicial interpretation, this commission cannot 314 THE INTERSTATE COMMERCE ACT. [SECTION 1 properly permit an advance in rates, with the intent to pro- duce an accumulation of surplus for this purpose." § 197. Reasonableness under sections 1 and 3. — The reasonableness of rates under section 1 must be distinguished from undue and unreasonable preferences of localities, which are prohibited by section 3. Thus it was held in Commission V. N. C. & St. L. R. Co., 120 Fed. 934 (1903), that a finding of unreasonableness under section 1 could not be established merely by a proof of a violation of section 3. That is, that a rate may be reasonable per se and still be unduly preferential of a locality, and thus be violative of section 3. A rate which is unreasonable, however, per se, may be shown by the same facts to be unduly preferential of the locality as compared with, other localities. See infra, section 3. § 198. Consideration of reasonableness in the courts. — In Commission v. Southern Railway Co., 117 Fed. 741 (1902), the circuit court of the western district of Virginia said that in determining the issue as to whether rates to and from a city were unjust and unreasonable in themselves, the greatest weight should be given to the opinion of expert witnesses, the effect of the rates charged upon the growth and prosperity of the city, the cost of transportation as compared with the rates charged and the rates in force to other cities where the circumstances are as nearly the same as may be. In this case the court refused to enforce an order of the commission directing reduction of rates to Danville, Virginia. 122 Fed. 800 (1903). In Commission v. L. & N. R. Co., 118 Fed. 613 (1902), the court found that the rates to Savannah from certain points on the Pensacola division of the Louisville & Nashville road were unreasonable, and said that they could not be justified by the contention that the railroad company had been building up a port and thus securing a longer haul. The court said that rates unreasonable, in themselves could not be justified by considerations of this character. In this case an advanced rate, filed with the Interstate Commerce Commission and put into effect pending the hearing before the commission on the legality of the rate previously in force, was held properly before the commission on such hearing. §199] THE INTERSTATE COMMERCE ACT. 315 On the issue of reasonableness in rates, the sworn return of the officers of the road made to state authorities for the pur- poses of taxation is admissible, but not conclusive. L. & N. R. Co. V. Brown, 123 Fed. 946 (1903). In Commission v. Lehigh Valley R. Co., 74 Fed. 784 (1896), the court said that the fact that the cost of carriage of all the coal of an entire railroad system from all points of the shipment to all destinations was a certain per cent, of the gross receipts from coal did not justify the conclusion that on a particular line of part of the system the cost of carriage bore the same relation to the gross receipts of the whole line, and that the commission erred in holding the contrary theory. The carriage of expensive merchandise is entitled to greater compensation than that of cheap goods. Commission v. D. L. & W. R. Co., 64 Fed. 723 (1894). § 199. Rulings of the commission upon the reason- ableness of rates. — The commission, though prior to 1906 it had no power to determine what rate a railroad should charge, has during the whole period of its existence been vested with the important jurisdiction of investigating and determining whether rates are reasonable or unreasonable. The Supreme Court has in several cases wherein it differed from the commission in the conclusions of law as to the construction of the act, remanded the cases to the commission for its own investigation upon the question of the reason- ableness of the rates, or has entered judgment without prejudice to the commission's right to re-investigation of the question of reasonableness of the rates. Interstate Com. Com. V. Clyde Steamship Co., 181 U. S. 33, 45 L. Ed. 731 (1901); L. & N. R. R. Co. v. Behlmer, 175 U. S. 649, 44 L. Ed. 309, supra. In many cases the conclusions of the commission have been accepted and acted upon by the railroad conipanies in the ad- justment of their rates, and though its conclusions may be recommendations and not judgments, they none the less have a permanent value and constitute a body of the administra- tive law on this difficult question of railroad administration. The opinions and conclusions have the greater weight from 316 THE INTERSTATE COMMERCE ACT. [SECTION 1 the character of the membership since the organization of the commission, and from the thoroughness of its investigation, as evidenced by the opinions. Under the enlarged jurisdiction of the commission under the acts of 1906 and 1910, its rulings have vastly increased in importance. In the ruling (1911) denying the advances in rates in the Western Traffic Line Cases, supra, the commission summar- ized its powers, saying: "It is doubtless true that in its- control over the charges which the railroads make, this com- mission exercises a power so extensive as to justify the broadest consideration of the economic and financial effects of its orders, but the government has not undertaken to become the directing mind in railroad management. This commis- sion is not a general manager of the railroads, and no matter what the revenue the carriers may receive there can be no control placed by the commission upon its expenditure, no improvements directed, and no economies enforced." In the same opinion the basis of the policy in the more con- gested portions of the country as to rates was stated as fol- lows: "First, a basic classification of commodities with relation to their relative value, bulk, fragility, and other proper transportation considerations, upon which is built a wisely balanced schedule of charges fixed with reference to well-defined zones of distributive territory; and, beneath these, those special rates on certain commodities as to which the public need demands that exceptions shall be made." In 14 I. C. C. 376, the commission said it had no authority to establish general rate schedules, but must deal with the interstate rates of this country, which had not been estab- lished upon any definite theory, as it finds them. What the commission takes off in one place, it cannot add in another. Unless, therefore, the general result of all rates is to yield an undue revenue to the carrier, the commission should not reduce a particular rate simply because it might have thought in establishing that rate de novo as part of a general scheme it ought to be somewhat lower or somewhat higher in proportion to the others. The rate attacked must be so out of proportion as to be unreasonable, and must so dis- criminate as to be undue and unlawful as to some other rates. §201] THE INTERSTATE COMMERCE ACT. 317 This case involved the rates upon live stock from Iowa points to Chicago, and the commission thought that while the general level of the rates ought not to be reduced, that the groupings of territory wherein the specific rates were effective should be revised. § 200. Considerations in the Advance of Rates. — In 26 I. C. C. 20, in investigating the proposed advance of rates on coal and coke in carload lots from points on the L. & N. Railroad to points on the C. C. & I. and other destinations, the commission said that neither the equities of the shippers, nor the intent or motive actuating the carriers in prescribing the advance in freight rates has any bearing upon the reasonableness of the increased rates, and cited the Union Pacific case, 222 U. S. 541, 56 L. Ed. 308, (1912) where the Supreme Court said that the reasonableness of rates could not be determined by categorical answers. Traffic moving during a given year should not be made to bear the entire cost of permanent improvements and better- ments. While cost is an important element in determining the reasonableness of any rates, it is not controlling, and the reasonable maximum rate is not ipso facto only such a rate as bears a distributive share of all operating expenses. The expense incurred in originating the traffic is a necessary incident to transportation. The commission found from all the facts that the proposed increase was not justified. § 201. Limitations of the commission's power in fixing rates. — While it is recognized that neither the com- mission nor any public regulative body can reduce rates below what is termed the confiscatory limit, that is, so as to deny the carrier a reasonable return upon the property devoted to the public service, its power is also limited, in that in deter- mining the reasonableness of a rate, it cannot reduce a reason- able rate for the sake of encouraging or protecting any business interest of the shippers. This was illustrated in the ruling of the Supreme Court in Southern Pacific Railroad v. Interstate Commerce Commission, 219 U. S. 433, 55 L. Ed. 283 (1911), reversing the circuit judges of the ninth circuit in 177 Fed. 963, which had enforced an order of the commission, 318 THE INTERSTATE COMMERCE ACT. [SECTION 1 14 I. C. C. 61, which directed the railroad to reduce the rate on lumber from the Willamette Valley points. The Court said the commission had no power to fix rates upon the assumprion that it had the right to protect the lumber interests from the consequences of a change in rates, even if the change was from a rate which had been fixed unreason- ably low for the purpose of encouraging the industry, though the higher rate thus reduced was not in itself unjust or un- reasonable. To the same effect is the ruling in 1911 by the commerce court (190 Fed. 591) in the Arhngton Heights Fruit Associa- tion case, where the court said that the commission had no power to protect the lemon industry of California against foreign competition, and as the order of the commission in 19 I. C. C. 148, was based primarily on such assumed au- thority, it was void. It seems from the opinions in these cases that if the com- mission had based its orders upon findings from substantial evidence that the rates were unreasonable per se, and that the reduction was necessary to make them reasonable per se, such conclusion of the commission would not have been dis- turbed. § 202. Presumptions of reasonableness from estab- lished rates. — In the determination of such an indefinite problem as the reasonableness per se of a given rate, depend- ence must necessarily be had upon the presumptions of fact which the circumstances afford rather than on those of law. Thus it is ruled that the long continuance of a rate is an admission of reasonableness; and where, in reliance upon ex- isting rates, capital has been invested and industrial condi- tions estabhshed.. such rates cannot be discontinued without taking into account its effect upon these commercial and in- dustrial conditions (15 I. C. C. 59): but from voluntary re- duction of a rate unreasonableness may be inferred (15 I. C. C. 11), nor is the long continuance of a rate a presumption that it is reasonable. (17 I. C. C. 313). There may be an inference of unreasonableness in a vol- untary reduction of rates by a carrier, but it is not conclusive. 8 I. C. C. 561. For presumption of unreasonableness from change of rates by carriers, see 6 I. C. C. 295. §204] THE INTERSTATE COMMERCE ACT. 319 After a rate has been raised by a carrier, it is still presumed to be reasonable until shown to be unreasonable, excepting in cases under the amendment of 1910, whereunder the carrier is compelled to prove the reasonableness of the increased rate. A lower rate via one line is not conclusive evidence of un- reasonableness of higher rate by another line. 15 I. C. C. 107, 15 I. C. C. 49. As to absence of legal presumption of reasonableness from pubhcation of rate, see Yellow Pine rate case, 206 U. S. 441, supra. § 203. The burden of proof . — It necessarily follows from this presumption of reasonableness of the existing rates that the party complaining has the burden of proof to show un- reasonableness. The commission has uniformly ruled that rates cannot be declared unreasonable where no proof is offered but that of comparison. I. C. C. 230, and 1 Int. Com. Rep. 627. A rate is not unreasonably simple because a lower rate is in effect on lines of other carriers. 17 I. C. C. 286. Parties complaining must, therefore, make proof of unreason- ableness in hearings before the commission. As to the burden of proof on justification of increases under amendment of 1910, see infra, sec. 15. In L. & N. R. Co. V. United States, 238 U. S. 1, 59 L. Ed. 1177 (1914), affirming 216 Fed. 672 which denied an injunc- tion restraining the order of the commission, 28 I. C. C. 533, reducing the freight paid on coal to Nashville as unreason- able from 11.00 to 80c, it was said that the burden was upon complainant to establish that the reduction was unreason- able. Where the rate had been in force for a long period and the traffic had greatly increased in value, and it was held that the reduction was supported by the finding that the rate was higher than coal rates between other points on the same road, and that it yielded a higher return per car mile than the coal rates of any of the railroads entering that point. § 204. Considerations in the determination of reasonableness. — The commission has ruled (see 13 I. C. C. 651), that a carrier has no right to attempt to dictate the use to which commodities transported by it shall be put; or to 320 THE INTERSTATE COMMEECB ACT. [SeCTION 1 fix the rate for one use higher than where the commodity is shipped for a different use. In this case the railroads sought to impose a higher rate upon nitrate of soda when used for the manufacture of explosives than when used for fertilizers. The commission cannot accept as conclusive any stipula- tion of parties as to the reasonableness of rates, 16 I. C. C. R. 426. The conclusions of the commission on such matters must be reached with a due consideration for the conclusions which it has already announced on the same subject, and for the knowledge which it has.gathered with relation thereto in other cases. The willingness of the shipper to receive, and of the carrier to pay, reparation upon certain traffic and under certain rates, can be approved by the commission only under a clear and decisive showing of facts which would lead the commission to award such reparation in opposition to the carrier's wishes. It was said in 17 I. C. C. R. that agreements covering rates could be evidence of an admission as between the parties exe- cuting it, and has strong evidentiary value that the rate agreed upon is reasonable. The rate which was advanced as the result of an agreement among carriers, even if such agree- ment was under color of violation of the Anti-Trust Act, will not on that account alone be declared unreasonable, 12 I. C. C. 451. Evidence of such violation is pertinent, but the existence of such unlawful agreement, even when proved, is not conclusive of the unreasonableness of the rate so ad- vanced. § 205. Review of the commission's rulings on rates. It was said by the commission, 28 I. C. C. 533, and by the Circuit judges in Tennessee, L. & N. R. Co. v. U. S., 216 Fed. 672, (1914), in denying a motion for preliminary injunction against the enforcement of an order of the interstate com- merce commission in regard to coal rates, that the question of the reasonableness of an order is one of fact, and the conclu- sion of fact of the commission that a given rate is reasonable or unreasonable is not to be reviewed on the weight of the evidence, unless there is no substantial evidence to support such conclusion, or it is contrary to the undisputable char- acter of the evidence. Where a party complains that the §205] THE INTERSTATE COMMERCE ACT. 321 facts found by the commission do not support its conclusion, and refuses to state what the facts are, the court may take the facts embodied in the report of the commission as con- clusive. The weight to be given to the evidence in regard to rate making is peculiarly within the province of the com- mission. It was said by the Circuit Court in Southern Pacific Co. et al. V. U. S. 197 Fed. 167 (1912), reviewing 21 I. C. C. 389 which had fixed rates on lumber from Willamette Valley points in Oregon to San Francisco and Bay points, and it made a classification based somewhat on condition and value, and it fixed a lower rate on rough fir lumber and lath than was permitted on better grade, took into consideration that without such rates the lower grades could not be shipped at all in competition with the same grades from points having water transportation, did not invalidate the order, when the rate was just and reasonable in itself. In Norfolk & Western R. Co. v. U. S., 195 Fed. 953, (1912,) it was held by the commerce court that it was no ground for interference with an order of the interstate commerce com- mission reducing certain rates charged by railroad companies, that competing companies, in consequence of their failure to meet the reduction, were losing traffic, nor if the rates fixed were reasonable in themselves, that, owing to the low com- modity rate on the same class of traffic which has been forced by competition on through shipments to one of such points, it would be necessary to reduce the through car load rate below a reasonable compensation, in order that it may not exceed the sum of the local rates. An unreasonably high rate on the traffic and between the points to which the order relates could not be justified on the ground that it was neces- sary to sustain some other rate. The Commerce Court in 1913 in A. T. & S. F. R. Co. v. U. S., 203 Fed. 57, dismissed the petition of the railroad company to enjoin the enforcement of the order of the commission reducing the rate on lemons from the Pacific to the Atlantic coast to one dollar per hundred, see 22 I. C. C. 149. The court said that it could not consider the evidence taken before the commission for the purpose of determining in the first instance whether a particular freight J-21. 322 THE INTERSTATE COMMERCE ACT. [SECTION 1 « rate was inherently unreasonable; such detennination being within the jurisdiction of the commission as a condition precedent ,to the exercise of its right to fix reasonable rates for the future. As the court found that the rate was such as to afford considerably more than the out-of-pocket ex- penses of the service, and even exceeded the part of the entire operating cost fairly apportionable to the particular traffic, it was neither unreasonable nor arbitrary. § 206. What is a reasonable rate. — ^A just and reason- able rate is neither the minimum charge that can be made for the service and permit the carrier to live, nor is it the maximum charge that can be borne by the shipper. An absolute rate may possibly be also a just and reasonable rate but the presumptions are against it by reason of its inflexi- bility. Between the minimum and maximum limitations, rates to be just and reasonable should be flexible and should permit compliance with sections 2 and 3 of the act forbidding discriminations, as well as section 4 with respect to long and short hauls. Assume that the out of pocket cost to the carrier for any transportation is 10 cents, assume further that the traffic would not move if the rate were fixed as high as 30 cents. In such a case a rate of 10 cents ordered by a com- mission would amount to confiscation of the carrier's prop- erty and a rate of 30 cents would be injurious to both carrier and shipper. A rate of 11 cents in such a case would permit of a large movement and whether it would be compensatory to the carrier or not would depend upon the carrier's financial condition and whether the increased movement fell short of over-taxing the carrier's facilities. If a rate of 20 cents under such conditions permitted reasonably free movement of the traffic, and if a rate of 15 cents yielded some approach to a fair return upon the carrier's investment, the reasonable rate might be fixed at anything between these two figures. In the Western Advance Rate Case, 20 I. C. C. 307, on pages 347, 348, the commission said: "Thus we return to the question. What is the reasonable rate that shall be charged to the shipper? The legislature may not make rates so as to confiscate the carrier's property. The carrier, on the other hand, may not make rates which are unjust to those who by economic necessity are compelled § 208] THE INTERSTATE COMMERCE ACT. 323 to employ its services. Here, then, we iiave the minimum of legislative power and the maximum of the carrier's power. Between these lies a zone, indefinite and variable. Without question the carrier will tend toward the maximum, while governmental authority will be inclined — in fact, has been created — to repress its upward tendency. One moves in- evitably upward to the highest rate which the traffic will bear; the other attempts to discover some relation between charge for service and cost of service." There is clearly a zone of reasonableness within which any rate is compensatory or just and reasonable to the carrier and fair to the shipper, or just and reasonable to the pubhc. Within this reasonable zone, for any particular traffic, rates as between different locaUties are to be adjusted with regard to each other to comply with other sections of the act. § 207. Res judicata with respect to rates. — There can be no such thing as res judicata in respect to rates. In practice, however, the publication and maintenance of a rate by a railroad estops it, ordinarily, from denying that the rate so published is just and reasonable, or compensatory so far as the carrier is concerned; by the act the orders of the commission with respect to rates expire after a period of two years ; and the finding or order of the commission or the action of a carrier on its own initiative is merely declaratory of what the rate ought to have been in the past, or what it shall be for the immediate future and is always subject to revision. In 19 I. C. C. 34, the commission said: "It ought to be perfectly apparent that rates which are reason- able at the present time may within a period of two years become very unreasonable, by reason of changes in circum- stances and conditions, economic, transportation or the like. It should be just as apparent that a rate which was unreason- able two years or more ago may become reasonable by reason of such changes in conditions. We think the plea of estoppel by reason of former adjudication is not good inso- far as the present rates on these articles are concerned." § 208. Through rates and local rates. — The distinc- tion between the through and local services of a railroad, i.e. its reasonable right to make the local rates greater than the 324 THE INTERSTATE COMMERCE ACT. [SECTION 1 proportionate part of a through rate over the same distance, has been recognized in the decisions of the commission and also of the courts. The distinction has also been considered in the state rate cases (see supra, §126), as the through rates are usually, but not always, interstate rates, and local rates are usually intrastate; but not infrequently, as when great cities are contiguous to state lines, such local rates are interstate. As to the comparative cost of local business as compared with through business, see South Dakota Rate Case, 176 U. S. 167, 44 L. Ed. 417, and the Minnesota Rate Case, 186 U. S. 257, 46 L. Ed. 1151. In the latter case it was claimed by the carrier that the sum of two admittedly reasonable local rates could not be unreasonable as a through rate between two designated points. But the court said that the practice of railroads in this country was almost universally to the contrary, the through rate being almost invariably less than the sum of the locals. See also discussion of through and local rates in Augusta S. R. Co. V. Wrightsville, 74 Fed. 522 (1896). The commission has discussed this distinction in a number of cases, and has uniformly held that the through rate should be less than the sum of the local rates. 3 I. C. C. 252, 2 Int. Com. 604; 8 I. C. C. 377; 9 I. C. C. 17; 7 I. C. C. 323; 6 I. C. C. R. 488. Through rates and through billing are matters of agree- ment among carriers engaged in interstate commerce, except- ing where established by order of the commission; and when they have been established and entered or finally abrogated or changed they are required by the statute to be kept open for public use. See infra, sec. 6, and 9 I. C. C. 182. Through rates are not required to be made on a mileage basis nor local rates corresponding with the division of a joint through rate over the same line. Mileage, however, is usually an element of importance, and due regard to distance and proportions are to be observed in connection with other considerations. They are material in fixing transportation charges. 3 I. C. C. 252, 2 Int. Com. Rep. 604; 8 I. C. C. 377. A rate is none the less a through rate in law, because the initial carrier charges its local rate as part of the through rate, § 209] THE INTERSTATE COMMERCE ACT. 325 and the remaining lines charge an agreed rate made by per- centage. While there is no mileage requirement in the act other than what may be required in the long and short haul rule in sec. 4 and the general requirement of reasonableness, as a rule in the transportation of freight of railroads, while the aggregate charge is continually increasing the further the freight is carried, the rate per mile is constantly growing less, making the aggregate charge less in proportion every hundred miles after the first, arising out of the character and cost of the service; and thus staple commodities and merchandise are enabled to bear the charges from and to the most distant portions of the country. 1 I. C. C. 480 and 1 Jnt. Com. Rep. 764; 2 I. C. C. 315 and 2 Int. Com. Rep. 199. On this gen- eral rule as to local rates, 3 I. C. C. 450, and 2 Int. Com. Rep. 721; 1 I. C. C. 152 and 1 Int. Com. Rep. 356; 6I.C.C.488;8 I. C. C. 277; 2 I. C. C. 584, and 2 Int. Com. Rep. 414; 7 I. C. C. 323. This admitted right of carriers to fix through rates on a lower relative basis than local rates has led not only to the allowance of the through rate for commodities manufactured enroute, as in milling in transit and compressing in transit privileges, but also to illegitimate devices to secure such lower through rate. See milling in transit, infra, sections 2 and 3 of the act. While the commission has uniformly said that the through rates should not exceed the sum of the locals, it has made no general rule on the subject, see 12 I. C. C. 498; and each case must be disposed of upon its merits. § 209. Reasonableness in commutation rates. — In what is known as the Commutation Rate case (21 I. C. C. 428), the commission in an interesting opinion considered the origin and history of commutation fares and the distinction between such traffic and other passenger traffic, and reached the conclusion that the commutation traffic stands by itself as a special and distinct kind of service for which the carrier may demand no more than a reasonable compensation. The case involved the commutation rates on the different rail- roads doing a commutation business in the vicinity of New 326 THE INTERSTATE COMMERCE ACT. [SECTION 1 York. All the railroads denied the authority and jurisdic-- tion of the commission over the reasonableness of commuta- tion fares, basing their contention on the language of sec- tion 22 of the act, which provides that "nothing in the act shall prevent * * * the issuance of mileage, excursion and com- mutation passenger tickets." It was admitted, however, that such fares was subject to sections 2, 3 and 4 of the act. The commission said that commutation rates were pecuUar, in that suburban homes had been established and communities built up in reliance upon reasonable commutation service. The commission reached the conclusion that while the serv- ice was peculiar, it was a special and distinct kind of service for which the carrier could demand no more than a reason- able compensation. The new commutation fares of .the Pennsylvania Railroad Company were held to be excessive, but those of the other railroads were not found to be un- reasonable, except in particular cases specified. § 210. Relation of interstate to state rates. — The re- lation of the interstate to state rates, where the carrier is doing business with the same track and equipment under the regulations of two sovereignties in our complex form of gov- ernment, has been considered, see supra, Part I, Chapter VII. The act to regulate commerce contains no provision, whereby interstate rates must be reduced because intrastate rates are lowered by state commissions (7 I. C. C. 601); nor are state rates required to be lowered because of the reduction of interstate rates. It was said by the commission (15 I. C. C. 29) that no greater sanctity is presumed in favor of rates established by state railroad commissions than of those vol- untarily established by the carriers themselves ; but when the commission is asked to examine an interstate rate, similar rates estabhshed by state authority in that territory must have great influence, especially when they have been long acquiesced in by the carriers. (14 I. C. C. 376.) Still, those state rates have no binding force upon the commission. They are standards of greater or less value, according as they ap- pear to be just and reasonable. As to the competitive effect of state imposed rates upon interstate traffic, and the rulings of the federal circuit courts thereon, see Part I, supra, §119. § 21 1] THE INTERSTATE COMMERCE ACT. 327 In the absence of a finding by the Interstate Commerce Commission that the state rates operate to effect a discrim- ination in interstate commerce, the provision of this act is in force, and the state rates cannot be disturbed by the fed- eral power. But when there is such finding of discrimination in interstate commerce the federal power controls. See Min- nesota and Shreveport rate cases, supra. § 211. Rates as affected by the development of the country. — In a rapidly developing territory, the changed conditions created by the growth of population and business may necessitate changes in rates to meet these altered con- ditions. This has been illustrated in the recent rulings of the commission reducing the Interstate Class Rates from Seattle, Tacoma and Portland to Idaho, Washington and Montana, 19 I. C. C. 265; and also the rates between Mississippi river and Missouri river to Utah points, 19 I. C. C. 218. See also 19 I. C. C. 238, where points in the western defined ter- ritory to points in Nevada were unreasonable. Some of these cases involved the long and short haul rule, see fourth section, infra. Rates to the coast had been fixed by water com- petition, and the rates to the interior were made by ad- ding locals to these through rates. The commission said in 19 I. C. C. 238, that the manufacturing center of the country had moved westward, and the Atlantic routes which were once necessitated are now almost unused. The commission said the time had come in their opinion when the carriers west of the Rocky Mountains must treat the intermountain country upon a different basis from that which had theretofore obtained. See also 19 I. C. C. 162, ruling the rates from Spokane to St. Paul and Chicago unreasonable. See 15 I. C. C. 376. These cases involve not only the reasonableness of the rates per se, but also the alleged preference in violation of sections 3 and 4, infra. A high interstate rate may be justified by the exceptional conditions of the country through which it operates. Thus, in 30 I. C. C. 488, the commission held that a rate of 6| cents per mile of the Eureka Springs R. R. Co., extending from Sehgman, in the state of Missouri, to Eureka Springs, Ar- 328 THE INTERSTATE COMMERCE ACT. [SECTION 1 kansas, was not unreasonable, as it was operating through a mountainous and sparsely settled country and was earning less than its taxes and cost of operation. The rate had been originally 10 cents a mile and was ordered reduced in 7 I. C. C. R. 69 to 6| cents. The commission said the fact that the aggregate intermediate fares prescribed by state authority not voluntarily accepted or used in making interstate fares were less than the through interstate fares, was not a viola- tion of the act. § 212. The Supreme Court on the considerations ad- missible in fixing rates. — In Interstate Commerce Com- mission V. Union Pacific R. R., 222 U. S. 542, 56 L. Ed. 308 (1912), where the court reversed the decree of the circuit court in enjoining the enforcement of an order of the com- mission in reducing lumber rates in Minnesota, it was claimed that the commission ordered the reduction in the rates be- cause of the effect upon the lumber industry of a rate ad- vance. But the Court said that an examination of the rec- ords showed that the order was not made because of the effect of the advance on the lumber industry, but that it appeared that the commission confined itself to the exercise of its statutory powers in fixing rates, as it said that the contro- versy could not be decided wholly upon the ground that complainants had enjoyed the lower rate for many years and that interests had been built up thereunder. In the case of Interstate Commerce Commission v. L. & N. R. R. Co., 227 U. S. 88, 57 L. Ed. 431, (1912) where the Court reversed the Commerce Court, 199 Fed. 541, which annulled an order of the commission reducing rates from New Orleans to other points, while the Court did not weigh the evidence, the Court found that the commission did consider substantial evidence, such as the company's financial statements, and general tariff sheets, and the fact that for many years prior thereto the carrier had maintained low local rates which were abnorm- ally low because compelled by water competition and there- fore furnished no just standard of reasonableness, but that this water competition had disappeared. The Court said that this was substantial evidence of which the commission had the right to judge, and the court would not interfere with its conclusion. §215] THE INTERSTATE COMMERCE ACT. 329 § 213. The commission on the interdependence of rates. — The commission has also considered the position of strong companies with good credit and weak companies with embarrassed credit, competing for business between the same points, and it was held that it would be unjust to the shipper to base rates upon the needs of the weaker road. In 11 I. C. C. 238 (1905), in an investigation of the class and commodity rates from St. Louis to Texas points, it declined to interfere with the advance made by the railroads, on the ground that their financial condition at that time was not favorable. It was said in the Utah cases, 19 I. C. C. 218, where expensively built mountain roads were under consideration, that in fixing a rate the commission would not look exclusively to that line which could handle the business cheapest or which was the strongest financially, but would consider the weaker rival ; but it did not consider that the rates should be fixed with reference to the weakest line, and it would certainly be un- just to the pubhc in deciding these rates to consider merely the expensive and circuitous routes. § 214. No vested interests in rates. — In 30 I. C. C. 36, the commission said that the protestants against the pro- posed increase of rates had made large investments in indus- trial plants on the line of the railroad, and they contended that these investments were dependent on the present rates being maintained, and that it would injure these enterprises if the rate was increased; and the commission was thereby precluded, it was claimed, from authorizing higher rates. The commission said it had been often held that shippers had no interest in rates by reason of contracts or by reason of investments made under the existing rates, and that such considerations alone would not preclude the raising of the rates, if the same were found unreasonably low. See also 29 I. C. C. 136, and the Southern Pacific case, 219 U. S. 433-450. 55 L. Ed. 283 (1910). § 215. Reasonableness of rates as dependent on character of the traffic. — The commission has uniformly recognized that the character of the traffic is material in determining the rates, and that the rates must be varied 330 THE INTERSTATE COMMERCE ACT. [SECTION" 1 according to the value of the commodities as well as the cost of handling and the degree of risk to the carrier. Thus to make the rates on metals, coal, and other low grade freights yield per ton the average received on all freight would be unjust, and these considerations are the basis of classification. See infra, section 3. Thus coal is one of the most desirable kinds of traffic, with a small hazard of loss, and the cost of receiving and delivering is less than that of most other kinds of freight, and at the same time it is an article of universal necessity in daily life and the basis of industries. See 10 I. C. C. 337. In 14 I. G. C. 23, the commission said that lumber was a low grade commodity and should move at low rates, espe- cially when the haul is long, as it moved in large quantities, was loaded by the shipper and unloaded by the consignee, was shipped in both closed and open cars, was loaded to a high economic car load rate, didn't require special or ex- pedited movement, was not easily injured in transit and caused few damage claims. In such commodities it is also true that their comparatively low value as compared with weight necessitated low rates to enable them to be carried any distance. On the other hand, the increased hazard to the carrier in transporting live stock is properly taken into account in fixing the tariff. 10 I. C. C. 327. See also 5 I. C. C. 514 and 4 Int. Com. Rep. 223; 6 I. C. C. 488. In 33 I. C. C. 109, (1915) the commission said in fixing a reasonable rate for the transportation of saw logs, that they were a low grade commodity, the transportation of which for long distances will not always be logical or practicable, and that the carrier has discharged its duty in this respect under the law when it has accorded reasonable and non-discrimina- tory rates. If the nature and value of the commodity offered for transportation is such as to demand an unreason- ably low rate, there is no lawful obligation upon the carrier to meet this demand. In the circumstances to be considered are all questions bearing upon the cost of service by the carrier, including any special services rendered the shipper, such as rapid transit and increased cost of handling. 2 I. C. C. 73 and 2 Int. Com. Rep. 49. §216] THE INTERSTATE COMMERCE ACT. 331 Greater value alone is not conclusive of the reasonableness of a higher rate of freight on a given article than upon another commodity of the same general character, especially when the incidents of transportation are identical, 21 1. C. C. 522. § 216. Distance as a factor in rates. — The commission has uniformly ruled that distance is an important factor in de- termining the reasonableness of rates and ordinarily the standard, but not always controlling. It has been said to be controlling in the absence of other influential conditions. 7 I. C. C. 180. Distance by the shortest route has been fre- quently considered in determining the rate on another and competing line, and the distance by the shortest available route has been taken as a basis of differentials in grain rates. 7 1. C. C. 481. When the act to regulate commerce was before congress, the mileage bases for rates was suggested but not adopted. The commission said in I. C. C. 629, 2 Int. Com. Rep. 9, that the fact that the rates were not fixed on a mileage basis does not necessarily make them either illegal or unjust, and the commission has no power to make an order requiring the adoption of such a basis. See also 2 I. C. C. 52, 2 Int. Com. Rep. 41. Where rates seemingly reasonable are made by a number of carriers in a widely extended territory and are relatively fair so far as the evidence shows, the commission will not order these rates changed at one important point, thereby throwing the rates of the entire system into confusion foi; the purpose of conforming to the mileage basis. 2 I. C. C. 315, 2 Int. Com. Rep. 199. For illustration of the blanketing of rates in a considerable territory securing substantial equality between producing points and markets, and the denial of the contention for rates based upon distance, see 17 I. C. C. 169. The commission has refused to change rates reasonable in themselves to equalize commercial conditions, or to enable cities to secure traffic from their own territory, 6 I. C. C. R. 195; as rates cannot be fixed to overcome natural advantages, or for the purpose of equalizing commercial conditions. See pref- erences as to communities, infra, § 276. 332 THE INTERSTATE COMMERCE ACT. [SECTION 1 The rule of increased aggregate rate and decreased rate per ton per mile as distance increases, while general, is subject to qualifications and exceptions. 9 I. C. C. 17. Charges are not proportion to distance where distances are considerable and the distances between the points relatively small. 5 I. C. G. 264 and 4 Int. Com. Rep. 65. As to grouping of rates, see infra, section 3. § 217. The commission on comparison of rates. — Rates reasonable in one section of the country may be un- reasonable in another. 6 I. C. C. 121. There is no necessary connection between rates on traffic of the same kind or class in one direction and rates in the opposite direction, as special circumstances, such as flow of traffic, may justify higher rates in one direction than in the other; especially is this the case where the distance is of great length. 6 I. C. C. 121, 9 I. C. C. 642. The share of a through rate is not necessarily the measure of a reasonable rate, but is properly used as a basis of comparison in determining its legality, 6 I. C. C. 458; and the apportionment of through rates to the different parts of the through line may be significant of the question of the reasonableness of the through rate. 2 I. C. C. 131, and 2 Int. Com. Rep. 78. Local rates are not properly compared with through rates. 1 I. C. C. 401, 1 Int. Com. Rep. 703; 3 I. C. C. 534, 2 Int. Com. Rep. 778. Where a railroad owned two parallel lines, it was ruled that having accepted low rates on one of them, it should have provided corres- ponding advantages to the patrons of its other lines, allow- ances being properly made for any differences in conditions. 4 I. C. C. 79 and 3 Int. Com. Rep. 115. In comparison with rates in other localities, dissimilar con- ditions and modifying circumstances are to be considered. § 218. Reasonableness of rates as relating to cost of service and needs of the shipper. — ^The general considera- tions of public policy relating to the cost of production of the commodity and the needs of the shipper on the one hand, and the circumstances and financial condition of the carrier, such as are involved in the cases before courts relating to interstate traffic, have been considered by the commission in several §218] THE INTERSTATE COMMERCE ACT. 333 cases, notably in the report to the senate in 1890 in response to a resolution of the senate calling for such report, on the alleged excessive freight rates and charges on food products. 4 I. C. C. 48, 3 Int. Com. Rep. 93-151, and in the opinion of April 1, 1903, on the proposed advance in freight rates. 9 I. C. C. 382. Thus the circumstances of the carrier, its operating expenses, cost of transportation, grades, destiny or sparseness of population, volume of business, book charges, dividends, are all properly considered but are not controlling. See 2 I. C. C. 375, and 2 Int. Com. Rep. 289; 3 I. C. C. 473, and 2 Int. Com. Rep. 742; 6 I. C. C. 601. See also 2 I. C. C. 272, and 2 Int. Com. Rep. 162. In the Spokane and Coast Rate Cases, 15 I. C. C. 376, in 1909, the commission ruled that the distribution of new stock of the Great Northern Railroad among the holders at par, though the market value was above par at the time of dis- tribution, had no bearing upon the earnings to which the company was entitled, or on the rates which were under question. It was ruled, however, that the earnings on the railroads were excessive, and the freight rates were ordered reduced. The opinion in this case has an exhaustive review of the history and capitahzation of the railroad with a discus- sion of the relation of coast and inland rates. See also 9 I. C. C. 318. The capitahzation of a railroad, the commission has said, to have consideration in cases involving the readjustment of rates, should be examined by the history of the capital ac- count, the value of the stock and various securities and the actual cost and the value of the property itself, as the making of the capital account alone the basis of legitimate earnings would place, as a rule, railroads conservatively managed and capitalized at an enormous disadvantage. 8 I. C. C. 158. But the circumstances of the carrier and its financial interests are not alone to be considered. 9 I. C. C. 160. While the expense of operation, liability to damage from sand drifts, etc., and the requirement of a return upon the investment of the carrier, are considered, the financial necessities of the carrier do not justify excessive rates. Railroads are en- titled to share in the general prosperity of the country, but the cost of replacement and of new construction should not 334 THE INTERSTATE COMMERCE ACT. [SECTION 1 be charged to earnings and cost of operation so as to diminish net earnings and cause an advance of rates. 9 I. C. C. 382; 5 I. G. C. 156, and 3 Int. Com. Rep. 794. Rates on the lines of rival companies or different branches of the same company are properly considered. 6 I. C. C. 121, I. C. C. 325, 1 Int. Com. Rep. 641, 6 I. C. C. 195; as also rates to contiguous points on same line. 2 I. C. C. 588, 2 Int. Com. Rep. 412. On the question of reasonableness, it is immaterial whether the railroads combine or act separately. 2 I. C. C. 375, 2 Int. Com. Rep. 289. And an increase of rates for the purpose of securing certain lines of traffic from territory set apart to railroads under an agreement is prima facie unreasonable. 6 I. C. C. 195. § 219. Reasonableness and proportion. — It was said by the commission in an opinion by its chairman. Judge Cooley, in an early case, 2 I. C. C. 231, and 2 Int. Com. Rep. 137, that the phrase "rates reasonable in and of them- selves" was very likely to be. misleading, and that it was not the theory of the act that reasonableness of rates could thus be separately and independently determined. On the contrary, it is assumed in the act that persons, cor- porations and localities are interested not only in the rates charged them, but in the rates which are charged to others also, and that while the act does not require all rates to be proportionate, it nevertheless makes proportion an important element when the rates to any locality are to be determined. No rates therefore can be reasonable in and of themselves, in contemplation of the act, which are made regardless of pro- portionment. And in another case it was said (3 I. C. C. 534, and 2 Int. Com. Rep. 777) : "The terms 'reasonable and just' as used in the statute, as applied to rates are each relative terms. They do not mean to imply that the rates on every railroad employed in interstate commerce shall be the same or even about the same. The conditions and circumstances of each road surrounding the traffic, and which enter into and control the nature and char- acter of the service performed by the carrier in the trans- portation of property, such as the cost of transportation, which includes volume or lightness of traffic, expense of con- § 220] THE INTERSTATE COMMERCE ACT. 335 struction and operation, competition in some respects of carriers not subject to the law, rates made stiorter and com- peting lines to same points of destination, space occupied by freight, and risk of carriage, — all have to be considered in dermining whether a given rate is reasonable and just." Tested by these a rate may be very reasonable and just to one road, and not as to another. As to the complexity of the question of adjusting rates so as to make them at once reasonable per se and in proportion, see supra, § 136. § 220. The commission on rate wars and reason- ableness of rates. — In the matter of the Chicago, St. Paul & Kansas City Railway Co. (2 I. C. C. 231, 2 Int. Com. Rep. 137), the commission in an opinion by Judge Cooley, con- sidered this subject under an application for alleged violation of the fourth section of the act, and said that the act was not passed to protect railroad corporations against the miscon- duct or mistakes of their officers, or even primarily to protect such corporations against each other, and that the term "just and reasonable" is employed to establish a maximum limitation for the protection of the public, not in minimum limitation for the protection of reckless carriers against their own action. The commission conceded that there was evidence that in many cases railroad companies temporarily established rates, which were not only below the fair com- pensation for their services, but if persisted in were destruct- ive of their own interests as well as of the interests of its rivals; but carriers that made such unreasonably low rates were giving the public to understand that those rates were reasonable and remunerative and were doing very much to estabhsh against themselves a low standard of rates for all time. The commission held that it had no power to order rates to be increased upon the ground that they were so low that persistence in them would be ruinous. This ruling was cited and approved by the Supreme Court in the Maximum Rate case, 167 U. S. 511, 1. c, 42 L. Ed. 257, the Court saying that the argument showing that the commission had no power to fix a minimum or establish an absolute ratio went also to show that they had no power to fix any rate to control in the future (under the act prior to amendment of 1906). 336 THE INTERSTATE COMMEECE ACT, [SECTION 2 Section 2. 221. Section 2. Unjust discrimination defined and forbidden. 222. Origin of the Section. 223. Purposes of the Section. 224. Effectiveness of the Section. The act of February 19, 1903. 225. Common law as to discriminations. 226. Just and unjust discrimination at common law. 227. Discrimination in charge based upon differences in service not discriminative. 228. The meaning of "rebate" in the section. 229. Circumstances and conditions of through traffic and local traffic are dissimilar. 230. Competition of carriers does not make circumstances dissimilar under section 2. , 231. The party rate case. 232. . Wholesale and retail rates in freight traffic. 233. Wholesale rates in freight and passenger traffic distinguished. 234. Discrimination not unjust when based on special service. 235. Carload and less than carload rates. 236. Discrimination in application of carload rates. 237. The Supreme Court on forwarding agents in carload rates. 238. Discrimination in carload rates. 239. Cargo rates discriminative. 240. Different forms of discrimination. 241. Discrimination in restricted rates. 242. Discrimination through industrial tap lines and plant facilities. 243. Discrimination through interest in connecting company. 244. Control by commission of Division of Joint Rates to Prevent Discrimination. 245. Allowance to short lines of railroads serving industries. 246. Discrimination by carrier in favor of itself as a shipper. 247. Discrimination in storage of goods, etc. 248. Stoppage in transit privileges. 249. Unjust discrimination through abuse of stoppage in transit privileges. 250. Unjust discrimination in passenger service. 251. Discrimination in rating of Sunday magazines. 252. Giving passes to shippers prohibited. 253. Unjust discrimination in telephone service. 254. Application of the section. 255. Retention of overcharge. 256. Enforcement of the section. 257. Connecting carrier not responsible for discrimination by initial carrier. 258. Effect of rebates upon contracts of affreightment. 259. Discrimination in allowance to private transfer companies. § 222] THE INTERSTATE COMMERCE ACT. 337 [Unjust discrimination de6ned and forbidden.] § 221. — Sec. 2. That if any common carrier subject to tJie provisions of this act shall, directly or indirectly, by any special rate, rebate, drawback, or other device, charge, de- mand, collect, or receive from any person or persons a greater or less campensation for any service rendered, or to be ren- dered, in the transportation of passengers or property, sub- ject to the provisions of this act, than it charges, demands, collects, or receives from any other person or persons for doing for him or them a like and contemporaneous service in the transportation of a like kind of traffic under substan- tially similar circumstances and conditions, such common carrier shall be deemed guilty of unjust discrimination, which is hereby prohibited and declared to be unlawful. § 222. Origin of the section, — This section has not been amended. It was said by the Supreme Court in the Texas & Pacific Railway case, 162 U. S. 197, 1. c. 219, 40 L. Ed. 940, to have been modeled upon section 90 of the Railway Clauses Consolidation Act of 1845, 8 & 9 Vict. ch. 20, the first EngUsh statute regulating railways. This section is as follows: "Sec. 90. And whereas it is expedient that the company should be enabled to vary the tolls upon the railways so as to accommodate them to the circumstances of the traffic, but that such power of varying should not be used for the purpose of prejudicing or favoring particular parties, or for the pur- pose of collusively or unfairly creating a monopoly, either in the hands of the company or of particular parties; it shall be lawful therefore, for the company, subject to the provisions and limitations herein and in the special act contained, from time to time to alter or vary the tolls by the special act au- thorized to be taken, either upon the whole or upon any par- ticular portions of the railway, as they shall think fit; pro- vided that all such tolls be at all times charged equally to all persons, and after the same rate, whether per ton, per mile, or otherwise, in respect to all passengers, and of all goods or carriages of the same description, and conveyed or propelled by a like carriage or engine, passing only over the same portion of the line of railway under the same circum- stances, and no reduction or advance in any such tolls shall be made either directly or indirectly in favor of or against any particular company or person traveling upon or using the railway." This section of the English law, known as the equality clause, differs from section 2 of the American act in the words J-22. 338 THE INTERSTATE COMMERCE ACT. [SECTION 2 "passing only over the same line of railway under the same circumstances," which impart a very different meaning as construed in the English courts from the words "under sub- stantially similar circumstances and conditions" found in the American act. The English section as construed by the English courts was confined in its operation to shipments passing only over the same portion of the line between the same points of departure and the same points of arrival. See M. S. & L. Ry. Co. v. Denby Main Colliery Co., 4 Rail- way & Canal Traffic Cases, p. 452; Murray v. G. & S. W. Ry. Co., 4 Railway & Canal Traffic Cases, p. 460; Denaby Main Colliery Co. v. M. S. & L. Ry. Co., 6 Railway & Canal Traffic Cases, p. 141; L. & Y. Ry. Co. v. Greenwood, Law Reps. 21 Q. B. Div. pp. 217 and 218. It appears from a statement made in the debate in congress by Senator Sherman, on May 14, 1887, that the words "and from the same original point of departure or from the same point of arrival" were at one time contained in section 2, but that these words were taken out by the conference committee, and the words "under substantially similar circumstances and conditions" adopted in lieu thereof. So that discriminations are "unjust" and violative of this section: first, when the servicQ is like and contemporaneous; second, when it is rendered in the transportation of a like kind of traffic, and third, when the service is rendered under substantially similar circumstances and conditions. That is, all three of these conditions must concur. § 223. Purpose of the section. — The purpose of this second section is the prevention of unjust discrimination be- tween shippers by any form of device. It was said by the commission in its report on its investigation of the subject of "underbiUing," 1 I. C. C. 633, and 1 Int. Com. Rep. 813, that the enumeration in this section of special rates, rebates, drawbacks and other devices showed the methods of favoritism which were presented most distinctively to congress in framing the act, and added: "The investigation which preceded the passage of the act had disclosed the fact that preferences were frequent, in fact were almost universal." The commis- sion quoted from the report of the senate committee to the § 224] THE INTERSTATE COMMERCE ACT. 339 effect that the prevaUing pohcy of railway mangement is but an elaborate system of special rates, rebates, drawbacks and concessions to foster monoply, to enrich favored shippers and to prevent free competition in the many lines of trade in which the item of transportation is an important factor. The commission said that the act was prepared accordingly with these evils directly in view. The section has been construed both by the commission and by the courts, in recognition of these evils which con- gress intended to remedy. The Supreme Court said in Wight V. United States, 167 U. S. 512, 42 L. Ed. 258, that the section was designed to compel every carrier to give equal rights to all shippers over its own road and to forbid it by any device to enforce higher charges against one than another. In another case. Union Pacific Railway Co. v. Goodrich, 149 U. S. 680, 37 L. Ed. 896, the Court said in construing a Colorado statute similar in terms, that the purpose of the Colorado statute was to apply to intrastate traffic the same wholesome rules and regulations which congress thereafter applied to commerce among the states, and to cut up by the roots the entire system of rebates and discriminations in favor of particular localities, special enterprises and favored corporations, and to put all shippers upon an absolute equality. This section 2, however, does not deal with discriminations between and preferences in favor of or against localities, or with discriminations between kinds of traffic, which are dealt with in the succeeding section, but only with discriminations between shippers of the same kind of traffic, that is, where the service is in the transportation of a like kind of traffic "under substantially similar circumstances and conditions." § 224. Effectiveness of the section. The act of Feb- ruary 19, 1903. — The effectiveness of the act is more dis- tinctly expressed in the second section than in any other. The reasonableness of rates remains as complex and indefinite a problem as when the act was passed, and as will be here- after seen, the anticipated prevention of the building up of trade centers to the prejudice of smaller towns has proven 340 THE INTERSTATE COMMERCE ACT. [SECTION 2 impossible of realization in the face of controlling competi- tion, but on the question of discrimination between individ- uals, or classes of individuals in the same kind of traffic, the rulings of the court have been in the main in harmony with those of the commission. It may be said further, that the evils prohibited in this section are recognized by railway managers, so that they have in the main co-operated with the commission in their efforts for their suppression. Thus the commission said in its first annual report, 1887, in reviewing the operation of the act for the first eight months in which it was in force, that it was justified in saying that the act had operated directly to increase railroad earnings by putting an end to rebates, drawbacks and special rates upon freight business, a result which was also found to be eminently satisfactory to the general public; and the investigations of the commission had not as yet disclosed the existence of unjust discriminations resulting from the use of those par- ticular methods of preference in interstate traffic. "On the contrary, a vast number of instances have been found where special rates, rebates and drawbacks have been discontinued, and where preferences and advantages which were formerly thereby given, have been terminated." In the intense competition of business, new devices for se- curing discriminating freight rates have been eagerly sought, and it appears from the subsequent reports of the commission that while discriminations are less openly given, the evil was far from being suppressed, particularly in the use of private cars in freight traffic, in the division of rates with terminal railroads owned or controlled by shippers and in other devices. See report of 1904, pages 12 to 19, and 10 I. C. C. 385, 10 I. C. C. 450. The act of February 19, 1903, commonly known as the Elkins bill, has very materially enforced this section. This law, infra, § 519, requires carriers in all cases to pub- lish their tariffs and prohibits "any practice on the part of the carriers whereby any such property shall by any in the tariff * * * qx whereby any other advantage is given or discrimination practiced." Under this amendment the practice of secret rebates from published rates, though made to all "similarly circumstanced" is made unlawful. §225] THE INTERSTATE COMMERCE ACT. 341 § 225. Common law as to discriminations. — It was said of the first section, as to the obligation to charge reason- ably, that it was only a reaffirmation of the common law. This can be said only in a qualified sense of the obligation to charge equally imposed by the second section. In the Party Rate Case, 145 U. S. 271, 36 L. Ed. 703, the Supreme Court said that at common law it was even doubted whether carriers were bound to make the same charge to all persons for the same service, although the weight of authority in this country was in favor of equality of charge to all persons for similar service. Several cases have held that while it was elementary, that common carriers could charge no more than a reasonable compensation, the mere discrimination in rates was not illegal. If a rate charged one party was reason- able, he could not complain if another was charged a less rate ; though the fact that another was charged less might be material as evidence for the jury tending to prove that the reasonable charge was the smaller one. Mr. Justice Black- burn in Great Western Railway Co. v. Sutton, L. R. 4 H. L. 238; Johnson v. Pensacola, etc. Co., 16 Fla. 623. In Cowden V. Pacific Coast Steamship Co., 94 Cal. 470 and 18 L. R. A. 221, (1892) the court intimated that it was because the com- mon law was not clearly settled on this point that it was necessary for parliament to enact the stringent equality clauses, and that there was a lack of direct authority in this country for the reason that common carriers, especially railway companies, had been placed entirely under the control of statute laws. On this question of the right of discrimination at common law, see Ex parte Benson, 18 S. C. 38; Baxendale v. Railway, 4 C. B., N. S. 63. In the latter case, in 1858, it was said that though a carrier was limited to a reasonable charge, there was no common law obligation to charge equal rates to all customers. It followed that he could discriminate in the purpose of securing traffic, which would otherwise go by another route. Ragan v. Aiken, 9 Lea (Tenn.), 609 (1882.) In Menacho v. Ward, 27 Fed. 529 (S. D. of N. Y.), (1886), the court, Wallace, J., conceded the right to discriminate, and said the courts had always recognized the rights of carriers to regulate their charges with reference to the quanti- 342 THE INTEESTATE COMMERCE ACT. [SECTION 2 ties of merchandise carried for the shipper, either at a given shipment or in a given period of time, although, said the court, pubUc sentiment in many communities had objected to such discrimination and had crystahzed into condemnation of the practice. The court however refused to apply this principle to the case where the carrier (a steamship com- pany), sought to make a discriminating rate in order to prevent competition, that is, by charging a higher rate to those who refused to patronize it exclusively. See also later cases decided by the same court after the passage of the Interstate Commerce Act. Thus in United States v. D. L. & W. R. Co., 40 Fed. 101 (1888), it was said that the Interstate Commerce Act had qualified materially common law rights and obligations of carriers. That at common law the carrier was not obliged to treat all who patronized him with absolute equality, and that discrimina- tions were only unreasonable, when they inured to the undue advantage of one person, or class of persons in consequence of some injustice inflicted on another. See also the same court in Interstate Commerce Commis- sion V. Texas & Pacific R. Co., 52 Fed. 187, (1892). § 226. Just and unjust discrimination at common law. — The right of discrimination at common law was not unlimited, and the general statement found in some of the opinions that the carrier had the right at common law to con- sult its own interests, was qualified by the distinct recogni- tion, especially in the latter cases, that this discrimination must be exercised within the limits of fairness and impar- tiality in view of the public duty owing by the carrier. See C. C. C. & I. R. Co. V. Closser, 126 Ind. 348 and 9 L. R. A. 754, (1890). There is an obvious difficulty in the application of this principle in cases, where the discrimination is sought to be justified on the ground of securing traffic which would not otherwise be secured, and in thus making concessions to large shippers, thereby giving them a distinct advantage over their competitors. The trend of the later cases, both in the federal and state courts, irrespective of the Interstate Commerce Act, dis- tinctly condemns discrimination based solely on the ground § 226] THE INTERSTATE COMMERCE ACT. 343 of the quantity of the freight shipped, as contrary to sound pubhc policy and inconsistent with the obUgations of the carriers to the pubhc. Thus in B. C. R. & N. R. Co. v. Northwestern Fuel Co., 31 Fed. (Iowa) 652, (1887) the Cir- cuit Court, Brewer, J., held that at common law a contract whereby a railroad company made a rate of $1.60 per ton to all shippers of 100,000 tons per month or over, with a rate of not less than |2.40 per ton to those shipping less than 100,000 tons per month, was so arbitrary and obviously in the interest of capital as to be contrary to public policy and void, though it was not distinctly decided that any discrimi- nation based upon the amount of shipments was permissible. In another case. Handy v. C. & M. R. Co., 31 Fed. 689, S. D. of Ohio (1887), Baxter, J., removed the receiver of a rail- road for making a discriminating rate in favor of the Standard Oil Company of ten cents a barrel while charging a rival ship- per thirty-five cents a barrel and agreeing to pay the twenty- five cents per barrel excess thus received over the Standard Oil Company. This discrimination was sought to be justified because the Standard Oil Company had threatened to store its oil until it could lay a line of pipes, unless the receiver should give such rates. The court said this was such gross and wanton discrimination as to warrant the removal of the receiver, although he had acted under the advice of counsel for what he deemed the protection of the interests of the railroad, and it did not appear that the money received from the rival shipper had been paid over to the Standard Oil Company. In Hayes v. Pennsylvania Co., 12 Fed. 309, (1882), on common law principles before the enactment of the Interstate Commerce Act (Dist. of Ohio) Judges Baxter and Walker it was held that discriminations based solely on the amount of freight, shipped without reference to any conditions tending to decrease the cost of transportation, were discrimi- nations in favor of capital, and were a wrong to the disfavored party, entitling him to recover the difference between the amount paid by him and that paid by the favored competitor. The court in its opinion distinguished the case of Nicholson v. Great Western Railroad Co., 28 L. J. C. P. 89, as in that case there was an undertaking to furnish a specific quantity of 344 THE INTERSTATE COMMERCE ACT. [SECTION 2 freight within a stated period. The court said in the Hayes Case, however, that while this EngUsh case was clearly distinguishable, future experience might possibly call for a modification of the principle there announced. This decision was approved in Kinsley v. B. N. Y. & P. R. R. Co., 37 Fed-. 181, (1888), where the receiver of a railroad was directed to pay the claim for money exacted for freight, when a lower rate was charged to another shipper who shipped larger quantities of freight. On the other hand, there is a class of cases where a reduced rate in consideration of the amount of shipment, where the shipment was attended with decreased expense to the carrier, was sustained, as was Hoover v. Pennsylvania, 156 Pa. 220, and 22 L. R. A. 263 (1893), and L. & N. ConsoUdated R. Co. V. Wilson, 132 Ind. 517, and 18 L. R. A. 105 (1892). In the Pennsylvania case cited, the Pennsylvania Constitution prohibited discriminations in somewhat the same terms as section 2 of the Interstate Commerce Act, and the court held that the carrier had a right to discriminate in rates on coal in favor of a manufacturer, saying: "Differences in freight rates on coal to manufacturers and mere dealers are and have been for many years in universal practice, and not a single case other than this has reached the courts of last resort, either in England or in this country, questioning the entire propriety and legaKty of such dif- ferences, and that circumstance is ample proof that both the professional and the lay mind recognize that the difference is legal." The court cited in this case the decision of the supreme court of the United States in the Party Rate Case, infra. In Evershed v. London & Northwestern R. Co., L. R. 3 Q. B. D. 135, (1877) the court conceded that a large business could be done at a cheaper rate than a small one, and that speaking generally, it was open to the railway company to make a bargain with a person provided they were willing to make that same bargain with another, although that other was not in a position to make it. In this case, however, it was held that a gratuitous carting, loading and unloading, by a railroad company for three firms of brewers in order to get their business, was an unjust discrimination against another § 227] THE INTERSTATE COMMERCE ACT. 345 brewer in the same place, the three being connected with another railway while the complainant was not connected with either railway. On the other hand, the right to make any discrimination in favor of a shipper, where the ground of discrimination is based solely on the amount furnished for shipment, even when necessary to secure the traffic of the favored shipper, has been denied on the ground of public policy and the public duty of the carrier. See Scofield v. Lake Shore & Michigan Southern R. Co., 43 Ohio St. 571; State v. Railroad, 47 Ohio St. 130. In Hilton Lumber Co. v. Atlantic Coast Line R. R. Co., the supreme court of North Carolina, (1904) 60 C. L. J. 30, in a review of the cases, held that a railroad carrying raw material to factories could not charge a factory, agreeing to ship the manufactured product by the same road, less for the same service than it charged the factory which makes no such agreement, saying that discrimination was a more dangerous power than high rates, if the latter were charged impartially to all. It will be observed however that the facts of this case would permit the allowance of a through rate under the milling in transit principle, as recognized under the Interstate Commerce Act. See infra. As to other cases on the same general subject, see Fitchburg R. Co. V. Gage, 12 Gray, 393; Spofford v. B. & M. R. Co., 128 Mass. 326; Avinger v. So. Car. R. Co., 29 S. C. 265; Railroad Co. V. Forsaith, 59 N. H. 122; Chicago, etc. R. Co. v. Suffern, 129 111. 274; Atwater v. Railroad Co., 48 N. J. Law, 55; Cook V. C. R. I. & Pac. R. Co., 81 Iowa, 151, 9 L. R. A. 764. In this latter case the court held, that the allowance of a rebate by a carrier to certain of his customers, from the tariff rate charged other customers for precisely the same service was sufficient of itself to show that the rate charged was unreasonable and unjustly discriminative. See also Great Western R. Co. v. Sutton, L. R. 4 H. L. 238; Messenger v. Penn. Co., 37 N. J. Law, 531. § 227. Discrimination in charge based upon dif- ference in service not discriminative. — While therefore there has been a difference of judicial opinion as to what constitutes unjust discrimination, at common law, with a 346 THE INTERSTATE COMMEECE ACT. [SECTION 2 distinct trend towards a clearer recognition of the public duty of the carrier and the public policy of equality of charge, it is also recognized that a discrimination is not unjust when it is based upon a substantial difference in the mode and kind of service. Thus it was held by the Supreme Court of the United States in the case already cited as to the common law in the federal courts, Western Union Telegraph Co. v. Call Publishing Co., supra, that common carriers, whether engaged in interstate commerce or in that wholly within the state, were performing public service. "They are endowed by the state with some of its sovereign power, such as the right of eminent domain, and so by reason of the public service they render. As a consequence of this all individuals have equal rights both in respect to service and charges. Of course such equality of right does not prevent differences in the modes and kinds of service and different charges based thereon. There is no cast iron rule of uniformity which prevents the charge from being above or below a particular sum, or requires that the service should be exactly along the same lines. But that principle of equality does forbid any difference in charge which is not based upon difference in service, and even when based upon difference in service must have some reasonable relation to the amount of difference and cannot be so great as to produce an unjust discrimination." This was a case of alleged discrimination in telegraph rates which were then not subject to the Interstate Commerce Act. § 228. The meaning of "rebate" in the act.— This section prohibits a carrier from making any special rate, rebate, drawback, or other device, and the term "rebate" in this section clearly means an unjust discrimination. It was said by the C. C. A., third circuit, in American Sugar Refining Company v. Del. L. Sc W. R. Co., 207 Fed. 733 (1913), reversing 200 Fed. 652, that the word "rebate" as used in this section and elsewhere in the act, refers only to such a discount, deduction or drawback as creates a discrimination in favor of a particular shipper and against other shippers in like situation, and destroys that equality of treatment in rates which it is the policy of the law to en- § 229] THE INTERSTATE COMMERCE ACT. 347 force. The court said that the word "rebate" had an ety- mological meaning which included any discount or deduction from a stipulated payment, charge, or rate not taken out in advance of payment, but it was apparent that in the com- merce act the word was used in an offensive sense, and referred only to such discount, deduction or drawback as is the basis of a discrimination in favor of a particular person and against other persons in like situation. An undiscriminating rebate, said the court, is not a criminal offense nor in any way interdicted or denounced by the law. It was held in this case that a deduction of two cents per hundred pounds from the freight charge on sugar shipped in carload lots to certain terminal points allowed by the rate schedule filed and published by an interstate railroad carrier to cover cost of transfer from a refinery to the station, which was allowed to all shippers alike, regardless of the actual cost of such transfer, was not a rebate within the meaning of the interstate commerce act, nor a discrimi- nation within section 3, or otherwise in violation of the act, the net rate being the same to all shippers. In U. S. V. B. & 0. R. R. Co., 231 U. S. 274, 58 L. Ed. 218 (1913), the Supreme Court affirmed the commerce court, 200 Fed. 779, in enjoining the enforcement of an order of the Interstate Commerce Commission, (20 I. C. C. 200), re- quiring certain carriers to cease paying certain allowances to shippers, since these allowances were proper compensation for instrumentalities furnished and services performed by the shippers in the aid of transportation by the railroads. In this case the allowances were for so-called hghterage service in New York County, and the disadvantages com- plained of were those incident to a disadvantageous location. See also opinion of Supreme Court in Party Rate Case, infra. For construction of "rebates" under Elkins Act of 1903, see infra, § 519 et seq. § 229. Circumstances and conditions of through traffic and local traffic are dissimilar. — While competi- tion between carriers cannot justify discrimination between individuals, competition may and does have an influence in determining the through rates, thus making them under 348 THE INTERSTATE COMMERCE ACT. [SECTION 2 essentially different circumstances and conditions from the local rates to other points on the same line. In such cases the reduced rate affected by competition is controlled by circumstances and conditions substantially dissimilar within the meaning of the act. But whether so controlled or not, it must be the same to all shippers under the same conditions. It has been uniformly held both by the commission and by the courts, that a local rate to a given point and the pro rata part of a through rate to the same point on the same line, are not under similar circumstances and conditions. The phrase "under similar circumstances and conditions" is found in sections 2 and 4. As hereafter seen, competitive conditions may create dissimilar circumstances and condi- tions between localities under section 4, but -when the rates are thus fixed under dissimilar conditions, section 2 requires that shippers in any given locality must be treated alike for the same service. But through traffic is a different "kind of service" from local traffic. This was held in Union Pacific Railway Co. v. United States, 117 U. S. 355, 29 L. Ed. 920, (1886) in the construction of the act of congress of July 1, 1862, relative to the Union Pacific Railway Company, and applied to the construction of the second section of the Inter- state Commerce Act in the Import Rate case, 162 U. S. 197, 40 L. Ed. 940 (1896). It is not only in the presence of com- petition, but also in the increased cost of service, resulting from stoppages, that the conditions of through and local traffic are substantially dissimilar. Chicago, etc., R. R. Co. V. Tompkins, 176 U. S. 167, 44 L. Ed. 417 (1899). See supra, § 208. § 230. Competition of carriers does not make cir- cumstances dissimilar under section 2. — These words as used in section 2 refer to the matter of carriage, and do- not include competition, that is, discrimination between indi- viduals is not justified by the fact of competition with other carriers influencing the lower charge. Thus in Wight v. United States, supra, the court sustained the conviction of a railroad agent for making to a consignee, who had a siding connection with a competing railroad, an allowance or rebate for the expense of cartage from its own station. It was urged §231] THE INTERSTATE COMMERCE ACT. 349 that the party who did not have this connection would have to go to the expense of cartage by whichever road he trans- ported, and that therefore the trafTic was not under the same circumstances and conditions within the terms of section 2. But the court said that the wrong prohibited by the section was a discrimination between shippers, and that the service in transporting to the station from the point of shipment was precisely the same to each shipper. The court concluded: "It may be that the phrase 'under substantially similar cir- cumstances and conditions,' found in section 4 of the act, and where the matter of the long and short haul is considered, may have a broader meaning or wider meaning than tlie same phrase found in section 2. It will be time enough to deter- mine that question when it is presented. For this case it is enough to hold that that phrase, as found in section 2, refers to the matter of carriage, and does not include com- petition." It was determined in other cases before the court construing section 4 that the term "under substantially similar circumstances and conditions" in the latter section did have a broader meaning, and did include competition as creating dissimilarity of circumstances and conditions. See section 4, infra. The construction of the section in the Wight Case prevents a carrier from making a concession to secure a business, which it could not otherwise secure, if that concession makes an in- equality in rates between shippers for the same service. Competing shippers in this case were not in fact injured by the concession, as they were compelled to pay for cartage in any event. The only effect was to give the shipper two com- peting lines at the same rate, and to give the carrier an opportunity to handle traffic from which otherwise it was cut off. While it could have been contended that the cir- cumstances were substantially dissimilar, and that such a discriminative rate for the purpose of securing business was not within the intent of the section, the construction de- clared in this case makes such a concession unlawful, although extended to all "similarly circumstanced," that is, to all making the same shipment. § 231. The party rate case. — It was ruled by the com- mission, 1 I. C. C. 208, 1 Int. Com. Rep. 611, that under this 350 THE INTERSTATE COMMERCE ACT. [SECTION 2 section reduced land explorers' tickets and settlers' tickets, and special rates to immigrants, 3 I. C. C. 652, 2 Int. Com. Rep. 804, were illegal as discriminating under this section. The same ruling was made the case of party rate tickets, that is, tickets sold at reduced rates and entitling a number of persons to travel together on a single ticket or otherwise, were an unjust discrimination against other passengers and illegal. This ruling however was disapproved by the circuit court, 43 Fed. Rep. 37, and also by the Supreme Court in what is known as the Party Rate Case, 145 U. S. 263, 36 L. Ed. 703. The latter Court said that party rate tickets, which were used principally by theatrical and operatic companies for transportation of their troupes, would hardly fall within the meaning of mileage or excursion or commutation tickets within the exception of section 22, but that did not make the tickets unlawful. The unlawfulness defined by section 2 consisted in an unjust discrimination. It was the object of section 22 to settle beyond all doubt that the discrimination between certain persons therein named should not be deemed unjust; but it did not follow that there might not be other classes of persons in whose favor such discrimination was made without such discrimination being unjust, and that the section was illustrative rather than exclusive. The object of such party rate tickets was to induce more people to travel, and to secure patronage that would not otherwise be secured. After a review of the English cases construing the English act of 1854, the Court said that the substance of all those decisions was that the railroad companies were only bound to give the same terms to all persons alike under the same cir- cumstances and conditions, and that any fact that produced change in condition and different circumstances and condi- tions justifies an inequality of charge. § 232. Wholesale and retail rates in freight traffic. — In the case of Hoover v. Pennsylvania Railroad Co., supra, the court based its ruling upon this Party Rate decision, and applied the principle to a discrimination in favor of manu- facturing industries which would contribute to the business of the railroad. In one of the early cases before the commis- sion, the Providence Coal Company Case, I. C. C. 107, 1 §232] THE INTERSTATE COMMERCE ACT. 351 Int. Com. Rep. 363, decided in 1887, soon after the organi- zation of the commission, it was held in an opinion by Judge Cooley, that the analogy of wholesale and retail purchasers of merchandise could not be extended to a discrimination in freight rates based solely upon the amount of shipment. The cases were not analogous, since the naming of the quan- tity of freight which should be compared to wholesale pur- chasers must necessarily be altogether arbitrary. In this case a discount of ten per cent, was allowed on 30,000 tons, and it seemed there was only one dealer who could make that shipment. Judge Cooley added: "A railroad company if allowed to do so might in this way hand over the whole trade along its road to a single dealer, for it might at law make a discount equal to or greater than the ordinary profit in trade, and competition by those who would not get the discount would then be out of the question. The 30,000 ton limit was unreasonable and unlawful because necessarily resulting in unjust discrimination. It was said also that the distinc- tion between carload and less than carload lots was readily understood and appreciated, but that discrimination to be valid must be based on the distinction involved in the cost of handling. This ruling of the commission, it will be seen, is in harmony with the recent trend of judicial opinion as to the common law right of discrimination ; that is, that it must be based upon a difference of the cost of service, and not upon the mere fact of a larger shipment. This was directly ruled in United States V. Tozer, 39 Fed. 369, (1889) eastern district of Missouri, in a case where the defendant, a railroad agent, was indicted for paying rebates in violation of section 2 of the act. The court, Thayer, J., charged the jury that the fact that the defendants received much more traffic from one shipper than from another did not make the circumstances and conditions under which the two services were rendered substantially dis- similar. It will be observed however that the discrimination in favor of the larger shipper could in some cases be justified on the ground of a difference in the cost of service, as it is recognized that as a rule the proportionate expense of handling and carriage is reduced with the increase of quantity. Divested 352 THE INTERSTATE COMMERCE ACT. [SECTION 2 of all considerations of public policy, a carrier might well afford to give a special rate in view of the assurance of a certain quantity for shipment. This was recognized in the Nicholson v. G. W, R. Co. case, supra. The really con- trolling consideration is that of public policy in this refusal to apply the analogy of wholesale and retail sales to freight rates. It is because the power to discriminate in favor of a larger shipper, whatever the business inducement, is neces- sarily injurious to business competitors who cannot make such shipments, and therefore tends to monoply. § 233. Wholesale rates in freight and passenger traSic distinguished.— There is another ground however for the clear differentiation of discrimination in passenger rates on the basis of the number carried in party rate tickets, from a like discrimination in the case of freight rates. No one is injured or can be injured by the issue of passenger tickets at a reduced rate, whereas in the case of freight rates based upon the amount of shipment, the effect might be to put out of business all but the favored shipper whose business was large enough to ship the requisite amount. This dis- tinction was commented upon by the Supreme Court in the Party Rate case, where the Court said at page 280: "If for example the railroad makes the public generally a certain rate of freight and to a particular individual residing in the same town a reduced rate for the same class of goods, this may operate as an undue preference, since it enables the favored party to sell his goods at a lower price than his com- petitors, and may enable him to obtain a complete monopoly of that business. Then if the same reduced rate be allowed to everyone doing the same amount of business, such dis- crimination may if carried too far operate unjustly upon the smaller dealers engaged in the same business, and enable the larger ones to drive them out of the market. The same result however does not follow from the sale of tickets for a number of persons at a less rate than for a single passenger; it does not operate to the prejudice of the single passenger, who cannot be said to be injured by the fact that another is enabled at a particular instance to travel at a less rate than he. If it operates unjustly toward any one, it is the rival road which has not adopted corresponding rates; but as before observed, it was not the design of the act to stifle competition, nor is there any legal injustice in one person's procuring a particular service cheaper than another." § 234] THE INTERSTATE COMMERCE ACT. 353 § 234. Discrimination not unjust when based on special service. — While discrimination based merely on the quantity shipped is not justified, discrimination is proper when it is based on a difference in the cost of handling. In any event however, whatever the basis, the reduced rate must be open to all alike complying with the same conditions, and the- rate must be published as provided in section 6. Thus if any accessorial services are rendered by the carrier, such as cartage, the circumstances and conditions are clearly dis- similar. Interstate Com. Com. vs. Detroit etc. Ry. Co. 167 U. S. 633. 42 L. Ed. 306 (1897). Where a special service is required of the carrier, such as rapid transit and speedy delivery, or refrigeration in transit, a higher rate than for ordinary freight is warranted. If the car- rier charging a rate for such special service fails to render it, to the damage of the shipper and without legal excuse, the remedy of the latter is by proper proceeding at law. 5 I. C. C. 529, 4 Int. Com. Rep. 205; 4 I. C. C. 588, and 3 Int. Com. Rep. 554. This principle was applied in a case, Wilson v. Atlantic Coast Line R. Co., 129 Fed. Rep. 774, where it was held that a railroad company was not required as a common carrier to take a circus train, a part of which is loaded with wild animals, and transport the same over its line, but it may refuse to transport such train except under special contract limiting its liability from that ordinarily assumed by a common carrier. See also Chicago, Milwaukee & St. Paul R. Co. V. Wallace, 66 Fed. 506, 14 C. C. A. 257, 7th Circuit, and 30 L. R. A. 161 (1895). In these cases the question was one of the right of the carrier to make special contracts for such special class of freight and to become in effect private carriers thereof. It would follow that the carrier would have a right to make special charges therefor without unjust discrimination. Thus there was held to be no discrimination in a preferen- tial rate to tank shippers as against barrel shippers, in the transportation of oil. Penn Refining Co. v. W. N. Y. & P. R. Co., 208 U. S. 208, 52 L. Ed. 456, (1908) affirming the C. C. A. third circuit, 153 Fed. 343. The shippers in this case furnished their own tanks and the carrier J— 23. 354 THE INTERSTATE COMMERCE ACT. [SECTION 2 had information that the transportation by tank cars was more remunerative to the shipper than the transportation by barrels. The latter shippers had made no demand for tank cars, and could not have used them economically on account of the lack of facilities for unloading. It was held there was no discrimination in charging a rate which was not unreason- able in itself, which was higher for barrels than the tank cars owned by the shippers. See also Interstate Commerce Commission v. Chicago G. W. R. Co., 209 U. S. 108, 52 L. Ed. 705, (1908) affirming 141 Fed. 1003, where held that the cost of carriage and risk of injury might excuse a higher rate on live stock than on dressed meats and packing house products. § 235. Carload and less than carload rates.^ — The phrase "under similar circumstances and conditions" has always been discussed with reference to the proper unit of freight charges, whether carload or less than carload, and of the proper basis for discrimination between carload rates and less than carload rates. It will be seen that on this point the interest of localities is directly involved. Thus the great centres of distribution opposed the differential for the sake of encouraging less than carload shipments to other parts of the country, while shippers at interior points, desiring themselves to distribute to their respective territories, strongly favored a liberal differential between the carload and less than carload rate. This subject was exhaustively considered in the Thurber case, 3 I. C. C. 473, 2 Int. Com. Rep. 742. Although it was contended by the western jobbers that the carload rate was the proper and recognized unit, the commission said that it was a sound rule for the carriers to adapt their classification to the laws of trade. If an article moves with sufficient volume and the demands of commerce will be better served, it is reasonable to give it a carload classification and rate. The carload is probably the only practicable unit of quantity, and the fact that an antecedent condition, when no such distinction existed and perhaps was not required, furnish no argument for a return to a condition no longer suited to the requirements of business. It was therefore impracticable § 236] THE INTERSTATE COMMERCE ACT. 355 and would seriously demoralize classification in business to attempt to restore equal rates for carload and less than car- load shipments in respect of goods properly so classified. It was said however that the public was more largely inter- ested in miscellaneous than in carload shipments of any one kind of traffic, and that differences ranging from forty to one hundred per cent, between the carloads and less than car- loads' were unreasonable and unjust especially upon articles of general and necessary use, as so great a difference would be destructive of competition between large and small dealers. While the circumstances and conditions in respect to the work done by the carrier and the revenue earned are dis- similar in the transportation of freights in carloads and less than carloads, and a lower rate on carloads than on less than carloads is therefore not in contravention of the statute, yet the difference between the two rates must be reasonable. 9 I. C. C. 78. See also 9 I. C. C. 318, where the commission discussed the proper differential between carload and less than carload rates from the middle west to the Pacific coast. The determination of what commodities are properly allowed carload rates may involve the matter of undue preference against particular kinds of traffic under sec. 3. See 4 I. C. C. 212, 3 Int. Com. Rep. 257, infra, § 315. § 236. Discrimination in application of carload rates. — In 9 I. C. C. 620, the commission discussed the right of a carrier in according a carload rating to look beyond the transportation itself to the ownership of the property trans- ported. The railroad in that case dechned to allow a com- bination of carriages in carload lots at carload rates, and in- sisted on allowing the carload rate only where the shipment was from one consignor to one consignee, thus denying the right of a forwarding agent shipping the goods of different parties at a carload rate. Jhe commission ruled that there should be no discrimination between consignor and consignee in the allowance of carload rates, when the conditions of the ownership after the property was delivered to the carrier was the same. But no opinion was expressed on the further question whether the carrier could distinguish between a forwarding agent and the actual owner. 356 THE INTERSTATE COMMERCE ACT. [SECTION 2 In Lundquist v. Grand Trunk Railway Co., 121 Fed. 915, (1901) it was held that a carrier could properly distinguish be- tween the forwarding agent and the owner of the property, and could apply the carload rating when the goods were tendered for shipment by the owner and refuse it when the like traffic was offered by the forwarder. The court said however that it was "a pioneer case, and little aid could be obtained from authoritative sources." A different ruling was made in England as to the English statute. Great Western Railroad v. Sutton, L. Rep. 4 H. L. 238, the court holding that like circumstances referred to the carriage of the property, and that the carrier could not impose a higher rate when offered by an agent than when offered by the owner. In the Lundquist case the court said that the English statute was much more explicit in its terms than the Inter- state Commerce Act, in that it provided that all toll should be charged equally to all persons; but even if it were not so, it was not probable that our courts would be called upon to follow the English courts, as the cases were so different. § 237. The Supreme Court on forwarding agents in carload rates. — It was subsequently ruled by the commis- sion both as to express companies (14 I. C. C. 422), and as to railroads (14 I. C. C. 437), that the carrier could not properly look beyond the transportation to the ownership of the shipment as the basis for determining the applicabihty of its rates, and that the rules of the ofTicial classifications, provid- ing that defendants should collect a greater compensation for car load shipments when made by forwarding agents of different shippers, were unjustly discriminatory and un- reasonable. This ruhng was disapproved by a majority of the circuit court of the southern district of New York in Delaware, L. & N. C. Co. v. Interstate Commerce Commis- sion, 166 Fed. 499, (1908) and the enforcement of the order of the commission was enjoined. The question was definitely determined, however, by the Supreme Court in support of the ruling of the commission, in 220 U. S. p. 235, 55 L. Ed. 448 (1911), where the Court re- versed the circuit court, and held that the ownership or non- ownership by the shipper of the goods tendered for carriage §239] THE INTERSTATE COMMERCE ACT. 357 was not a dissimilar circumstance and condition within the meaning of section 2 of the act, and that a forwarding agent was a person within the meaning of the act. The Court adopted the settled construction of the equality clause of the English Act and held that the circuit court erred in annulling the order of the commission. § 238. Discrimination in carload rates. — The right to make carload and less than carload rates carries with it the right of the carrier to fix the minimum rate and charge for the transportation of less than carload shipments on account of the necessary expense and trouble attending the carriage of such shipments, which aside from the actual manual labor involved are practically the same irrespective of the bulk of the package. The question in such cases is whether or not the rate is reasonable and not unjustly discriminative. In 10 I. C. C. 412, it was ruled that the minimum charge upon any single shipment of freight should be for one hundred pounds, and that the class or commodity rate of a certain property was not unreasonable or unjustly discriminative in its application to the traffic in question. § 239. Cargo rates discriminative. — The principle of the carload as the only practicable unit of quantity was dis- cussed in 7 I. C. C. 218, where it was strongly intimated, though not finally decided, that a lower rate made by the carrier on cargo lots, being ten thousand bushels of oats and eight thousand bushels of other grains, than on carload lots in export shipments, or in shipments made to the seaboard for export, violated the rule of equality and constituted an un- just discrimination. It was said that this limit of the lower rate would require about ten carloads, and that the effect would be to throw the business into the hands of the large dealers, the margin of profit being very small and the opportunity afforded for the manipulation of prices at sea- board points would be increased. As to discrimination based on differential in favor of ten carloads of cattle, see 10 I. C. C. 327. Any regulation not justified by the increased cost of service and which tends to discriminate between shippers 358 THE INTERSTATE COMMERCE ACT. [SECTION 2 according to the amount of traffic is unreasonable. Thus making certain charges for the transportation of coal shipped in carloads when the coal is loaded by tipple, that is from platforms and chutes, and exacting a higher charge when it was loaded in some other way, and for that reason was found in 10 I. C. G. R. 226, not to be justified by a difference in the cost to the carrier, and that the higher rate was dis- criminatory against the small shippers. § 240. Different forms of discrimination. — Any special rate, rebate, drawback or other device whereby dis- crimination is effected, is prohibited. Thus there may be discrimination in any accessory service charge, as in demur- rage, see Michie v. R. R. Co., supra, where charge of dis- crimination was not sustained in the service of cars, 9 I. C. C. 207; in the manufacturer's rate on coal, 5 I. C. C. 466, 4 Int. Com. Rep. 157; in rebates for the use of live stock or private cars, 4 I. C. C. 630, 3 Int. Com. Rep. 502; or in the exaction of unreasonable rent for private cars, 4 I. C. C. 131, 3 Int. Com. Rep. 162. All forms of secret rates and draw- backs are prohibited, 1 I. C. C. 480, 1 Int. Com. Rep. 764. Discrimination may be effected by unjust classification, 4 I. C. C. 535, 3 Int. Com. Rep. 460; or by commissions paid to soliciting agents, 2 I. C. C. 513, 2 Int. Com. Rep. 340; also combination rates less than tariff rates are illegal, 2 I. C. C. 1, 2 Int. Com. Rep. 1. Any form of discriminating preference is in violation of the statute, 2 I. C. C. 90, 2 Int. Com. Rep. 67. Where a carrier employs a shipper to perform a service as in carrying over private tracks from the mines and coke ovens of shippers to the rails of a carrier, being a service which the commission held was neither compelled nor prohibited by law to the carrier, and the carrier pays the shipper an exces- sive compensation therefor, the latter obtains a discrimi- nation in violation of the statute. See 36 I. C. C. 40. Discrimination violative of this section may be effected through underbilling the weight of freight, or giving it a false classification, whereby less compensation is paid by one per^ son than by another for a like and contemporaneous service. In the report of the commission upon this subject, supra, in § 240] THE INTERSTATE COMMERCE ACT. 359 1888, it was said that this method of discrimination had been extensively employed, and it reviews the evidence taken by the commission in their investigation. Under the recommen- dation of the commission, section 10 of the act was amended, imposing penalties upon the shipper who by false classifica- tion, false weighing, or false report of weight, or by other devices, knowingly or wilfully obtain transportation of their property at less than the regular rate. See infra, section 10. As to discrimination in billing at net weight, see 4 I. C. C. 87, 3 Int. Com. Rep. 131; 9 I. C. C. 440. Another form of discrimination is in the use of private cars, as where freight cars are either owned by the shipper or a private car line. See supra, § 177. The commission says in its annual report for 1904 that the private car may be of ad- vantage to the carrier by enabUng it to provide equipment for special service during limited periods, and the equipment is hkely to be more adequate for the public, than for the carrier to undertake to own the cars itself or to secure them from its own connections. Concessions however were made in the use of such charges to particular shippers, which amounted to the payment of a rebate, and when the owner of the car be- came a dealer in the commodity transported, the fact of own- ership gave him an important advantage over his competitor. A contract of a lumber company with a railroad by which it agreed to build a tie hoist for loading ties on the railroad company cars, and to haul the ties to a certain point for eight dollars and a half a car and return ten per cent. — ^when the freight was received to apply on the cost of the hoist, the rate given being materially less than the published rate, — this was held by the court of appeals of the fourth circuit to be an illegal discrimination and unenforcible. See C. & 0. R. R. v. Standard Lumber Co., 174 Fed. 107, (1909). Though the refusal of an interstate carrier to furnish cars for the shipment of cross ties, while furnishing them to others for interstate shipments to save freight, constituted a discrimination, and that as cross ties were included in the term "lumber," it would constitute a discrimination for the railroad to place them in another classification, see American T. T. Co. v. Kansas City Southern, 175 Fed. 28, in the circuit court of the fifth circuit, (1909). 360 THE INTERSTATE COMMERCE ACT. [SECTION 2 § 241. Discrimination in restricted rates. — In 20 I. C. C. p. 426, the commission reaffirmed its conference rulings (see rules 34 and 225, conference rulings bulletin No. 4) that railroad tariffs which named rates for the transportation of coal for railroad use more than the rates applicable to the transportation for commercial coal between the same points, was an unjust discrimination and unlawful. It ruled that a tariff providing for reduced rates on coal used for steam pur- poses, or that the carrier would refund part of the regular carrier charge on the presentation of evidence that the coal was so used, was improper and unlawful, that is to say, that the carrier had no right to attempt to dictate the uses to which commodities transported by it shall be put in order to enjoy a transportation rate. The' carriers were, therefore, ordered to desist from maintaining tariffs which contained rates applicable wholly upon shipments for a particular con- signee, or when the commodity transported is for the par- ticular use or rates that are restricted to the use of certain shippers and not open to all shippers alike. It was also ruled that a carrier may not, as shipper over the lines of another carrier, be given any preference in the appli- cation of tariff rates on interstate shipments; but it may lawfully and properly take advantage of legal tariff joint rates applying to a convenient junction or other points in its own line, provided such shipments are consigned through to such points from point of origin and are in good faith sent to such billed destination. In this construction of section 2 the commission cited the Wight case, Pa. R. R. Co. v. Inter- national Coal Mining Company, 230 U. S. 184, 57 L. Ed. 1446 (1913). See also Mitchell Coal & Coke Co. v. P. R. R. Co., 81 Fed. 403 (1897). On this subject see also 11 I. C. C. 104; 16 I. C. C. 246, 512. § 242. Discrimination through industrial tap lines and plant facilities. — The discrimination effected through allowances made by regular carriers to so-called tap lines and plant facilities, whether formally organized as railway cor- porations or not, has been extensively considered by the commission. Thus in 17 I. C. C. 338, the Star Grain & Lumber Co. case, it was ruled that the commission could not §242] THE INTERSTATE COMMERCE ACT. 361 recognize as common carriers under the act any of the lines, that did not publish tariffs in ample form, or concur properly in the lawful carriage of other lines, or did not file annual reports and keep their accounts in accordance with the form prescribed by the commission, or that did not in all respects comply with the law. That even if the tap line or industrial line was duly incorporated and complied with the act in these respects, the commission would look to the substance and not to form, in cases where the line was only a facility of a mill or its proprietors. Any allowances or division made to or with the tap line that was owned or controlled directly or indirectly by the lumber mill, or its ofTicers or proprietors, and beyond the logs that it hauled to the mill had no traffic, except such as it might pick up as a mere incident to serve the mill as a plant facility, would be discrimination or a prefer- ence and an unlawful departure from published rates. In this case Commissioner Prouty filed a separate opinion, stat- ing that he did not concur in the belief that none of the tap Unes were bona fide common carriers, and that many of the tap lines had developed into real common carriers. See also 19 I. C. C. 50, and 18 I. C. C. 517, where the tap line was constructed and used exclusively for the company owning the timber. The allowances therefore to the company were unlawful. The principle announced in these cases of so-called tap lines in the lumber districts was applicable to any industrial or plant facihty. Thus in 14 I. C. C. 236, the commission ruled that a manufacturing plant of the General Electric Company of Schenectady, which enclosed twelve miles of broad gauge switching track and seven miles of narrow gauge electric switching track, with its own motors and engines, and a force of men, particularly the internal switching, which would be seriously interfered with by the switching of the railroad if permitted access to the plant, was not entitled to compel the railroad to extend its transportation obhgations and to accept and deliver cars within the enclosure to meet the require- ments of the industry. The case of the Crane Iron Works at Catasaqua was con- sidered in 15 I. C. C. 248 and 17 I. C. C. 514, where the com- pany prayed for an allowance of two dollars per car as its 362 THE INTERSTATE COMMERCE ACT. [SECTION 2 share of a through rate on the Philadelphia & Reading Rail- road. But the commission ruled that whether the Crane Company was a common carrier or not, the service per- formed by the railroad was a plant facility and the expenses should be borne entirely by the complainant. This ruling of the commission that it could determine the compensation in such a case, which should be allowed for a plant facility although it was a common carrier, was re- affirmed in 23 I. C. C. 279 and 549, where the different tap lines were discussed in detail, but was disapproved by the commerce court, 209 Fed. 244, which held that the commis- sion had no jurisdiction to make any such distinction; and this judgment of the commerce court was sustained by the Supreme Court in United States v. Louisville & T. R. Co., 234 U. S. 1, 58 L. Ed. 1185, (1914): and the Court held that as the order of the commission was affirmative rather than nega- tive in character, it was reviewable in the commerce court, and that the right of the public to use the railroad and to demand service of it rather than the extent of its business, was the real criterion to determine whether it was a common carrier, — and if it was a common carrier it was entitled to participate with the trunk line in joint through rates, where the tap lines were organized as common carriers under the state laws. The Court in its opinion referred to the con- curring opinion of Commissioner Prouty in 17 I. C. C. 336. The Court held, however, that it was not only within the power, but it was the duty of the Interstate Commerce Com- mission to reach all unlawful discriminatory practices result- ing in favoritism and unfair advantages to particular shippers or carriers. If the division of joint rates was such as to amount to a rebate or discrimination, because of their dis- proportionate amount, in view of the service rendered, it was within the province of the commission to reduce the amount so that the tap hne should receive just compensation only for what it actually does. In United States vs. Butler County R. Co., 234 U. S. 29, 58 L. Ed. 1196, (1914) the Supreme Court also affirmed the commerce court 209 Fed. 260, and held that a tap line rail- road was entitled to the same allowance from the trunk lines out of joint through rates for logs and lumber offered to such §243] THE INTEESTATE COMMERCE ACT. 363 tap lines by its proprietary company, as it receives out of the joint rate for non-proprietary log and lumber carried, in view of the exception in favor of lumber and manufacturing products thereof, contained in the statute forbidding railway carriers to transport in interstate commerce articles or com- modities with which they are associated or in which they are interested. The Court said in this case also, that if the divi- sion of the rates was a fair cover for discrimination, such practices ought to be controlled by the commission under the authority given it under the act. The tap line subject was further discussed in 31 I. C. C. 490, after this decision of the Supreme Court, and the previous order made before that decision, was vacated. It was said in the opinion that it had been reported to the commission, that the abuses and discriminatory practices had been largely corrected through the action of the commission, in the indis- criminate issuing of passes by traffic lines to persons who were ostensibly officers and employees of the tap lines, but who were in fact officers and employees of a lumber company and who used the transportation when traveling solely in the interest of the lumber company. See also further discussion of the same subject in 32 I. C. C. R. 110, where the Birming- ham & Southwestern Railroad Company was held to be a common carrier and entitled to make joint rates, and the maximum division of six and one-half cents per ton on carload traffic was found not to be in the nature of a rebate. See also 34 I. C. C. 116, (1915), where subject was further dis- cussed, and the different classes of tap and industrial lines described. § 243. Discrimination through interest in connect- ing company. — Another device for effecting discrimination is through the making of a joint rate with a connecting rail- road controlled by the shipper out of proportion to the value of the service and constituting in effect a rebate to the shipper. This was illustrated in the Hutchinson Salt case, 10 I. C. C. 1, where the commission found that the connecting railroad did not own any equipment or rolling stock and was not in any way engaged as a common carrier, and that the granting of the division of the through rate to this connecting 364 THE INTERSTATE COMMERCE ACT. [SECTION 2 company was a mere subterfuge to give a concession in the rate and was an unlawful discrimination. In another salt case involving the transportation of salt westward from points in Michigan, where a similar charge was made as to the alleged interest of the salt producer in a boat line on Lake Michigan, 10 I. C. C. 148, the commission found on investi- gation of the facts that the share of the through rate allowed to the boat line was not so disproportionate as to amount to a rebate, and therefore that the discrimination was not established. Discrimination through the devices of a con- necting railroad in the division of joint rates was further dis- cussed by the commission in 10 I. C. C. 385, in an opinion filed Nov. 3, 1904, wherein the commission reported the results of investigation of the divisions allowed the terminal lines in and about the city of Chicago. It was found that certain connecting railroads were practically controlled by certain large shippers and that the amounts allowed as divi- sions of the through rate were so excessive as to constitute in effect rebates to such shippers, and that the amounts allowed as divisions of the through specific charges had been formu- lated, no order was made. The commission ruled that to the extent that these divisions exceeded the reasonable charge for the performance of the service, they were an unlawful preference and discrimination in favor of the shipper owning the railroad. On this subject see also the report of the commission for 1904, pages 19 to 23. This subject was further considered by the commission in 27 I. C. C. 554, where the Denver & Rio Grand Railroad was held guilty of an undue rate discrimination through the operation of a coal company owned by it, and also violated the commodity clause of the act in section 1, in that the group rates apphed only from its junction with the industrial lines of the complainants, while they were applicable directly from its own lines and its branch lines, the latter being operated under general conditions substantially similar to those surrounding the operation of the industrial hues of the complainants. In 23 I. C. C. 558, the same principle was applied to the case of a boat Une incorporated as a common carrier, which owned a railroad in the interest of a salt company. It pub- §245] THE INTERSTATE COMMERCE ACT. 365 lished no rates except upon salt in cargo lots, and used the terminal facilities and docks and warehouse of the salt company, by whose agents and employes all shipments were handled. The commission found that the boat line was a mere device to defraud the law and that payments made to it by the connecting rail carriers in the guise of divisions, were rebates. These cases were decided before the decision of the Su- preme Court in the tap line case, but it does not seem that they are inconsistent therewith under the specific facts involved in the cases. § 244. Control by Commission of Division of Joint Rates to prevent discrimination. — While the commission has often said that the law has no concern with the division of rates which carriers make by agreement with each other, it was said, in 22 I. C. C. p. 51, that this principle has very decided limitations. If the railroad is a shipper, or is owned by a shipper, or is so linked up with a shipper, that a division of a rate means a rebate or a discrimination in favor of or an advantage to a shipper, the commission may properly look into the nature of the service which the carrier gives and the division it receives. Thus, where the industry-owing carrier, by virtue of a trafTic agreement with the Trunk Line carrier, conducts its operations in part over the Trunk Line rails, that fact becomes an additional reason why the commission may take cognizance of the division of joint rates to which the industry-owner carrier is a party. The commission said there may be some doubt as to the power of the commission to correct such a situation, but whatever power the commis- sion had it should exercise, and it therefore issued an order against one of the carriers to show cause why its rates should not be reduced, and to another carrier, why its rates on coal to the same point should not be reduced. § 246. Allowances to short lines of railroads serving industries.— In 29 I. C. C. 212, termed "the Industrial Railways case," the commission considered the legality of the allowances paid by public carriers east of the Mississippi river to industries on their rails, that own and operate plants 366 THE INTEESTATE COMMERCE ACT. [SECTION 2 and railways in connection with their industrial establish- ments. The commission reported that the service by line carriers in official classification territory beyond a reasonably convenient point of interchange, between their rails and the tracks of industries, is a shipper's service, a part of the industrial operations of the plant, and not a service of trans- portation; and that the performance of such services by the line carriers without charging in addition to the rate, and the allowances paid by them therefor to industries, or their plant railways, for performing the service for themselves, are unlawful rebates, in fact and effect, and give undue and unreasonable preference and advantages to interests so favored, and work undue and unreasonable prejudice and disadvantage to shippers in the same line of shipments, who do not receive any such allowances or benefit of any such services. It was also ruled that the admission of industrial Hues to the benefit of the modified short time agreement results, in many cases, in a substantial addition to their revenues, that accrues directly to the benefit of the industry, and is an undue, unreasonable and unlawful preference and advantage to the industry, and that the delivery of a car by a hne carrier upon the interchange track is a delivery to the industry itself, and that the elimination of demurrage as a trans- portation charge against industries with plant railways claim- ing to be common carriers, results in undue, unreasonable and unlawful preferences and advantage to such industries, to the prejudice of other shippers not enjoined to the benefits of such arrangements. In this case the facts referring to the several industrial railways were very fully investigated and set out. This report was made in January 1914, prior to the decision of the Supreme Court in the Tap Line case, supra. The com- mission, in a subsequent report, 32 I. C. C. p. 129, after this decision, said that in fundamental principles the case of the industrial railways did not differ from the Tap line case; that there may be a distinction as to the application of the commodities clause, but that could not possibly affect the conclusion or acts of the commission. If the commodities clause is violated that infraction of law is not to be corrected § 246] THE INTERSTATE COMMERCE ACT. 367 or punished by rate adjustment. The commission said it had been abundantly demonstrated, that the granting of allowances to industrial roads had been carried to indefen- sible extremes, and that they were advised that many abuses had been eliminated as the result of the investigation by the commission. The commission further stated that since the decision of the Supreme Court they had given effect thereto by fixing the maximum divisions of rates and switching allowances, giving effect in each case to the principles an- nounced by the Supreme Court. The commission concluded that each of the industrial railways was or was not a common carrier; and if it was one it was entitled to all the rights and subject to all the limitations provided in the act. § 246. Discrimination by carrier in favor of itself as a shipper. — A carrier can no more discriminate in favor of itself as producer and shipper than in favor of any other ship- per, said Judge Cooley in 4 I. C. C. 296, and 3 Int. Com. Rep. 302. There is a difficulty in determining the fact of discrimina- tion by a railroad in its own favor as a carrier. Thus in a proceeding against the Delaware, Lackawanna & Western Railroad Company, 3 Int. Com. Rep. 302, and 4 I. C. C. R. 296, supra, it appeared that the railroad company kept no separate account between itself as a carrier and itself as a shipper of coal, so that there was no means of determining whether it carried for reduced rates as a carrier, or sustained a loss as a dealer. The commission in that case ruled that it had no power to order such an account to be kept. It could however determine whether the rate charged to the complainant was a reasonable one, and in determining that issue it could determine the price at which the railroad com- pany sold its coal, and the extent of its own profits upon coal marketed compared with the rates charged other dealers for transportation, or whether it made any profit at all, could be inquired into by any tribunal authorized to pass upon the reasonableness of rates. The commission said in the former case, that even if the carrier kept a separate account showing what it charged itself for transportation, and even were such a separate account required, it would not be a safe guide 368 THE INTERSTATE COMMERCE ACT. [SECTION 2 in determining whether the carrier did or did not use its power as a carrier oppressively. See also case in 8 I. C. C. 630, another coal case, involving the rates from Myrick, Missouri, and from Rich Hill, the latter being owned by the Missouri Pacific Company. The court held that the only remedy available to the independent operator was to secure a reasonable rate, as the carrier could so adjust its rates that the moving of the coal could be conducted at a loss, the profit being derived from the carriage, and in that event every mine operating must operate at a loss. In 7 I. C. C. 33, the railroad company owned the entire stock of a development company, which had been organized for the purpose of holding certain lands of the railroad com- pany, and caused grain to be purchased in the name of the development company and transported over the lines of the railroad company and sold upon the market. The commis- sion said that even assuming that the development company was an independent entity, and that the nominal freight charges were actually paid by it, still it was merely a tool in the hands of the railroad company and the act accom- plished was the act of that company. There was no fixed rate, and the rate actually received was less than was, or would have been, charged any other person for the same service under the same conditions. Here it was said that this was a clear violation of section. 2. The commission in this case distinguished the coal cases above cited, saying that in those cases there was a permanent condition which must be met, while this was an unlawful practice which must be stopped. In the Chesapeake & Ohio Railroad Company case, supra, there was a contract between the railroad company and another railroad for the sale of coal to be transferred over its line at a price less than the aggregate cost of the expense items and its own published freight rates. The Court held that this transaction was not a violation of section 2, unless the transaction was a mere device to cover an intentional giving of a less rate for carriage to some than to others, there being no legal ground for assuming that the loss was sustained by it as a carrier rather than as a dealer, and also that if the carrier did not credit on its books its freight accounts with §247] THE INTERSTATE COMMERCE ACl'. 369 its published rate and did not charge the loss to an account kept with the article dealt in, there would seem to be an apparent violation of the 2nd and 6th sections of the act; but at most only a technical violation, as it had a right to suffer a loss as a dealer. The Court could not find any authority for saying that the loss under such a contract must necessarily be treated as a loss on carriage, there being no evi- dence in the case affecting the good faith of the contract, and therefore nothing whereon to base an inference that the trans- action was a device to evade the law. See "commodity clause" in amendment of 1906, § 181, supra. In July 1915, 36 I. C. C. 1 the commission reported that a railroad company as shipper was entitled to the same con- sideration as a commercial shipper, and no more, even when the shipment moves in part over the rails of such railroad company. It follows that in such case the carrier is entitled to a division of a through rate, but the division must be fixed by the same considerations which would determine divisions upon a true commercial shipment in which the railroad had no other interest than that of carrier. § 247. Discrimination in storage of goods, etc. — An- other form of discrimination condemned by the commission was presented in the complaint of the American Warehouse- men's Association, 7 I. C. C. 556, which set forth that a large number of railroads unjustly discriminated in offering free storage of freight in various ways to some shippers and not to others, in failing to collect demurrage charges on cars de- tained by favored shippers, by storing for some concerns large quantities of freight and making delivery thereof in small lots to purchasers, and by assuming expenses of unloading loading and cartage for some shippers and not for others. A large volume of testimony was taken in different parts of the country. The commission ruled that the system pre- vailing was open to grave abuses, and that the allowance of such privileges as storage and the Uke was clearly forbidden by section 2 of the statute. The effect of allowing special facilities for storage was to provide a favored shipper with branch business houses in large cities. The investigation resulted in a general order requiring carriers to state in their J— 24. 370 THE INTERSTATE COMMERCE ACT. [SECTION 2 tariffs, what free storage was granted and the terms and con- ditions under which it would be granted. The commission said that as this procedure had been recommended by the Supreme Court in the Grand Haven Free Cartage case, it was all the more applicable in the case of storage, which was expressly mentioned in the act. As to right of carrier to contract for storage of through grain in elevators at terminals in transit, see 10 I. C. C. 309. It was ruled by the commission in 25 I. C. C. 618 (1913) that the Pennsylvania Railroad should desist from leasing an elevator to a certain company as long as the stockholders of the latter were the owners, wholly or in part, of the property passing through the elevator, and should cease from paying any allowance for terminal services to such elevator com- pany upon any property passing through such elevator, be- longing wholly or in part to any stockholder of such elevator, unless the published tariffs of the railroad shall, at the same time, offer such allowance to all other shippers using said or any other elevator in the city. § 248. Stoppage in transit privileges. — The privilege of milling in transit, that is of stopping in transit, for the pur- pose of grinding grain into flour or compressing cotton, or sawing logs into lumber, at some point in transit, and then shipping the manufactured or compressed product forward at the through rate, has been discussed in several cases by the commission. See infra, § 267. In 8 I. C. C. 121, the com- mission commended the practice in a case of cotton shipment, saying that it benefited both the railroad company and the producer and tended to place non-competitive points upon equality with more distant competitive localities from which lower rates were in force. Such privileges may be granted or withheld by the carrier. The receiving of cotton from a shipper and having it com- pressed at a station en route and reshipping to eastern points at the rate equal to the published through rate is not an un- lawful discrimination under section 2, when all parties are entitled to the same privilege. Cowen v. Bond, 39 Fed. 54 (So. Dist. of Miss.) (1889). It is immaterial in such case, that the arrangements are made to induce buyers to §249] THE INTERSTATE COMMERCE ACT. 371 believe that the cotton was actually raised in different localities than where it was in fact raised, as the deception could not be imputed to the railroad company. But when the privilege is extended, it must be extended to all in the same conditions and "similarly situated." See inpa, section 3. The mere fact of the payment of a local rate to the manu- facturing or compressing point is not material, if there was from the first an agreement that the property should be entitled to the privilege, and it goes forward from the com- pressing or manufacturing point upon a through bill from the point of origin to the destination. Another application of the milling in transit privilege was illustrated in 10 I. C. C. 193, in the making of a through rate on lumber with allowance of a proportion of a rate for cost of moving the lumber by a "tap hne" from the forest to the mill. The commission ruled that this allowance could only be made to another common carrier, and could not be granted to a shipper as compensation for cost of moving the lumber to the mill. In Laurel Cotton Mills v. Gulf & S. I. Railroad Co., the supreme court of Mississippi (1904), 37 So. Rep. 134, sus- tained a right of recovery, that is, it held a petition not de- murable under a contract by a railroad with a manufacturer about to erect a cotton mill, to give it a milling in transit rate not exceeding certain rates to certain competitive points. The court adopted and followed the opinion of the commis- sion in the lumber tap line case above cited as to the legality of a milling in transit rate. § 249. Unjust discrimination through abuse of stoppage in transit privileges. — While the commission has recognized and approved the allowance of through rates in cases of stoppage in transit for purpose of milling wheat into flour and compressing cotton, so as to facilitate the move- ment of the great staples of the country to market, this privilege has been sought to be applied to cases where there was no manufacture or compressing, but where the effort was to secure a through rate when property was stored for a time at an intermediate point on the through line. Thus 372 THE INTEESTATE COMMERCE ACT. [SECTION 2 shipments of grain were carried to Kansas City from points west thereof at local rates, and afterwards shipped and rebilled from Kansas City to Chicago, at the balance of the established through rate from the original point of shipment to Chicago. There was no agreement for the through carriage between the shipper and the carrier at the original point of shipment, but the practice was to allow the consignee or other owner of grain at Kansas City to ship from Kansas City to Chicago and other points at the balance of the through rate upon presentation of the paid expense bill to Kansas City. The commission ruled that such shipment and re-shipment did not constitute a through shipment from the point of origin to the final point of destination, and that the grain so shipped and reshipped was not entitled to the benefit of the through rate in force and that the shipment from the point of origin to Kansas City was local, resulting in the grain becoming Kansas City grain, and the fact that it had come from a point further west was no reason for apply- ing on shipments of such grain from Kansas City any less or different rate than was in force from Kansas City. The commission ruled that an indispensable element in every through shipment was the same — a contract for such through service, and an agreement between the parties at the incep- tion of the carriage from the point of shipment to the desti- nation at the through rate. 7 I. C. C. 240. The same was made in the case of a cattle shipment. 3 I. C. C. 450, and 2 Int. Com. Rep. 721. Any device therefore for securing a through rate, where the shipment is not in fact a through shipment, and for specifically allowing the milling in transit privilege on facts not justifying the same, would be an unlawful discrimination and violative of this section. As to "extension of this principle of milling in transit to" fabrication in transit "of steel products" see infra § 302. § 250. Unjust discrimination in passenger service. — Unjust discrimination is prohibited in the transportation of passengers, as well as property. This section however does not prohibit separate cars for the white and colored races, provided cars and accommodations equal in all respects are § 250] THE INTERSTATE COMMERCE ACT. 373 furnished to both and the same care and protection of passengers observed. 1 I. C. C. 428, 1 Int. Com. Rep. 719. See also 1 I. C. C. 208, 1 Int. Com. Rep. 611. When a railroad company makes a reduction from regular passenger fares which are not found unreasonable, it may law- fully require that a person desiring to avail himself of such reduction shall purchase a ticket and that all persons not holding such reduced rate ticket shall pay the reasonable ordinary fare. 10 I. C. C. 217. For alleged discrinynation in parlor car rates as between through and local passengers not sustained, see 10 I. C. C. 221. The regulation published on regular tariff sheets that the conductors shall collect twenty-five cents additional fare on trains from passengers without tickets was not an unjust discrimination. 3 I. C. C. 512, 2 Int. Com. Rep. 766. It has been ruled by the commission that commutation rates for school children must be open to all children within the age limit. See 17 I. C. C. 144; 12 I. C. C. 95. Such rates are not in the nature of charity and, therefore, did not come within the exceptions of the rule in sec. 22. While a carrier has a wide field of reasonable discretion in passenger service it cannot justify an unreasonable discrimi- nation between localities in refusing to stop its train at a par- ticular place on certain days by a contract not to do so. In 17 I. C. C. 396, the stoppage of trains on Sunday at a moun- tain resort was brought about by the influence of the patrons of the place, and it was ruled, under the circumstances, not unreasonable. The discrimination involved in the carrying of personal baggage of a passenger without extra charge, is not undue as against a passenger without baggage. The commission said, 17 I. C. C. p. 88, that a railroad could properly carry for one charge a passenger and his personal baggage, and ccKild pro- vide a separate car for transportation of baggage, and limit the amount of baggage to be carried free, making a charge for the excess. The commission did not decide whether 150 pounds was a reasonable limitation of the amount of baggage, or whether the samples of a drummer ought properly to be carried as baggage at all, or whether the excess rates charged were reasonable, as these questions were not presented by the record. 374 THE INTERSTATE COMMERCE ACT. [SECTION 2 § 251. Discrimination in Rating of Sunday Maga- zines. — In 26 I. C. C. 395, the commission considered a complaint that the defendant carrier had violated the act by charging for the transportation of the supplement of a Sunday edition to certain newspapers as first class when it should have been ranked as second class. It appeared from the evidence that the publication in question was in form and general appearance not distinguishable from magazines of the larger size and was folded, but was sewed or stitched with wire. The commission ruled that while the publication was used solely as a supplement to certain newspapers, its character as a magazine was not thereby lost or destroyed. It seemed that this magazine was published in New York and formed a part of the Sunday issue of the newspaper members of the association. Its outside cover was lithographed in colors, and the paper was of better grade and more smoothly finished than that used for newspapers. The commission said that this particular publication should be classed as other magazines, although it was used as a supplement with a newspaper and never sold separately. The complaint was dismissed. § 252. Giving passes to shippers prohibited. — A rail- road official who gives a pass for interstate transportation as a matter of personal favor, not within any of the exceptions contained in section 22, violates sections 2 and 3 of the act. Charge to Grand Jury (N. Dist. of Cal.), 66 Fed. Rep. 146. One riding on a pass and assuming all risks of accident is bound thereby and cannot recover, and it is immaterial that the pass was issued in violation of the act. Duncan v. Maine Central R. R. Co., 113 Fed. 508. It has been ruled by the commission that the giving of free transportation to shippers, 7 I. C. C. 92, or any free trans- portation other than that allowed by section 22 of the act is illegal. 2 I. C. C. 359 and 2 Int. Com. Rep. 243. The Supreme Court has sustained the validity of stipula- tions in railway passes against liability for injuries, where parties accept the passes with knowledge of such conditions. See Northern Pacific R. Co. v. Adams, 192 U. S. 440, 48 L. Ed. 513 (1904), and Boering v. Chesapeake Beach R. Co., 193 U. S. 442, 48 L. Ed. 742 (1904). § 254] THE INTERSTATE COMMERCE ACT. 375 Since the above rulings were made, the giving of passes other than to certain excepted classes was prohibited and made penal both on the part of the railroad and the recipient, see § 179, supra. § 253. Unjust discrimination in telephone service. — In the first telephone case that was before the commission, 20 I. C C. 614 (1911), it was ruled that contracts between old subscribers and the company, even though valid when made, could not, after congress had undertaken to regulate the rates and practices of telephone companies, be accepted as justifying its charges as between its subscribers similarly situated, such undue discrimination being forbidden by the act. It seems in this case that a few subscribers connected with the new exchange were previously connected with another exchange, which had been abandoned by the defendant company from motives of economy of management and efficiency in service. But the commission ruled that this did not warrant the exaction of the current charges from the new subscribers, while for the same service and facilities the old subscribers continued to pay the lower charges formerly exacted at the old exchange. It seems that there was no difference either in the physical service or in the efficiency of the service, which was rendered by the defend- ant to the old subscribers at the old exchange and to its new subscribers resident in the same locality who paid the current rates. See also 27 I. C. C. where complaint was dismissed for failure to show discrimination. § 254. Application of the section. — This section only deals with the discrimination, which consists of the charging one person with a different compensation, than is charged another for a like and contemporaneous service for the transportation of a hke kind of traffic under substantially similar circumstancfes and conditions. Forms of discrimina- tion which relate to the furnishing of facilities, such as car service and the like, are prohibited by the more compre- hensive language of section 3, infra. The mere fact of the payment of a rebate may not con- stitute "an unjust discrimination" at common law, or under 376 THE INTERSTATE COMMERCE ACT. [SECTION 2 the statutes, at least prior to the amendment of 1903. Thus it was held in a state case, Laurel Cotton Mills v. Gulf, etc., Railway Co., supra, by the supreme court of Mississippi, that if there is no unjust discrimination, an agreement by a carrier that they will carry goods at a certain rate and repay the shipper a part thereof as a rebate after the shipment, is not illegal, and the rebate may be recovered by the shipper in a proper case. But under the publication of rates required under section 6 of the Interstate Commerce Act and es- pecially in view of the provisions of the Elkins Act of Feb- ruary 19, 1903, infra, any deviation from the published rate constitutes an offense. If a rebate therefore is paid to one, it must be paid to all under similar circumstances, and the rebate must be a part of the published tariff. In the Beef Trust case. Swift v. United States, supra, the bill alleged that the defendants as a part of their unlawful combination for monopolizing the market, were obtaining ar- rangements with the railroads whereby by means of rebates and other devices they paid less than the lawful rates for transportation. The Supreme Court said that this did not necessarily charge unlawful acts, as the defendants might severally lawfully obtain less than the lawful rates for trans- portation, if the circumstances were not substantially dis- similar for which the regular rates were charged, as if they furnished their own cars, for instance, and there were other differences in the service. But as the charge was made in connection with the alleged attempt to monopolize the market in violation of the Anti-Trust Act, the court said that no more powerful instrument of a monopoly could be used than an advantage in the cost of transportation, and that every act done with the intent to produce an unlawful result is unlawful. The charge was therefore held material in connection with the other charges in the bill. See supra, §89. This section of the statute has no application where the traffic is of different kinds and classes not competitive with each other. 8 I. C. C. 531 and 5 I. C. C. 193, 3 Int. Com. Rep. 841. There is no discrimination under this section in the case of impartial action. It must consist in doing for or allowing to one party or place what is denied to the other. §255] THE INTERSTATE COMMERCE ACT. 377 1 I. C. C. 401, 1 Int. Com. Rep. 703. A like kind of traffic within the meaning of this section does not mean traffic that is identical, but a kind that is capable of a fair and just classification. 4 I. C. C. 447, 3 Int. Com. Rep. 417. The section has no application to terminal charges in different cities, 7 I. C. C. 513, nor is there any unjust discrimination involved in the refusal to pay mileage to a private car com- pany. 1 I. C. C. 132, 1 Int. Com. Rep. 329. Discriminations based solely upon the business motives of the shipper are illegal. 6 I. C. C. 85. In Pa. R. R. Co. v. International Coal & Mining Co., 230 U. S. 184, 57 L. Ed. 1446 (1913), the Supreme Court, affirming on this point the circuit court of appeals of the third circuit, (173 Fed. 1) held that the substantially dissimilar circum- stances and conditions wherein discrimination was allowed, related only to the circumstances and conditions of carriage, and did not include matters affecting individual shippers, and that a railroad company was not authorized to charge one shipper of coal a lower rate than is charged another shipper between the same terminals, because the former is shipping under contracts extending over a term of years based on lower rates which were in force when such contracts were made, while the other shipper has no such contracts. § 255. Retention of overcharge. — The Interstate Com- merce Act does not recognize indefinite or uncertain trans- portation charges. The idea of unequal compensation for Uke service, or discrimination in the treatment of persons similarly situated, is repugnant to every requirement of the law, and a party to an interstate shipment cannot be ex- cluded by the carrier from the privileges afforded to other patrons in the same locality because of his refusal to pay excessive freight charges, even thoiigh an agreement to subsequently refund the excess should accompany the de- mand. 6 I. C. C. 36. The retention of an overcharge has all the effect of extortion and unjust discrimination, and when the refund of an excessive charge has been unnecessarily delayed for a considerable period, the officials responsible therefor become fairly chargeable with wilful intention to violate the law. 378 THE INTERSTATE COMMERCE ACT. [SECTION 2 In Ohio Coal Co. v. Whitcomb, 123 Fed. 359, (1903) C. C. A., 7th circuit, an extra charge of two dollars per car made to one shipper for access to the docks was held under the facts to be discriminative under the Wisconsin statute, and an agreement by the shipper to pay the dis- criminating charge in order to obtain the service, to which it was legally entitled without such charge, did not estop him from maintaining a suit to recover back the sum so paid. § 256. Enforcement of the section. — The section has no application to cases occurring before the act was passed, 1 I. C. C. 144, 1 Int. Com. Rep. 607, that is, so far as the penalties imposed by the other sections of the act for viola- tion of its provisions are concerned. It has been held how- ever that contracts for rebates made before the act went into effect were thereafter incapable of enforcement. Southern Wire Co. v. St. etc., R. Co., 38 Mo. App. 191, (1889.) There has been a difference of judicial opinion as to the civil remedy under this section, which has now been deter- mined by the Supreme Court. Under the original bill in the senate when the act was under consideration, of congress, a right of action was given to the plaintiff for the amount of rebate paid to any other person, that is, for a penalty to be measured by the difference between the lawful and unlawful rate whether damage resulted or not. That provision was stricken out, however, and section 8 of the act, see infra, gives a right of action for damages and attorney's fees to the person injured and to the extent of the injury. In Pennsyl- vania R. R. Co. V. International Coal Mining Co., 173 Fed. 1, the C. C. A., third circuit, (1909), held that plaintiff had the right to recover the difference between the amount paid by him and the amount paid at the lowest rate charged on any other shipments carried under substantially the same circumstances and conditions during the same time. This ruling, however, was reversed by the Supreme Court in 230 U. S. 184, 57 L. Ed. 1447 (1913), where the Court, Justice Pitney dissenting, held that the liability of a carrier to a shipper who has been charged and has paid the lawfully published freight rates on interstate shipments, while lower rates resulting from rebates have been allowed other shippers §259] THE INTERSTATE COMMERCE ACT. 379 during the same period and between the same termini, is not measured by the amount of discrimination in rates, but is hmited to the pecuniary loss suffered and proved under section 8, which provides for the recovery of damages sus- tained, together with a reasonable attorney's fee. See section 8, infra. The criminal liability under this section has been enforced by the provisions of the Elkins Act, infra § 519. Section 10 of the act makes the violation of any of the provisions of the act a misdemeanor and subject to punish- ment. For a conviction under this section, see the Party Rate case, supra, decided in 1897. § 257. Connecting carrier not responsible for dis- crimination by initial carrier. — While a railroad is responsible for the rates on a connecting road, which it operates as part of its own line -(Penn. R. R. Co. v. Interstate Coal Mining Co., supra), it was held by the Supreme Court in Penn. Refining Co. v. Western New York & Penn. R. R., supra, that a connecting carrier which receives cars from an initial carrier and participates in the through rate which is reasonable in itself, is not liable for a discrimination, alleged to have been made by the initial carrier in favor of shippers by tanks as against shippers by barrels, as the wrong, if any, was chargeable to the initial carrier only. § 258. Effect of rebates upon contracts of affreight- ment. — In Merchants Cotton Compress Co. v. Insurance Co., 151 U. S. 368, 38 L. Ed. 195 (1894), it was held, that there was nothing in the Interstate Commerce Act which vitiated bills of lading, or which by reason of the allowance of rebates actually made would invalidate a contract of affreightment, or exempt the railroad company from lia- bility on its bills of lading. This was a suit of an insurance company, which had paid losses claiming to be subrogated against the railroad company on bills of lading issued to the owners and consignees of cotton. It was not shown that the owner or consignee of the cotton had knowledge of the rebate. § 259. Discrimination in allowance to private trans- fer companies. — The railroads operating west from St. 380 THE- INTERSTATE COMMERCE ACT. [SECTION 2 Louis made the rate on west bound traffic from East St. Louis ^he same as from St. Louis, and out of this rate allowed five cents per hundred pounds to transfer companies hauling less than carload lots from East St. Louis to St. Louis. The commission (10 I. C. C. 661), without deciding whether the railroads could properly apply the St. Louis rate to the station of a bona fide transfer company in East St. Louis and absorb the cost of transfer to St. Louis, nor whether by proper schedule they could allow all shippers from East St. Louis a fixed sum per hundred pounds for transporting their merchandise to the stations in St. Louis, ruled that an allow- ance from the rate could not be made to a carrier company, which was in effect only a private carrier organized and doing the business of one shipper, as such payment would be in effect a rebate to such shipper. §260] THE INTERSTATE COMMERCE ACT. 381 Section 3. § 260. Section 3. Undue or unreasonable preference or advantage for- bidden. 261. Origin of the section. 262. Relation to sections 1 and 2. 263. Preferences of localities enforced by competitioa are not unjust. 264. Application of the competition rule. 265. Whether competition is controlling is a question of fact. 266. Discrimination between domestic and foreign traffic in import and export rates not unjust preference. 267. Milling in transit and export trade. 268. Application of the import rule to intermediate points on the line. 269. Undue preference in export rates and bills of lading. 270. Through rating by water route. 271. Competition created by carriers. 272. The "basing point system" not illegal. 273. Basing points not exempt from regulating power of commission. 274. Grouping of rates. 275. Qualifications in the application of the competition rule. 276. Recognition of natural advantages of localities not an unjust preference 277. Country and town millers. 278. The competition of localities. 279. Competing cities on opposite banks of rivers. 280. St. Louis and East St. Louis coal rates. 281. Terminal charges, St. Louis and East St. Louis. 282. Privilege of grain-reshipment in Nashville within six months. 283. Differentials between competitive cities. 284. Preference in demurrage charges. 285. Uniform demurrage rules recommended. 286. Different forms of undue preference. 287. Undue preference in allowance for grain elevator service. 288. Undue preference in wharfage rights. 289. Wharves and approaches thereto. 290. Management of freight stations and warehouses must be with- out preference. 291. Undue preference in car service. 292. The commission's regulations of coal car service sustained. 293. The irregularities in mine ratings for distribution of coal cars. 294. The embargo by a carrier on coal cars going to other carriers unlawful. 295. Distribution of cars for transportation of grain. 296. Discrimination by carrier in its own favor. 297. Undue preference in private cars. 298. Demurrage and other charges on privately owned cars. 382 THE INTERSTATE COMMERCE ACT. [SECTION 3 299. Exclusive use of excursion or sleeping cars of one owner. 300. Leasing Of cars does not carry right of exclusive use by owner. 301. Stoppage in transit privileges. 302. Fabrication in transit. 303. Reconsignment charges. 304. Transit privileges. 305. Privilege of storage in transit. 306. Transit privilege in lumber shipments. 307. Interference by state railroad commission with proportional tariff rates. 308. The rates on bales of compressed cotton. 309. Sidetracks and connections. 310. Switch connections and local terminal facilities. 311. Absorption of switching charges. When preferential. 312. Undue preference in denying shippers the choice of route. 313. Undue preference in arbitrary division of territory. 314. Rate wars and undue preferences. 315. Discrimination in kinds of traffic. 316. Preferences against traffic — must involve injury. 317. A reasonable regulation of carload weights not preferential. 318. Differentials between grain and grain products. 319. Discrimination in mode of shipment. 320. Classification. 321. Uniform classification recommended. 322. Classification distinct from rate making. 323. Consultation of carriers in classification not illegal combination. 324. Undue preference in classification. 325. Power of commission in correcting classification. 326. Reasonable regulations in 'classifications. 327. Facilities for interchange of traffic. 328. Discrimination in exacting prepayment from connecting carriers. 329. Discrimination in exacting prepayment from shippers. 330. State control of interchange of interstate traffic. 331. State and municipal control of terminals. 332. The charging of local rates not an unjust discrimination. 333. The right of exclusive through routing. 334. Contract rights of trackage. 335. Rights of connecting carriers as to milling in transit privileges. 336. Exclusive contracts for station facilities not unlawful. 337. Baggage transfer under the act. 338. Undue preference through action of State Commission. 339. Interstate and state passenger rates. 340. The relation of state fares to interstate. § 260. Section 3. Undue or unreasonable preference or advantage forbidden. — Sec. 3. — That it shall be unlaw- ful for any common carrier subject to the provisions of this act to make or give any undue or unreasonable preference or §261] THE INTERSTATE COMMERCE ACT. 383 advantage to any particular person, company, firm, corpo- ration, or locality, or any particular description of traffic, in any respect whatsoever, or to subject any particular person, company, firm, corporation, or locality, or any particular de- scription of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever. [FacUitieB for interchange of trafBc] Every common carrier subject to the provisions of this act shall, according to their respective powers, afford all reason- able, proper, and equal facilities for the interchange of traffic between their respective lines, and for the receiving, forwarding, and delivering of passengers and property to and [Discrimination between connecting lines forbidden.] from their several lines and those connecting therewith, and shall not discriminate in their rates and charges between such connecting lines; but this shall not be construed as requiring any such common carrier to give the use of its tracks or ter- minal facilities to another carrier engaged in like business. § 261. Origin of the section. — This section has not been amended. It was said by the Supreme Court in the Import Rate Case, 162 U. S. 197, 1. c. 222, 40 L. Ed. 940 (1896), that it was modeled upon the second section of the English act, for the better regulation of traffic on railways and canals, of July 10, 1854, and the eleventh section of the act of July 21, 1873, entitled "An Act to Make Better Provision for Carrying into Effect the Railway and Canal Act of 1854, and for other purposes connected therewith." Section 2 of this English act of 1854 is as follows, 17 and 18 Vic. c. 31. "2. Every railway company, canal company, and railway and canal company, shall, according to their respective pow- ers, afford all reasonable facilities for the receiving, and for- warding and delivering of traffic upon and from the several railways and canals belonging to or worked by such com- panies respectively, and for the return of carriages, trucks, boats, and other vehicles, and no such company shall make or give any undue or unreasonable preference or advantage to or in favor of any particular person or company, or any particular description of traffic, in any respect whatsoever, nor shall any such company subject any particular person or company, or any particular description of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever; and every railway company and canal company, and railway and canal company having or working 384 THE INTERSTATE COMMERCE ACT. [SECTION 3 railways or canals which form part of a continuous line of railway or canal, or railway and canal communication, or which have the terminus, station, or wharf of the one near the terminus, station, or wharf of the other, shall afford all due and reasonable facilities for receiving and forwarding all the trafTic arriving by one of such railways or canals by the other, without any unreasonable delay, and without any such preference or advantage, or prejudice or disadvantage, as aforesaid, and so that no obstruction may be afforded to the public desirous of using such railways or canals, or rail- ways and canals as a continuous line of communication, and so that all reasonable accommodations may, by means of the railways and canals of the several companies, be at all times afforded to the public in that behalf." Section 11 of the English act of 1873, 36 and 37 Vic. c. 48, re-enacts section 2 of the English act of 1854, and provides specifically for the enforcement of the duty of receiving, for- warding and delivering from and to other companies. For history of this second section of the English act of 1854, see opinion in the case of L. & Y. Railroad Co. v. Greenwood, Law Reps. 21 Q. B. D. 215. The equality clause of the Rail- way Clauses Consolidation Act of 1845 had been construed by the courts to mean equal rates for the carriage of goods over the same portions of the line, and did not apply where the places over which the goods were carried were not the same; and this restricted application led to the more com- prehensive provisions of the act of 1854. It will be seen that section 3 of the act of congress to regu- late commerce inserts the word "locality," which does not ap- pear in the English act, so that any undue or unreasonable preference or advantage is prohibited to any particular person, firm, company or corporation or any locality, or any particular description of traffic. The effect of the English cases construing the preference branch of the English act were thus summarized by Judge Jackson in his opinion in the Party Rate case in the circuit court, 43 Fed. 37 (1890), (affirmed by the Supreme Court in 145 U. S. 263, 36 L. Ed. 703, (1892), supra), quoting from a report of the English Amalgamation Committee of 1872, page 130, as follows: "The effect of the decisions seems to be that a company is bound to give the same treatment to all persons equally § 262] THE INTERSTATE COMMERCE ACT. 385 under the same circumstances, but there is nothing to pre- vent a company, if acting with a view of its own profit, from imposing such conditions as may incidentally have the effect of favoring one class of trade or one town, or one portion of that trafTic, providing the conditions are the same to all per- sons, and are such as lead to the conclusion that they are really imposed for the benefit of the railway company." It was said by the Supreme Court in this case, 145 U. S. 263, as to both sections 2 and 3, p. 276 : "It is not all discrimina- tions or preferences that fall within the inhibition of the statutes; only such as are unjust and unreasonable. * * * Indeed the possibility of just discrimination and reasonable preferences is recognized by those sections in declaring what shall be deemed unjust." § 262. Relation to sections 1 and 2. — The first para- graph of the section in its prohibition of any undue or unrea- sonable preference or advantage to any particular person, company, firm or corporation, or the subjection of any par- ticular person, company, firm or corporation to any undue or unreasonable prejudice or disadvantage in any respect what- ever, is comprehensive enough, standing alone, to include the prohibition of discrimination contained in section 2, and such is the judicial construction in England of the term "undue or unreasonable preference or advantage" as used in the English Railway and Canal Traffic Act, from which the terms of this section are taken. United States v. D. L. & W. R. Co., 40 Fed. 101 (1889). Section 3 is broader than section 2 in that it is not limited to discrimination in rates, but includes any form of unjust dis- crimination or preference whereby a person, a class of busi- ness, a locality, or a kind of traffic is unjustly prejudiced. That part of the section which forbids a carrier from mak- ing or giving any undue or unreasonable preference or ad- vantage to any particular description of traffic, it was said in U. S. V. B. & 0. R. Co., 153 Fed. 997 (1907), relates to the property transported, and does not apply to either the method of transportation or the rate charged therefor. Section 1 prohibits unreasonable rates and the reasonable- ness of rates can only be determined by the consideration of whether rates are relatively reasonable. A rate which sub- J-25. 386 THE INTERSTATE COMMERCE ACT. [SECTION 3 jeets a person or community or any kind of traffic to any un- due or unreasonable prejudice or disadvantage is in that sense an unreasonable rate. Proceedings before the com- mission and the courts contesting the rates established by the carriers have usually included sections 1 and 3 and not in- frequently sections 1, 2, 3, and 4, the latter when the long and short haul on the same line are involved. Under section 3 however, it is only the relative reasonableness of a rate which is considered, and as cases of individual discriminations in rates have been considered in connection with section 2, the cases grouped under this section will be those relating to discriminations between shippers other than in rates and to alleged preferences to localities and kinds of traffic. § 263. Preferences of localities enforced by competi- tion are not unjust. — Section 3 has been closely related to section 4 in the judicial discussion of the relation of competi- tion to preferential rates. Section 3 contains the general pro- hibition of undue or unreasonable preference or advantage to any locality, while section 4 contains the specific prohibition of any greater rate for a shorter than for a longer distance over the same line, subject to the provision that on application to the commission a higher rate for a short haul may be charged if allowed by the rate regulating body. After the decision of the Supreme Court in the Social Circle case in 1897 (162 U. S. 184), infra, section 4, it was ruled by the commission in a proceeding involving the relative rates to Chattanooga and Nashville from the eastern seaboard, 5 I. C. C. R. 546, and 4 Int. Com. Rep. 213, that while the carrier had the right under the law then existing to judge in the first instance, whether it was justified in making the greater charge for the shorter distance under section 4, nevertheless the third section of the act forbidding the making or giving of undue or unreasonable preference or advantage was still ap- plicable, and that where such unjust preference was created, even as a result of railway competition, compeUing a lower charge for a longer haul, the carrier should apply for exemption under the proviso of the fourth section. This ruUng was sustained in the circuit court and C. C. A., on somewhat different grounds, 39 C. C. A. 413 and 99 Fed. § 264] THE INTERSTATE COMMERCE ACT. 387 52, but was reversed in the Supreme Court, East Tennessee, etc., R. Go. V. Commission, 181 U. S. 1, 45 L. Ed. 719, 729 (1901), who said that the effect of this ruling of the commis- sion was to blend the third and fourth sections in such a manner as to necessarily destroy one by the other. The pro- hibition of the third section was directed against unjust discrimination or undue preferences arising from the volun- tary or wrongful act of the carriers complained of, and does not relate to acts the result of conditions wholly beyond the control of such carriers. Where the competition was con- trolling, the preference was not undue or the discrimination unjust. It appeared in this case that there was a margin of profit in the rates in force to Nashville and Memphis. The court said there might be a case where the carrier would not be allowed to avail himself of the competitive condition. Thus if he could not meet the competitive rate without transporting the merchandise at less than the cost of trans- portation, and therefore bringing about a deficiency which would increase charges upon other business, the engaging in such competitive traffic would both bring about an unjust discrimination and a disregard of the public interest. The court said that the question whether the charges were reasonable or otherwise, and whether the certain discrimina- tions were due or undue were questions of fact to be passed upon by the commission in the light of all the facts, and the case was directed to be remanded and the proceedings dis- missed without prejudice to the rights of the commission to proceed with the further investigation of the facts. § 264. Application of the competition rule. — The same ruling has been made in several cases in the circuit courts and circuit courts of appeal. Thus in Commission v. Atlantic Railway Co. et al., 35 C. C. A. 217, and 93 Fed. 83, (1889) the court said that under the decisions of the Supreme Court competition was a factor to be considered, and if the competition was real and controlling, it created substantially different circumstances and conditions, and where such lower rate was so induced, if not so low as to be unreasonable and unremunerative to the carrier, it could not afford a basis of undue and unreasonable preferences and advantages in 388 THE INTERSTATE COMMERCE ACT. [SECTION 3 favor of the competitive point within the inhibition of the third section, nor be unjust and unreasonable under the first section of the act. It would seem however that under the rulings of the Supreme Court even if the competition is con- trolling, and thus creates substantially different circum- stances and conditions justifying the lower rate for the entire haul, and precluding the inference of an unjust preference therefrom, it would still remain for the commission under all the facts to determine whether the established rates were reasonable or not. See also 10 I. C. C. Ill, where the commission applied the ruling of the court in this case to the reasonableness of rates from New York to Chattanooga and Nashville. In 12 I. C. C. 68, the commission said that a railroad could not arbi- trarily determine that a particular mill shall compete in a certain market with other localities, and that other mills on its line shall not so compete, particularly where the discrimi- nation is not justified by operating conditions. It was also ruled, 13 I. C. C. 56, that dissimilar circumstances, which justified under section 4 a greater charge for a shorter than a longer haul, will also prevent such rate from constituting an illegal preference or advantage under section 3, and in 13 I. C. C. 342, that a carrier may in its own interest, if it so desires, carry for a longer distance over its own lines than would be necessary if carried between the same points over the line of its competitor, in order to obtain a portion of the competitive business, upon terms that will afford some profit. It did not necessarily follow, however, that a carrier in com- peting for traffic in this way thereby subjects itself to an order compelling it to do so. And in 15 I. C. C. 11, a carrier with a longer route is not obliged as a matter of law to meet the rate of a short line competitor; and neither is a carrier via any route obliged as a matter of law to reduce its rates because a short line competitor reduces its rate, which has been the same via both routes. And also, 15 I. C. C. 49, the commission declined to lend sanction to the idea that a lower rate in effect via one line than via another line is con- clusive evidence of an unreasonable rate. § 266. Whether competition is controlling is a ques- tion of fact. — When competition enters into a case as an ele- §266] THE INTERSTATE COMMERCE ACT. 389 ment, whether or not there is an undue preference or ad- vantage, that is whether the competition is controlling, is a question not of law, but of fact. Commission v. L. & N. Railroad Co., 73 Fed. 409 (1896). See also Brewer v. Central Railroad of Georgia, 84 Fed. 258 (1898); Commission v. Western A. R. Co., 88 Fed. 186; Commission v. Cincinnati & P. R. Co. et al., 124 Fed. 624 (1903). In the latter case, the commission, 9 I. C. C. 118, had found that the rates from western cities to Wilmington, N. C, were prejudicial and unduly preferential to Norfolk, Richmond, and other Virginia cities, and it ordered that they should be made upon a basis of 125 per cent of the rates contempora- neously in force from East St. Louis to Norfolk. The court refused to enforce this order, holding that the conditions at Norfolk and Richmond, by reason of the larger number of carrying lines, both rail and water, created a very active competition; and furthermore, the fact that these two cities were in what was known as trunk line territory and Wilming- ton was in what was known as southern territory, where there were fewer transportation lines and less active competition, resulting in higher rates to Wilmington, although the length of haul was about the same. The commission had refused to recognize the higher preferential rates based upon the location in the southern territory in another case from Wil- mington. See 9 I. C. C. 17. In the latter case the commis- sion said it was the first case during their fourteen years experience which showed a through rate charge over connect- ing roads in excess of the combination charges applying to and from an intermediate point on the through line. As to the competition rule, see also Commission v. L. & N. R. Co., 46 C. C. A. 685, and 108 Fed. 988, affirmed by the Supreme Court in 190 U. S. 273 and 47 L. Ed. 1047 (1903). For application by the commission of the competition rule to alleged preference, see 10 I. C. C. 29. Where the prefer- ence in rate exceeds the competitive rate, there is as to such excess a case of undue preference under this section. 10 I. C. C. 342. § 266. Discrimination between domestic and for- eign traffic in import and export rates not unjust preference. — An order was made by the commission in 390 THE INTERSTATE COMMERCE ACT. [SECTION 3 March, 1889, requiring that imported traffic transported to any place in the United States from a port of entry or place of reception, whether in this country or in an adjacent foreign country, should be taken on the inland tariff cover- ing other freights. Later, in June of the same year, in 3 I. C. C. 137, and 2 In€ Com. Rep. 553, the commission ruled that in export rates the proper method was to add to the estabhshed inland rates from the interior to the seaboard the current ocean rates. The commission ruled that as ocean rates were not subject to the control of the act, they were not proper for consideration in creating a dissimilarity in circumstances and conditions within the meaning of the act. The parties to the Export Rate case complied with the order of the commission, but the import rate ruling was contested by the Texas & Pacific Railroad Company. The commission ruled that the com- petition of ocean lines or circumstances affecting the move- ment of foreign commerce before reaching our own country did not constitute a dissimilarity of circumstances and con- ditions within the meaning of the act. Their ruling was sustained by the circuit court in a proceeding to enforce the order of the commission, 52 Fed. 187, and also by the C. C. A. 653, 57 Fed. 948. The latter court thought that some discrimination in rates might be justified under the circumstances, but that the rates imposed were un- reasonable. The Supreme Court in Texas Pacific Ry. vs. Commission 162 U. S. 197, 40 L. Ed. 940 (1896), reversed both courts and directed the dismissal of the bill (Justices Harlan, Brown and Fuller, C. J., dissenting). The Court said that the purpose of congress was to facilitate and promote commerce, and not to reinforce the provisions of the tariff laws, and that the effort of the commission to deprive inland consumers of the advantage of through rates seemed to create the mischief which it was one of the objects of the act to remedy, and that among the circumstances and conditions to be considered, as well in the case of traffic origi- nating in foreign ports as in the case of traffic originating witliin the limits of the United States, was competition at the seaports, and in deciding whether rates and charges, made at a low rate to secure foreign freights, which would §267] THE INTERSTATE COMMERCE ACT. - 391 otherwise go by competitive routes, are or are not undue and unjust, the fair interest of the carrier companies and the wel- fare of the community, which is to receive and consume the commodities, are to be considered. The Supreme Court said that the fact that there was a considerable disparity between other and local rates did not warrant the circuit court of appeals in finding that the disparity constituted an undue discrimination, as no such issue was made before the com- mission, and the defendant was entitled to have the reason- ableness of the rate considered, in the first instance at least, by the commission upon a full consideration of all the cir- cumstances and conditions upon which a legitimate order could be based. Especially was this true when there was no person, firm or corporation claiming that he or they had been aggrieved by the disparity in the rates, the party com- plaining being the commission itself. This decision was construed as applying to export rates as well as to import rates. The commission in its report of 1897 said that the carriers insisted that fhis decision controlled the rates for inland carriage to the seaboard of traffic for export, and recommended that congress amend the act giving the commission power to control inland rates, both import and export, but no such amendment has been enacted. It is a question of fact whether rates upon export or import traffic as well as those upon domestic traffic are un- reasonable and unjustly preferential, but as a matter of law, it is not any violation of the act for the carrier to make a lower rate to the point of export or from the port of import upon the traffic which is exported or imported than upon that which is locally consumed. See 8 I. C. C. 214. § 267. Milling in transit and export trade. — In 14 I. C. C. 356, the commission considered the case of a miller in the city of New York who competed in export business with shippers from the west, and it was ruled that as he was not entitled to a milhng in transit privilege, that he should have the same rate upon grain which he subsequently ground into export flour that the carriers accorded to interior mills upon export flour. The ruUng of the commission in this case was affirmed by the circuit court, S. D. of N. Y., N. Y. Ry. Co. v. Commis- 392 THE INTERSTATE COMMERCE ACT. [SECTION 3 sion, three judges concurring, 168 Fed. 131 (1909), which denied a temporary injunction against the enforcement of the ruling. The court said in its opinion that the commis- sion was an administrative tribunal deaUng with practical problems, and as long as parties affected by its orders appear and are fully heard, it has power to grant such relief as the facts shown upon the investigation call for, even though such facts may be presented by evidence technically outside of the issues raised by the pleadings, but were germane to the sub- ject matter of the investigation. The commission was there- fore empowered, where it found that a discrimination existed against a shipper or commodity, to prescribe a relative rate so that the charge should be the same as that for its similar services to other shippers or another similar com- modity, instead of fixing an absolute maximum rate, which would enable the carriers to continue the discrimination by reducing the rate to other shippers or on the other com- modities. See also Phila. Ry. v. U. S. 219 Fed. 988 (1915). See comments on this decision by the commission in the annual report of 1909, p. 30. § 268. Application of the import rule to inter- mediate points on the line. — It was ruled by the commis- sion, 8 I. C. C. 214, after the decision in the Import Rate case, that in the application of export grain rates the carrier should in no case make the rate from any point to the sea- board less than from any intermediate point on the same line, and that a rate on export flour from Minneapolis which was one and one-half cents less than the domestic rate to the port of export, with no corresponding concessions to inter- mediate millers, was an unlawful discrimination, and that any line participating in any such lower export rate on flour from Minneapolis must make a corresponding reduction on the same article from all intermediate points. See also 9 I. C. C. 534. As to the pubhcation of rates on export traffic, see infra, section 6. See also 8 I. C. C. 185, and 8 I. C. C. 110. The commission said in the case first cited that the Import Rate decision did not bar the import and export traffic from the purview of the commission, although it did require that §270] THE INTERSTATE COMMERCE ACT. - 393 conditions abroad as well as at home should be considered, and that the interests of classes, and not a single class, should be taken into account. See 8 I. C. C. 304. § 269. Undue Preference in Export Rates and Bills of Lading. — In 25 I. C. C. 216, the commission reported that it had no direct authority to require the issuing of a through export bill of lading, since it had no jurisdiction over the water carrier which was a necessary party to such a contract. But they said that this must not be understood as meaning that the commission might not act upon a rail carrier which is subject to its jurisdiction in a proper case, where the ocean carrier stands ready to enter into these through arrangements on reasonable terms, and that if the rail carrier declined to issue bills of lading through one port while issuing them through other ports, this will be an undue preference and an unjust discrimination against that port, unless justified by the conditions at the different ports. In this case it was found that the conditions at Galveston called for the application of an average demurrage rule, and four days was found to be a just period for computing the average demurrage. The subject of export rates was also considered in 23 I. C. C. 417, and 32 I. C. C. 272, and it was there ruled that the defendants owning docks and serving docks at Mobile should establish an interchanging switching system, so that in all events it should be available to any of the shippers located on any of the lines serving Mobile or any of the other connecting lines, distinguishing this case from the one considered in 28 I. C. C. 621, and that the charges for this terminal switching should be assessed on a basis of being reasonable and compensatory. In this case the commission thoroughly discussed the subject of discriminatory rates and practices of terminal systems and through routes and through bills. In 27 I. C. C. 403, the commission said that it had no direct authority to require the issuance of through export bills of lading, but it did have power to remove discrimination. § 270. Through rating by water route. — While the commission is given no jurisdiction over traffic moving entirely by water, and it is only in case of a common arrange- 394 THE INTERSTATE COMMERCE ACT. [SECTION 3 ment for a through transportation by railroad and water that the commission obtains jurisdiction over water carrier, yet, where a defendant ocean carrier voluntarily subjects itself to the jurisdiction of the commission by making a joint tariff from Augusta, Georgia, via Savannah to North Adams, Massachusetts, the commission ruled, 32 I. C. C. 380, (1913) that it had authority to compel such water carrier to file similar tariffs with respect to other points similar with North Adams and perhaps in competition with North Adams. The commission said that the defendant steamship companies did not, by coming under the act by making a through route with railroads, subject themselves to the requirement of the act as to their all water business which was not covered by the act ; but it was quite a different matter to say that they did not subject themselves to the jurisdiction of the commis- sion with respect to other traffic of the same character which may be, and is within the act. § 271. Competition created by carriers. — In the Nashville and Chattanooga Rate case, supra, the C. C. A. in an opinion by Judge Taft, 1. c. 424, commented upon the fact that the competition at Nashville was be- tween railroads under the same control, the Louisville & Nashville railroad owning the majority of the stock of the Nashville, Chattanooga & St. Louis Railroad Company, and that but for the restriction of normal competition by the Southern Traffic Association the situation of Chattanooga would win for her certainly the same rates as Nashville. The Supreme Court in its opinion reversing the case, held that the commission and the circuit court and circuit court of appeals had proceeded upon an erroneous construction of the act, in holding that a preference enforced by controlling competition could be unjust, and that the assertion that the road from Chattanooga to Nashville, growing out of the stock owner- ship, was in effect the Louisville & Nashville, was necessarily antagonistic to the express findiirg of the commission that the carriers through Chattanooga and Nashville were placed in position where they must meet the competition to Nashville or abandon all traffic to that point. The Court said that it could not undertaken the duty of weighing the evidence and § 272] THE INTERSTATE COMMERCE ACT. 395 determine the issues of fact, which the statute required the commission in the first instance to pass upon, and the case was therefore directed to be re-committed to the commission for that purpose. In Commission v. Southern Railway Co., 117 Fed. 741, (1902) the railroad company had acquired the ownership of the only road which had previously competed for the business to a certain point, but it was held that this could not affect the question whether its rates unjustly discriminated against such point in favor of another point where competition existed, where it affirmatively appeared that the rates to the non-competitive point had not been increased since the pur- chase of the competing road. In the later case of Interstate Commerce Commission v. L. & N. Railroad Co., 190 U. S. 273, 1. c. p. 283, 47 L. Ed. 1047 (1903), the Supreme Court said that if by agreement or com- bination among carriers it was found that at a particular point, rates were unduly influenced by a suppression of competition, that fact would be proper to consider in deter- mining the question of undue discrimination and the reason- ableness per se of the rates to such possible competitive points. It must be an actual and not possible competition. See also infra, section 4. It therefore is a question of fact to be determined by the commission whether the preference is induced by the competition, and whether competition is forced upon the carrier or whether the preference is effected through an agreement or combination stifling competition. But if the preference is compelled by the competition, then is not unjust, under section 3, though the rates may still be unreasonable per se and on this ground violative of section 1 of the act. § 272. The "Basing Point System" not illegal. — The commission in several cases had condemned what had been called the "Basing Point System" prevaihng in the south. 4 I. C. C. 686, 3 Int. Com. Rep. 482 and 6 I. C. C. R. 342; 6 I. C. C. 361; 8 I. C. C. 142. This system consisted in basing local rates according to the relative distance of the local points by the distance of such points from the com- petitive points, the rate being ascertained in each case by 396 THE INTERSTATE COMMERCE ACT. [SECTION 3 adding to the through rate to the basing point the local rate from that point back to the local point, the result being that the local points were given an advantage resulting from their proximity to the basing point in proportion to the degree of such proximity. The Interstate Commerce Commission on the complaint of a merchant of La Grange, Alabama, made an order upon the railroad to desist from charging upon this basing rate to La Grange based upon its rate to Atlanta, the basing point. The circuit court sustained the order of the commission. Interstate Com. Com. v. L. & N. R. Co. 102 Fed. 709. This judgment was reversed by the C. C. A., 108 Fed. Rep. 988, and the judgment of the latter court was affirmed by the Supreme Court, Commission V. L. & N. Railroad Co., supra. The latter Court said that as it was conceded that the rate on the through freight from New Orleans to Atlanta was the result of competition to Atlanta, there was a resulting dissimilarity of circumstances which prevented any unjust preference in the fact of a high charge to La Grange, and that there was no just cause of complaint in giving to the local stations the advantage result- ing from their proximity to Atlanta, the competitive point, as the same result would have followed if the rate had been fixed at Montgomery, the competitive point nearer to New Orleans, and the local rate fixed from thence on. It was subsequently ruled by the commission (1907), in 12 I. C. C. 372, that in a territory where the basing point had been in operation since the advent of railroads, rates to a competing point made by a combination of the through rate to the nearest trade center and the local beyond, need not, under the construction of the fourth section by the Supreme Court, be reduced to the basis of every neighboring point of like distance, when the other points in the group whose rates are sought have the advantage of water or other competition. This was prior to the amendment of the fourth section by the act of 1910. § 273. Basing points not exempt from regulating power of commission. — In Interstate Commerce Commis- sion V. Chicago R. I. & P. Co., 218 U. S. 88, 54 L. Ed. 946 (1910), the Supreme Court (Justices White, Holmes, and §273] THE INTERSTATE COMMERCE ACT. 397 Lurton dissenting) reversed the circuit court of the northern district of Illinois, 171 Fed. 680, which had enjoined the enforcement of an order of the commission reducing the class rates on through freight from the Atlantic seaboard to the Missouri river cities. It was claimed, and a majority of the circuit judges held, that this order was beyond the power of the commission, as it introduced a new system of rate making which had theretofore had the Mississippi river as a basing point; but the Supreme Court held that on the finding of the commission, which carried with it the presumption of correct- ness, that the through rates to the Missouri river cities were too high and unreasonable, that the commission had the power to readjust the rates, although that involved a change in the basing points theretofore estabhshed in rate making. The Supreme Court in this case quoted from the opinion of the commission 14 I. C. C. 312. "We are not impressed with the view that making rates on certain basing lines should be abolished. No system of rate making has been suggested as a substitute for it, except one based upon the postage stamp theory or one based strictly upon mileage. Either of these would create a revolution in transportation affairs and chaos in commercial affairs that had been builded upon the system of rate making now in effect. It must not, however, be assumed that a basing line for rates may be established and be made an impassable bar- rier for through rates, or that cities or markets located at or upon such basing line have any inviolable possession of or hold upon the right to distribute traffic in or from the terri- tory lying beyond. Development of natural resources, in- crease in population, growth in manufacturing or producing facilities and increased traffic on railroads, create changed conditions which may warrant changes in rates and in rate adjustments in order to afford just and reasonable oppor- tunity for interchange of traffic between points of produc- tion and points of large consumption." And the Supreme Court added: "It was the sense of the commission, however, that such points could not be immovable forever and fixed forever against power of changing, or that through rates based on such points must be exempt from regulation no matter what their character, or be constituted at the will of the railroads of the sum of local rates or the sum of rates from one basing point to another, however unjust the rates might be," 398 THE INTERSTATE COMMERCE ACT. [SECTION 3 The commission has ruled, 18 I. C. C. 502, that if the basing point system is adopted, it must be applied alike to all places where real dissimilarity of circumstances or controlling competition does not exist. See also, as to application of system in rate making, 16 I. C. C. 20, 56, 182, 134, 254; 7 I. C. C. 30, 197, 302. In this connection see orders of the commission upon appli- cation for relief from the long and short haul provision of section 4 and creating zones of traffic as basing points in connection with transcontinental traffic, § 352, infra. § 274. Grouping of rates. — While section 4 of the act prohibits the charging of a greater rate for the shorter dis- tance, there is no prohibition against charging the same aggre- gate rates on like traffic for the longer distance over the same line in the same direction. There is in the act no require- ment of mileage apportionment of rates. The commission in several cases has passed upon the so called "group" or "blanket" rates, that is, the making of the same rates for different points situated on the same line, or on different lines under the same control communicating with a common centre and being the same or approximately the same dis- tance from such centre and possessing substantially the same commercial relations. The principle was applied in 2 I. C. C. 540, and 2 Int. Com. Rep. 313, to a large number of mines composing a coal mining district extending across the state of Ilhnois to points in western Wisconsin, Iowa and Minne- sota, the distance by some part of the route being sub- stantially a fair equivalent for the distance from other points and the commercial necessities being substantially the same for all. In another case the grouping of coal rates at the rate of ninety cents per ton for a distance covering a radius of forty miles around Pittsburgh, Pennsylvania, was sustained. 2 I. C. C. 618, 2 Int. Com. Rep. 436. The commission said that actual undue prejudice or damage of which the rate is the cause must result to more favorably situated producers to render a group rate unlawful. In this case the commission cited the practice under the English Railway & Canal Traffic Act of 1854, where it had been held that the grouping of § 274] THE INTERSTATE COMMERCE ACT. 399 rates was not unlawful, unless as a matter of fact the effect was to produce an undue preference, and noted that the new Enghsh act of 1888 had made specific provision for grouping of rates in conformity with the rule which had been acted on by the commissioners and the courts. See also 4 I. C. C. 533, and 3 Int. Com. Rep. 460, where groupings of mines in the Lehigh anthracite coal region was held to involve no un- reasonable disadvantage. Thus in 4 I. C. C. 417, 3 Int. Com. Rep. 400, it was found that the rates on wheat and wheat flour, for reasons peculiar to the territory lying west of the Mississippi river, and com- prising the large portion of Texas, the state of Missouri and a considerable portion of Kansas, were grouped, without refer- ence to distance. In 7 I. C. C. 92, the subject of grouping of rates was considered in its application to the rates on milk, which was fixed at a uniform rate from all interstate shipping stations along the lines of the New York, Susquehanna & Western Railroad west of the Hudson river to the points of delivery at Weehawken, Hoboken and Jersey City. The commission said, reaffirming 6 I. C. C. 131, that the practice of making one rate for the same product over a very large district and thus equalizing the burdens of transportation to the same market was only justified under special and ex- ceptional circumstances. The circumstances in this case were peculiar, in that the furnishing of an extra perishable article like milk in no greater quantity than is required for daily use in a great city was a business which falls naturally to those producers nearest the city who were able to provide the needed supply. The commission found under the facts that a uniform or blanket rate from all stations of the road was an unreasonable preference to the more distant stations, and said there should be at least four divisions, extending re- spectively forty miles, fifty-two miles, one hundred miles, one hundred and ninety miles and stations beyond one hundred and ninety miles, with rates adjusted to the respective groups according to distance. On this application of the grouping of rates to milk traffic, see 2 I. C. C. 272, and 2 Int. Com. Rep. 162. In 5 I. C. C. 478, and 4 Int. Com. Rep. 183, "blanket" or group class rates applying upon the Northern Pacific road for 400 THE INTERSTATE COMMERCE ACT. [SECTION 3 a distance of over five hundred and eighty miles were found relatively unreasonable. In 7 I. C. C. 43, group rates of seventy per cent, on second class articles and forty-four per cent, on third class applying within a distance of two hundred and seventy-one miles from Pritchard, Alabama, to Verona, Mississippi, on ship- ments over an extreme distance of six hundred and forty miles to East St. Louis, and which in the next two hundred miles fall to thirty per cent, on second class and twenty-two per cent, on the third class, were ruled prima facie unreason- able and unjustly discriminative against points within the group which were nearer to East St. Louis, and unfair as to shipments from Verona. The commission said however that there were probably circumstances under which a group rate of this kind might be justifiable, and no order was made pending an opportunity for the defendant to readjust its group scale, or justify the apparent discrimination. § 275. Qualifications in the application of the com- petition rule. — ^The judicial construction of the term "un- due preference" by the elimination therefrom of the prefer- ences compelled by railway competition has very materially affected the enforcement of the third section by the commis- sion. Thus during the first ten years after the enactment of the law, the commission proceeded upon a different theory of the law, and the decisions reported in the first six volumes of the Interstate Commerce Commission Reports, and all of the Interstate Reports, in the construction of this section as well as of section 4, are based upon the theory that the com- petition of railways subject to the act was not, although it was conceded that water competition was, a justification of a higher rate for the shorter haul and the resulting preference of localities. In 8 I. C. C. 107, the commission said that the greater charge for the shorter than for the longer haul over the same line in the same direction had been made in no case which had been presented to them, except where the competition existed at the longer distance points and was set up as the sole excuse for such greater charge. But under the decisions of the Supreme Court, the applica- tion of the competitive rule is subject to the following quaU- §275] THE INTERSTATE COMMERCE ACT. 401 fications : First, the competition must compel the lower rate ; that is, the competition must be controUing. The carrier must either reduce its rates or lose the business. Second, the competition must not be created by the carrier; that is, the preference must not be affected through an agreement or combination of the carrier with other carriers stifling com- petition. Third, the competitive rate must be at the pre- ferred point remunerative to the carrier. Fourth, the rates must be reasonable in themselves. This reasonableness of rates in themselves must be deter- mined in the light of all the circumstances. The commission has ruled, 9 I. C. C. 581, following the decision of Chairman Cooley in 2 I. C. C. 231 and 2 Int. Com. Rep. 137, that no rates can be reasonable in themselves within the contempla- tion of the act which are made regardless of proportion ; that rates to be reasonable must be under all the facts and cir- cumstances relatively reasonable. In the case cited, the com- mission ruled that although there was a substantial dissimi- ilarity of circumstances and conditions as between Nashville and intermediate points on the Louisville & Nashville Rail- road to Louisville, so that section 4 of the act did not apply, that a difference of one cent in the rates fully offset this difference in circumstances and conditions, and that any greater difference rendered the rates from the intermediate points relatively unreasonable in violation of sections 1 and 3, although the commission said that it did not feel com- petent to say that the rates from the intermediate points, independent of the Nashville rate, were absolutely unreason- able in and of themselves. The commission has considered the claims of unjust prefer- ence in the adjustment of rates as between localities in a great variety of cases from all parts of the country. Thus in 8 I. C. C. 608, the subject of the transcontinental rates was con- sidered, and it was ruled that the rates from Denver to San Francisco should not be higher than the rates from Missouri river points to San Francisco. It was found however that the rate on sugar might be higher to Denver from San Fran- cisco than to the Missouri river on the ground that the cir- cumstances and conditions governing the trafTic were different when it was carried to Missouri river points than J— 20. 402 THE INTERSTATE COMMERCE ACT. ISeCTION 3 when it stopped at Denver, but that there was nothing shown justifying higher intermediate rates on any article west bound. In 10 I. C. C. 460, decided in 1905, the differential be- tween Wichita and Kansas City and other Missouri river points of fifteen cents against Wichita was ruled exces- sive. In a former case, 6 I. C. C. 586, such a differential was held violative of the long and short haul clause, but that deci- sion was rendered before the construction of the clause by the Supreme Court. As railroad competition existed at Kansas City, a higher charge to Wichita was justified, but the amount of the differential, fifteen cents per one hundred pounds, on sugar in carloads, was ruled unduly preferential under section 3. The rate from New Orleans to Wichita, forty cents per one hundred pounds, was also ruled to be unreasonable per se. In 8 I. C. C. 503, the rates from St. Louis, Nashville and Chattanooga, to Hampton and Palatka, in Florida, were ruled prejudicial to the Hampton merchants. That while the competition at Palatka justified a lower rate, the difference should not be greater than the local rate from Palatka to Hampton. In 9 I. C. C. 160, rates on sugar from New Orleans to Tifton, Georgia, were ruled unduly prejudicial as compared with rates to other Georgia points. See also on general subject of undue preference to localities, 8 I. C. C. 316, and 8 I. C. C. 290. Where an existing relation of rates is found to be unduly preferential as between localities, the discrimination may be corrected by raising one rate or reducing the other, provided of course, the rate when adjusted is reasonable in itself. See 10 I. C. C. 456. In this case it was ruled that the existence of water competition between Buffalo and New York did not justify any wider difference in the rates from Saginaw and Buffalo to points on the New York and Long Branch Rail- road than existed in the rates from those shipping points to New York. In Philadelphia & R. Ry. Co. v. U. S. 219 Fed. 988, (1915) an order of the Interstate Commerce Commission that there was discrimination in a railroad company's failure to con- form to the rates of other companies, the discrimination § 277] THE INTERSTATE COMMERCE ACT. 403 consisting in conforming to those rates except as to a par- ticular locality, was sustained. These and other cases cited under the different topics of this section illustrate the almost infinite variety of circum- stances bearing upon the complex question of the adjustment of rates between localities. § 276. Recognition of natural advantages of locali- ties not an undue preference. — The commission has repeatedly ruled that a town favorably situated for trade, possessing natural advantages therefor, is entitled to the benefits in rates naturally arising from such location. See 5 I. C. C. 571, 4 Int. Com. Rep. 230; 10 I. C. C. 148 (the Michigan Salt Case). The law requires the regulation of railroad charges according to the ascertained rights of persons and places, and it is not an agency for the regulation of trade by enabling shippers or communities to do business by putting them on even terms with rivals more remote from competitive territory. 6 I. C. C. 458, 8 I. C. C. 409. The equal right of a competing locality is neither increased nor diminished by municipal subscriptions advanced for the building of a road. 2 I. C. C. 147 and 2 Int. Com. Rep. 95. The refusal to give a through rate is not an unjust discrim- ination against a locality when the same rule is applied to all towns and the privilege accorded to none, although the re- fusal may operate prejudicially to one town and favorably to another, as the discrimination must consist in doing for or allowing to one party or place what is denied to another. 1 I. C. C. 401, and 1 Int. Com. Rep. 703. § 277. Country and Town Millers.— In 30 I. C. C. 16, the commission said that they had fully considered the dis- advantages of the country millers over their competitors at the rate-breaking-points, where they endeavored to explain why the interior milling points located on the direct routes should be placed on the basis of substantial rate equality with rate-breaking-points, such as St. Louis, and held that its result had been that the total charge on the grain into the mill and on the flour out, is not more than the rate in and out of the rate-breaking-point, with the addition of a half cent charge for milling in transit. 404 THE INTEESTATE COMMERCE ACT. [SECTION 3 § 278. The competition of localities. — In 30 I. C.,C. 71, the commission discussed the relative position of towns where competitive points are in close proximity to one another and are in groups from and to which different group rates applied. "While carriers may establish common rates to a defined zone, or group points, and treat them all as uniform for rate fixing purposes, they should also be subject to the inhibitions of the law against creating undue prejudice to points just within or out of that zone. In 32 I. C. C. 297, November 1914, the Board of Trade of Kansas City attacked the proportional rates of the St. Louis, & S. F. Railroad Company on grain and grain products from Kansas City to Memphis, which it claimed were unduly differential as compared with rates maintained by it and its connections from Omaha, Nebraska to Memphis, and in connection with this complaint was heard another applica- tion under the 4th section, involving the maintenance of lower rates from Omaha than from Kansas City and a number of Mississippi valley destinations. A large number of associations like that of the complainant, competing with Kansas City protested any change in the present adjustment. The commission said that the changes asked for would affect, not only the grain traffic from Kansas City and Omaha to Memphis and the southeast, but would also have a bearing upon the traffic from nearly all markets to the destination territory involved, as well as to other destinations. That in a case of this kind there must be an examination of the entire rate from point of production to point of destination. It is not sufficient to consider the rates to an intermediate market, nor alone the rates from and to such market, if the question of discrimination between such markets is to be determined. It was not within the power of the commission to equalize economic conditions and to place one market in a position to compete on equal terms with another market as against natural advantages. Nor has the commission power to require railroads in the face of varying trade conditions to adjust their rate schedules in such a manner as to insure to a market the continuance of the trade which it once enjoyed. The commission dismissed the complaint, except in so far as it related to rates on grain products from Kansas City and § 278] THE INTERSTATE COMMERCE ACT. 405 Omaha, which were higher from Kansas City than from Omaha, to certain Mississippi valley destinations, which involved the consideration of the section 4, and was there- fore held for further consideration. Neither can a railroad be held to discriminate against a . town which it does not reach and in whose carrying trade it does not participate. 5 I. C. C. 264, and 4 Int. Com. Rep. 65. While the commission has conceded that the recognition of natural advantages of localities is not unduly preferential, yet it has also ruled that the mere fact that one point is larger than another with more busiriess does not justify a discrimi- nation in its favor, 9 I. C. C. 42, and that one of the underly- ing principles of the act was equality between great and small. See also 2 I. C. C. 25 and 2 Int. Com. Rep. 32. In 27 I. C. C. 457, the commission, discussing the competi- tive condition between Sioux City and Omaha and Kansas City, said that in considering the lawfulness of rate adjust- ments, the commission could not treat all carriers within its , jurisdiction as if they were embraced in one united system, and deal with complaints against existing rights as matters alone of general policy in which it may exercise a wide dis- cretion in equalizing all details between markets, but it must give full recognition to the separate organizations and obhgations of individual carriers, and to the effect of sub- stantial diiferences in the circumstances and conditions in the determination of whether the granting or withholding of a given rate or practice is an undue preferential or prejudicial against the complaining locality. For original consideration of this case, see 27 I. C. C. 98. In Southern Railroad Co. v. United States, 204 Fed. 465, it was held by the commerce court (1913) that section 15 of the interstate commerce act as amended in 1906 confers on the commission power to determine whether rates put in force by carriers discriminate between two cities, and under the same power it has a right to extend its scope of the examination far enough to arrive at the true situation with respect to all matters which properly tend to show whether or not under sec. 3 undue preference has been given one city over another, and when such a finding is made, if the com- merce commission had jurisdiction of the subject, it is not reviewable by the courts. 406 THE INTERSTATE COMMERCE ACT. [SECTION 3 For ruling of the district court, E. D. of Penn. (three judges sitting) on the question of the power of the commission in terminating discrimination between cities, see supra, § 275. § 279. Competing cities on opposite banks of rivers. — The principle that a city is entitled to the benefits arising from its location, and that when it enjoys exceptional ad- vantages in one respect it should not therefore be subjected to discrimination in other respects, has been applied in the case of cities situated on the banks of rivers, which railroads must cross by expensive bridges for which an arbitrary toll is charged, or which must be allowed for in an apportionment of through rates. Several such instances have been pre- sented to the commission. Thus the cases of Omaha and Council Bluffs, St. Louis and East St. Louis, Cincinnati and Louisville were presented, though in the latter case the cities are situated on the opposite banks of the Ohio river some distance apart, but are competitors for the business of the same territory. In the case of Cincinnati, 7 L C. C. 180, complaint was made by the Freight Bureau of the Chamber of Commerce against the higher rates charged from Cincinnati than Louis- ville to southern points. The commission said that the loca- tion of Cincinnati upon the north bank of the Ohio river and the fact that the railroads leading south must cross that river by expensive bridge charges justified a higher differential from Cincinnati over rates from Louisville on the south bank of the river. As the commission had nothing before it except the fact of distance, it did not pass any opinion as to whether the existing differentials were just or excessive. In the case of Omaha and Council Bluffs, 7 I. C. C. 386, it was ruled that there was no unjust discrimination against Omaha in the fact that rates to points in Iowa were higher for Omaha than for Council Bluffs by the amount of the bridge toll on an expensive bridge over the Missouri river. It was said in the opinion that all like or group rates were frequently applied to cities considerably further apart than Omaha and Council Bluffs, but that the usage in this regard was not so uniform and well established as to make their application to those cities even prima facie unjust. §281] THE INTERSTATE COMMERCE ACT. 407 § 280. St. Louis and East St. Louis coal rates. — In the so called Illinois coal rates, 32 I. C. C. 659, (January 1915) the commission considered the reasonableness of the present and the proposed increased rates from certain coal mines in Illinois to the city of St. Louis. It was contended on the part of St. Louis that the city of St. Louis and East St. Louis formed one commercial centre and were therefore entitled to one common rate on all traffic. The commission said the fact remained that Illinois coal moved to East St. Louis over ordinary stretches of track, involving no unusual traffic con- ditions, while the delivering to St. Louis after it had reached East St. Louis could be effected only through the performance of the additional transportation service over bridges, or by means of other instrumentalities of carriage, that effort involving not only additional expenses to operate, but a very substantial additional outlay of capital. The commission therefore said that they were not prepared to say that the difference between the two was not a material one from a commercial point of view. On long haul traffic the charges of the terminal association were absorbed in the through rate in the absorption of them by the line carriers, and their larger revenues made this traffic possible, enabling them to do this. But the commission found no just basis for requir- ing the absorption by the lines of the carrier of the charges of the terminal association on the short haul traffic, leaving them a very much smaller revenue. It was found that a differential of twenty cents between St. Louis and East St. Louis was not unreasonable under the circumstances. § 281. Terminal charges, St. Louis and East St. Louis. — Complaint was made by various warehouse men in St. Louis and some individual shippers in regard to arrange- ments between interstate carriers and certain transfer com- panies, for the handling of interstate shipments between the terminals and East St. Louis and the destination to the city of St. Louis. The commission entered upon its own motion an inquiry and reported, 34 I. C. C. 453, that the terminal rail facilities of St. Louis had not grown proportionately with the growth of commerce and trade in the community. Prior to 1906 the St. Louis rates were based on the East St. 408 THE INTERSTATE COMMERCE ACT. [SECTION 3 Louis rates "and were made by adding to the latter the charge for transferring the traffic across the river. The faci- lities for crossing the river have a capacity forty per cent, in excess of the maximum demand ordinarily made upon them. The congestion and delay therefore is due to other causes, and grows largely out of the inadequate depot and other facilities on the west side of the river, and is experienced most acutely, if not already, in connection with less than car load traffic. The eastern lines having terminals in East St. Louis only were compelled to make arrangements with transfer companies to move the freight by wagons, between St. Louis and East St. Louis. The freight stations of St. Louis, often referred to as "off -track" stations, because they are not reached by the rails of any carrier, are in buildings owned or leased by the transfer companies and are operated by the transfer companies as agents of the carrier. Shippers and consignees who use for private storage the warehouses of transfer companies in which freight houses are conducted are at no expense for cartage; while the merchants who use their warehouses for storage must pay the cartage charges. The contracts between the transfer companies and the railroad provided that the transfer companies shall charge the shipper and con- signee as much for carrying their shipments, between store doors and the constructive station, as they would charge for carrying freight a like distance to and from the regular stations and "off -track" stations in the city of St. Louis. In June, 1915, the commission reported that under the rule declared in the case of U. S. v. Baltimore and Ohio, 225 U. S. 306, 56 L. Ed. 1100, (1912) there was nothing unlawful in this practice. The carriers could not buy or rent similar property in the city of St. Louis, and through their own employes could operate such facilities both as a convenience for shippers and a means of clearing all traffic which would otherwise be lost to them. The commission, however, con- demned the constructive receipt and delivery of traffic at stations at undefined points on the west bank of the Missis- sippi river, found not to be available to all shippers. In 5 I. C. C. 57 and 3 Int. Com. Rep. 701, an East St. Louis miller was ruled entitled to the advantage of his loca- §283] THE INTERSTATE COMMERCE ACT. 409 tion on the east side of the river as against his competitors on the other side of the river in St. Louis, and a railroad ter- minating in East St. Louis which allowed St. Louis millers r rebate for the cost of their teams across the bridge to the rail- road station was unjustly discriminating against the East St. Louis miller, and the latter was therefore entitled to a reduc- tion of six cents a barrel as to flour handled by him to the station on the rates in force, as long as the railroads bore that amount of the cost of carriage for the St. Louis shippers. § 282. Privilege of grain re-shipment in Nashville. — In U. S. V. L. & N. R. Co., 235 U. S. 314, 59 L. Ed. 245, (1914) the Supreme Court reversed the decision of the commerce court, 197 Fed. 58, which had enjoined the enforcement of an order of the Interstate Commerce Commission, 18 I. C. C. 183, 21 I. C. C. 186, holding invalid the privilege theretofore allowed by the L. & N. Railroad and the Chattanooga & St. Louis Railroad of reshipping grain shipped from river points to Nashville within six months to more distant points in the southeast. The commerce court held that the grant- ing of this privilege under the acts to Nashville and not to Atlanta, where different competitive conditions existed, was not a violation of section 3, but the Supreme Court held that the commerce court exceeded its authority in substituting its judgment for that of the Interstate Commerce Commission, and that the re-billing privilege was a violation of section 4 prohibiting the charge of lesser rate for a longer than for a shorter haul without the consent of the Interstate Commerce Commission. § 283. Differentials between competitive cities. — The intense competition of modern commerce is illustrated in the complaints made to the commission by the Boards of Trade or other commercial organizations of different cities against alleged discriminations in the relative railroad rates to competing localities. The differentials allowed by the trunk line associations, particularly on the grain traffic from the west to the seaboard, as between the different seaboard cities, have been very exhaustively investigated. Thus in the case of the alleged discriminations against Boston, 1 I. C. C. 410 THE INTERSTATE COMMERCE ACT. [SECTION 3 436 and 1 Int. Com. Rep. 756, the commission ruled in 1888 that the then existing differentials between Boston and New York, being ten cents per hundred pounds on the first and second classes, and five cents per hundred on the four other classes, on traffic from west of Buffalo, were not unreason- able. The conclusion was based upon the greater cost of transportation to Boston, the greater volume of business to and from New York, the competition by water and through lakes and canal and Hudson river to New York, and the geographical and commercial advantages of New York. Later however in 1892, the commission re-examined the subject and concluded that the differential was excessive and should be made, not by adding an arbitrary sum to the New York rate, but by adding a percentage, teti per cent, to the New York rate. In this case the commission ruled that the doctrine of estoppel was not applicable, as the commission was not a court, and that the whole spirit and scope of the act made the report and order of the commission in no sense final, except in the sense that the parties may be impressed with the justice of the order and acquiesce therein. 5 I. C. C. 166, 3 Int. Com. Rep. 830. In 1898 the commission, on the complaint of the New York Produce Exchange, investigated the differentials allowed by the railroads of two cents to Philadelphia and three cents to Baltimore below the New York rate on grain, flour and pro- visions. 7 I. C. C. 612. The commission made an exhaus- tive investigation of the commerce of the three ports, and concluded that the differentials were legitimately based upon the competitive relations of the carriers, and did not result in any unlawful preferences or advantage to Philadelphia or Baltimore over the city of New York. It was contended in this case that the rates were really made by the trunk line associations, but the commission ruled that, so far as the alleged violation of the third section was concerned, this was immaterial. Still another apphcation was made in 1904, and in an opinion in 11 I. C. C. 13, the differentials were again con- sidered, this time relating only to export trade. The com- mission ordered a reduction of two cents on flour at Baltimore and one cent at Philadelphia, allowing the existing export § 283] THE INTERSTATE COMMERCE ACT. 411 differentials otherwise to remain in force. Commissioner Clemens dissented, saying that he did not think that com- peting carriers could lawfully effect though the agency of the commission a restraint of competition in trade between them- selves and the ports, when such action on their own part would be unlawful. This subject of differentials between the east coast cities was again considered in 1912, 24 I. C. C. 55, on the com- plaint of the Chambers of Commerce of the different east coast cities. The commission said it was a long standing controversy, which originated in and was kept alive by the competition of railroads serving the several commercial ports and by the commercial interests at those ports, and that it was conceded by one of the carriers that the so-called differential port adjustment was more or less arbitrary in its nature, and was the result of compromise and arbitration resorted to for the purpose of settling or averting rate wars. It was argued that New York bad niiimerous advantages of location, harbor facilities, etc., and that the maintenance of lower rates to other ports was unlawful under the act to regu- late commerce and in violation of the constitution. The commission said that while they recognized the right of the carriers to conserve the interests of the ports served by them, they could not consider them as one and a great single system. The theory of the law was that carriers should establish and maintain through routes and joint rates, so that there will be a freer movement of traffic without the necessity of reshipment. They held therefore that it was not unlawful or unjustly dis- criminatory against New York for the carriers which served it to participate in the competitive traflTic to Philadelphia and Baltimore at the lower rates fixed to those points by the carriers whose lines controlled those stations. The commis- sion found there was no justification for lower rates to or from Boston than to and from New York. That the differ- ential under New York on all rail and lake and rail export shipments to Baltimore from differential territory should not exceed three cents per 100 pounds, and to Philadelphia should not exceed two cents per 100 pounds on all classes of commodities other than grain, and on the same shipments of grain, the differentials under New York should not exceed 412 THE INTERSTATE COMMERCE ACT. [SeCTION 3 1.5 cents per 100 pounds to Baltimore, and one cent per 100 pounds to Philadelphia. The differential between the east coast cities were recognized in the report of the commission upon fourth section violations in the southeast, see 32 I. C. C. 61, (1914). On a complaint of the Saginaw Board of Trade (17 I. C. C. 128), it was ruled that the proximity of Detroit and Toledo to the great channels of through transportation and their location on direct through routes where the amount of traffic is very great and the general operating and traffic conditions are favorable, are elements that cannot be ignored by the rate maker, and must necessarily tend to lower rates than can be accorded to communities that are removed from these great streams of traffic. Cases of alleged discrimination in relative rates between competing cities have been investigated in different sections of the country. As in the case of alleged-unreasonable rates, the conclusions of the commission are not adjudications, and as the commission observed in the case of the Boston differen- tial, they do not preclude the commission itself from reinves- tigation. A rate, which is relatively reasonable at one time, may become through changed conditions relatively un- reasonable. § 284. Preference in demurrage charges. — Undue preference between competing cities, or between competitors in business, may be shown in the allowance of demurrage; that is, in allowing time unreasonably small in one place and unreasonably long in another, 8 I. C. C. 351. See also 7 I. C. C. 591. The commission may afford relief from the imposition of demurrage charges upon a showing that the complainant is so subject, either to unjust discrimination or to the payment of unreasonable charges, 13 I. C. C. 571. After allowing a reasonable time for unloading cars, the carrier may impose such charges for further detention as will afford a speedy relief to its equipment, 16 I. C. C. 116. Where a railroad extends the time of free delivery at one place, they must treat alike all points similarly situated, see 16 I. C. C. 497. The commission, however, has no jurisdic- tion over the question of whether the demurrage charges §285] THE INTERSTATE COMMERCE ACT. 413 exacted by the carrier constitute a lawful lien upon the property, 13 I. C. C. 571. The right of a railroad to exact demurrage charges while the cars are standing on a siding owned and operated by the railroad, which was constructed for the use of complainant, is not affected by the fact that the cars are owned by the complainant. In Horton v. Tonopah & Goldfield Railroad Co., 225 Fed. 406 (1915), in a suit to recover for alleged illegal sales by a carrier for failure to pay freight and demurrage charges, the court held that the demurrage charges could be collected although they had been advanced after the shipment was begun. The demurrage charge was in part compensation and in part penalty to secure the release of equipment in tracks. The advance during the shipment therefore did not impair any pre-existing rights. § 285. Uniform demurrage rules recommended. — The commission in its 23rd annual report (1909) calls atten- tion, p. 13, to the adoption of a uniform code of car demurrage rules by the National Association of Railway Commissions, an association comprising the membership of all the state railroad commissions of the United States. A report was made to this association showing that the transportation system of the country was very much embarrassed by the undue holding of cars by shippers and receivers of freight. A code of rules was prepared by this association, the most characteristic features of which are the tendency of limiting "free-time" to the actual requirements of the consignor and consignee and the refusal of recognition to rules which are employed as instruments of discrimination. The code thus adopted by the National Association has been endorsed by the Interstate Commerce Commission. The commission says in this report that it has been estimated by competent authority that the general adoption and enforcement of demurrage rules allowing the smallest measure of free time consistent with the needs of the public is equivalent to the addition of 100,000 cars for the country's available car supply. The commission says also "Co-operation between the federal and state railroad commissioners with a view to securing the maximum of transportation efficiency and at the 414 THE INTERSTATE COMMERCE ACT. [SECTION 3 same time assuring equal services to shippers and receivers in all parts of the country, so far as they may be possible, augurs well for the future government regulation." § 286. Different forms of undue preference. — It may be stated generally that any form of discrimination between persons or localities in the performance of any of the duties of a carrier, whether such duties are imposed by the common law, or by statute, or by contract, would be violative of this section. Thus the failure to publish through rates to a par- ticular town, while such through rates are established and published to other points on the road, operates as an unlawful discrimination against that town. 9 I. C. C. 221. In any of the so-called "accessorial services" which may be rendered by the carrier, there must be no unjust preference of localities or individuals in providing such services. Any in- justice resulting from the allowance and non-allowance by the carriers of such privileges and facilities is violative of section 3, as well as of section 2. See 7 I. C. C. 556. The differential between carload and less than carload rates may be unjustly prejudicial to locaUties, as well as unjustly discriminative as between individuals. See 9 I. C. C. 318, and section 2, supra. Where the circumstances and conditions of the locahties are dissimilar, there can be no unjust preference under section 3, as there can be unjust discrimination under section 2. See Grand Haven Cartage Case, supra. Thus it is not an unjust discrimination against a town situated on a branch line to charge it a higher rate than an intermediate point on the through line, even though such intermediate point enjoys the same rate as the terminal point. 5 I. C. C. 44 and 3 Int. Com. Rep. 706. In 4 I. C. C. 131 and 3 Int. Com. Rep. 162, the commission ruled that the acquisition and consoHdation by a carrier under one system or arrangement of different competing lines of road serving the same territory in the carriage of com- petitive traffic to the same markets did not allow it to take advantage of the privilege to deprive the public of the benefits of fair competition, nor afford warrant for oppressive discrimination for its own interests, such as equalizing profits §287] THE INTERSTATE COMMERCE ACT. 415 of the several divisions; but that its duty to the public re- quired that its service must be alike to all who were situated alike. A carrier in order to build up and foster industries on its line cannot lawfully refuse to carry the products of like in- dustries located on connecting Hues. 15 I. C. C. 620; 12 I. C. C. R. 183; 13 I. C. C. 460. It was held in Foster v. C, C, C. & St. L. R. Co., 56 Fed. 434, that the action of a railroad passenger agent guarantee- ing that a theatrical troupe to whom he sold a party rate ticket should arrive at its destination in a given time, was not a giving of an undue or unreasonable preference, and the guarantee was held valid and enforcible. § 287. Undue preference in allowance for grain elevator service. — The subject of allowance by railroads to the owners and operators of elevators, where grain is stored in bulk and incidental services in connection therewith are rendered, has been extensively considered by the commission and litigated in the courts. It was first ruled by the commission, 12 I. C. C. 85, that an allowance could be made to a shipper of grain who furnishes elevation services under arrangement with the carrier, pro- vided the allowance did not exceed the actual cost. Sub- sequently, however, it was ruled, 14 I. C. C. 317, that such a payment to the owner of an elevator was an undue dis- crimination against competing grain dealers in other markets. It was held in the eighth circuit, C. C. A. 176 Fed. 409, in Peavey v. Union Pacific R. R., and Union Pac. Co. v. Updike Grain Company, 178 Fed. 223 (1910), that such an allowance could not be deemed an undue preference or discrimination, as the act to regulate commerce expressly recognized that services in transportation rendered by an owner of the property are to be paid by the carrier. This ruhng was affirmed by the Supreme Court, 222 U. S. p. 42, 56 L. Ed. 83, (1911). The Court, however, held that the commission had the right to determine what compensation was reasonable, and, therefore, affirmed its allowance of three-fourths of a cent per hundred pounds, and also, as to the order in the Peavey case, confining allowance to grain reshipped within ten days. 416 THE INTEESTATE COMMERCE ACT. [SECTION 3 In the Updike case, 222 U. S. 215, 56 L. Ed., 171, decided at the same term, the Court held that a carrier could not refuse the allowance for elevator service to an elevator owner who, through ownership of the grain, derived an incidental advantage by using the opportunity afforded during the process of elevation to weigh, store, inspect, clean and mix the grain; nor could the carrier make his allowance condi- tional upon the return of the empty car to the carrier within forty-eight hours after delivery to the elevator, when such return was made impossible by the ruling of the Railway Association of which the carrier was a member, and over which the elevator owner had no control. The subject was considered by the commission after the rendition of these opinions by the Supreme Court in 22 1. C. C. 496 and 24 I. C. C. 197, in connection with an application by the Merchants Exchange of St. Louis and others, pro- testing against undue preference in any permission of elevator allowances. The commission said there were two kinds of elevation, one of which may be termed transportation eleva- tion, consisting of the passing of the grain through an elevator for the purpose of transferring it from car to car and obtaining its weight, and commercial elevation, which includes various processes in the treatment of the grain itself, like cleaning, mixing, clipping, drying, etc. The first sort of elevation is an incidfent to the transportation of grain ; the second, to the merchandising of the grain. The com- mission concluded that the decisions of the Supreme Court meant this: that the act to regulate commerce requires carriers to furnish transportation elevation; that this may be done by employing the owner of the grain t^ perform the service, and the fact, that this grain in the process of trans- portation elevation can be, and is, made the subject of com- mercial elevation also, while an advantage to the owner of the grain, is not an undue discrimination according to the meaning of the act. Transportation elevation has been defined by the commis- sion as passing the grain through the elevator and ten days' free storage. One-fourth of one cent per bushel was held to be fair compensation for transportation elevation at the points in question; but for both transportation elevation and §289] THE INTERSTATE COMMERCE ACT. 417 commercial elevation at such points, a fair compensation would not be less than three-fourths of a cent per hundred pounds. The commission, however, postponed making any order until a reasonable opportunity had been given the parties for adjustment and on the basis recommended on the scale of allowances set forth in the opinion. § 288. Undue preference in wharfage rights. — The jurisdiction of the commission extends to the case of a cor- poration created to carry on, conformably to a municipal ordinance and confirmatory statute intended to secure public shipping facilities, a wharfage business at a seaport, and to furnish terminal facilities for a railroad and steamship system of which it forms a part, and by which it is controlled through a holding company; and a lease to a shipper of one of the piers and improvements thereon belonging to a ter- minal company, which relieves him from payment of all wharfage and storage charges other than such as may be included in the yearly rental, enabling him to acquire prac- tically a monopoly of the export of cotton-seed products, constitutes an unlawful preference under the act to regulate commerce where other shippers are not, and cannot be afforded the facilities on the same conditions. Southern Pac. Co. V. Interstate Commerce Commission, 219 U. S. 433, 55 L. Ed. 283 (1911). This case was distinguished from that of Louisville & N. R. v. West Coast Naval Stores Co., 198 U. S. 483, 49 L. Ed. 1135, where the complainant company was found to have the same privilege of using the wharves of the railroad company as other shippers had. It was also dis- tinguished from the case of Weems S. B. Co. v. Peoples' S. B. Co., 214 U. S. 344, 53 L. Ed. 1024, where there were two independent lines of steamboats one claiming the right to use the wharves of the other on the ground that the wharves had been dedicated to the public and the fact was found adversely to the contention. § 289. Wharves and approaches thereto. — In 27 I. C. C. 252, the commission held that the wharves and the tracks running thereto owned by the rail carrier engaged in interstate commerce, and used for receiving and delivering J— 27. 418 THE INTERSTATE COMMERCE ACT. [SjECTION 3 property moving by rail in interstate and foreign commerce are subject to the act to regulate commerce, and the regula- tions and practices affecting their use must be reasonable and non-discriminatory. In a case involving the conduct of public wharves at Mobile, the commission ruled, 23 I. C. C. 417, that where a railroad has a wharf to which a carrier offers deUvery and through which part of the shipping public is served, such a wharf becomes a public terminal, and if all the shippers are not given access to it by boats they use or employ, it then becomes the carrier's duty to make delivery of freight to the same docks at the same rate. A railroad has the right to reserve wharves for its own use and for the use of such water carriers as it prefers, pro- vided it affords to the public access to them with equal facilities as elsewhere at equal rates. Where a railroad carrier making a rate to a port institutes the practice of authorizing its agents to issue bills of lading for water lines, it must extend such practices to all water lines under reasonable regulations. See appendix to this case, with tariff provisions as to Mobile, at the Mobile and Ohio Railroad and Southern Railroad docks. The interstate commerce act does not prohibit an inter- state railway from paying a reasonable compensation on a tonnage basis to the owners of a water front, where a zone is established covering a commercial and manufacturing river front for the performance of a lighterage service, as this is for instrumentalities furnished and services performed by the shippers in aid of transportation by the railroads, and is not an allowance for accessorial service which would con- stitute an illegal performance or discrimination. This was decided in U. S. v. Baltimore & Ohio R. Co. 231 U. S. 274, 58 L. Ed. 218 (1913) in the case of the Arbuckle Bros, where the judgment of the commerce court, 200 Fed. 779, enjoining the order of the commission in 20 I. C. C. 200 was affirmed. See also 225 U. S. 306 where the temporary injunction in the same cause was sustained. § 290. The management of freight stations and warehouses must be without preference. — The circuit §291] THE INTERSTATE COMMERCE ACT. 419 court of Oregon in U. S. ex rel. v. Oregon R. & N. Co., 159 Fed. 975, (1908) held that while a railroad could grant the privilege to one person to erect a warehouse on its right of way and refuse a like privilege to another, yet that the warehouseman for whom the orders for cars were given, was the agent of the carrier, and the latter was bound to see that the agent was guilty of no negligence or unfaithful per- formance of duty ; and if the rules established by the manage- ment of the stations or warehouses operated to prejudice one class of patrons, or if the manner of distributing the cars subjected the storers and exporters to an undue or unreason- able prejudice and disadvantage and favored the warehouse- men who were also engaged in the business of buying and exporting, there was a violation of the law. The hours of business may also involve undue and un- reasonable prejudice and disadvantage to shippers. Thus, in 10 I. C. C. 378, the commission ruled that such a case, where complaint was made of a closing hour, 4 :30, as earlier than that in competing cities, was a matter within their jurisdiction, though the exceptional hour was for the time justified by the congestion of traffic. § 291. Undue preference in car service. — The provid- ing of reasonable car facilities for its patrons is a common law duty of the carrier, and this service must be rendered without unreasonable discrimination either in charges or in the facili- ties afforded. This common law duty, which is enforced in the different states under state statutes and at common law, is emphasized by and may be enforced under the provisions of this section as to interstate trafTic. Localities as well as ship- pers may be prejudiced by the unjust discriminations in the supply of cars. This right is further enforced by the amend- ment of 1889, specifically authorizing the issue of a writ of mandamus {infra, section 23), for the furnishing of cars and other facilities. In United States v. West Virginia & Northern Railroad Co., 125 Fed. 252 (1903), the United States circuit court of West Virginia granted a mandamus to compel the carrier to cease preferences in the supply of cars to certain coal mines. The court said it was the legal duty of the railroad company in furnishing cars to coal 420 THE INTERSTATE COMMERCE ACT. [SECTION 3 mines along its line to distribute the same impartially with- out unjust discrimination or favoritism, and that such distribution should be based on a disinterested and intelligent examination of the mines, by experts, and upon a considera- tion of all the factors which go to make up the capacity of the mines, the production, the equipment for the use for handling and loading of the product being secondary because it could quickly and easily be increased to meet the require- ments. The distribution of cars was found to have been unduly preferential to certain companies, this conclusion being based upon an estimate of the capacity of the mines and the percentage of cars allotted to each. See also to same effect United States v. Norfolk & Western R. Co., 109 Fed. 831 (1901); infra, section 23 of act. It was ruled by the commission, 1 I. C. C. 594 and 1 Int. Com. Rep. 787, that it was not a valid excuse for refusal to furnish a fair allotment of cars of a certain class that they could be more profitably employed and could supply the wants of a larger number of shippers on another portion of the line. It also ruled that undue preference of a locality or of a shipper in the car service is established by showing that there is a considerable delay in furnishing cars, while other localities or shippers are furnished with comparative prompt- ness. 9 I. C. C. 207. For other cases of discrimination before the commission in providing cars for coal, see 10 I. C. C. 226; 10 I. C. C. 47. The commission in several cases has awarded reparation in damages for discrimination in car service In Harp v. Choctaw & G. R. Co., 61 C. C. A. 405, and 125 Fed. Rep. 445 (eighth circuit), (1903), it was held in a case where discrimination in car service was claimed in violation of the Arkansas statute, that a carrier transporting large quan- tities of coal is entitled to make regulations in respect to the manner of receiving and transporting it so that it may be handled safely, expeditiously and economically without inter- ference with the carrier's other business, and regulations which are also designed to promote such business cannot be complained of on the ground that they operate to give a preference to one who complies with them or in a discrimina- tion against one who does not. The furnishing therefore of §291] THE INTEEST ATE COMMERCE ACT. 42] cars to certain mine owners, who, through agreements with the company, had constructed private spur tracks to their mines, while refusing to furnish cars for loading on the station track to owners who had constructed no spur track, did not constitute an undue preference either under the common law or the Arkansas statute, which prohibited the giving of any preference in the furnishing of cars. The court found that the volume of business was such that to permit the use of the station tracks for loading cars in that manner would not only interfere with the operation of the trains, but also cause serious loss and inconvenience to other ship- pers and the pubhc. It was held by the state court under the same statute that there was no undue preference between localities when there were not enough oars to supply all. The court cited as the leading case, Oxlaid v. Northeastern R. Co., 15 Common Bench, N. S. 680, construing the English Canal and TrafTic Act of 1854, upon which the Interstate Commerce Act was based. Little Rock & St. L. R. Co. v. Oppenheimer, 44 L. R. A. 353, 64 Ark. 271. The commission has ruled that it is not the duty of a carrier to notify the shipper when he can obtain cars for the removal of freight, if by reasonable inquiry he can obtain such information himself. 1 I. C. C. 608 and 1 Int. Com. Rep. 778. It was said by the commission in another case, 1 I. C. C. 374 and 1 Int. Com. Rep. 688, where damages were claimed for alleged violation of the act in the failure to furnish cars for coal shipments, that the inability of a carrier to furnish cars as fast as demanded by shippers was not a violation of the act, where the company had an adequate freight equipment for ordinary conditions, but owing to an extraordinary de- mand for coal cars due to exceptional conjunction of cir- cumstances, was unable to supply them as fast as the shippers demanded. Under such circumstances, the company per- formed its duty when it furnished the cars ratably and fairly at the mines along its line in proportion of their freights until the emergency had passed. Neither was a carrier responsible for the detention of cars by shippers longer than was neces- sary, when it appeared that the company did all in its power to enforce the prompt unloading of the cars. See also as to 422 THE INTERSTATE COMMERCE ACT. [SECTION 3 carriers' duty in the matter of car equipment, 2 I. C. C. 90, and 2 Int. Com. Rep. 67. In 28 I. C, G. 502 the commission ruled that each carrier subject to the act was charged with the duty of furnishing cars, and that a carrier's obligation to furnish cars for ship- ment to points upon lines of its connection was joint with such connecting roads, and contracts with them could not relieve it of its portion of such joint liability. § 292. The commission's regulations of coal car service sustained. — The complex questions involved in the daily distribution of coal cars in time of car shortage, to coal mines under the peculiar conditions of that industry, are illustrated in the rulings of the commission, 12 I. C. C. 398; 13 I. C. C. 440, and 13 I. G. G. 451. These orders were based upon the peculiar conditions of the industry, which required the disposition of the product as soon as the coal was brought on the surface, as it is impracticable to store the coal, and the production of the mine is therefore dependent upon the quan- tity that can be removed each day, and the daily distributions of cars are made to the mines to permit their removal of the available output for each day. Unforeseen periods neces- sarily arise when the shortage of cars to meet the demand takes place notwithstanding the full performance by the carriers of their duty, because of the wide fluctuations of the demand and the detentions of the cars at the terminal points. These conditions have required regulation of the distribution of coal cars. This situation required the handling of four classes of cars: 1. System cars owned by the carriers and in use for the transportation of the coal. 2. Gompany fuel cars, used for coal for fuel purposes of the carrier. 3. Private cars owned by coal mining companies, or shippers or consumers, and used for the benefit of their owners, and 4. Gars owned by other railroad companies for the purpose of supplying such other companies with fuel. The commission ordered that in time of car shortage, when the daily distribution was made, that the railroad should count against the mine receiving the same, company fuel cars, foreign railway cars or private cars ; and the commission required the railroad to establish regula- tions for the period of two years from July 1st, 1908, provid- § 292] THE INTERSTATE COMMERCE ACT. 423 ing for the counting of all such cars. The scope of the order was, however, modified by authorizing the railroad company to deliver to a particular mine the foreign railway fuel cars, the private cars and the company fuel cars consigned to such mine, even though the number might exceed the pro- rata share of the cars attributable to the mine when ascer- tained by taking into account all the cars which the order required to be considered. Where, however, the number of such cars was less than the prorata share of the mine, the order only permitted the carrier to add a sufficient number of system cars to make up the rightful pro rata number. The railroad company brought suit to enjoin this order of the commission, and the circuit court (Ilhnois) held that the railroad was entitled to an injunction restraining the enforce- ment of the order of the commission, in so far as it directed the taking into account of the cars employed by the railroad in hauling its own fuel. This was on the theory that these cars were not engaged in commerce as commerce. 173 Fed. 930. The Supreme Court, Interstate Com. Com. v. Illinois Central Ry. Co., 215 U. S. 452, 54 L. Ed. 280 (1910), reversed this decision, holding that this was an administrative order of the commission within the scope of the power delegated by congress; that commerce, in the constitutional sense, in- cluded the instrumentalities by which commerce was carried on, and extended to the coal cars owned by the railway com- pany engaged in interstate commerce, wherein it received coal and used it solely for its own fuel purposes; and that the Court would not review the discretion of such administra- tive order of the commission in determining that a certain distribution for a term of two years was fair and reasonable as a means of prohibiting the unjust discrimination forbidden by the act. The Court said that in view of the facts found by the com- mission as to the preference and discrimination resulted from the failure to count the company fuel cars in the daily distri- bution in times of car shortage, and in the far reaching prefer- ence and discriminations set forth in the answer of the com- mission, which were taken as true, as the cause was submitted on bill and answer, the subject was clearly within the sweeping provision of section 3 of the act prohibiting prefer- 424 THE INTERSTATE COMMERCE ACT. [SECTION 3 ences and discriminations, and the order was within the com- prehensive powers conferred by the amendatory act of 1906. The divergence and even conflict in the systems of coal car distribution in times of shortage enforced by the different railroad systems illustrated by such cases as Logan Coal Co. v. Penn. R. Co., 154 Fed. 497 (1907); U. S. ex rel. Pitcairn Coal Co. V. B. & 0. R. Co., 165 Fed. 113 (1908), and cases therein cited, also Majestic Coal & Coke Co. v. 111. Cent. R. Co., 162 Fed. 810; and Montana Ry. v. Morley, et al. 198 Fed. 991 (1913), showed complexity of the subject which required and justified the broad discretion imposed in the Interstate Commerce Commission to make the uniform rulings required to prevent preferences and discriminations in the commerce of the country. Subsequently to this decision of the Supreme Court in 1910 the system of coal car distribution practiced on the Pennsyl- vania Railroad was condemned by the commission, see 19 I. C. C. 356, and the commission adhering to its previous ruling that the owner of private cars was entitled to their exclusive use and that foreign railway fuel cars assigned to a particular mine, again ruled that all such cars must be counted against the distributory share of the mine receiving them and that the defendant's rule providing that the capacity in tons of such "assigned" cars shall be deducted from the rated capacity of the mine receiving them, and that the remainder was to be regarded as the rated capacity of the mine in the distribu- tion "assigned" cars was unlawful and discriminatory. The commission said that the law not only gave the shipper a right to ^n equal or a justly ratable use of the facilities of an inter- state carrier, but the assurance that no other shipper shall fare ratably better at the hands of the carrier. The utmost obligation of the carrier under the law was to equip itself with sufficient cars to meet the requirements of a mine for actual shipment. See also 20 I. C. C. 52. In these cases there was a difference of opinion in the com- mission not only on the power to award damages to a com- plainant, see infra, § 472, but also on the method of rating lines. The minority contended that the 'physical capacity of the mine was the only proper basis for car distribution, while the majority adopted the rule of considering not only physical capacity but the commercial output. § 294] THE INTERSTATE COMMERCE ACT. 425 § 293. The irregularities of mine ratings for dis- tribution of coal cars. — The subject of the distribution of coal cars and the rating of mines therefor were considered in relation to the Illinois Central Railroad, 25 I. C. C. 286. The commission held that the ratings for mines should be based upon their several hourly capacity for production, that the mines with outlet by river should be treated as junction point mines; that upon the days the junction point mines order no cars from another carrier, it should have its full rating on the Illinois Central ; that upon a day for which it orders cars from one other carrier, its rating upon the Illinois Central for that day should be seventy-five per cent of the full rate ; and that upon a day on which it orders cars from two other carriers, its rating upon the Illinois Central for that day should be fifty per cent of the full rating. In 25 I. C. C. 399, the commission held that a carrier could not be required at all times to be prepared to furnish more than the reasonable facilities necessary for the usual amount of business done at a particular point upon its lines, and upon the facts of the case therefore denied the application. In 30 I. C. C. 531, it appeared that the carrier arrived at the mine rate during the car shortage periods by adding to the estimated physical capacity the commercial capacity taken foi- the twelfth month prior period, dividing the result by two. The commission found that this method permitted of discriminations and the defendant was required to distribute cars thereafter on the basis figured on the average shipments on a day's work by the mine located on its line taken for the two year period prior to January 1, 1913. They said that the proper distribution of cars was a question of fact determined according to circumstances and conditions existing in each particular case. § 294. The embargo by a carrier on coal cars going to other carriers unlawful. — A rule estabhshed by the IlUnois Central Railroad Company, prohibiting the sending of its coal cars loaded with coal to the lines of certain desig- nated carriers in order to retain on its own lines sufficient cars to serve the communities dependent on it for fuel was declared unlawful, in 22 I. C. C. 39. 426 THE INTERSTATE COMMERCE ACT. [SECTION 3 The commission said the railroads of the country are called upon to so unite themselves that they will constitute one national system; that an embargo may be justified because of the physical inabiUty of the carrier, for the same reason, to deal with traffic which overwhelms it, but an embargo placed against connecting carriers, because of their their failure to promptly return cars is not consonant with the service, which the carriers constituting the through routes are required by law to give. Railroads are required, under the act, to serve the through routes which they have established with other carriers without respect to the fact that in rendering such service their equipment may be carried beyond their own line. Where the carriers fail to make reasonable rules and regulations for the exchange, interchange, and return of cars used upon through routes, the commission is empowered to determine the individual or joint regulation or practice that is just, fair, and reasonable. § 296t Distribution of cars for transportation of grain. — In 29 I. C. C. 396 the commission held that the basis of grain car distribution is one that cannot be dealt with by any fixed, arbitrary or inelastic regulation, and the decision must, in the nature of the case, finally rest in the exercise of sound discretion in the station agent, as to what is right and proper, under the circumstances, in each case. In this case the commission said that the situation was entirely different from that of cars required for coal mines; while the output from a mine may vary from day to day, and month to month, the coal is mined, in ownership, ready to be moved as fast as it can be mined and loaded to meet the demand. Grain is not already bought and in the elevator, in these periods of car shortage, but is being constantly purchased from the cars contiguous to the station in com- petitive bids of rival buyers. § 296. Discrimination by carrier in its own favor. — As the carrier may not discriminate in favor of itself in viola- tion of section 2 when it is both a carrier and a shipper, so it may not discriminate by the unjust preference of certain localities by the same means, see supra, section 2. Such a §297] THE INTERSTATE COMMERCE ACT. 427 preference was involved in the matter of coal car distribution considered in the preceding section; and it was upon the ground that the supreme court would not interfere with the administrative order of the commission made for the purpose of securing equality and preventing an undue preference, that the system of car distribution sustained in that case was enforced. In Commission v. Chesapeake & Ohio R. R. Co., supra, a contract by a carrier for the delivery of the coal belonging to the first at a fixed price was held to operate to give the pur- chaser an undue preference in violation of section 3, and the - contract was therefore illegal and unreasonable, and its further performance was enjoined. See supra, section 2. It was held by the Supreme Court in the Ilhnois Central Coal Car Distribution Case, supra, § 292, that a railroad com- pany is not at fault for failure to deliver all the coal cars called for in times of shortage, if the equipment of the coal cars was reasonably adequate to meet all normal conditions, although it became insufficient at times because of extra- ordinary circumstances against which it was in reason im- possible to provide. This subject was again discussed by the commission, and its rulings are contained in the Commission's Conference Ruhngs Bulletin No. 5, and in the matter of restricted rates, 20 I. C. C. 426. It was held that preferential rates on prop- erty consigned to or intended for the use of a railroad, lower than those accorded to other shippers of the same com- modities between the same points were unlawful. A carrier as a shipper over the lines of another carrier may not have any preference in the application of trans- portation rates and charges, though conversely it may have the same privileges under the tariffs as any other shipper. For further discussion of the matter of the transportation of company materials see 22 I. C. C. 439. § 297. Undue preference in private cars. — The sub- ject of the use of private cars and their abuse in causing undue preference has been the subject of frequent discussion by the commission, both in its decisions and reports. The act has been amended, see section 1, supra, in accordance with the 428 THE INTERSTATE COMMERCE ACT. [SECTION 3 recommendations of the commission, so that the private cars by whomsoever owned, used in transportation and refrigera- tion, and all the facilities of transportation used in interstate commerce, are under the control and regulation of the com- mission. While the owner of the private cars is thus under the control of the commission, the carrier is none the less responsible for all the necessary incidents of transportation and is bound to furnish them to all without discrimination and without undue preference. In 9 I. G. C. 1, the comniission said that the carrier could refuse to haul private cars at all, or to only haul those of a cer- tain class and refuse to haul others of a little different or sub- stantially different class. In this case the private car was that of a commercial salesman and was stocked with his samples of men's clothing and furnishings. The commission said that in comparison with the private car services rendered for pleasure journeys and theatrical companies, the service was so different and unusual as to justify a greater compensa- tion, or even the refusal of the car altogether. As to tank cars which have been the subject of frequent dis- cussion in the decisions of the commission, see 4 I. C. C. 131, and 3 Int. Com. Rep. 162, the commission said it was the carrier's duty to equip its road with the instrumentalities of carriage suitable to the trafhc, and to furnish them alike to all, and its duty to furnish equipment could not be trans- ferred to nor acquired by shippers. Where it accepted and used cars owned by shippers and others, in legal contempla- tion, it adopted them as its own for the purpose of rates and carriage. The carrier could not by any device, such as the payment of unreasonable rent, avoid the duty of equal charges for equal service. See also 1 I. C. C. 503, and 1 Int. Com. Rep. 722; 6 I. C. C. 295. The carrier, however, has the right to fix its rates according to the cost of the service rendered, as between the transporta- tion in tank cars and barrels. See Penn. Refining Co. v. W. N. Y. & P. R. Co., supra. It was said also by Judge Cooley in an early case, 1 I. C. C. 503, and 1 Int. Com. Rep. 722, that it is properly the busi- ness of the carrier to supply the rolling stock for the freights it offers and purposes to carry, and that if the diversity and § 298] THE INTERSTATE COMMERCE ACT. 429 peculiarities of traffic are such that this is not practical, the consignors must supply it themselves, and that the carrier must not allow his own deficiencies in this particular to be the means of competing to the disadvantage of those who make use of the traffic and the facilities it supphes, citing Railroad Co. V. Pratt, 22 Wall. 123, 22 L. Ed. 827 (1875). This subject was discussed by the commission in the Cah- fornia Fruit Case, 9 I. C. C. 182, where it is said that it must be conceded that the leasing of equipment by carriers of re- frigerator cars, afforded opportunities for unfair advantage, but that carriers were allowed by the law to procure equip- ment for business by lease as well as by purchase, and they were not prohibited from leasing from a shipper, nor are they compelled to lease from all shippers because they do from one. As to the reasonableness of charges for private cars and for refrigeration, see § 176 et seq., supra; and as to unjust dis- crimination upon shippers in connection therewith, see § 240, supra. See also extended discussion of the subject of private cars by the commission in its annual report for 1904, prior, however, to the amendment of the act, placing such cars under the jurisdiction of the commission. § 298. Demurrage and other charges on privately owned cars. — The commission has ruled upon the subject of privately owned cars, 13 I. C. C. 378, that where the cars are owned by shippers and hired by the carriers on a mileage basis, they are subject to demurrage when such cars stand upon the tracks of the carrier, either at the point of origin or at the point of destination, but are not so subject when upon either the private track of the owner of the car, or the private track of the consignee. The carrier must charge demurrage in all cases where demurrage is imposed by tariff provision upon its own equipment, except where the privately owned car is upon the privately owned siding or track, and the carrier is paying or is responsible for no rental or other charge upon such car. The privately owned car, in the sense in which that expression is used, is the car owned by an in- dividual firm or corporation for the transportation pf the commodities which they produce or in which they deal. 430 THE INTEHSTATE COMMERCE ACT. [SECTION 3 § 299. Exclusive use of excursion or sleeping cars of one owner. — -The same principle applies in cases of special classes of cars, such as excursion and sleeping cars for passen- gers. A railroad company may acquire cars of any class, by construction, by purchase, or by contract for their use, and no one can compel a railroad company to select among these sev- eral modes or to contract with all carriers. This principle was applied by the commission in 3 I. C. C. 577, and 2 Int. Com. Rep. 792, in ruling that it was not unjustly preferential for a railroad company to refuse to haul the excursion cars of one car company, when it had a sufficient supply of excursion cars for its business from other company with whom it had contracted. § 300. Leasing of cars does not carry right of exclu- sive use by owner. — It is the duty of a carrier to equip its road with the means of transportation, and in the absence of exceptional conditions those means must be open impartially to all shippers of like traffic. The commission said in one of the numerous tank line cases, 5 I. C. C. 415, 4 Int. Com. Rep. 162, that ownership of a car rented to a carrier for a full consideration did not of it- self entitle the owner to the exclusive use of such car, and if he could stipulate for such use, it must be upon such terms as shall not constitute an unjust discrimination against shippers of like traffic excluded from use of the car. Where a carrier pays mileage for a car which it employs in the service of the shipper, it is the carrier and not the party or company from whom the car is rented who furnished the car to the shipper, and in such case there is no privity of contract between the car owner and the shipper. 6 I. C. C. 295. § 301. Stoppage in transit privileges. — The privilege of stoppage in transit, including the right of milling grain in transit or of compressing cotton, which the commission sus- tained as a legitimate privilege extended by carriers, must not be so extended as to operate as an undue preference to localities or unjust discrimination between individuals. See supra, section 2. The commission said in 9 I. C. C. 373, that if stop-over privileges are granted for any purpose, all the facts and cir- § 302] THE INTEKSTATE COMMEECE ACT. 431 cumstances connected therewith should be clearly stated in the published tariff so that the public generally may enjoy the benefits. In this case the grain was shipped through St. Louis with stop-over privilege in East St. Louis for cleaning, sacking, or any other purpose, the shipment afterwards carrying the proportional or balance of through rate from East St. Louis. The commission in this case, however, con- demned the practice of shipping to East St. Louis on a local rate for the purpose of "trying the market," and then shipping on a reduced proportional rate to a southern point. See also 7 L C. C. 240, where a similar practice was con- demned. In the lumber "Tap-line" case, 10 I. C. C. 193 (supra, § 163), the commission said that it might be urged with force that practices of this kind were not sanctioned by the act, and that it had intimated that view in 1 I. C. C. 401, 1 Int. Com. Rep. 703. The practice had become so general that vast amounts had been invested in industrial plants upon the faith of the continuance of these privileges; and no doubt their allowance had cheapened the cost of transportation and probably of manufacture. The commission concluded that when once the principle of milling in transit was admitted it could be applied to the manufacture of logs into lumber. See supra, § § 248, 249. In 1 I. C. C. 401 and 1 Int. Com. Rep. 703, the commis- sion ruled that the privilege of stoppage in transit should not be extended so as to give to the merchants of a town the privilege of shipping their goods from the point of purchase to their own locality, and thence to the place where the goods may be sold by them at the same rate at which they would have been charged if there had been but one shipment from the point of purchase to the point of final delivery. § 302. Fabrication in transit. — This term is applied to the process by which structural steel, after it is manufactured, is adapted for use in bridges, buildings and other structures ; the term "fabrication" being used to distinguish it from the previous manufacture. The stoppage-in-transit privilege had been applied to the stoppage for fabrication of steel products. This subject was discussed by the commission in 432 THE INTERSTAT!! COMMERCE ACT. [SECTION 3 14 I. C. C. 121, 15 I. C. C. 370, and also in 29 I. C. C. 70. The commission ruled that under section 6 it was unlawful for a carrier to allow substitution without clearly specifying in its tariff rate to substitute, and uniformity should be established in the time-limit in which to fabricate under the transit rate, and the commission could not look with favor upon extension of transit to include additional processes, until it was clearly shown to be necessary in order to avoid discrimination, promote commerce, and affect other proper and lawful results. The carriers were therefore required to cancel their tariffs which were under suspension, and to maintain for the statutory period the present charge of one and one-half cents per one hundred pounds as the maximum at the fabrication in transit point involved in the proceeding. In 32 I. C. C. 185, it was held that there was no peculiar requirement incident to the pressed steel car industry such as existed in the case of the bridge and structural steel interest which necessitated the extension of the fabrication- in-transit privilege to the pressed steel car in'dustry with respect to the pressed steel underframes for steel railroad cars. § 303. Reconsignment charges. — In the case of South- ern Railway Company v. St. Louis Hay & Grain Co., 214 U. S. 297, 53 L. Ed. 1004 (1909), the Supreme Court reversed the C. C. A. of the 7th circuit in 153 Fed. 728, and the circuit court for the eastern district of Illinois, 149 Fed. 649 (1905), which had rendered judgment in favor of the company for the amount awarded by the commission and an attorney's fee for an alleged unreasonable and exces- sive charge for permitting a reconsignment of hay at East St. Louis. The company bought hay and had it shipped to East St. Louis and there unloaded and inspected, and re- loaded for southern markets. Taking the reloaded cars therefrom involved the use of the cars for a time, and there was some expense for hauling the cars; and the railroad compapy charged from four to five dollars a car, equivalent to two cents per hundred pounds. The commission ruled that this was an unreasonable charge and allowed only half the amount, 11 I. C. C. 90, and for this the circuit court gave § 305] THE INTERSTATE COMMERCE ACT. 433 judgment which was affirmed by the court of appeals. The Supreme Court reversed this judgment and ordered the case remanded to the Commerce Commission for further investi- gation and report. The Court said the railroad was not limited to the actual cost of the privilege; that it had the right to make a reasonable profit. See also 11 I. C. C. 486, where the commission dismissed a somewhat similar com- plaint. § 304. Transit privileges. — ^Where a railroad allows the compression of cotton in transit at the nearest point, the commission held, 12 I. C. C. 312, that it cannot vary that rule so as to give certain shippers the opportunity to avoid it and thereby receive an advantage which is not given to shippers generally. As to compression of cotton in transit, see also 12 I. C. C. 312; 13 I. C. C. 187; and for adjustment of rates on com- pressed and uncompressed cotton, see 15 I. C. C. 222; 16 I. C. C. 131; 17 I. C. C. 12. It was argued before the commission that it was without power to direct a carrier to grant a transit privilege. But the commission answered, 16 I. C. C. 232, that there could be no question as to the right and power of the commission to order the removal of an unjust discrimination, and to prescribe such reasonable rates and regulations as would afford such re- moval; see also 15 I. C. C. 138. The same principle was applied in 12 I. C. C. 210, where it was held that the privilege of stopping hogs in transit, shipped from western points to the east in order that they could be sorted and re-consigned under a through rate from point of origin, could not be enforced against carriers in favor of any specific point or shipper, in the absence of law- fully established tariffs making such privileges open to the pubhc. While the commission has conceded what could be said in favor of milling and manufacturing in transit, it has also commented upon the irregular and discriminatory practices that are invited and possible under the practices. See 16 I. C. C. 232. § '305. Privilege of storage in transit. — In 30 I. C. C. 131, the commission denied the application for the privilege J— 28. 434 THE INTERSTATE COMMERCE ACT. [SECTION 3 of storage in transit for grain at El Central, California, where it appeared that like privileges were not granted by the defendant elsewhere in that territory, and the necessity for storage at that point primarily grew out of the domestic disturbances in the neighboring country of origin, that is, in Mexico. The necessity for storage within the American boundary lay primarily in terminal conditions, for which the carriers were not responsible and over which they had no control. § 306. Transit privileges in lumber shipments. — In 31 I. C. C. 678, the commission considered the subject of transit privileges on the shipment of lumber. The charge of two cents per 100 pounds was found to be not unreasonable, but the refusal to apply the transit rate on small shipments of lumber on a particular kind of wood, it being part of a mixed carload shipment, which weighed less than a thousand pounds, was found to be unreasonable. The same subject was considered and the subject of substi- tution in transit fully discussed in Grand Rapids & Ind. Railroad Company v. United States, 212 Fed. 577 (1914), and Nickels & Cox Lumber Co. v. United States, 212 Fed. 588 (1914), where the C. C. A. affirmed the judgments returned in the lower courts, that the railroad company was guilty of giving to the shippers, and the shippers of receiving rebates, through the device of unlawful substitution in respect to shipments of lumber. For investigation into the substitution of tonnage at transit points, see 24 I. C. C. 340, and continuance of the investiga- tion in 18 I. C. C. 290, and 24 I. C. C. 552. Compression of cotton. It was ruled by the commission in 32 I. C. C. 146, that the compression of export cotton at the port of trans-shipment was not a service rendered by the owner of the property transported, which is connected with such transportation by the rail carrier, and the carrier must therefore cease from making allowances for such compression. § 307. Interference by state railroad commission with proportional tariff rates. — The term "proportional tariffs" has been given to freight rates applying upon ship- § 308] THE INTEKSTATE COMMERCE ACT. 435 ments with stoppage in transit privileges, that is, where the commodities shipped originate beyond the place of shipment, when their ultimate destination is beyond the point to which the proportional rates apply. In a recent Texas case, it appeared that the State Railroad Commission had issued an order that the Chicago, Rock Island & Texas railroad com- pany should cancel all its so-called proportional tariffs on grain products from and to points reached by its railway, whether local or in connection with any other lines of railroad. A bill was filed by the owner of a grain elevator at Fort Worth engaged in the purchase of grain from the country north of Texas for the purpose of shipment by export from the Gulf ports, alleging that these proportional local tariffs had been filed with the Interstate Commerce Commission and relate wholly to interstate traffic. The court held that the order of the state railroad commission was illegal and void, that it had no jurisdiction or control over the proportional tariff rates in question; and a temporary injunction was issued against the enforcement of the order so far as the commission was concerned ; the court decHning to grant any injunction against the railroad company, on the ground that it was fully able to respond in damages for any failure to carry out its contract. Rosenbaum Grain Co. v. C. R. & T. R. Co., 130 Fed. 46 (1903). The order granting the tem- porary injunction was affirmed in C. C. A. 130 Fed. Rep. 110. § 308. The rates on bales of compressed cotton. — In 32 I. C. C. 458, December, 1914, the commission considered the apphcation of parties interested in the compression of cotton into a so-called round bale, and they therefore claimed that it was unreasonable to charge the same rates on such high density bales, as the charge upon the ordinary standard compressed bales, which did not load so heavily. This question was considered by the commission in 11 I. C. C. 382; 8 I. C. C. 308, and 18 I. C. C. 440. The commission concluded that the cotton industry in the southwest was so organized, that the existing any-quantity- rates are best suited to its ends and needs, and the shipment on carload rates, though that might effect some economies in 436 THE INTERSTATE COMMERCE ACT. [SECTION 3 transportation cost, it would tend unduly to concentrate the ■ cotton producing industry, especially in the light of the facts that the average product of the cotton farm within the region is not over eleven bales, and that a carload of cotton represents an investment of several thousand dollars. The commission concluded that the existing any-quantity-rates on cotton were not unreasonable or discriminatory, even when applied to bales of high density, see 19 I. C. C. 397. § 309. Sidetracks and connections. — Another form of alleged preference has grown out of the practice of building sidings and spurs for connecting the main track of a railroad with industrial enterprises, such as mills, furnaces and elevators. The amendment of the act in 1906 has given the commis- sion the power, upon the application of a shipper, or a branch railroad, to order the making of a switch connection. As to the ruhngs of the commission thereunder, see supra, § 182; Some states, as South Dakota (R. S. So. Dakota, 1899, sec- tion 253), and Nebraska (Laws of 1887, Ch. 60), have made a statutory provision for such connections. The statute of the latter state was construed as authorizing the state railroad commission to require the railroad company to grant the right to erect an elevator upon the right of way at a specified point on the same terms and conditions which it had already granted to other persons the right to erect elevators thereat. The Supreme Court held in Missouri Pacific Railway Co. v. Nebraska, 164 U. S. 403, 41 L. Ed. 489 (1896), that this Nebraska statute so construed as requiring a railroad com- pany to grant to the petitioners a right to build and maintain a permanent structure on their right of way was a taking by the state of the private property without the owner's consent for private use, and was violative of due process of law and the fourteenth amendment. The Court however limited its decision to this point, and said that the question of the power of the legislature to compel the railroad company to erect and maintain an elevator for the use of the public, or to compel it to permit all persons to enjoy equal facilities of access from their own lands to its tracks for the purpose of shipping or receiving grain or other freight was not involved, as the order §309] THE INTERSTATE COMMERCE ACT. 437 of the commission was not limited to the temporary use of the tracks nor to the conduct of the business of the railway company. In Illinois, railroads were required by the state constitu- tion, article 13, section 5, to permit connections to be made to their tracks so that any consignee of grain in bulk and any public warehouse, coal bank or coal yard may be reached by the cars on the railroad. In Chicago, etc., R. Co. v. Suffern, 129 111. 274, it was held that a railroad company was not justified in refusing to ship coal over its own railroad off of a switch road to the shipper's mine simply because the shipper also shipped on another carrier's line. The question was considered in one of the Louisville Stock- yard cases, Butchers & Drovers Stockyard Co. v. Railroad Co., 14 C. C. A. 290, 1. c. p. 297, 67 Fed. 35 (1895), whether it was a discrimination which could be controlled or re- strained by the courts for a railroad company to refuse to furnish a sidetrack or not to its customers and furnish such accommodations to another similarly situated. The court said in an opinion by Justice Taft that this question was very difficult, both at common law and under the statute. It was held however not to be involved in the case before the court, as there was such a difference between the business of the complainant and that of the other abutters upon the spur track, as to make the refusal of the company to grant the sidetrack to the complainant entirely reasonable, this difference consisting in the fact that .the complainants' traffic was live stock and that of the other abutters dead freight, making the conditions of deliveries and shipments entirely distinct. In Harp v. C. 0. & G. R. Co. (Ark.), 118 Fed. 169 (1903), the court held that a railroad was under no obligation to build a spur track to coal mines for private benefit of the owner, nor was it liable for damages for unlawful discrimina- tion because of refusal to build such track, although it had assisted and permitted other spurs to be built. The judg- ment was affirmed in the C. C. A., but on another ground. 61 C. C. A. 405, 125 Fed. 445 (1904). This decision was approved and followed in Robinson v. B. & 0. Railroad Co., 129 Fed. 753, where it was held that 438 THE INTERSTATE COMMERCE ACT. [SECTION 3 the carrier in his right to make reasonable regulations for the delivery of freight was not compelled to receive coal at a siding where merchandise other than coal was received, merely because the place was more acceptable to a shipper, when it had designated the siding for receiving coal and the siding was not an unreasonable place. In another stockyards case, that of the Interstate Stock- yards Co. V. Railroad Company, 99 Fed. 473, the court laid down the general proposition that a "common carrier of inter- state freight cannot lawfully deny switch connection and service, to one person, place or locality, or kind of traffic, which it affords to others similarly situated." This question however must be construed in connection with the special facts of the case, the alleged discrimination being by a city belt, line which was required under the city ordinance and state statute to grant switch connections to all persons and to render service in respect to all freight upon equal and im- partial terms. This road was enjoined from discontinuing the receipt of live stock from sidings which had been there- tofore constructed and maintained. Assuming that there can be no unjust preference in the re- fusal of switch connections, unless the circumstances and con- ditions are similar, it is difficult to see how in any case the court can compel a carrier to construct and maintain such a siding for private use in its own right of way at its own expense. Nebraska v. Missouri Pacific Ry. Co., supra. There seems to be no case where either the commission or the court has enforced the construction and maintenance of such switch connections. See 7 I. C. C. 194, where such an application was unsuccessfully made. The carrier is not bound in every instance to furnish under legal compulsion the same terminal facilities for all descriptions of traffic. It is sufficient if reasonable provision is made in this regard, and what is reasonable in a given instance depends largely upon the conditions and surroundings of a particular locality. See 9 I. C. C. 61. § 310. Switch connections and local terminal facili- ties. — The proviso of this section that it shall not be con- strued as requiring a common carrier to give the use of its §310] THE INTERSTATE COMMERCE ACT. 439 tracks or terminal facilities to another carrier engaged in like business must be construed with the amendments of 1906 and 1910 to section 1, where a railroad is defined "to include all switches, spurs, tracks and terminal facilities of every kind used or necessary in the transportation of persons or property designated in the act and also all services con- nected with the receipt, delivery, elevation and transfer in transit, ventilation, refrigeration or icing, storage and hauling of property transported"; and it was held by the Supreme Court in Pennsylvania R. Co. v. United States, 236 U. S. 351, 59 L. Ed. 616 (1915) that the proviso of section 3 must be read with these amendments of section 1, and that facili- ties for delivering freight of a terminal character are brought within the terms of the transportation to be regulated. The court therefore affirmed the order of the district court of Pennsylvania, 214 Fed. 445, refusing to restrain the order of the Interstate Commerce Commission requiring the Pennsyl- vania Railroad to desist from its practice of refusing to inter- change carload freight with one carrier within the switching limits of the city, while rendering such service in connection with other connecting carriers within such switching limits. This construction was further illustrated in the Tennessee Central litigation at Nashville, Tennessee. The Louisville & Nashville and the Nashville, Chattanooga & St. Louis owned separate terminals at Nashville and maintained and operated them jointly under the name of the Nashville Terminals; while the Tennessee Central, the only other road into Nash- ville, maintained separate terminals. In L. & N. R. R. Co., et al, V. U. S., 238 U. S. 1, 59 L. Ed. 1177 (1915) the order of the district court in Tennessee, 216 Fed. 672, refusing an application for a temporary injunction to restrain an order of the Interstate Commerce Commission, 28 I. C. C. 533, which declared that the practice of the L.& N. and Chattanooga railroads of refusing to switch cars of coal from the tracks of the Tennessee Central, except at prohibitive rates, while switching to and from the tracks of each other at a much lower rate, was unjustly discriminatory. This order, how- ever, was interpreted by both railroads as referring exclu- sively to non-competitive coal; and another application was made to the Interstate Commerce Commission, and it was 440 THE INTERSTATE COMMERCE ACT. [SECTION 3 ruled, 33 I. C. C. 77, that the carriers should exchange com- petitive and non-competitive traffic at no greater charge to the Tennessee Central than to the other roads; and the carrier interchanging traffic with one connecting carrier and thereby short-hauling its own line, cannot refuse to inter- change traffic with another connecting line on the ground that its own line would be short-hauled thereby. The railroads again applied to the district court to enjoin the enforcement of this order, and, three judges concurring, 227 Fed. 258 (1915), an injunction against the enforcement of the order was denied, and the bill dismissed. An appeal was taken from this decision of the district court to the Su- preme Court, and an order was made by the former court for preserving the status quo pending the perfection of the appeal. See L. & N. R. Co. v. U. S., 227 Fed. 273 (1915). The control by congress of this interchange of railway traffic and railway terminals invalidates as an unlawful regulation of interstate commerce an order of a state railroad commission undertaking to make the same regulation. See 111. Central R. Co. v. DeFuentes, 236 U. S. 157, 59 L. Ed. 517 (1915); also Grand Trunk R. R. Co. v. Michigan R. R. Com- mission, 231 U. S. 457, 58 L. Ed. 310 (1913). § 311. Absorption of switching charges, when pref- erential. — The subject of the absorption of switching charges on grain, at Chicago, was discussed in 24 I. C. C. 660, 27 I. C. C. 71, 24 and 28 I. C. C. 677, and 29 I. C. C. 438. The commission ruled that the failure of the five defendant carriers to absorb switching charges on grain to deliver to Chicago industries, off their line, while absorbing such charges in the other commodities, did not constitute unlawful discrimination; there must be a prejudice arising out of the discrimination under the third section against one party, which is a source of advantage to the other, alleged to be favored, and generally a competitive relation between the commodities in the cases of which discrimination is alleged to be essential. The commission held that the question as to which of the carriers, inbound or outbound, participating in the movement of the grain, through Chicago, should assume the burden of absorption of switching charges, was §313] THE INTERSTATE COMMERCE ACT. 441 one wherein there might be a more satisfactory adjustment by negotiation than by decision. § 312. Undue preference in denying shippers the choice of route. — Another form of undue preference con- demned by the commission is the practice of initial carriers in joint continuous routes of reserving to themselves the exclu- sive control of the routing of freight, and denying to shippers any choice or control in the selection as between different established routes, the route being determined by the carrier's agents according as they may desire to distribute the shippers' business among one another from time to time or for any reason whatever. The commission ruled in the CaUfornia Fruit case, 9 I. C. C. 182, that this practice was in violation of the statute, subjecting the shippers to undue and unreasonable prejudice and giving the carriers undue and unreasonable preference and advantage. See also 3 I. C. C. 658, 3 Int. Com. Rep. 33. The United States circuit court for the southern district of California, in 123 Fed. 597, and 132 Fed. 829, sustained this view and ordered the enforcement of the order of the commis- sion, and held that the agreement between the carriers con- stituted a trafTic pool, violative of sec. 5 of the act. But this judgment was reversed by the Supreme Court, Southern Pacific Co. et al. v. Interstate Commerce Commission, 200 U. S. 536, 50 L. Ed. 585 (1906). The Court said that the rule of the carriers where the right of routing beyond its own terminal was reserved to the initial carrier as a condition for guaranteeing through rates to the shipper, was not violative of sec. 3 or sees. 5 or 6 of the Interstate Commerce Act; that the rule was intended to break up rebating, and that there was nothing' in the act which prevented the carriers from agreeing upon a routing of the freight. But see amendment to § 457, infra. § 313. Undue preference in arbitrary division of ter- ritory. — ^Another practice condemned by the commission as violative of the rights of shippers in creating undue preference was the arbitrary division of territory under the agreement of the Southern Railway and Steamship Association, 6 I. C. C. 195, whereunder the commission found that the rates on 442 THE INTERSTATE COMMERCE ACT. [SECTION 3 traffic of certain classes were made higher from Chicago and Cincinnati to southern territory than they otherwise would be, for the purpose of securing to the lines from the north- eastern cities, transportation of that trafhc from the territory set apart to them under the agreement, and that this raised the presumption of the unreasonableness of the rates in such territory. The commission found that this division of terri- tory was without warrant in law, and to have been made for the benefit of carriers without regard to the interests of shippers in the territory, to whom it was in effect a denial of the privilege of shipping their goods to market by the line or route they may prefer. See also 8 I. C. C. 185, wherein the commission made a report on the export rates from points east and west of the Mississippi river, and said that it was neither sound in principle or equitable in practice for railroad lines to create artificial differential in the rates, whereby the product of one section is assigned to one market and the product of another section assigned to another market. § 314. Rate wars and undue preferences. — The rela- tion of rate wars to the reasonableness of rates was considered under section 1, supra, § 220, 2 I. C. C. 231 and 2 Int. Com. Rep. 137. In the rate war prevailing in the southern freight traffic in June and July, 1894, great disparities in rates were suddenly produced at intermediate points by the large reduc- tion in rates to Knoxville at the commencement of this war. See 6 I. C. C. R. 632. The commission made an inquiry of its own motion, 7 I. C. C. 177; see also eighth annual report of the commission, 1894, pp. 20 to 24. The commission held that the maintenance of the usual rates to intervening points during the period of such reduced rates to the terminal points was an unwarranted discrimination, and entitled the shippers from intermediate points to reparation for the excess paid by them during such rate war. On the subject of passenger rates and rate wars, see also 2 I. C. C. 543 and 2 Int. Com. Rep. 340. These decisions of the commission were rendered especially in view of the long and short haul requirement of section 4, and prior to the ruling of the Supreme Court that railroad §315] THE INTERSTATE COMMERCE ACT. 443 competition created a dissimilarity of conditions within the meaning of the section. The ruling however of the Supreme Court that the competitive rate must be remunerative (see supra, § 264), would of itself prevent the extreme reductions condemned by the commission. As to undue preference and discrimination in passenger rates, see supra, section 2. As to applications for injunctions in rate wars by carriers and shippers, see annual report of 1896, page 43. For account of "rate war" injunctions filed by a competing carrier, a trust company representing security holders of the carrier, and a complaining shipper during rate war between Seaboard Air Line and the Southern Railway Company in 1896, see annual report of commission for 1896, page 43. § 315. Discrimination in kinds of traffic. — The first paragraph of section 3 also prohibits any undue or unreason- able preference or advantage of any particular description of traffic in any respect whatever. It was held in the Oregon Short Line & U. N. R. Co. v. Northern Pacific Railway Co., ninth circuit, 9 C. C. A. 409, 61 Fed. 158 (1894), that this first paragraph of the third section forbidding discriminations against any locality or description of traffic is for the pro- tection of the locality or traffic itself, and cannot be invoked by a carrier against a connecting carrier for alleged dis- criminations in the matter of requiring prepayment of freight and car mileage.. The court said that it was not competent for a railroad company to appropriate the grievances of a citizen or locality under section 3 and complain on account of it. Goods offered for shipment from a given point must be car- ried for the established rate from such point, in the absence of a through routing, regardless of the point where the goods originated. Bigbee Packet Co. v. M. & 0. R. Co. (So. Dist. of Ala.), 60 Fed. 545 (1893); 4 L C. C. 611, 3 Int. Com. Rep. 515. Discriminations against kinds of traffic have been involved with discrimination against localities where the industries dis- criminated against are established, and especially when raw material and manufactured products are in any sense com- 444 THE INTERSTATE COMMERCE ACT. [SECTION 3 petitive. This is illustrated in the litigation resulting from the competition between the packing houses of Chicago and those which have been established in the stockraising section in the west where the industries located in Chicago are directly concerned in keeping down the rates on live stock to that point as compared with the rates on packing house products. See 4 I. C. C. 158, also 4 I. C. C. 611, 3 I. C. C. 515, and 10 I. C. C. 428. The commission made an order in this latter case brought on the complaint of Chicago Live Stock Exchange, prohibiting the carrier from charging higher rates for transporting cattle to Chicago from points west than for transporting live stock properties. The circuit court, northern district Illinois, after an exhaustive investigation, declined to enforce this order, 141 Fed. 1003, and the judg- ment was affirmed by the Supreme Court in 209 U. S. 108, 52 L. Ed. 705, (1908). The Court held that there was no presumption of wrong arising from a change of rate by a carrier nor was there any universal rule that the rate on raw material should not be higher than on the manufactured product. The cost of carriage and risk of injury might excuse a higher rate on live stock than on dressed meats and packing house products, and the reduction of the freight rates for packing house products did not work an undue and un- reasonable preference when it was induced by competition, and did not directly injure or influence the shippers of live stock. The Court said in this case that the railroads were the private property of their owners, and while from the public character of the work in which they are engaged, the public has the right to prescribe rules for securing faithful and efficient service and equality between shippers and com- munities, in no proper sense is the public a general manager, and it followed that the railroad companies could contract with shippers for a single transportation or for successive transportations, subject though it may be to a change of rates in the manner provided in the act; and in fixing their own rates, the carriers may take into account competition with other carriers, provided only that the competition is genuine and not a pretense. For subsequent, Oct. 1911, case of discrimination against packing house products in favor of live hogs, from Iowa points to the east, see 21 I. C. C. 490. §316] THE INTERSTATE COMMERCE ACT. 445 The same alleged discrimination between kinds of traffic and localities wherein the competing industries were located was shown in the complaint of the Missouri and Kansas millers against the differential between wheat and flour, where the discrimination operated in favor of the Texas mills as against the mills of Missouri and Kansas. See infra, § 318. Questions of undue preference of kinds of traffic have been raised by manufacturers in respect to raw material and manu- factured product for the protection of their local industries against competition, and also by the manufacturers of and dealers in commodities, which were commercially competitive as anthracite and bituminous coal, 4 I. C. C. 535, 3 Int. Com. Rep. 460. This question of undue preference to particular kinds of traffic was also involved with the subject of carload and less than carload rates, supra, § 235. See 3 I. C. C. 473, 2 Int. Com. Rep. 742; 5 I. C. C. 638, 4 Int. Com. Rep. 285. § 316. Preferences against traffic — must involve in- jury. — Undue preference against traffic must ordinarily be such that injury is caused thereby to some party or locality. The commission said in 10 I. C. C. 173, one of the Louisville Stockyards cases, with reference to a claim that a refusal to receive carloads of live stock from a connecting carrier, when carloads of dead freight were received, that this involved an undue preference of the dead freight, that this refusal to receive live stock did not in any respect benefit dead freight. If an undue discrimination was found, the carrier might com- ply with the order by ceasing to deliver dead freight, and if this latter alternative was adopted, complainant would not be benefited and other shippers would be greatly injured. See also Butchers & Drovers Stockyards Co. v. L. & N. R. Co., 14 C. C. A. 290, 67 Fed. 35 (1895). When manufacturing industries are established in localities it often happens that a slight change in the adjustment of transportation charges as to the raw material and manufac- tured product or article may be sufficient to close manufac- turing plants at some points and increase the output at others located elsewhere. This was the contention in the Chicago Live Stock case, but the Supreme Court, supra, § 315, held that there was no 446 THE INTERSTATE COMMEECE ACT. [SECTION 3 presumption of wrong arising from a change of rate by a carrier, nor was there any universal rule that the rate of the raw material should not be higher than on the manufactured product. It was admitted, however, that as a general rule, the manufactured product carried a higher rate than the raw material. § 317. A reasonable regulation of carload weights not preferential. — It was ruled in 7 I. C. C. 255, that a rule made by a carrier which had not provided track scales at stations, forbidding shippers to load cars above a specified weight of marked capacity of the car under the so-called penalty of an increased rate on the excess weight, was not unlawful, provided the increase in charges for the excess weight was not unreasonable, and the margin between such maximum and the carriers' minimum of carloads of grain was so wide that shippers could readily comply with both rules. Such rules however must be shown upon the carriers' posted schedule. See infra, section 6. In this case it was also ruled that rules for minimum carload weights for corn or other grain which varies with the size of cars furnished by the carrier are unreasonable, in that they would inevitably confuse and puzzle shippers and consignees, and subject them to excessive charges resulting from arbitrary weights, and increase the number of overcharge claims and afford many opportunities for discrimination in rates between competing shippers. The commission said therefore that the carrier should enforce a fixed and reasonable minimum carload rate for corn and other grain irrespective of the capacity of the cars furnished by it to shippers. In another case, 3 I. C. C. 241 and 2 Int. Com. Rep. 599, the commission held that a rule was reasonable, which pre- scribed the minimum weight of a carload of cattle at a certain rate, and then charged by the hundred pounds for any excess of weight over the minimum. The commission said that such a rule was more just and reasonable than the practice of making a carload rate irrespective of weight leaving the shipper to load into the car as many cattle as he pleased and was able to put into it, and the fact that some difficulties were found to exist in the prompt and accurate weighing of §318] THE INTERSTATE COMMEECE ACT. 447 the cattle was not a reason for abolishing the new rule, but rather for improving and perfecting it. § 318. Differentials between grain and grain prod- ucts. — This question has been extensively discussed before the commission. The millers located in wheat producing territory strongly insisted, that flour being more easily handled, was entitled to at least an equal rate with wheat. On the other hand, the millers located in Texas out of the wheat producing territory were directly interested in a high differential between wheat and flour, so as to at once secure an adequate supply of wheat and exclude competing flour. It appeared from the testimony in the proceeding instituted before the commission by the millers of Missouri and Kansas that the Texas railroads were in the habit of increasing this differential during harvest time for the benefit of the Texas flour mills. The commission ruled, 4 I. C. C. 417, and 3 Int. Com. Rep. 400, that a differential of five cents per hundred pounds, that is, five cents per hundred pounds higher on flour, was warranted by the peculiar conditions, but that a larger differential, such as had been maintained for con- siderable periods, worked an unjust discrimination and was unlawful. In 8 I. C. C. 304, decided some nine years later, the com- mission reaffirmed this ruling saying that the advantages were not sufficient to warrant interference with the estab- lished differential; and in the same opinion, the differential between corn and corn meal in the same territory was made not to exceed three cents per hundred pounds. This ruling was again reaffirmed in January, 1904. 10 I. C. C. 35. In 11 I. C. C. 220, a differential on corn meal shipped from Missouri river points to Texas was fixed at a maximum of three cents above the rate on corn in force at the same time. In 16 I. C. C. 73, the differential on flour was fixed at not more than twelve per cent, of the rate on wheat from Kansas points to Phoenix, Arizona. See also 12 I. C. C. 258. In cases from other sections of the country it was held that grain and grain products were presumptively entitled to equal rates. See 8 I. C. C. 214, where the commission ruled that an equal rate on wheat and flour in the export trade was pre- 448 THE INTERSTATE COMMERCE ACT. [SECTION 3 sumptively proper, but that in view of all the conditions shown in the investigation, the differential rate for export should not exceed two cents per hundred pounds. For further discussion of this subject, see 32 I. C. C. 602, which was a case supplemental to that reported in 29 I. C. C. 424 and 429, where the carrier asked permission to increase rates on wheat and flour in connection with the general read- justment of rates contemplated by them pursuant to the decision of the Supreme Court in the Intermountain case. The commission in this case discussed the relationship between wheat and flour in different parts of the country, and ruled that the increase on flour in carload lots from sixty- five to seventy-five cents per one hundred pounds from points in Kansas, Nebraska and neighboring states to Cali- fornia terminals was reasonable, provided the difference between wheat and flour did not exceed eight cents, and provided also that the rates on the commodities to the terminals did not exceed the rates to the intermediate points. In 31 I. C. C. 623, the commission, in considering the case of flour and other grain products from the valley of Virginia to the Carolina territory, said that carriers would not be required to modify their rates to any standard that was apparently fairly adapted to the case of commodities and interests affected, except when the unreasonableness and resulting unjustifiable injury was proven. They said they had considered the relation of flour and grain rates from many angles and with respect to various sections of the country, and always had regard for the particular interests existing in the particular territory involved. It was said that the usual rule in the western classification territory and in the official classification territory was to charge something more on flour than on wheat, varying from one-half cent to four cents per one hundred pounds. § 319. Discrimination in mode of shipment. — Undue preference may consist not only in a differential rate, that is, a difference in rate not warranted by the character of the commodity or any consideration relating to the cost of serv- ice, but also in any discrimination in the performance of any §319] THE INTERSTATE COMMERCE ACT. 449 of the duties of the carrier, or any accessorial services rendered. This is illustrated in the rulings of the commission upon the subject of the alleged discriminations in the ship- ment of oil in tanks as against the shipment in barrels. Thus it was ruled in 1 I. C. C. 503 and 1 Int. Com. Rep. 722, that when oil is transported in tanks permanently affixed to car bodies, the tank is to be considered as part of the car, and for oil transported therein the charge for transportation should be the same by the hundred pounds, that the carrier charges for transportation between the same points, of barrels filled with like oil and taken in carload lots, and that the carrier was guilty of unjust discrimination if the shipper in barrels was charged a higher rate. See also 2 I. C. C. 90, 2 Int. Com. Rep. 67. In the case last cited, on account of the difference in ex- pense of service a higher rate for the oil in barrels in less than carload lots as compared with oil in carload lots was sus- tained. The allowance by a carrier to a shipper of oil in tanks of forty-two gallons or any number of gallons for alleged leakage and waste in the transportation, in the absence of a corres- ponding allowance to shippers in barrels, was an unjust dis- crimination and unlawful. 4 I. C. C. 131, 3 Int. Com. Rep. 162. There was no objection however to the use of estimated or constructive weights, provided the method of estimating works no inequality in its practical application to competing modes of conveyance. It is the duty of the carrier to equip its road with the means of transportation, and in the absence of exceptional condi- tions, those means must be open impartially to all shippers of like traffic. If the carrier transports freight in cars owned by the shipper, it must be upon such terms as shall not constitute an unjust discrimination against shippers of like traffic, who are excluded from the use of such private cars. Where the use of a class of private cars, such as tank cars, is not opened to shippers impartially, but is practically limited to one class of shippers, and the charge for a barrel package in barrel shipments in the absence of a corresponding charge on the tank shipments results in a greater cost for the transporta- tion, it is undue preference and discrimination. 5 I. C. C. J— 29. 450 THE INTERSTATE COMMEKCE ACT. [SECTION 3 415, 4 Int. Com. Rep. 162. For decision of Supreme Court as to alleged discrimination between tank and barrel ship- ments, supra, § 234. Thus in 24 I. C. C. R. 291, the commission said that a merchant located in Georgetown had a just complaint against the Pennsylvania Railroad and other carriers in refusing to give him a free delivery in less than carload lots, when they did grant it in other sections of the city. § 320. Classification. — The subject of undue preference against kinds of traffic necessarily involved the question of classification. The strict apportionment of a cost of service on all classes of commodities equally would be impracticable, for the reason that articles which are bulky and cheap would be unable to bear the burden of transportation, as their value would be confiscated by the cost of transportation for any considerable distance. It is universally recognized therefore that in order that such articles as grain and its products, fuel, lumber and ore can be transported at low rates which they can stand, it is necessary for the carrier to charge upon the other classes of goods, which comprise greater value in smaller compass, a greater proportionate rate. Upon this necessity are based the principle and practice of classification of freight traffic, which have been exhaustively discussed in the reports of the Interstate Commerce Commission. See report of 1888, p. 34, 1891, p. 98, 1893, p. 55, 1897, p. 70, 1914, p. 62. Commodities not classified are given what is known as commodity rates. Thus salt requires and receives a com- modity rate lower than class rates. The commission said in 5 I. C. C. 299, 4 Int. Com. Rep. 33, that the carriers should only be limited as io such low rating by the rule that a com- modity should not be carried at such unremunerative rates, as will impose burdens upon other articles transported to recoup losses in carrying that commodity. § 321. Uniform classification recommended. — The commission in its several annual reports has earnestly recom- mended a uniform classification. In its report on the pro- posed western classification No. 51, 25 I. C. C. 442, the com- §321] THE INTERSTATE COMMERCE ACT. 451 mission exhaustively considered the subject of classification, setting out its history in detail, explaining the attitude of the commission, and emphasizing the importance of action on the part of the carriers (See also 34 I. C. C. 554). In the annual report of 1897, page 62, the subject is reviewed and it is said that at the time of the adoption of the interstate commerce act classifications were nearly as nu- merous as the railroads and led to endless confusions. Some of the classifications contained not less than 33 classes, and even in later years in some of the southern states there were classifications in use containing as many as 22 classes of freight. The subject was complicated by the local interests involved in different parts of the country, which it was claimed required distinct classification. It was said that the evil had been measurably reduced by the growth of "commodity of interests" among railroads and the consoli- dation of connecting lines, but the differences and resulting confusion were still very great. The first important step in the direction was the establish- ment of the Official Classification put in force in 1887 at the time of the taking effect of the commerce act. This classi- fication has been generally adopted throughout the territory north of the Ohio and Potomac rivers drawn roughly from Chicago to St. Louis at the junction of the Mississippi with the Ohio. The Western Classification prevails practically on all the railways operating throughout the territory from Chicago to St. Louis and the Pacific coast. What has been called the Southern Classification has been adopted by the lines south of the Ohio and east of the Mississippi river. Quoting the commission, 25 I. C. C. 455: "At the present time these three great classifications, the Official, Western, and Southern, subject to exception sheets and commodity rates of the individual carriers and the lim- ited use of certain state classifications, transcontinental tariffs, and the Canadian classification, are the only classifi- cations applying to interstate traffic. Occasionally, however, these classifications overlap. Articles shipped from a point in one territory to a point in another are sometimes governed by the classification of the point of origin and at other times by that of the place of destination. Confusion arises par- ticularly in the shipment to and from a point located com- paratively near a classification boundary. St. Louis, for 452 THE INTERSTATE COMMERCE ACT. [SECTION 3 instance, uses the official classification for east bound freight, the western for westbound freight, the southern for south- bound freight, and the transcontinental tariffs for Pacific coast trade. "^ While congress by amendment of 1910 to section 1, has made it the duty of the carriers to observe and enforce just and reasonable classifications and has declared unreasonable classification unlawful, it has not directly empowered the commission to enforce uniform classification. In its report of 1914, the commission recommends congress to provide for such uniformity by prompt and appropriate legislation requiring the carriers to file with the commission a uniform classification, and authorizing the commission upon investi- gation to make such amendments as may appear to be reasonable and necessary. § 322. Classification distinct from rate making. — In its report on the western classification in 25 I. C. C. 442, the commission commented on the distinction between classifica- tion and rate making, and said that uniform classification must be worked without an attempt to affect revenues and that classifications and rates and revenue should be kept entirely distinct. Whether a rate is too high or too low should be made a separate issue distinct from classification. "A classification is a universal tariff from which the sched- ules of individual carriers should not depart, except in cases demanded by special conditions. Commodity tariffs in re- stricted number may always remain a necessity." In the same report the commission insisted that the hearing of the classification committee should be made public and due notice to interested parties including state commissions and the Interstate Commerce Commission; and commented in detail upon all the essential factors to be considered in a iPor details of the present system of classifications, and its relation to intra-state systems, see Official Map of Railway, Freight Classification Territories, and Freight Traffic Association Territories, with Appendix, showing the classifications applying on intra-state traffic in the several states, and the extra-territorial applications of the respective classifica- tions, issued under direction of the Central Freight Association, Chicago, 111. § 324] THE INTERSTATE COMMERCE ACT. 453 classification on the relation between car load lots and less than car load lots of mixtures and other considerations re- lating to the materials transported. See also on same sub- ject 34 I. C. C. 554. § 323. Consultation of carriers in classification not illegal combination. — In the report of 1899, pp. 12 to 20, the commission discussed the question of the advance in freight rates by the carriers using what is known as the official classification, covering the territory lying east of the Missis- sippi and north of the Ohio and Potomac rivers, and in that connection gives the opinion of the attorney-general of December 30, 1899, to the effect that consultation by the representative railroad men in the committee respecting suggested changes in classification, and subsequent independ- ent action by the respective railroad companies by the adoption of the new classification recommended, in the absence of any testimony of compulsion or combination in adopting a classification, was not in violation of the Anti- Trust law. § 324. Undue preference in classification. — Undue preference may be effected by discrimination in classification between commodities which are in fact competitive, where such classification is not based on a difference in the cost of service. The Enghsh statute of 1854 was construed as imposing upon the carrier the burden of justifying such dis- crimination by considerations relating to the cost of carriage. Oxlade v. N. E. Ry. Co., 1 Ry. & Canal Traffic Cases, 73; Thompson v. London & N. W. Ry. Co., 2 Ry. & Canal Traffic Cases, 115. This general principle has been appfied by the commission in a variety of cases. Thus, the advance of hay and straw from the 6th to the 5th class on the official classification of January 1, 1900 (see 9 I. C. C. 264), was ruled unreasonable and unjust as resulting in unlawful dis- crimination and prejudice against the localities where such commodities are produced, and against producers, dealers and consumers. As to the governing principles of freight classification, see 6 I. C. C. 148 and 4 Int. Com. Rep. 525; 9 I. C. C. 78. See also 3 I. C. C. 473, 2 Int. Com. Rep. 742. 454 THE INTERSTATE COMMERCE ACT. [SECTION 3 In 4 I. C. C. 212, 3 Int. Com. Rep. 257, it was said that where questions of classification and rates are involved as to one particular article of freight, it is often necessary to exam- ine and consier the classifications and rates upon other articles in which the same calculations in respect to value, bulk and expense of handling and carriage would to a con- siderable extent enter. For the purpose of such comparison it is not indispensably necessary that the articles should be competitive, though if they are competitive, then this feature is held partly to be considered. The proper method of determining the justice of classification by comparison, is with classification created by the carrier for analogous articles. 5 I. C. C. 638, 4 Int. Com. Rep. 285. The fact that different rates and classifications are jn force in different sections of the country would not of itself warrant an exten- sion of the lower rate of classification to the higher rate and classification as applied. There must be proof of unlawful discrimination or disadvantage or unreasonably higher rates to procure an order directing different rates and classification. 6 I. C. C. 61. In 6 I. C. C. 85, a commodity (i. e. not classified) rate published for intending settlers only, but in fact given to shippers indiscriminately was condemned by the commission as calculated to mislead the public and afford an opportunity for favoritism. For illustrations of the rulings of the commission in cases in classification, see 2 I. C. C. 1, 2 Int. Com. Rep. 1, where classification of dried fruit and raisins in two different classes was ruled unreasonable. Hub blocks were classed with lumber, instead of with un- finished wagon materials. 2 I. C. C. 122, 2 Int. Com. Rep. 81. In 1 I. C. C. 393, 1 Int. Com. Rep. 685, railroad ties were classed with other rough lumber. In 2 I. C. C. 573, 2 Int. Com. Rep. 403, Hostetter's Stomach Bitters were ruled not properly classified in the first class with other liquids similar in character. In 4 I. C. C. 32, 3 Int. Com. Rep. 74, patent medicines were ruled properly classed at a higher rate than ale, beer and mineral water. § 324] THE INTERSTATE COMMERCE ACT. 455 In 4 I. C. C. 41, 3 Int. Com. Rep. 77, toilet soap was ruled properly classed higher than laundry soap, the commission holding that manufacturer's description of his production for commercial purposes warranted a classification accordingly. See also 4 I. C. C. 733, 3 Int. Com. Rep. 564. 5 I. C. C. 663, 4 Int. Com. Rep. 318, ruled that celery was properly classified with vegetables rather than with fruits. In 6 I. C. C. 148, in view of the great reduction in value of window shades, the classification as first class was held un- reasonable. The United States circuit court, in 64 Fed. 724 (1894), declined to enforce this order on the ground that it applied to shades having a very high value as well as to the cheaper varieties, and the order was amended accordingly. 6 I. C. C. 548. In 7 I. C. C. 40, open-end envelopes were ruled properly classed with merchandise envelopes. In 8 I. C. C. 368, iron pipe and fittings packed in cases were ruled properly classed higher than iron pipe and fittings packed in barrels. 6 I. C. C. 61, ruled that there were condi- tions compelling a low rate upon flour which did not apply in the transportation of cereal products. In 4 I. C. C. 212, 3 Int. Com. Rep. 257, the principles of classification were discused, and applied in the case of surgi- cal chairs. In 10 I. C. C. 281, cow-peas were ruled properly classed With grain, and not with fertilizers. In 12 I. G. C. 216, the commission said that classifica- tion must be based upon a real distinction from a transporta- tion standpoint, and could not depend upon the uses of the commodity after reaching the destination. If the matter was considered from any other than a transportation standpoint, it would lead to an almost endless multiplication of rates. Thus it was ruled in 13 I. C. C. 109, that the inclusion of wire brushes and brooms not toilet in cases of less than carloads, in the first class, was unreasonable, and they were ordered classi- fied in the third class; while the inclusion of new and old automobiles in the same class was found in 15 I. C. C. 27, not to be unjust, as no convenient line could be drawn between old and new machines of different values in trans- portation. 456 - THE INTERSTATE COMMERCE ACT. [SECTION 3 In 21 I. C. C. 518, classification of earthen crucibles at third class in less than carloads and fourth class in carloads, was held unjust and discriminatory. § 325. Power of the commission in correcting classi- fication. — The commission has in a number of cases exer- cised the power to order a change in the classification, as in the cases before cited; also in 1 1. C. C. 393, 1 Int. Com. Rep. 685; 2 I. C. C. 122, 2 Int. Com. Rep. 81; 4 I. C. C. 312, 3 Int. Com. Rep. 257; 6 I. C. C. 148, 4 Int. Com. Rep. 525. Assurance made by a carrier that if one will locate in busi- ness on the line of his road his property shall be taken for transportation as belonging to a specified class, it was ruled by the commission in 2 I. C. C. 122, 2 Int. Com. Rep. 81, could not bind the carrier so as to compel a classification accordingly. There can be no contract right to a special classification, as the law requires uniformity and impartiality in the dealings of the carrier with all persons. The subject of classification was considered by the Supreme Court in C. H. & R. Co. v. Interstate Com. Com'n, 206 U. S. 142, 51 L. Ed. 995 (1907), affirming 146 Fed. 559. The Court in this case sustained the order of the commis- sion, directing the carrier to cease from further charging the freight rate for common soap in less than carload lots op- erating throughout official classification territory, increasing the classification from fourth to third class, which was found to have brought about a general disturbance in relations pre- viously existing in the territory, and creating discriminations and preferences among manufacturers and shippers of the commodity and between localities in such territory. The Court said that the findings of the commission, that a classi- fication of freight rates produced preferences and discrimina- tions would not be interfered with on appeal, when concurred in by a federal circuit court, unless the record established that clear and unmistakable error had been committed. For the order of commission, see 9 I. C. C. 440. § 326. Reasonable regulations in classifications. — The commission has ruled, 6 I. C. C. 61, that the fact that dif- ferent rates and classifications are in force in different sections §327] THE INTERSTATE COMMEECE ACT. 457 of the country would not itself warrant an extension of the lower rate and classification to the section where a higher rate and classification were applied. There must be proof of un- lawful discrimination or disadvantage or of unreasonable higher rates to justify directing an order for changes in the classification. In this case it was ruled that a mixed carload rate for cereal products or for cereal products and flour, that would have the effect of throwing out of the trade many com- petitors of complainant, or the manufacture only of certain kinds of cereal products and of centraUzing the^ business in the hands of one or more of the dealers, should not be cur- tailed, when without it no wrong is done to any one and the market is open to all competitors. The commission said therefore that to obtain the abrogation of a rule in classi- fication denying a mixed carload rate upon specific articles, the rule should be shown to be unreasonable, unfair or unjustly discriminative. It was ruled in 20 I. C. C. 546, that the classification of an article of commerce should be stated in terms that the ship- ping public may readily understand. Tariffs are to be con- strued according to their language, and the intention of the framers and the practices of the carriers do not control. See 16 I. C. C. 431. In 20 I. G. C. 489, it was ruled that the classification rule applying minimum weights on shipments of merchandise, and more particularly by millinery packing in ordinary pasteboard or strawboard boxes, that the rule was not unreasonable which provided for the refusal of such ship- ments when not crated. But in the same case, a classifica- tion rule applying minimum weights on shipments in cor- rugated paper or pulp cartons of certain sizes when uncrated, instead of assessing charges on the basis of their actual weights, was found unreasonable. § 327. Facilities for interchange of traffic. — The sec- ond paragraph of the third section, though based in part upon the English statute, is materially different therefrom, and the difference has been construed as substantial. Thus the English statute was construed as empowering the court to compel through routing of passengers or freight. The com- mission held in an early case, 1 I. C. C. 86, 1 Int. Com. Rep. 458 THE INTERSTATE COMMERCE ACT. [SECTION 3 ' 357, that this section of the act did not compel one railway company to sell through passenger tickets over the road of another company. In the Kentucky and Indiana Bridge case, decided in 1890, which was really the pioneer case in the construction of the act, 37 Fed. 567, Jackson, J., said that the commission was not vested with authority to establish through routes nor to fix through rates between connecting lines. It has since been definitely determined by the repeated de- cisions of the courts that there is no authority in the commis- sion or in the courts under the act to compel either the rout- ing of passengers or freight, and that the requirement of this section for the affording of all reasonable and proper facilities for the interchange of traffic and the receiving, forwarding and delivery of passengers and property does not mean the receipt and delivery of cars or their through routing of any kind, but only the receipt and delivery of freight and pas- sengers at connecting points without discrimination. This had been the construction given by the Supreme Court to the constitution and statute of Colorado prior to the enactment of the Interstate Commerce Act A. T. & S. F. R. Co. v. Denver & N. 0. R. Co., 110 U. S. 667, 28 L. Ed. 291 (1884); and such has been the construction given to the Interstate Commerce Act in a number of cases in the circuit courts and circuit courts of appeal, cited approvingly by the Supreme Court in the Central Stock Yards case, supra, 192 U. S. 568, 48 L. Ed. 565 (1904). See also Little Rock & M. R. Co. v. St. Louis Iron Mountain & So. R. Co., 41 Fed. 559, and 59 Fed. 400 (1894); Oregon Short Line & Utah Northern R. Co. V. Northern Pacific R. Co., 61 Fed. 158, 9 C. C. A. 409 (1894); Allen V. Oregon Railroad & Navigation Co., 98 Fed. 16 (1899). It was held in all of these cases that through routing of passegers or freight depends upon contract voluntarily made between the carriers, and there is no power in the commission or courts to enforce the making of such a con- tract. Prescott & Arizona Central R. R. Co. v. A. T. & S. F. R. Co., 73 Fed. 438 (1896), wherein the court comments on apparently different ruling in N. Y. & Northern R. R. Co. V. N. Y. & N. E. R. R. Co., 50 Fed. 867 (1892). For discrimi- nation by carrier between competing local transfer com- § 328] THE INTERSTATE COMMERCE ACT. 459 panics, see St. Louis Drayage Co. v. L. & N. R. R. Co., 65 Fed. 39 (1894). The commission said that in the act to regulate commerce, congress intended to eflect the same results as the English statute, but omitted the machinery necessary to accomplish it, and it was therefore recommended that the act be amended in this particular. The commission has in its annual reports recommended to congress to give the necessary authority by new legislation. For amend- ments of 1906 and 1910 authorizing the commission to establish through routes, see infra, § 452. A rail carrier may make a through rate with one line of connecting steamboats, and refuse to make such rates with other steamboats. 4 I. C. C. 265, 3 Int. Com. Rep. 278. The words "track and terminal facilities" in this section refer to all rail carriers, or a carrier part rail and part water, but not to an independent water line. § 328. Discrimination in exacting prepayment from connecting carriers. — It has been contended, as through routing is a matter of contract, that a carrier has the right to establish joint rates and through routes for the purpose of facilitating and increasing its business, and that therefore it has the right to discriminate in the requirement of prepay- ment from connecting carriers. This was ruled by the C. C. A. of the fifth circuit i,n Gulf, C. & S. F. R. Co. v. Miami S. S. Co., 86 Fed. 407, 30 C. C. A. 142 (1898). It was held by the C. C. A., ninth circuit, in Ilwaco Ry. Navigation Co. v. Oregon Short Line & U. N. Ry. Co., 57 Fed. 673, (1893) reversing 51 Fed. 611, that a transportation company, operating a railway and a line of steamboats connecting at the company's wharf, was not required by this third section of the act to permit the boats of a com- petitor to land at the wharf. See also Little Rock & M. R. Co. v. St. L. & I. M. & S. Ry. Co., circuit court, eastern dist. of Ark. supra and Oregon Short Line R. Co. v. N. Pac, 51 Fed. 465. On the other hand, in Wadley Southern R. Co. v. Ga., 235 U. S. 651, 59 L. Ed. 405 (1915), the Supreme Court affirmed the judgment of the Supreme Court of Georgia, 137 Ga. 497, holding that a discrimination between connecting railroads 460 THE INTERSTATE COMMERCE ACT. [SECTION 3 in the requirement of the prepayment of freight was an unjust discrimination under the Georgia statute, the Court holding that the state statute so construed did not violate due process of law. The Court cited the above cases but did not decide whether waiver of such requirement constituted an unjust discrimination under the Interstate Commerce Act. It would seem that the carrier would be allowed a reasonable latitude in determining whether such requirement of prepayment from a connecting carrier could not be waived in furtherance of his own interest. On the general subject of discrimination between railroads in the absence of statutory direction, see Atchison, T. & S. F. R. Co. V. Denver & New Orleans R. R. Co., 110 U. S. 667, 28 L. Ed. 291 (1883). § 329. Discrimination in exacting prepayment from shippers. — In Gamble-Robinson Commission Co. v. C. & N. W. Ry. Co., 168 Fed. 161, in the C. C. A. of the eighth circuit, it was held. Judge Hook dissenting, that a common carrier did not violate the act by subjecting a party to unreasonable and undue preference in insisting upon his paying his freight bills in advance and refusing to give him the credit which it gave customarily to others. In the opinion of the court, the extension of credit was a favor, in effect a loan, to the shipper, which he had no right to ask, and therefore its refusal could in no way be the basis of a charge of discrimination or undue preference. On the other hand, it was strongly urged in the dissenting opinion, that the court should take notice of the general custom of the business, and that the favor extended to one shipper should be extended to all similarly circumstanced. In Hocking Valley Ry. Co. v. U. S., 210 Fed. 735, C. C. A. sixth circuit (1914), in a criminal prosecution under the Elkins Act, the court held that such an extension of credit to one shipper was unlawful, although other shippers, not knowing of such privilege granted to the favored shipper, had not demanded that the same privilege be extended to them. The court based its opinion upon the specific lan- guage of the Elkins Act. See infra, § 528. §330] THE INTERSTATE COMMERCE ACT. 461 § 330. State control of interchange of interstate traffic. — Questions have arisen out of the anomalous control of commerce by governmental authority of the states and the United States, as the same carriers are controlled by the state with reference to their intrastate trafTic, and by the federal government as to interstate traffic. A belt or switching- rail- road is subject to the state authority when it charges local rates for its traffic and makes no interstate routing, while it becomes subject to the federal law when it joins with other carriers in making through shipments of interstate traffic. In the Louisville stockyards litigation, under the provisions of the state constitution of Kentucky it was claimed that the defendant company was required to receive and deliver freight in the carloads to any point that was in physical connection with the tracks of another company. It was said by the C. C. A. for the sixth circuit, An. Stockyards Co. V. L. & N. R. Co. 55 C. C. A. 63, 118 Fed. 113 (1902), that assuming, without deciding, that the Kentucky constitution and legislation made such requirement, that the state could not regulate interstate commerce, using the term in the sense of intercourse and interchange of traffic between the states. The power of the state to require connecting tracks between two railroad companies at an intersection for the transfer of cars used in the local business of such line of railroad was conceded. In the case before the court, it was not the means of making a physical connection with other railroads that was aimed at, but it was sought to compel the cars and freight received from one state to be deUvered to another at a particular place and in a particular way. If the Kentucky constitution could be given any such construction, it would follow that it could regulate interstate commerce. The judgment in this case was affirmed by the Supreme Court, in 192 U. S. 568. The latter Court did not decide this question of the power of the state with reference to interstate traffic, as it construed the Kentucky constitution as referring only to cases where freight was destined to some fur- ther point by transportation over a connecting line. It will be seen that in this case there was no authoritative construc- tion of the state constitution and statute by the judiciary of the state. 462 THE INTERSTATE COMMERCE ACT. [SECTION 3 At the time this suit of the Central Stockyards was filed a proceeding was also instituted before the Interstate Com- merce Commission by the Railroad Commission of Kentucky, and the decision of the Supreme Court was followed by the commission, dismissing the complaint. 10 I. C. C. 173. § 331. State and municipal control of terminals. — The last clause of the section, providing that the directing of facilities for interchange of traffic should not be construed as requiring the carrier to give use of its tracks or other terminal facilities to another carrier engaged in like business, was con- strued by the United States circuit court of Iowa, in State of Iowa V. Chicago, Milwaukee & St. Paul Railroad Co., 33 Fed. 391, (1887) soon after the adoption of the act. The state of Iowa filed a bill in the state court against the defendant carrier to enforce an order of the State Board of Railroad Commissioners requiring the defendant to pass cars of other companies over its siding in the city of Dubuque at reason- able rates fixed by the board, the sidings having been laid under the permission of the city on condition that they should be open to all. The defendant carrier moved the case to the United States court, there being no diverse citizenship, on the ground that a federal question was involved, to-wit, its right in interstate traffic under section 3 of the act. The court sus- tained motion to remand the case, saying that the provision in the section as to the terminal facilities simply declared that the preceding provision of the section should not be deemed to give the right to one carrier to use the tracks or terminal facilities to another carrier in like business, and had reference to the effect of the act of congress, and to nothing else saying: "If the defendant company by a contract with the city of Dubuque has bound itself to allow other companies to use part of its tracks or terminal facilities this clause of the act of congress does not affect such a contract or the enforcement thereof. So also if the state of Iowa has provided by proper statute that different companies may have a joint or common use^of certain terminal facilities, the rights of the several com- panies to such joint use are not affected by the provisions of the Interstate Commerce Act, but the same must be deter- mined by the statute of the state." See also Interstate § 333] THE INTERSTATE COMMERCE ACT. 463 Stockyards Co. v. Indianapolis U. R. Co., 99 Fed. 472 (1900), where there was a similar state and municipal regulation for the use of the terminal tracks. § 332. The charging of local rates not an unjust dis- crimination. — When through rates and through billing are a matter of agreement between the carriers in interstate com- merce, it follows that when a carrier with whom connecting carriers decline to make through rates delivers freight, it only has the right to demand that other carriers receive from and deliver freight for transportation at their published local tariff rates. See 4 I. C. C. 265, 3 Int. Com. Rep. 278; 3 I. C. C. 450, 2 Int. Com. Rep. 721. As to the distinction between local and through rates, see supra, section 2. It was ruled by the commission in 7 I. C. C. 323, that in the absence of some agreement or understanding with a con- necting line by which the joint tariff rates was authorized, a given carrier cannot lawfully apply any other rates than those which are fixed by the transportation between the points fixed by its railroad ; and the rates so fixed are the only lawful rates which the carrier may charge for any transportation service which it may perform. The only rates authorized by the act are the rates established by a single carrier upon its route and the joint rates over continuous lines or routes operated by more than one carrier. But while a carrier is not bound to make through routing, and in the absence of such agreements for through routing may charge its regular tariff rates, those charges must be reasonable for the service. In Augusta Southern Ry. Co. v. Wrightsville & T. R. Co., 74 Fed. 522 (1896), the court held that in the absence of through routing the carrier was not entitled to charge the full local rate permitted by the state law on freight, which was not in reality local, but through freight. The decision in this case however cannot be reconciled with the authorities cited above unless upon the ground that the rate was un- reasonable per se for the service. § 333. The right of exclusive through routing. — Through routing rests upon contract between the carriers. 464 THE INTERSTATE COMMERCE ACT. [SECTION 3 except, of course, where the power of ordering a through routing is exercised by the commission under the act as amended in 1906. It follows, therefore, that a carrier may lawfully make a contract with one connecting carrier for through routing to the exclusion of another. This subject has been extensively litigated in exclusive con- tracts in what are known as the Live Stock cases. While it is the duty of a railroad company to provide suitable facilities for receiving and delivering live stock at its station without additional compensation other than the regular transporta- tion charge, it may provide these facilities by making an ex- clusive contract with one stockyards company, and as long as this company imposes no charge for delivering live stock when that stock is taken by the consignee within a reason- able time, such contract is not obnoxious to law. Covington V. Keith, 139 U. S. 128, 35 L. Ed. 73 (1891); Butchers & Drovers Stockyards Co. v. L. & N. R. Co., 67 Fed. 35, Central Stockyards Co. v. L. & N. R. Co., 55 C. C. A. 63, 118 Fed. 113, 192 U. S. 568, 48 L. Ed. 565 (1904). In the case of the Interstate Stockyards Co. v. Indianapolis Union R. Co., supra, the Indiana circuit court held that a belt line connecting with the different carriers and making agreements for continuous shipments of interstate commerce had no right to discriminate against different stockyards by refusing to deliver stock at one of the yards, though consigned to the owner for care, and the court granted a temporary in- junction against the discrimination. In this case however the terminal road was expressly required by the state statute and its city franchises to render such services without dis- crimination, and it seems that the track connection had been made and the injunction was against the interruption of the service theretofore rendered. § 334. Contract rights of trackage. — In the absence of statute the rights of a railroad company under a lawful agree- ment for the specified use of the tracks of another railroad company are measured in respect to the direct use in the terms of the contract, and the provisions of the act to regulate commerce apply to the situation created by the contract, and add no authority for a different use of the track. 3 I. C. C. §335] THE INTERSTATE COMMERCE ACT. 465 519, 2 Int. Com. Rep. 771. In this case it was ruled by the commission that the Rock Island Company which operated the Union Pacific tracks between Kansas City and Topeka upon condition that no intermediate business should be done by the Rock Island Company on any part of the hne used under the agreement, the Pacific Company retaining the control of the road and supplying accommodations between the intermediate points and Kansas City. The majority of the commission said that such running arrangements existed in many parts of the country and were of great service in trans- portation. Chairman Cooley doubted the validity of the contract, but agreed that the commission had no jurisdiction to interfere with the arrangement. In Union Pacific Railroad Co. v. Chicago, etc., R. Co., 163 U. S. 564, 41 L. Ed. 265 (1896), the Supreme Court held that a later contract made between the same parties for trackage rights by the Rock Island Company over the Union Pacific tracks from Council Bluffs to South Omaha, and giving the Union Pacific Company the right to operate the Rock Island tracks between South Omaha and Lincoln, was valid, and the court said that such business arrangements were in accord with the pohcy in favor of continuous lines declared by con- gress in the act of 1866 {supra, § 44), and that a railroad could contract to give another running rights over its tracks with- out express statutory authority, and the decree of the court below specifically enforcing the contract was affirmed. The contract in this case provided that the Union Pacific Com- pany should do no intermediate business on the Rock Island's tracks. § 335. Rights of connecting carriers as to milling in transit privileges. — As through routing is based upon con- tract and the relation is not created by any application of the common law or requirement of statute, except where ordered by the commission, it follows that any railroad company may decline to become a party to any agreement for through rout- ing, unless the terms and conditions are satisfactory to it. This principle has been applied by the commission, 9 I. C. C. 311, to the privilege of milling in transit granted by some roads. As before shown the commission has approved of this J— 30. 466 THE INTERSTATE COMMERCE ACT. [SECTION 3 practice as promotive of commerce but no authority is given by the act, to the commission, to regulate the granting of such privileges. The commission ruled however that the Boston & Maine Railroad, receiving traffic from the west, was not com- pelled to apply that rate on shipments of feed, ground in tran- sit; and that it was not bound by a private arrangement ex- isting between the shipper and the carrier from whom he received the privilege, to grind his corn in transit. It was ruled in the same case however, that while the connecting carrier was bound by the arrangement for milling in transit, it could impose an arbitrary charge in addition to the regular through rate on the milled product. As to right of carriers to judicial protection in the inter- change of traffic, see infra, section 8, and as to unlawful com- binations interfering with such interchanges, see infra, section 10. § 336. Exclusive contracts for station facilities not unlawful. — In Donovan v. Pennsylvania Company, 199 U. S. 279, 50 L. Ed. p. 192 (1905), the Supreme Court affirmed the C. C. A. for the seventh circuit, 120 Fed. 215, 124 Fed. 1016, in affirming a decree of the circuit court enjoining cabmen from entering a railway station and grounds to solicit customers, and from congregating on the sidewalk in front of the station so as to ■ interfere with the ingress and egress of passengers and employes enter- ing the railway station and grounds of the railroad of com- plainant in Chicago. The railway company had made an agreement with a local transfer company to furnish at its passenger station all the vehicles necessary for the accommo- dation of passengers arriving there on its trains or on the trains of other railroad companies using the station; and the court held that it could rightfully exclude from the station and depot grounds all other hackmen or cabmen seeking entrance for the purpose of soliciting for themselves the cus- tom or patronage of passengers. The Court said that the licensed hackmen or cabmen, when not forbidden by vahd municipal regulations, could within reasonable limits use the public sidewalks about the main entrance to the railway passenger station in prosecuting their calling; but they were not entitled to so congregate as to interfere with the ingress § 338] THE INTERSTATE COMMERCE ACT. 467 and egress of passengers and employes. The Court also held that the absence of adequate legal remedy jusified a resort to injunction. In 20 I. C. C. 458, the commission followed this case in sustaining the arrangement made by the Wabash Railroad with a fruit auction company to conduct its business as an auctioneer of fruit and vegetables on the terminal premises of the defendant in St. Louis. The commission said there was no element of discrimination as between the different shippers that wished to use the auction company's service. The com- mission said that the right to grant exclusive privileges of this general nature in passenger stations had been much discussed in the courts of this country and in England, and had gen- erally been sustained, although in a few of the states it had been denied, but that the decision in the Supreme Court in the case above cited had settled the matter. The commis- sion said that it could not take cognizance of any claims except those of the traveling or shipping public. See also 38 I. C. C. 165 for apphcation to the Penn. R. R. fruit auction in Pittsburgh. § 337. Baggage transfer under the act. — In 23 I. C. C. 72, the commission held that no public duty was owed by a carrier or baggage transfer agent as such, and therefore, although the exclusive privilege of soliciting baggage trans- fers on trains is given to only one transfer company which is controlled by the officers of the defendant, yet there is no undue discrimination, since no one is given any undue advantage or is subject to any undue or unreasonable pre- judice as to any matter in relation to which the carrier owes a duty. The carrier's duty to the public as to baggage begins and ends in the baggage room provided by it. The baggage transfer is prior or subsequent to the transportation service, as to which the carrier owes a duty to the public, and is therefore outside the jurisdiction of the commission. § 338. Undue preference through action of state commission. — Undue preference may be effected through the action of a state commission enforcing the lowering of intrastate rates so that the carrier, in charging reasonable interstate rates, may cause an unjust discrimination in 468 THE INTERSTATE COMMERCE ACT. [SECTION 3 interstate commerce. The authority of the Interstate Com- merce Commission to remove discriminations against inter- state traffic, includes the power to control the intrastate rates maintained by a carrier under state authority to the extent necessary to remove such resulting unjust discrimipa- tion against interstate commerce, notwithstanding the proviso in section 1 of the act that its provision shall not apply to purely intrastate traffic. In Houston E. & W. T. R. Co. v. U. S., 234, 58 L. Ed. 1341 (1913) U. S. 342, the court affirming the commerce court in 205 Fed. 391 and 380, held that such order of state commis- sion would not be binding upon the carrier in the face of such an order of the Interstate Commerce Commission forbidding such undue preference, and that the carrier could comply with the order where adjusting the other rate so as to remove the discrimination. T'his case was first considered by the commission in 23 I. C. C. 31, but after the decision in the Shreveport case by the Supreme Court, supra, the subject was again considered in 34 I. C- C. 472. The commission reaffirmed its former entry and declared that higher rates on uncompressed cotton to Shreveport from Texas points than to eastern Texas points, distance considered, were unjustly discriminatory. § 339. Interstate and state passenger rates. — In 31 I. C. C. 532, the commission considered the complaint of the Corporation Commission of Oklahoma, the Railroad Com- mission of Arkansas and the Public Service Commission of Missouri, alleging that the interstate passenger fare of three cents a mile through these states was unreasonable and unjustly discriminatory, to the extent that it exceeded the two cents per mile contemporaneously maintained in these states. The commission ruled that the defendants did not voluntarily estabhsh or do any voluntary act to maintain the intrastate passenger rate of two cents per mile, and that as the interstate rate of three cents per mile had not been found to be unreasonable, and the lawfulness of the two cents rate not being in issue, the complaint was dismissed. The commission said that if its function was to compute the sum of intrastate rates and prescribe the result as the measure § 340] THE INTERSTATE COMMERCE ACT. 469 of the interstate rates, the actual and direct regulation of interstate commerce by the states would be the result. The commission quoted from the decision of the Supreme Court in the Shrieveport Rate case, supra, and said that under this decision, if discrimination is shown to exist, they had the power to order that the carriers desist therefrom, and in removing such unlawful discrimination arising from the relations of intrastate rates to interstate rates, they were not bound to reduce the latter below what they found is a proper standard, fair to the carrier and to the pubhc. The commis- sion suggested that it might be that the mileage scale on passenger rates appUcable to both the interstate and intra- state business of somewhat less than three cents per mile would be reasonable in this territory, and would remove the alleged discriminations, and they suggested this for con- sideration by complainants and defendants as a basis of adjustment of the pending controversy. § 340. The relation of state fares to interstate. — In 30 I. C. C. 352, the commission considered the question as to what extent state established rate scales not acquiesced in bj' the carriers are per se controlling as gauging the reasonable- ness and justice of the fares for an interstate journey, where one stretch of such journey lies wholly within the state of this prescribed state rate scales. The complaint arose from conditions existing in Minnesota, where the Supreme Court in 230 U. S. 352 had held that the carriers had not shown the state rates to be confiscatory. The commission said that while it should give due and proper weight to the determina- tions of state legislatures and commissions, it could not be controlled in its judgment upon the reasonableness of inter- state rates as to fares by the independent action of the state legislature or a tribunal not federal. It was therefore found that while the petitioner was not entitled to rehef upon the ground upon which the complaint was brought, it did appear however that the through fares were unlawful under section 4 of the act to the extent that they exceeded the aggregate of the intermediate fares at that time in effect and applicable to interstate transportation. In 34 I. C. C. 341 the commission considered the com- plaints occasioned by the estabhshment of lower intrastate 470 THE INTERSTATE COMMERCE ACT. [SECTION 3 rates on grain and flour from interior Missouri points to St. Louis within the proportion of interstate rates for the santie movement, applicable on other shipments (see also 30 I. C. C. 700). The court said that the difference in these rates gave an unlawful and undue advantage to St. Louis and against interior Missouri, southern Illinois points and East St. Louis. The commission said that while St. Louis shippers could not be denied the benefit of intrastate rates to St. Louis as long as they are in force, that did not preclude the finding that the intrastate rate effected an unjust dis- crimination against interstate traffic. §341] THE INTERSTATE COMMERCE ACT. 471 Section 4. § 341. Long and short haul provisions. 342. History of the section and its amendments. 343. Construction of the section prior to the amendment of 1910. 344. "Over the same hne." 345. Application to the Commission. 346. The burden of proof. 347. Construction of section by Commission and application to differ- ent classes of rates. 348. Ruling of Commission as to export and import rates under sec- tion. 349. The Commission on application for relief under the fourth sec- tion. 350. The five trade zones for transcontinental traffic. 351. The Commission sustained by Supreme Court. 352. Applications for relief under this section. 353. The water competition amendment. 354. Burden upon carrier of showing discrimination is not unjust. 355. Application for relief in the courts. § 341. Long and short haul provisions. — Sec. 4. {As amended June 18, 1910.) That it shall be unlawful for any common carrier subject to the provisions of this Act to charge or receive any greater compensation in the aggregate for the transportation of passengers, or of like kind of property, for a shorter than for a longer distance over the same line or route in the same direction, the shorter being included within the longer distance, or to charge any greater compensation as a through route than the aggregate of the intermediate rates subject to the provisions of this Act; but this shall not be construed as authorizing any common carrier withtin the terms of this Act to charge or receive as great compensation rCommissioii has authority to relieve carriers from the operation of this section.] for a shorter as for a longer distance : Provided, however. That upon application to the Interstate Commerce Commission such common carrier may in special cases, after investiga- tion, be authorized by the Commission to charge less for longer than for shorter distances for the transportation of passengers or property; and the Commission may from time to time prescribe the extent to which such designated com- mon carrier may be relieved from the operation of this sec- tion: Provided further. That no rates or charges lawfully existing at the time of the passage of this amendatory Act shall be required to be changed by reason of the provisions of this 472 THE INTERSTATE COMMERCE ACT. [SECTION 4 section prior to the expiration of six months after the passage of this Act, nor in any case where application shaH have been filed before the Commission, in accordance with the pro- visions of this section until a determination of such ap- plication by the Commission. [Water competition.] -' Whenever a carrier by railroad shall in competition with a water route or routes reduce the rates on the carriage of any species of freight to or from competitive points, it shall not be permitted to increase such rates unless after hearing by the Interstate Commerce Commission it shall be found that such proposed increase rests upon changed conditions other than the elimination of water competition. § 342. History of the section and its amendment. — This section was not based upon any provision in the English statute, and it was the subject of more thorough discussion in congress, and more divergent opinions than any other. The original bill in the house, known as the Reagan Bill, contained an absolute prohibition of charging more for a shorter than for a longer distance, and even when the longer distance in- cluded the shorter; while the senate bill, known as the Cullom Bill, contained a similar prohibition, qualified by the allowing of the granting of exceptions by the commission in special cases. The section was reported by the conference com- mittee, and contained the words "under substantially similar circumstances and conditions," qualifying the prohibition of the greater charge for a shorter than for a longer distance over the same line. In this form the section was enacted. These words "under substantially similar circumstances and conditions," were taken from the second section. See 1 I. C. C. 4, and 1 Int. Com. Rep. 278. The bill with these words "under substantially similar cir- cumstances and conditions," became a law and continued un- changed until the amendment of June 18, 1910, when these words were stricken out ; so that now the section contains the prohibition unqualified of a greater compensation for a shorter than for a longer haul, with the same authority in the commission upon application to grant reUef from the opera- tion of the section which had existed in the original act. The amendment contains the further qualification that rates law- fully existing at the time of the passage of the amendatory §343] THE INTERSTATE COMMERCE ACT. 473 act, shall not be required to be changed prior to six months after the passage of the act, nor in case of any pending appli- cation for relief until its determination by the commission. The amended act contains the further new proviso that where a carrier by railroad reduces its rates in competition with a water route, it shall not be permitted to increase the rates, unless the commission finds that the proposed increase rests upon changed conditions other than the elimination of the water competition. § 343. Construction of the section prior to the amendment of 1910. — The judicial construction of the section prior to its late amendment really turned upon the real meaning of the words "under substantially similar circumstances and conditions," and upon the effect of com- petition in determining dissimilarity of circumstances and conditions. The commission at first ruled (see opinion by Cooley, J., 1 I. C. C. 6, and 1 Int. Com. Rep. 278), that the existence of actual and controlling competition in respect to traffic important in amount might make out dissimilar cir- cumstances and conditions, in effect leaving it with the rail- roads to determine in the first instance the existence of peculiar cases of competition which would constitute a dis- similarity of circumstances and conditions under the act. Subsequently, in 1892, the commission ruled that the carrier could not judge of this emergency for itself, but should apply to the commission when, after investigation, the exceptions could be made. See 5 I. C. C. 324, 4 Int. Com. Rep. 121; 5 I. C. C. 596, 4 Int. Com. Rep. 267. These rulings were contested in the courts, and five years later, in 1897, the Supreme Court overruled the commission and estabhshed the rule that competition of any kind, whether from railroads subject to the act or not, was an eifective circumstance that made substantially dissimilar circumstances and conditions; and that such competition when controlhng, should justify the carrier in making a lower rate for the longer haul, not as a matter of grace or favor of the commission, but as a matter of right. Import Rates Case, 162 U. S. 197, 40 L. Ed. 940 (1896); Commission v. Alabama & Midland R. Co., 168 U. S. 144, 42 L. Ed. 414 474 THE INTERSTATE COMMERCE ACT, [SECTION 4 (1897); L. & N. R. Co. v. Behlmer, 175 U. S. 648, 44 L. Ed. 309; East Tenn., Va. & Ga. R. Co. v. Commission, 181 U. S. 1, 45 L. Ed. 719 (1900); Commission v. L. & N. R. Co., 190 U. S. 273, 47 L. Ed. 1047 (1902). The effect of the amendment of 1910 is to restore the juris- diction of the commission as it was exercised prior to this ruling of the Supreme Court. That is, the carrier cannot now judge for itself, but must apply to the commission under its power to grant relief, and the commission then determines, not whether the circumstances are dissimilar, but whether the facts and conditions constitute a special case for the authori- zation of a lower charge for a longer than for a shorter distance. As to the relation of this ruling of the Supreme Court to the prohibition of undue preferences under section 3, and as to the power of the commission to determine the reasonableness of rates, see supra, § § 263 et seq. See also rulings of the commission in 9 I. C. C. 534; 9 I. C. C. 569, and 10 I. C. C. 460. § 344. "Over the same line." — The view was expressed in the opinion in the C. C. A., Osborne v. R. R. Co., 3 C. C. A. 347, 52 Fed. 912 (1892), that when two railroad companies owning connecting lines of road unite in a joint through tariff with the view of making the connecting roads a new and independent line, the through tariff on the joint line is not a standard by which the separate tariff of other companies is to be measured in determining whether the fourth section was violated. In the Social Circle Case, 162 U. S. 184 (1896), 40 L. Ed. 935, a Georgia railway company whose road lay wholly within the state of Georgia and exacted and received its regular local rate for the transporta- tion on its line, on a through bill of lading, the rate of which was fixed by adding that local rate to the through rate from Cincinnati to Atlanta, was held subject as to the through bill from Cincinnati to Social Circle to the federal act and to the control of the Interstate Commerce Commission. The Court distinguished the Osborne Case, supra, upon its special facts, and said that when goods shipped under a through bill of lading from a point in one state to a point in another are §345] THE INTERSTATE COMMERCE ACT. 475 received in transit by a state common carrier on a conven- tional division of the charges, such carrier must be deemed to have subjected the road to an arrangement for a con- tinuous carriage or shipment within the meaning of the act to regulate commerce. Having elected to enter into the carriage of interstate freights and thus subjected itself to the control of the commission, the carrier could not withdraw that control with respect to foreign traffic to certain points on its road and exclude other points. The Court added: "When we speak of a through bill of lading, we are referring to the usual methods in use by connecting companies, and must not be understood to imply that the common control, management or arrangement might not be otherwise manifested." § 345. Application to the commission. — Under the original act, after the ruling of the Supreme Court as to the right of the carrier to judge for itself in the first instance of the controlling efTect of competition in authorizing a greater charge for a shorter than for a longer haul, the occasion for a resort to the discretionary power of the commission under the proviso, was very materially affected. During the period when a different rule prevailed such applications were com- paratively numerous, as may be seen from the reports of the Interstate Commerce Commission. For a summary of the commission's rulings upon applications made for relief, made prior to this ruling of the Supreme Court, see annual report of 1892, pages 18 to 21; 1893, page 22; 1894, page 18, and 1895, page 24. Petitions for relief were asked on other grounds than that of controlling competition. Thus the World's Fair at Chicago was held, in 6 I. C. C. 323, and 6 I. C. C. 328, to be a case of an exceptional and special nature justifying rehef from the operation of the section. The same ruhng was made in the case of an application on account of crop failure and the necessity of reduced rates for the transportation of food for the people and their animals. These cases however were ex- ceptional and nearly all the applications for relief were on the ground of controlling competition. It was said by the com- mission in its report of 1897 that the ^ffect of the decisions of 476 THE INTERSTATE COMMERCE ACT. [SECTION 4 the Supreme Court was to eliminate the fourth section from the act. § 346. The burden of proof. — Although the judicial construction of the term "under similar circumstances and conditions" had a very profound effect upon the administra- tion of the act, it is not strictly correct to say that its effect was to eliminate the fourth section. It put upon the carrier the burden of proving the existence of dissimilar circum- stances and conditions for its justification when the fact of the greater charge for the shorter haul over the same line appears. Under the section as amended, the jurisdiction of the com- mission will be invoked, not to determine whether the cir- cumstances are dissimilar, as those qualifying words are now omitted from the section, but whether under the circum- stances the carrier presents a case for the exercise of the dis- cretion of the commission in relieving it from the prohibitions of the section. § 347. Construction of section by commission and application to different classes of rates. — The long and short haul provision of this section did not take effect as to the existing rates until six months after the passage of the act, that is, until Dec. 18, 1910. Prior to this date, in October, 1910, the commission, acting under its general authority under the section, extended the existing rates until February, 1911, providing, however, that the dis- crimination against intermediate points should not be greater than in existence August 17, 1910, except under cer- tain described competitive conditions. Carriers desiring relief from section 4 were directed to make separate applica- tion for freight rates and passenger rates and also for long and short hauls.. This extension order was made with the statement that the commission reaffirmed its express view that a through rate or fare that was higher than a combina- tion of intermediate rates was prima facie unreasonable. On March 13, 1911, applications for relief having been filed by the transcontinental and other lines the commission made the following ruhng as to the apphcation of the amended section to different classes of rates : § 348] THE INTERSTATE COMMERCE ACT. 477 "(1) The fourth section applies to all rates and fares, but in determining whether its provisions are contravened, rates and fares of the same kind should be compared with one an- other; that is, transshipment rates should be compared with transshipment rates, proportional rates with proportional rates; excursion fares with excursion fares and commutation fares with commutation fares. It would not be in violation of the fourth section, for instance, if a proportional rate to or from a given point were lower than a regular rate to or from an intermediate point, nor if a commutation fare to or from a more distant point were lower than a regular fare to or from an intermediate point. "A proportional rate is defined as one which applies to part of a through transportation which is entirely within the juris- diction of the act to regulate commerce; that is, the balance of the transportation to which the proportional rate applies must be under a rate filed with this coi^mission. A rate to a port for shipment beyond by a water carrier, not subject to the provisions of this act, would not be a proportional rate. "(2) Where from the absorption if a switching charge it results that a total transportation charge from a more dis- tant point to the point where the property is delivered is less than the total transportation charge from or to an interme- diate point, the fourth section is violated. Owing however to the very general practice of absorbing switching charges from competitive and not from non-competitive stations, and in view of the fact that more benefit and little complaint results, the commission will by general order permit a con- tinuance of this practice, reserving for consideration and determination individual cases which may require separate consideration." For discussion of the relation of section 4 to section 3 where a re-bilhng privilege at Nashville was held by the commission violative of section 3, by the Supreme Court, by the com- merce Court sustained, but held violative of section 4, see supra § 282. § 348. Ruling of commission as to export and im- port rates under the section. — On December 17, 1910, the commission made its ruling as to the application of the section as amended to export and import rates. "(1) That inland export and import rates are subject to the provisions of the act and within the jurisdiction of the commission. 478 THE INTERSTATE COMMERCE ACT. [SECTION 4 "(2) That the fourth section of the amended act forbids carriers subject thereto without authority from the commis- sion, in accordance with said section, to charge more for the transportation of a hke kind of export or import traffic for a shorter than for a longer haul over the same line in the same direction, that is, as we understand the law the validity of the rate under the section is determined by comparison of an export rate with an export rate, and import rate with an import rate. "(3) So far as the fourth section is concerned carriers are not required in the first instance to establish export and im- port rates which shall be measured and limited by domestic interstate rates between the same points of origin and desti- nation in the United States; but as export and import rates as well as domestic interstate rates are subject to the provi- sions of the act and the jurisdiction of the commission, it is clear that the reasonableness of any of these rates under the provisions of section one, and the questions of discrimination under the third section, may all be considered and the com- mission may condemn any discrimination in export and im- port rates upon comparison with those applicable on domes- tic interstate traffic to the extent that the same may be found unjust or unreasonable in any particular case upon investigation and full hearing." § 349. The commission on application for relief under the fourth section. — In opinions filed June 22, 1911, 21 I. C. C. 329, and 21 I. C. C. R. 400, the commission exhaustively considered the history and purpose of the amendment of the fourth section concerning the long and short haul clause, and ruled that the amendment was a provision of law within the proper scope of congressional jurisdiction and was not a grant of arbitrary or absolute power, and that its purposes must be limited and conditioned upon the presence in special cases of conditions and cir- cumstances which would make such exceptions legal and proper and in no wise antagonistic to other provisions of the act. Under the proviso it must be affirmatively shown by the carriers in seeking exception that injustice will not be done to intermediate points by allowing rates to the more distant points. The enactment of the amended law was to make its prohibition of the higher rate for the shorter haul a rule of well nigh universal application from which the commission may deviate only in special cases, and then to meet trans- § 350] THE INTERSTATE COMMERCE ACT. 479 portation circumstances which are beyond the carrier's control. The commission said that congress intended to invest the commission with authority, not only to determine whether a wrong results from the disregard of the long and short haul provision, but also to correct that wrong if found to exist. In the application for relief as made the commission must inquire whether the maintenance of the higher intermediate rate will result in unreasonable charges and unjust dis- criminations, and the commission may also prescribe in any way that is definite and certain the extent to which the inter- mediate rate may exceed the long distance in cases where this is necessary to prevent unreasonable rates or unjust discriminations. In 21 I. C. C. 329, the commission gave an interesting re- view of the long-time struggle between the transcontinental railroads and the ocean carriers, and concludes that the transcontinental lines naturally gave consideration to sea competition, but that for thirty years the whole of their efforts had been to neutralize and control such competition. The opinion intimates that the railroads must soon meet with competition by water more important, searching and deter- minative in its effect upon railroads than any other; that is, when the route by the Panama Canal is opened. § 350. The five trade zones in transcontinental trafEic. — In the reports referred to on the applications for relief under the fourth section, under the amendment of 1910, the commission ruled that the carriers had not shown that undue discrimination was not affected by their rate adjustment between points in Nevada and points in Cali- fornia, nor had they established that the rates to the coast cities if extended by them from eastern points outside the zone of water influence were not fully compensatory. The applications for relief by the transcontinental carriers from the long and short haul clause were therefore denied. The cities of Spokane and Salt Lake City were held specifically to be prejudiced by the charge of the through rate to the coast with the local rate added% The commission announced that for the purpose of dispos- ing of this matter by an order under the fourth section, they 480 THE INTERSTATE COMMERCE ACT. [SECTION 4 had divided the United States into five territorial zones, as follows : "(The transcontinental groups hereinafter described are as specified in R. H. Countiss' agent's transcontinental tariff, I. C. C. No. 929.)* "Zone No. 1 comprises all that portion of the United States westof the line called line No. 1, which extends in a general southerly direction from a point immediately east of Grand Portage, Minn.; thence southwesterly along the northwestern shore of Lake Superior, to a point immediately east of Supe- rior, Wis.; thence southerly, along the eastern boundary of transcontinental group F, to the intersection of the Arkansas and Oklahoma state line; thence along the west side of the Kansas City Southern Railway to the Gulf of Mexico. "Zone No. 2 embraces all territory in the United States lying east of line No. 1 and west of a line called line No. 2, which begins at the international boundary between the United States and Canada, immediately west of Cockburn Island, in Lake Huron; passes westerly through the Straits of Mackinaw; southerly through Lake Michigan to its south- ern boundary; follows the west boundary of transcontinental group C to Paducah, Ky. ; thence follows the east side of the Illinois Central Railroad to the southern boundary of trans- continental group C; thence follows the east boundary of group C to the Gulf of Mexico. "Zone No. 3 embraces all territory in the United States lying east of line No. 2 and north of the south boundary of transcontinental group C and west of line No. 3, which is the Buffalo-Pittsburg line from Buffalo, N. Y., to Wheeling, W. Va. ; thence follows the Ohio river to Huntington, W. Va. "Zone No. 4 embraces all territory in the United States east of line No. 3 and north of the south boundary of trans- continental group C. "Zone No. 5 embraces all territory south and east of trans- continental group C." And the commission added (21 I. C. C. R. 425): "Looking at this whole situation and endeavoring to justly consider the interests of all parties affected, including the carriers, we are of the opinion that from zone 1 no higher charge can justly be made at any intermediate point than to a more distant point. The eastern limit of this territory is approximately 1,500 miles from the Atlantic seaboard, al- * R. H. Countiss referred to, is the agent of the trans-continental lines for the purpose of compiling, publishing, and filing with the com- mission their tariffs on classes and commodities. §350] THE INTERSTATE COMMERCE ACT. 481 most midway between the Pacific and Atlantic oceans. No traffic has ever been, and none probably ever will be trans- ported from this section to the Atlantic coast and thence by water to the Pacific coast. Giving full weight to the effect of competition of all kinds, we can find no justification for a system of rates which maintains from this territory a higher charge to an interior point than is made to the coast. "With respect to territory embraced in zone 2 the case stands somewhat different. This zone comprises the Missis- sippi Valley and a considerable portion of the great manufac- turing area of the west. It lies 400 miles nearer the Atlantic seaboard, with which it is connected in part at least by lines of railroad affording the cheapest transportation service in any part of the country. Still there never has been and there probably never will be in the future any considerable move- ment of traffic from this territory to the Pacific coast by way of the Atlantic seaboard. "We are of the opinion that rates from this territory to in- termediate points may properly exceed by not more than 7 per cent, rates from the same points of origin to Pacific coast terminals. "From zone 3 there is still greater possibility of actual transportation competition on business destined to Pacific coast points, although from this section hitherto the actual movement has been only occasional. "We are of the opinion that from points of origin in this territory rates to intermediate points may properly exceed those to terminal points by not more than 15 per cent. "In the past the actual movement from eastern points of origin to Pacific coast terminals has been mainly confined to zone 4, and even in this zone the greater part of the traffic has originated in or near the seaboard itself. "The force of water competition is greatest in New York and gradually diminishes as the distance from New York in- creases, but we are of the opinion that this entire territory may properly be treated as a single group, and that rates from points of origin within its limits to intermediate points may properly exceed those of terminal points by not more then 25 per cent. "No opinion is expressed at this time as to zone 5, since rates from that territory are not involved in these proceed- ings." The commission said that this was not a new and additional authority, but simply the exercise of a jurisdiction provided for in the fifteenth section for the adjustment of unjust dis- crimination, and that there was no essential difference be- J— 31. 482 THE INTERSTATE COMMERCE ACT. [SECTION 4 tween this order and an order which the commission might make under the third section. § 351. The commission sustained by Supreme-Court —In United States v. A. T. & S. F. R. Co., 234 U. S. 476, 58 L. Ed. 1408, (1914) the Supreme Court reversed the com- merce court, 191 Fed. 856, which had enjoined the enforce- ment of an order of the Interstate Commerce Commission under this section. The Court said that the section involved no unlawful delegation of power, nor was the section invahd as authorizing the arbitrary destruction of rights of persons or communities. The Court therefore held that the action of the commission in creating the zones in trans-continental traffic did not exceed the powers conferred by the statute or transcend the limits of sound legal discretion, and the order of the commerce court was therefore reversed and the case was remanded to the proper district court with directions to dismiss the bill for want of equity. § 362. Application for relief under this section. — Since the decision of the Supreme Court sustaining the ruling of the commission, a great number of applications have been filed, aggregating several hundred, from all parts of the country affected by this ruling, and asking for relief from the 4th section. In the matter of rates on tropical fruits from Gulf ports under the 4th section, 30 I. C. C. 621, the commis- sion ruled that carriers engaged in the transportation of bananas and cocoanuts from Galveston and other Texas ports to points east of the Missouri river on the line of the Kansas City Southern Railroad Company should be allowed relief from the 4th section to meet the competition of rail hues from New Orleans engaged in the transportation of similar commodities reported through that port. The same relief was extended to carriers whose lines were circuitous in cases where their lines were fifteen per cent longer than the more direct lines between the same points. As to the sugar rates from New Orleans, Louisiana to points taking the same rates on the Ohio river, Memphis, St. Louis and intermediate points, see 32 I. C. C. 606. As to commodity rates and Pacific coast terminals and inter^ § 553] THE INTERSTATE COMMERCE ACT. 483 mediate points, see 32 I. C. C. 611. See also 38 I. C. C. 237. As to the rates on sugar from San Francisco and California beet sugar producing points to Missouri river and this sec- tion, see 31 I. C. C. 511. In 32 I. C. C. 611, (1915) in considering the commodity rates to Pacific coast terminals and intermediate points, the commission said in reply to the suggestion that the construc- tion of the Panama Canal by the government was indicative of a government policy to secure all the coast to coast busi- ness for the water lines, that the canal was but one of the agencies of transportation which the government had fos- tered from the Atlantic to the Pacific, and that if the rail- roads were able to secure such rates from the Atlantic sea- board to the Pacific coast as would hold to their lines some portion of this traffic with profit to themselves they should be permitted to do so, and the commission were therefore of opinion that the carrier should be permitted to compete for this long distance traffic as long as it could be secured at rates which clearly covered the out of pocket cost. The com- mission concluded that the California cities situated on the ocean and accessible as ports of call for such ocean going vessels were natural terminal points, and entitled to terminal rates by reason of the competitive conditions resulting from their situation, and as to other cities not ocean terminals the rates should be the rates to the terminals plus three fourths of the locals back from the terminals. The inland cities are seeking to enjoin the enforcement of this order. See Merchants & Manufacturer's Association of Sacramento, et al. V. United States, et al. United States district court for the northern district of Cahfornia. As to rates in through traffic to points in Louisiana and Texas, see 38 I. C. C. 153. § 363. The water competition amendment. — In the Transcontinental Commodity Rate case, 32 I. C. C. 449, the commission considered the effect of this amendment of 1910, under the claim of San Jose, Santa Clara and Marysville, that the application of terminal rates to the California points was due to the competition of the ocean lines on the opening of the Panama Canal, and carriers should not be permitted to increase those rates, as no change in conditions had taken place. The commission ruled that even if it be conceded that 484 THE INTERSTATE COMMERCE ACT. [SECTION 4 these three points were given terminal rates by rail carriers as a result of the direct competition by water carriers, this amendment could not be applied to them, as they were given these terminal rates prior to the passage of the amendment, and indeed before the original act to regulate commerce. It was also ruled in 32 I. C. C. 54, that this amendment applied only to rates thereafter reduced, and therefore could not be applied to present transcontinental commodity rates to interior California points. § 354. The burden upon carrier of showing dis- crimination is not unjust. — ^The general principle, under which these applications for relief under the fourth section are considered by the commission, are discussed in the supplemental report of the commission on the commodity rates to the Pacific in the case of the Railroad Commission of Nevada, 21 I. C. C. 329, and in the report of the commis- sion on the fourth section violations in the southeast, 31 I. C. C. 153. In the first of these cases the commission said that the proviso authorizing the commission to grant exceptions to the general prohibition was not a grant of arbitrary or absolute power, but its exercise must be limited and conditioned upon the presence in special cases of conditions and circumstances which would make such exceptions legal and proper, and in no case antagonistic to other provisions of the act. It inust be affirmatively shown by the carriers seeking such excep- tion that injustice will not be done to intermediate points by allowing lower rates to more distant points. The report in this case contains a survey of the facts involved in the trans-continental situation in reference to sea competition, and points to the distinction between this competition which brings about lower rates from coast to coast, and the so-called "market competition" which produces lower rates from the interior to the coast. The commission concluded that congress had pursued the same theory in regard to the fourth section, as in the first, second and third — that is, in stopping undue discriminations. To charge more for the shorter haul over^thejsame line is madejpresumptive evidence of unjust discrimination, and the burden is cast upon the § 355] THE INTERSTATE COMMERCE ACT. 485 carrier of justifying a condition which is prima facie unlawful and unjust. § 355. Applications for relief in the courts. — Follow- ing the ruling of the Supreme Court in the Santa Fe case, supra, sustaining the power of the commission under this section, the district court of Kentucky, in L. & N. R. Co. v. U. S., 225 Fed. 571, (1915) denied an injunction to restrain the commission from refusing to give relief under the long and short haul clause. The court said that the commission made an order, denying such an application for relief, not supported by evidence, the carrier would be entitled to relief, but the weight to be given to evidence is peculiarly, for the commission, and on a review in the courts, the com- mission finding of facts would always be taken as prima facie correct, and in most instances as conclusively so; citing, U. S. V. L. & N. R. Co., 235 U. S. 314, 59 L. Ed. 245 (1915). U. S. V. L. & N. R. Co., 235 U. S. 318; 59 L. Ed. 598 (1915). The court said that the burden was upon the carrier to show that it was a "special case," and that the facts must show that the order was invalid in depriving a railroad of its property without due process of law. The allegations in this case were found insufficient for any relief. 486 THE INTERSTATE COMMERCE ACT. [SECTION 5 Section 5. § 356. Pooling of freight and division of earnings forbidden. 357. Construction of section. 358. Controlling through routing by initial carrier is not pooling. 359. Agreements not within the prohibition. 360 The relation of the section to the Anti-trust Law of 1890. 361. Pooling as a defense to action of the carrier. 362. Interstate Commerce regulations of Panama Canal Act approved August 24, 1912. 363. Construction of this section by the Commission. § 366. Pooling of freight and division of earnings for- bidden. — Sec. 5. That it shall be unlawful for any common carrier subject to the provisions of this act to enter into any contract, agreement, or combination with any other com- mon carrier or carriers for the pooling of freights of different and competing railroads, or to divide between them the aggregate or net proceeds of the earnings of such railroads, or any portion thereof; and in any case of an agreement for the pooling of freights as aforesaid, each day of its continu- ance shall be deemed a separate offense. § 357. Construction of section. — This section was not amended until the adoption of the Panama Canal act, of Aug. 24, 1912. For amendment of this section by that act, see infra, § 362. This section was more thoroughly dis- cussed in congress and in the public press before the enact- ment of the statute than any other, except the long and short haul provision of section 4, yet in view of its importance as a declaration of public policy, it has received comparatively little discussion in the courts or before the commission. In 115 Fed. 588 (1902), this section was construed by the court, Hammond, J., in the western district of Tennessee, in a charge to the grand jury. He said that the statute contemplated two methods of pooUng, both of which were prohibited. First a physical pooling, which means a dis- tribution by the carriers of property offered for transporta- tion on different and competing railroads in the proportions and on the percentages previously agreed upon; and secondly, a money pooling, which is described best in the language of the statute, "to divide between them (different and competing § 358] THE INTERSTATE COMMERCE ACT. 487 railroads) the aggregate or net proceeds of the earnings of such railroads, or any portion thereof." The court in its charge adopted the definition of the word "pool" from the Century dictionary, as: "It is a combination intended by concert of action to make or control changes in the market of rates; * * * a combina- tion of the interests of several otherwise competing parties, such as rival transportation lines, in which all take common grounds as regards the pubhc, and distribute the profits of the business among themselves equally or according to special agreement. In this sense pooling is a system of reconciling conflicting interests and obviating competition by which the several competing parties or companies throw their revenues into one common fund, which is then divided or distributed among the members of the pool on a basis, per- centage or proportion previously agreed upon or determined by arbitration." The agreement of the Southern Railway and Steamship As- sociation provided for a division of territory between eastern and western hnes, and also a system of fines and penalties among the members for violation of the association rules. The commission said in 6 I. C. C. 195, that these fines and penalties are available as substitutes for the penalties which would be exacted under a regular pooling system, and that the arrangement was tantamount to a combination forbidden by the section, and that the law had regard to the sub- stance rather than to the form, and that whatever it pro- hibited from being done directly could not legally be done indirectly. § 358. Controlling through routing by initial carrier is not pooling. — In the Southern California Fruit Case, 9 I. C. C. 182, the commission found there was a tonnage pool in traffic as between the connecting carriers and that the through routing was controlled so as to give specific per- centages of traffic to their said connections. This view was sustained by the circuit court (S. D. of Cal.), Interstate Commerce Commission v. S. P. Ry. 132 Fed. 829, which rendered judgment for the enforcement of the commission's order, that the carrier should desist from this practice of con- trolling the through routing. The Supreme Court in South- 488 THE INTERSTATE COMMERCE ACT. [SECTION 5 ern Pacific et al. v. Interstate Commerce Commission, 200 U. S. 536, 50 L. Ed. 585 (1906), reversed this judgment, holding that there was nothing in the act which prevented carriers from agreeing upon a through routing of the freight and of insisting upon the right of routing as a condition of guaranteeing through rates to the shipper. It seems that the rule was intended to break up rebating and in practical operation had been effective to that end. Subsequent to this decision, by the amendment of 1910, this right of controlling the through routing was secured to the shipper (see section 15, infra). § 359. Agreements not within the prohibition. — An agreement for the division of through freights between the members of a trunk line is not within the prohibition of this section. Neither is an agreement for consultation for the pro- motion of reasonable rates. 6 I. C. C. 85. In this case the commission ruled that the agreement of the transcontinental association was not within the prohibition of the section, as there was no provision for the actual pooling of freights or division of earnings between the parties, and it was not shown by the agreement itself or other evidence that the measures provided therein for fixing and maintaining rates constituted a contract, agreement or combination in violation of section 5, or that those measures if carried out in good faith for the purpose named, would lead indirectly to the same result as the actual pooling of freights and division of earnings prohibited by the act. The operation and conduct of the Immigrant Bureau of the Western Passenger Association, whereunder the immigrant traffic was divided between the carriers in the agreed propor- tion based upon the proportion of the domestic passenger traffic done by each line, was not within the prohibition of the section. 10 I. C. C. 13. The commission said that the sec- tion forbade a division of the aggregate or net proceeds of the earnings of such competing railroads, whether such earnings arise from freight or passenger business,-but for some reason it did not provide specifically against a division of passengers between competing roads. The amount of the immigrant traffic was insignificant compared with the general traiffic of § 360] ■ THE INTERSTATE COMMERCE ACT. 489 the railroads, and there were no discriminations against individuals, as the immigrants were forwarded at the domestic published rates, and the arrangements had even- tually prompted the protection and greatly improved the comfort and treatment of immigrants. The commission declined therefore to take any action in the premises. It would theretofore follow that the prohibition of this sec- tion must be limited to an actual pooling of freights of com- peting railroads or the division of earnings, and would not include agreements between carriers looking to the con- venient and expeditious handling of their business at terminal points, which are not for revenue and therefore not subject to the specific prohibition of this section or of the Anti-Trust Act. See infra, § 531 et seq. § 360. The relation of the section to the Anti-Trust Law of 1890. — The prohibition of pooHng contained in this section has been considered in connection with the judicial discussion of the prohibition of all forms of combination whether of trusts of otherwise in restraint of interstate com- merce, contained in the Anti-Trust Law of 1890. This section prohibits only the specific form of combination which comes under the definition of pooling, and it is limited to such agreements made by a common carrier subject to the provision of the act "with any other common carrier or car- riers." Thus it was ruled in the case of a complaint alleging an agreement for the pooling of freight between certain rail- roads and the Standard Oil Company, 5 I. C. C. 415, 4 Int. Com. Rep. 162, that such an agreement for the pooling of traffic between a carrier by rail and a carrier by pipe line did not fall within the description of contracts prohibited by section 5. In the opinion as to the relation of express com- panies to the act, ruling that they were not included therein (see section 1, supra), the commission said that the pro- hibition of section 5 did not include express companies, who were therefore at liberty to pool their earnings. 1 I. C. C. 349, 1 Int. Com. Rep. 677. This was prior to their inclusion in the act by the amendment of 1906, supra, § 157. In United States v. Trans-Missouri Freight Association, 166 U. S. 290, 41 L. Ed. 1007, (1887) it was urged that as the 490 THE INTERSTATE COMMERCE ACT. [SECTION 5 Commerce Act related solely to railroads and their proper regulation and management, the act of 1890 should be con- strued as applying to all contracts of the nature therein described, entered into by any other than competing common carriers by railroads for the purpose of establishing rates of traffic and transportation. But the Court said that the fifth section of the Interstate Commerce Act prohibited what was termed "pooling," because prior to the passage of the act railroad companies had some times endeavored to regulate competition and maintain rates by pooling arrangements, and in the act that kind of arrangement was forbidden, and while that act did not prohibit such an agreement as that of the Trans-Missouri Freight Association, it did not authorize it, and both statutes stand, as neither was incon- sistent with the other. The Court said that the amendment of the Interstate Commerce Act would not have been an appropriate method of dealing with other devices to suppress competition for the reason that the Anti-Trust Act included other parties than common carriers. (See act of 1890, /n/ra, § 531 e^ seq.) In the bill filed by the government in 1910 in eastern dis- trict of Missouri against the Western Trunk lines to enjoin the proposed general advance in freight rates, wherein a temporary injunction was issued, it was alleged that the advance was made pursuant to an agreement and com- bination violative of the Anti-Trust Act. As the railroads agreed to withdraw the proposed advance, and refile the same after the pending amendatory act went into effect, the suit was dismissed. In complaints by shippers and others before the commis- sion it has been on several occasions charged that their rates were the result of an agreement between the carriers in viola- tion of the Anti-Trust Act, and that this raised a presumption that the rates were unreasonable, but the commission has uniformly ruled that it has no powers in the enforcement of that act, and that there was no presumption of unreason- ableness under the Interstate Commerce Act, if the rates were established in consequence of an agreement between competing carriers. 20 I. C. C. 463, 465. §362] THE INTERSTATE COMMERCE ACT." 491 § 361. Pooling as a defense to action of the carrier. — In Del. L. & W. R. Co. v. Frank et al., 110 Fed. 689 (1901), the United States circuit court for the western district of New York, denied an injunction against certain ticket brokers as to special excursion tickets issued for the Pan-American Exposition at Buffalo on the ground that the complainant with other railroads had made an unlawful combination for the fixing of rates and pooUng earnings. A contrary ruling however has been made in the United States circuit court for the eastern district of Missouri, unre- ported, and in Kinner v. Lake Shore & Michigan So. Ry. Co., 69 Ohio St. Rep. 339, on the ground that the alleged unlawful combination did not relate to the specific business sought to be enjoined. § 362. Interstate commerce regulations of Panama Canal Act, approved Aug. 24, 1912. — Section five of the act to regulate commerce, was amended by the Panama Canal Act, Aug. 24, 1912, by adding thereto a new paragraph to the end thereof, as follows: From and after the first day of July, nineteen hundred and fourteen it shall be unlawful for any railroad company or other common carrier subject to the Act to regulate com- merce to own, lease, operate, control, or have any interest whatsoever (by stock ownership or otherwise, either di- rectly, indirectly, through any holding company, or by stockholders or directors in common, or in any other man- ner) in any common carrier by water operated through the Panama Canal or elsewhere with which said railroad or other carrier aforesaid does or may compete for traffic or any vessel carrying freight or passengers upon said water route or elsewhere with which said railroad or other carrier aforesaid does or may compete for traffic; and in case of the violation of this provision each day in which such violation continues shall be deemed a separate offense. Jurisdiction is hereby conferred on the Interstate Com- merce Commission to determine questions of fact as to the competition or possibility of competition, after full hearing, on the application of any railroad company or other carrier. Such application may be filed for the purpose of determin- ing whether any existing service is in violation of this sec- tion and pray for an order permitting the continuance of any vessel or vessels already in operation, or for the purpose of asking an order to install new service not in conflict with 492 "THE INTERSTATE COMMERCE ACT. [SECTION 5 the provisions of this paragraph. The commission may on its own motion or the application of any shipper institute proceedings to inquire into the operation of any vessel in use by any railroad or other carrier which has not applied to the commission and had the question of competition or the possibility of competition determined as herein pro- vided. In all such cases the order of said commission shall be fmaL If the Interstate Commerce Commission shall be of the opinion that any such existing specified service by water other than through the Panama Canal is being operated in the interest of the public and is of advantage to the con- venience and commerce of the people, and that such exten- sion will neither exclude, prevent, nor reduce competition on the route by water under consideration, the Interstate Commerce Commission may, by order, extend the time during which such service by water may continue to be operated beyond July first, nineteen hundred and fourteen. In every case of such extension the rates, schedules, and practices of such water carrier shall be filed with the Inter- state Commerce Commission and shall be subject to the act to regulate commerce and all amendments thereto in the same manner and to the same extent as is the railroad or other common carrier controlling such water carrier or in- terested in any manner in its operation: Provided, Any ap- plication for extension under the terms of this provision filed with the Interstate Commerce Commission prior to July first, nineteen hundred and fourteen, but for any reason not heard and disposed of before said date, may be considered and granted thereafter. No vessel permitted to engage in the coastwise or foreign trade of the United States shall be permitted to enter or pass through said canal, if such ship is owned, chartered, operated, or controlled by any person or company which is doing business in violation of the provisions of the Act of Congress approved July second, eighteen hundred and ninety, entitled "An Act to protect trade and commerce against unlawful restraints and monopolies," or the provi- sions of sections seventy-three to seventy-seven, both in- clusive, of an act approved August twenty-seventh, eighteen hundred and ninety-four, entitled "An Act to reduce taxa- tion, to provide revenue for the Government, and for other purposes," or the provisions of any other Act of Congress amending or supplementing the said Act of July second, eighteen hundred and ninety, commonly known as the Sherman Antitrust Act, and amendments thereto, or said sections of the Act of August twenty-seventh, eighteen hun- dred and ninety-four. The question of fact may be deter- § 363] THE INTERSTATE COMMERCE ACT. 493 mined by the judgment of any court of the United States of competent jurisdiction in any cause pending before it to which the owners or operators of such ship are parties. Suit may be brought by any shipper or by the Attorney General of the United States. § 363. Construction of this section by the commis- sion. — ^This amendment was considered in 32 I. C. C. 691, February, 1915, on the apphcation of the Southern Pacific Company in connection with the operation of the Pacific Mail Steamship Company. The commission said that this amendment indicated, among other things, a clear and unmistakable policy adopted by congress to separate from railroad ownership, control or influence such carrier water lines, and such vessels as may, when thus separate, compete with the present owning and controlling companies, — except where, upon investigation, it is found by the commission that the existing service by water, other than through the Panama Canal, is being operated in the interest of the public, is of advantage to the convenience and com- merce of the people, and that its continuance will neither exclude, prevent nor reduce competition on the route by water. The commission therefore held that it was without power to grant any extension of time as to vessel or vessels operating or intending to operate between San Francisco and Colon, for the reason that service by water would be through the Panama Canal. If it should be made to appear that certain specified vessel or vessels will operate no further than Balboa, the commission could, as to such vessel or vessels, grant an extension of time. But that in every case in which extension of time was granted, the rates, schedules and practices of the water carrier, governing traffic subject to the act, must be subject to all of the provisions of the act in the same manner and to the same extent as is rail carrier controlling or inter- ested in such water carrier. A very large number of applications have been filed with the commission by railway companies throughout the United States for permission to operate lake boats and ferry boats. See 34 I. C. C. R. 49; 34 I. C. C. 47; 34 I. C. C. 55; 34^ I. C. C. 52; 34 I. C. C 83; 34 I. C. C. 86; 34 I. C. C. 174; 494 THE INTERSTATE COMMERCE ACT. [SECTION 5 34 I. C. C. 218; 34 I. C. C. 229; 34 I. C. C. 648; 33 I. C. C. 426; 33 I. C. C. 632; 33 I. C. C. 658 and 33 I. C. C. 701. In these cases the commission held that the service would not reduce competition, and the application was therefore granted, the ferry and lake boat companies being required to file tariffs under the law. The application of the New York Central to operate lake boats was, however, denied, 33 I. C. C. 199, as it was not to the public advantage for boat lines on the lakes to be con- trolled by the railroads. While the commission approved the operation of the boats of the Southern Pacific Company on the Sacramento river, 34 I. C. C. 648, it did not approve the continued ownership by the Spokane, Portland & Seattle Railway of the steamers operating on the Willamette and Columbia rivers; nor did it approve the application of the Southern Pacific to operate steamers between San Francisco and San Pedro. It held in 34 I. C. C. 77, that a rail carrier did not necessarily have to reach a point, in order to compete with water carriers that operate directly to that point, but that such competition may exist by the rail carrier's partici- pation in joint rates. It was held, therefore, that if the Southern Pacific Company owned any common carrier pipe line which does or may compete with the operation of its other line, such ownership and operation was within the provisions of the Panama Canal Act. The commission said in 33 I. C. C. 700, that the purpose of the Panama Canal Act was to preserve the common interests of the people free and unaffected, the water route of competition via the Panama Canal : also it was its purpose to restore the water routes of the country to the same condition of freedom from domination that would reduce their usefulness as a natural means of transportation. 364] THE INTERSTATE COMMERCE ACT. 495 Section 6. § 364. Section 6 as amended in 1906 and 1910. 365. History and amendment of the section. 366. Effect of publication under the section. 367. Limitation of baggage liability under established rate. 368. The published rate conclusive. 369. Conclusiveness of the published rate irrespective of reasonable- ness. 370. Conspiracy to violate the section held indictable. 371. Contract for different than the published rate invalid. 372. Failure to post rates in stations. 373. Insurance policy of carrier in violation of this section unenforcible. 374. The section not applicable to a foreign shipment. 375. Claims for misrouting. 376. Status of carriers as shippers or consignees. 377. What is included in schedules. 378. What is sufficient publication and filing. 379. Joint tariffs and through rates. 380. Responsibility for through rates. 381. Published joint rates must be duly authorized. 382. The Commission's power of modification as to filing of tariffs. 383. Inclusion of transit privileges in tariffs. 384. Commission on request for waiver of time limitation on loss claims. 385. Control of accessory charges in the tariffs by the Commission. 386. Text of amendment by Section 11 of Panama Canal Act of August 24, 1912. 387. Construction by Commission of the amendment of 1912. § 364. Section 6 as amended. — Sec. 6. {Amended March 2, 1889. Following section substituted June 29, 1906. Amended June 18, 1910.) That every common carrier sub- ject to the provisions of this Act shall file with the Commis- sion created by this Act and print and keep open to public inspection schedules showing all the rates, fares, and charges for transportation between different points on its own route and between points on its own route and points on the route of any other carrier by railroad, by pipe line, or by water when a through route and joint rate have been established. If no joint rate over the through route has been established, the several carriers in such through route shall file, print [Printing and posting of schedules of rates, fares and charges including rules and regulations affecting the same, icing, storage and terminal charges, and freight classifications.] and keep open to the public inspection as aforesaid, the 496 THE INTERSTATE COMMERCE ACT. [SECTION 6 separately established rates, fares and charges applied to the through transportation. The schedules printed as aforesaid by any such common carrier shall plainly state the places between which property and passengers will be carried, and shall contain the classification of freight in force, and shall also state separately all terminal charges, storage charges, icing charges, and all other charges which the Commission may require, all privileges and facilities granted or allowed and any rules and regulations which in any wise change, affect, or determine any part or the aggregate of such aforesaid rates, fares, and charges, or the value of the service ren- dered to the passenger, shipper, or consignee. Such sched- ules shall be plainly printed in large type, and copies for the use of the public shall be kept posted in two pubhc and con- spicuous places in every depot, station, or office of such car- rier, where passengers or freight, respectively, are received for transportation, in such form that they shall be accessible to the public and can be conveniently inspected. The pro- visions of this section shall apply to all traffic, transporta- tion, and facilities defined in this Act. [Printing and posting of schedules of rates on freight car- ried through a foreign country.] Any common carrier subject to the provisions of this Act receiving freight in the United States to be carried through a foreign country to any place in the United States shall also in like manner print and keep open to public inspection, at every depot or office where such freight is received for ship- ment, schedules showing the through rates established and charged by such common carrier to all points in the United States beyond the foreign country to which it accepts freight [Freight subject to customs duties in case of failure to publish through rates.] for shipment; and any freight shipped from the United States through a foreign country into the United States the through rate on which shall not have been made public, as required by this Act, shall, before it is admitted into the United States from said foreign country, be subject to customs duties as if said freight wer'e of foreign production. [Thirty days* public notice of change in rates must be given.] No change shall be made in the rates, fares, and charges or joint-rates, fares, and charges which have been filed and pub- lished by any common carrier in compliance with the require- ments of this section, except after thirty days' notice to the Commission and to the public published as aforesaid, which shall plainly state the changes proposed to be made in the schedule then in force and the time when the changed rates, fares, or charges will go into effect ; and the proposed changes § 364] THE INTERSTATE COMMERCE ACT. 497 shall be shown by printing new schedules, or shall be plainly indicated upon the schedules in force at the time and kept [CommiBsion may modify requirements of this section.] open to public inspection: Provided, That the Commission may, in its discretion and for good cause shown, allow changes upon less than the notice herein specified, or modify the requirement of this section in respect to publishing, post- ing, and filing of tariffs, either in particular instances or by a general order applicable to special or peculiar circumstances or conditions. [Joint tariffs must specify names of carriers participating. Evidence of concurrence.] The names of the several carriers which are parties to any joint tariff shall be specified therein, and each of the parties thereto, other than the one filing the same, shall file with the Commission such evidence of concurrence therein or accept- ance thereof as may be required or approved by the Commis- sion, and where such evidence of concurrence or acceptance is filed it shall not be necessary for the carriers filing the same to also file copies of the tariffs in which they are named as parties. [Copies of contracts, agreements or arrangements relat- ing to traffic must be filed witli Commission.] Every common carrier subject to this Act shall also file with said Commission copies of all contracts, agreements, or arrangements with other common carriers in relation to any traffic affected by the provisions of this Act to which it may be a party. [Commission may prescribe forms of schedule.] The Commission may determine and prescribe the form in which the schedules required by this section to be kept open to the public inspection shall be prepared and arranged and may change the form from time to time as shall be found expedient. [No carrier shall engage in transportation unless it files and publishes rates, fares, and charges thereon.] No carrier, unless otherwise provided by this Act, shall engage or participate in the transportation of passengers or property, as defined in this Act, unless the rates, fares, and charges upon which the same are transported by said carrier have been filed and published in accordance with the provi- [Published rates not to be deviated from.] sions of this Act; nor shall any carrier charge or demand or collect or receive a greater or less or different compensation for such transportation of passengers or property, or for any service in connection therewith, between the points named in such tariffs than the rates, fares, and charges which are are specified in the tariff filed and in effect at the time; nor J-33. 498 THE INTERSTATE COMMEECE ACT. [SECTION 6 shall any carrier refund or remit in any manner or by any device any portion of the rates, fares, and charges so speci- fied, nor extend to any shipper or person any privileges or facilities in the transportation of passengers or property, except such as are specified in such tariffs: Provided, That [''Carrier" means "common carrier.*'] wherever the word "carrier" occurs in this Act it shall be held to mean "common carrier." [Preference and expedition of military traffic in time of war.] That in time of war or threatened war preference and pre- cedence shall, upon the demand of the President of the United States, be given, over all other traffic, to the trans- portation of troops and material of war, and carriers shall adopt every means within their control to facilitate and ex- pedite the military traffic. [Commission may reject schedules.] The Commission may reject and refuse to file any schedule that is tendered for filing which does not provide and give lawful notice of its effective date, and any schedule so re- jected by the Commission shall be void and its use shall be unlawful. [Penalty for failure to comply with regulation.] In case of failure or refusal on the part of any carrier, re- ceiver, or trustee to comply with the terms of any regulation adopted and promulgated or any order made by the Com- mission under the provisions of this section, such carrier, receiver, or trustee shall be liable to a penalty of five hun- dred dollars for each such offense, and twenty-five dollars for each and every day of the continuance of such offense, which shall accrue to the United States and may be recovered in a civil action brought by the United States. [Carrier to furnish written statement of rate.] If any common carrier subject to the provisions of this Act, after written request made upon the agent of such car- rier hereinafter in this section referred to, by any person or company for a written statement of the rate or charge ap- plicable to a described shipment between stated places under the schedules or tariffs to which such carrier is a party, shall refuse or omit to give such written statement within a rea- sonable time, or shall misstate in writing the applicable rate, and if the person or company making such request suf- fers damage in consequence of such refusal or omission or in [Damages for misstatement of rate.] consequence of the misstatement of the rate, either through making the shipment over a line or route for which the proper rate is higher than the rate over another available § 3-65] THE INTERSTATE COMMERCE ACT. 499 line or route, or through entering into any sale or other con- tract whereunder such person or company obligates himself or itself to make such shipment of freight at his or its cos! , then the said carrier shall be liable to a penalty of two hun- dred and fifty dollars, which shall accrue to the United States and may be recovered in a civil action brought by the United States. [Name of carrier's agent to be posted.] It shall be the duty of every carrier by railroad to keep at all times conspicuously posted in every station where freight is received for transportation the name of an agent resident in the city, village, or town where such station is located, to whom apphcation may be made for the information by this section required to be furnished on written request; and in case any carrier shall fail at any time to have such name so posted in any station, it shall be sufficient to address such request in substantially the following form: The Station Agent of the — Company at — Station," together with the name of the proper post-office, inserting the name of the carrier company and of the station in the blanks, and to serve the same by depositing the request so addressed, with postage thereon prepaid, in any post-office. § 365. History and amendment of the section. — This section has been extensively amended; first in 1889, in the first series of amendments made to the act, which pro- vided for printing of the schedule and posting in two public and conspicuous places, prohibited reduction of rates without three days' notice, and made a more specific provision as to the power of the commission in prescribing different sched- ules, rates, fares and charges. The section was also amended by the so-called Elkins Act of 1903 (infra, § 519), in the requirement of publication and the invariable application of the tariff rates, making the rate conclusive as against the carrier. In the amendments of 1906, the section was substantially rewritten. The important changes were, first, the require- ment of the same pubhcation of the joint rate as of the sepa- rate rates. Theretofore the measure of publicity given to joint rates was prescribed by general order of the commission. Second, change in the rates, either separate or joint, was prohibited except after thirty days notice, while before the amendment, ten days notice was required of an increase and three days notice of a decrease. Third, the requirement of a 500 THE INTERSTATE COMMERCE ACT. [SECTION 6 separate printing and posting, not only of terminal charges and all other charges which the commission might require, and all privileges or facilities granted or allowed. Fourth, the requirement as to posting and notice could be modified on good cause shown. The section was also amended by the act of 1910, in author- izing the commission to reject any schedule tendered for filing which did not provide an effective date. The failure of a car- rier to comply with the terms of any regulation adopted under the section was penalized, and the carrier was required to fur- nish a written statement of rate on request, made subject to damages for any mistake or omission of a rate, and it was made the duty of the carrier to keep the name of its agent posted in its station where freight was received for trans- portation. This section was also amended by section 11 of the Panama Canal Act of Aug. 24, 1912, see infra § 386. The importance of these successive changes should be con- sidered in connection with the decisions of the commission and of the court construing the section at the different periods. § 366. Effect of publication.— In Gulf, Colorado & Santa Fe Railroad Co. v. Hefley, 158 U. S. 98, 39 L. Ed. 910 (1895), the Supreme Court decided that all railroads carrying interstate freight were subject to the provisions of the act to regulate commerce, and that the only rule of compensation which can be followed in regard to interstate shipments in the rate expressed in tariffs published at stations and filed with the commission in accordance with the requirements of the act. In this case there was conflict between the Texas law containing a provision for recovery of a penalty in the case of a violation, while the federal statute prohibits carriers from deviating from tariff rates published and on file, and pro- viding penalties for any departure therefrom. The Court held that these two statutes prescribing a different rule on the subject-matter, exposed a party to a conflict of duties, and that in the case of an interstate shipment, the state law must yield. As to the effect of the pubhshed rates upon the standard of reasonableness in an action at law for alleged unreasonable charges, see supra, section 1. §366] THE INTERSTATE COMMERCE ACT. 501 Contracts and tariffs filed with the commission under this section may be considered in any proceeding before the com- mission, although not specifically introduced in evidence on the hearing. 4 I. C. C. 664, 3 Int. Com. Rep. 493. The re- duction of passenger rates without consent of connecting lines, over which tickets are sold, and without filing schedules with the commission was ruled in violation of this section. 2 I. C. C. 513, 2 Int. Com. Rep. 340. The filing of schedules of rates with the commission as re- quired by statute raises no presumption as to the legality of such rates, and no omission or failure to challenge or disap- prove the schedules of rates so filed can have the effect of making rates unlawful which are unreasonable. 4 I. C. C. 104, 3 Int. Com. Rep. 138. When a schedule is filed announcing an advance of general application, for which no apparent reason exists, such action is a proper subject of investigation, and if it thereupon ap- pears that the advance is unwarranted, the commission will proceed to correct the injustice. 9 I. C. G. 382. It is the duty of the carrier to apply the rate as published, and where it appears in the complaint before the commission that a contract was made for a lower charge than pubhshed, the contract is not binding and its violation furnishes no ground for redress under the act. See 9 I. C. C. 216. The commis- sion said that that question had been decided by the Supreme Court in the Hefley Case, supra. See Elkins Act of Feb- ruary 19, 1903, infra, § 519, making the failure to pub- lish the tariff, or to strictly observe the tariff, until changed, a misdemeanor, and also declaring the pubhshed rate con- clusively deemed to be the legal rate. It was held in United States v. DeCoursey 82 Fed. 302 (1897), that a receiver is not criminally liable under this sec- tion for violation of a joint tariff previously established by a railroad company of which he is receiver and another com- pany which he has not ratified, adopted or recognized in any way. Where conflicting rules that affect the rate are published and are effective on the same day in separate tariffs by the same carrier, the rule which will result in the application of the lower rate is the one which is lawfully applicable to the traffic to which such rules apply. See 22 I. C. C. 26. 502 THE INTERSTATE COMMERCE ACT. [SECTION 6 § 367. Limitation of baggage liability under pub- lished rate. — It has been determined by the Supreme Court in several decisions that the effect of fihng schedules of rates with the Interstate Commerce Commission was to make these pubhsh^d rates binding upon shipper and carrier ahke, thus making effectual the purpose of the act to have but one rate, open to all alike, and from which there could be no departure. The Court in Boston & Maine R. Co. v. Hooker, 233 U. S. 97, 58 L. Ed. 868, (1914) reversed the Supreme Court of Massachusetts, 209 Mass. 598, which had rendered judgment against a carrier for the full value of certain lost baggage notwithstanding a limitation of such liability to the declared value contained in the carrier's published tariffs. The Court ruled that the hability should be limited to $100.00 which was the limitation fixed by the published rates where there was no declaration of value and no payment of the additional amount required to secure liability in the greater sum. (Justice Pitney dissenting). The Court said that it was doubtless in the power of the Interstate Commerce Com- mission to make requirements as to the checks or receipts to be given for baggage, if that subject needed regulation. The Court also said that its conclusion was enforced by section 22 of the act and by the regulations of the Interstate Com- merce Commission. 26 I. C. C. 292. See also A. T. & S. F. R. Co. V. Robinson, 233 U. S. 173, 58 L. Ed. 901, (1914) where the publication under this section is held to control the liability of the initial carrier under the Carmack Act. See § 502, infra. The Supreme Court in this case extended to the baggage of passengers and railway traffic the same principle of the limitation of liability which had been declared in the case of Adams Express Company v. Croninger, 226 U. S. 491, 57 L. Ed. 314, (1913) in the case of an express receipt. The decision in the Croninger case was based upon the shipper's knowledge that the carrier's rate was based upon the value of the shipment, where this plainly appears from the terms of the bill of lading and from the published rates on file with the Interstate Commerce Commission. The decisions in these cases led to the passage Jay congress of the so-called Cummings amendment, March 1915 (see § 368] THE INTERSTATE COMMERCE ACT. 503 infra, § 501, as to this act and the construction thereof by the Interstate Commerce Commission). § 368. The published rate conclusive. — Under this section before its amendment in 1906, it was held by the Supreme Court in Texas Pacific R. Co. v. Mugg, 202 U. S. 242, and 50 L. Ed. 1011 (1906), reversing the Texas civil court of appeals, 98 Tex. 352, that a carrier could exact the regular rate for an interstate shipment as shown by its pub- lished and printed schedule on file with the Interstate Com- merce Commission and posted in the station of the carrier, although a lower rate had been quoted by the carrier to the shipper and shipped under such lower rate so quoted. The Court said that this was within the principle of the decision of the Hefley Case, supra. It was said by the commission in 17 I. C. C. 418, that the published rate governing transporta- tion between two given points, so long as it remains uncan- celed, is as fixed and unalterable either by the commission or by the carrier, as if that particular rate had been estab- lished by a special act of congress. When regularly pub- lished it is no longer the rate imposed upon the carrier, but the rate imposed by law. The commission in its annual report, 1908, p. 16, in com- menting upon this decision of the Supreme Court in the Mugg Case, said that the theory of the act was that the shipper could at all times by reference to the schedules ascertain for himself the rate, but that in practice it was quite different, as the tariffs were very voluminous; and that it had been found practically impossible to comply with the literal re- quirement of the statute as to the posting; that in a great majority of cases the ordinary shipper could not without special experience ascertain for himself from an inspection of the tariffs what the rates are, and he must rely on the statement of the railroad agent, and added : "The commission feels that to require the shipper to ascer- tain for himself at his peril the rate imposed upon him an un- due burden. The railway should know what its established charges are, and may fairly be required to state in writing, when a written request is made by the shipper, the rate which it has published and maintains in force. We call special attention to this matter as one of immediate and 504 THE INTERSTATE COMMERCE ACT. [SECTION 6 general concern, which discloses the need of an appropriate remedy, and urgently request that a suitable measure be promptly enacted." The amendment of 1910 provides for a penalty of $250 to accrue to the United States to be recovered by civil action against the carrier brought by the United States, for any misstatement by the carrier as to the rates whereby the shipper suffers damage.* As to whether any remedy is available to the shipper for such damage see § 372 infia. The commission has ruled (18 I. C. C. 299) that it has no power under the Act to award such damages to the shipper. Any unpublished rate made by the agent of a carrier, whether through mistake or otherwise, is, therefore, unen- forcible by the carrier or shipper; and decisions, such as the Pondecker Lumber Co. v. Spencer, 86 Fed. 846 (1898), and certain state decisions sustaining recovery by the shipper in such cases, wooild seem to be inapplicable under the con- struction of this section as amended. See Armour Packing Co. V. U. S., (C. C. A. eighth circuit,) 153 Fed. 18 (1907). The word "diiferentj," included by the amendment of 1906 in the prohibition agaihst the carrier charging any other than the schedule rate, extends this prohibition to any evasion by indirection of the fundamental requirement of publicity of rates, conformity thereto and equality in such rates to all similarly conditioned. The practice of using transportation in payment of advertising services and claims was condeinned by the Supreme Court as violative of this section. See supra, § 156. The section does not repeal section 22, nor impair the power of the carrier as thus recognized to adjust its rates to different classes and conditions. In L. & N. R. Co. V. Maxwell, 237 U. S. 94, 59 L. Ed. 853, (1915) the Court reversed a judgment of the Supreme Court of Tennessee in favor of the defendant in a suit brought by * It was said in the report of the house committee on interstate and foreign commerce, in reporting the amended bill of 1910, that the "bill does not provide for any redress to the shipper who may have suffered loss on account of misquotation of the tariff rate, for the reason that it has so far seemed impracticable to find any method of so doing with- out opening a loophole for the allowance of secret rebates in such manner as would be practically unprovable in criminal proceedings. § 369] THE INTERSTATE COMMERCE ACT. 505 the railroad company to recover the amount of an alleged undercharge of a sale of railroad tickets. The Court said that a carrier could recover from a purchaser the difference between the amounts, and that the findings of the state court showing that the fare paid by an interstate passenger was less than the amount due under the applicable public rates was conclusive in the Supreme Court on the writ of error, where the carrier's tariffs were not included in the record. It was sufficient that the findings of fact showed that the amount paid was less than the amount due over the routes selected. It was held in 111. Cent. R. Co. v. Segari & Co., Dis. Ct. 205 Fed. 998, (1913) that the making of a contract for trans- portation of freight in interstate commerce at a rate less than that prescribed by the schedule on file with the Interstate Commerce Commission does not prevent a recovery of the difference by the carrier, since both parties to the contract of shipment are bound by the tariff. But where a settlement is made in good faith, on the basis of actual shipping weights, of a controversy between carrier and shipper over the freight charges on goods transported in larger cars than the shipper requested, and there is nothing to show that the capacity of the cars so requested was noted upon the bill of lading and way bill as required by rule in the carriers tariff schedule, such settlement prevents the carrier from recovering from the shipper the difference between the charge as settled and the rate based upon car capacity. St. Louis S. W. R. Co. v. Spring River Stone Co., 236 U. S. 718, 59 L. Ed. 805, (1915) affirming 169 Mo. App. 109. § 369. The conclusiveness of the published rate is irrespective of reasonableness. From the conclusiveness of the published rate established by this section it follows that it is unlawful for the carrier to depart from it except in the manner provided for revising the schedule. If the carrier does depart from it it violates the law and the shipper who sustains the injury thereby can recover as provided in the act. This was directly determined in C. B. & Q. R. Co. y. Feintuch, 191 Fed. 482, (1911) by the C. C. A. of the ninth circuit. In this case the plaintiff filed his 506 THE INTERSTATE COMMERCE ACT. [SECTION 6 petition with the Interstate Commerce Commission demand- ing reparation for charges made in excess of those fixed by the schedules. The commission awarded reparation. The court held that this was the proper proceeding and it was wholly irrespective of the reasonableness of the charges. The court said it was the inexecrable logic of the situation and needed no authority to sustain it ; that the decisions to the effect that a party must show he was injured as in that of Parsons v. C. & N. W. R. Co., 167 U. S. 447, 42 L. Ed. 231 (1897) were not in point, as the complaint was not of an unreasonable charge but of an unlawful charge, that is, one in excess of what the law has made the lawful rate. The plaintiff was held entitled to recover. § 370. Conspiracy to violate the section held in- dictable. — While section 6 penalizes a failure of a carrier to comply with the terms of any order made by the commission, it prohibits any deviation from the published rates; and it was held, in U. S. v. Grand Trunk Railway of Canada, et al., 225 Fed. 283, that an indictment for conspiracy under section 5440 R. S. to violate the law of the United States, was sustainable under this section, and demurrer thereto was overruled. It was immaterial that paragraph 2 of the act, concerning the posting of schedules of freight carried through a foreign country, did not mention passenger rates, as the entire section must be read in connection therewith; and passenger rates were therefore included. It was also held that a foreigji carrier was properly indictable under the act as a co- conspirator with a shipper in an agreement for the receiving of rebates under this section. While imports from a foreign country in the United States were not included in the act, commerce of a domestic origin transferred into or through a foreign country, did fall within its provisions. § 371. Contract for different than the published rate invalid. — The C. C. A. of the sixth circuit in Taenzer V. Chicago, R. I. & P. Ry. Co., 191 Fed. 543, (1911) held that an agreement by an interstate railroad carrier to accept less than the established and published rate § 372] THE INTERSTATE COMMERCE ACT. 507 by dividing the same with the shipper, which built a private track over its own lands connected with the railroad com- pany's lines was in violation of this section and wholly illegal, and unenforcible. In this case which was an action by a shipper against a railroad company to recover damages for the breach of such a contract the plea was held sufTicient in connection with the contract set out in plaintiff's declara- tion to raise the defense that the contract was illegal, and as the agreement was entire and undivisible the court held that no action could be maintained for its breach by defend- ant for refusing to furnish cars. The court also held that in this case the rule, that a party who had given a reason for his refusal to perform a contract was estopped to change his ground after litigation, did not apply because in this case the contract was unlawful and in violation of a positive statute and in such case the defaulting party is not estopped to plead its invalidity. § 372. Failure to post rates in stations.— In Texas Pacific R. Co. V. Cisco Oil Mill, 204 U. S. 449, 52 L. Ed. 562 (1907), it was claimed that a rate schedule not having been lawfully posted in public and conspicuous depots, waiting rooms, ofTices etc., was itself unlawful and therefore not bind- ing upon the carrier. The Court said that the contention was without merit and that the requirement of posting was not a condition precedent to the establishment and putting in force the tariff of rates, but it was a provision based upon the existence of an established rate, and had for its definite object the affording of special facilities to the public for ascertaining the rates actually in force. The Court added: "Whether by the failure to post an es- tablished schedule, a carrier became subject to penalties provided in the act to regulate commerce, or whether, if damage had been occasioned to a shipper by such omission, a right to recover on that ground alone would have obtained, we are not called upon in this case to decide." This decision was prior to the amendment of 1910 which ex- pressly penalizes any failure by the carrier to perform its duty or any misstatement whereby a shipper suffers damage. This decision was construed and applied by the commission in 14 C. C. 82; and it declined to allow a refund to the shipper. 508 THE INTERSTATE COMMERCE ACT. [SeCTION 6 where the delay in posting the tariff was due to unforeseen causes, though the carrier was wilhng to pay the amount claimed, saying that it was an unpleasant duty to deny such request, and thus prevent shippers from receiving refunds which the carrier was willing to pay, but that the issuance of such authority would be in contravention of the terms or pur- poses of the law and would estabUsh a wrongful precedent. It was held by the circuit court of appeals, fourth circuit, 1911, in St. L. & S. W. Ry. Co. of Texas v. Lewellen, 192 Fed. 540, that where the dependent carrier failed to file and post an established rate between a certain point in Texas at its office and by reason thereof the plaintiff was compelled to pay more freight on the shipment than it would have been required to pay under competitive rates over another road, it could recover the difference as damages, although the effect of the recovery would be to give plaintiff a quasi rebate from the estabhshed rate over the defendant's hne. The court said that up to that time (1911) the Supreme Court had not decided the question. In the following year (1912) the question was presented to the Supreme Court in 111. Cent. R. Co. v. Henderson Elevator Co., 226 U. S. 441, 58 L. Ed. 290, (1913) where it appeared that the shipper sought to recover damages sustained by him as a result of an erroneous quotation of an interstate freight rate. The Court reversed the judgment of the Supreme Court of Kentucky, 138 Ky. 220, saying that the reasons upon which the action of that court was based were in conflict with the rulings of the Supreme Court interpreting and apply- ing the act to regulate commerce. The Court said the failure to post did not prevent the rate on file from being controlled by the settled rule established by the cases referred to is now beyond question, citing Kansas City Southern R. Co. v. C. H. Albers Commission Co. 223 U. S. 594, 56 L. Ed. 567 (1912). In this case the Court reversed 79 Kansas, 59, and held that an agreement by a carrier with a single shipper for shipments over connecting fines having no joint through rate at less than the established local rates for each load, was void and did not prevent the collecting of the established local rates by the carriers. The court in its opinion quoted from the § 373] THE INTERSTATE COMMERCE ACT. 509 circuit court of appeals, eighth circuit, in C. B. & Q. R. Co. v. U. S., 157 Fed. 830, (1907) saying that where no joint through rate is pubhshed and filed with the commission, the lawful rate to be charged is the sum of the established local rates; or, if there is a local rate over one road and a joint rate over the others, the only lawful through rate to be charged is the sum of the local and joint rates. § 373. Insurance policy of carrier in violation of this section unenforcible. — The inflexibility of the principle of the conclusiveness of the published rate was illustrated by the decision of the C. C. A. of the second circuit in Duplan Silk Company v. American & Foreign Marine Insurance Co. 205 Fed. 724, (1913). It seems that the official schedule fixed the value of raw silk under the uniform bill of lading at one dollar per pound and the schedule contained a provision that "the cost of insurance against marine risk will not be assumed by carriers unless specifically provided for in tariffs." The consignment of raw silk was shipped under uniform bill of lading which limited the liability of the company in case of loss to one dollar per pound, and the shipment was lost in a marine disaster to one of the carrier's boats. The railroad held a policy of insurance which by its terms covered the shipment for the benefit of the owner as well as the carrier. The latter paid the loss to the shipper at the rate of one dollar per pound in accordance with the bill of lading. It seems that the value of the silk was $6,273.20, but at one dollar per pound, the amount paid the shipper, was $3,319. The rail- road paid this amount to the shipper without prejudice to his right to recover the balance of the insurance policy, and suit was therefore brought against the insurance company for this balance of the loss. The court held that the suit could not be maintained because the insurance was a violation of section 6 by the carrier because not stated in the tariff schedules, and it was immaterial that it was given to all shippers equally. It was also immaterial that the shipper did not know of this insurance at the time the goods were shipped. 510 THE INTERSTATE COMMERCE ACT. [SECTION 6 § 374. The section not applicable to a foreign ship- ment. — In J. H. Hamlen & Son Co. v. Illinois Cent. R. Co., 212 Fed. 324, (Dis. Ct. of Ark. 1914), plaintiff sought to recover damages on an agreement of defendant that if plaintiff would make certain shipments over its lines from Little Rock to New Orleans the defendant would secure and guarantee an ocean rate on the freight from New Orleans to Buenos Ayres. Plaintiff shipped his freight, but when it arrived in New Orleans there was no steamship line there, and plaintiff was compelled to have his freight reshipped to Mobile and there engaged ocean freight at a higher rate than that guaranteed by the defendant. The court held that as defendant had never published or filed with the commission a through rate to Buenos Ayres it was neither required nor could it make a through rate, and the Carmack amendment did not apply in such case. The court said further that any contract by which a carrier of interstate freight assumed a more burdensome liability than that specified in the pub- lished schedules was void, and the court held that there could be no recovery for damages, but plaintiff was entitled to a judgment for the money prepaid for the ocean freight. § 375. Claims for Misrouting. — It follows therefore that the published rates are conclusive upon both the carrier and the shipper, that the misrepresentation by the agent of a carrier as to the rates is not binding on the carrier although he is thereby misled to his own injury, 18 I. C. C. 299, that is, a shipper is bound by the published rate whatever other remedy he may have for the misrepresentation. In case of through routing, as the shipper is entitled to the lowest published rate between the points of shipment, the initial carrier is bound to ship via the road having the lowest rate and is liable on claim of reparation to the shipper for failure to do so. 17 I. C. C. 443, 18 I. C. C. 190. In case the shipper gives instructions as to the route of shipment the initial carrier is justified in following instructions, even though a higher rate applies on such route than was available between another road between the same points. 12 I. C. C. 469, 18 I. C. C. 299. If the shipper is in doubt as to what route provides the lowest rate to the terminal point, he should § 375] THE INTEHSTATE COMMERCE ACT. 511 tender the traffic to the initial carrier without instructions as to the specific route, and he is then entitled to the lowest rate. 18 I. C. C. 190. In 17 I. C. C. 588, the commission ruled that if an initial carrier files and posts a rate making joint rates from stations upon its lines to destination upon a connection hue in which tariff a connecting line does not occur, the initial line thereby becomes responsible to the shipper under its tariff. If the shipper is compelled to pay under rates legally in effect a greater transportation charge than that named in the tarifT, he may recover from the initial carrier the difference, cer- tainly if the rate posted by it is found to be reasonable. Every carrier party to a joint rate is jointly and severally responsible for that rate, and those carriers who actually par- ticipate in the transportation under a joint rate, are jointly and severally liable for damages for unreasonableness of that rate; and a complainant is not deprived of his right to a reasonable rate by the fact that the defendants, through neglect of the rules of the commission as to the publication of their tariffs, had failed to establish that rate in legal form. See also 17 I. C. C. 379. A carrier voluntarily establishing a through rate less than the sum of the locals after a shipment has moved, does not ipso facto become liable for the difference between the amount charged and the amount which would have been collected, if the through rate had been in effect at the time of the removal 17 I. C. C. 295. The same principle applies whether the claim for reparation is made by a shipper or an offer to refund is made by a carrier. Thus, in 17 I. C. C. 461, the commission refused to grant leave to a carrier to refund to a shipper the difference between the class rate paid and a reduced commodity rate, though the shipper had been informed by the carrier that the reduced rate was in force; and, being informed of the correct rate before the shipment, on advice of the carrier the shipper allowed the shipment to go forward on the carrier's agreeing to apply for authority to make the refund. The commission said that to grant the refund in such a case would do away with the published tariff altogether. Claims of reparation are determined upon the principle of knowledge which the shipper is conclusively presumed to 512 THE INTERSTATE COMMERCE ACT. [SECTION 6 have as to the published rates. In case of through routing it has been held that a carrier is criminally responsible under the Elkins Act (see infra, %b\% etseq.),ior failure to observe a through rate with which it participates although it filed no written agreement therein. In such cases the shipper could not be conclusively charged with knowledge of the parties to the through route and rate. In 32 I. C. C. 244, the commission considered the case where a complaint was made that owing to an error in the defendant's tariff, the Delaware, Lackawanna & Western R. Co., naming the rate on cement from Nazreth, Pennsyl- vania to Bradford and Niantic, Rhode Island, on which the complainant relied and made shipment which he sent to Bradford and it seems that the name of the station had been changed about a year before these shipments, so that the place formerly known as Bradford was Melville and the one formerly known as Niantic as Bradford, and the defendants had failed to note in their tariffs those changes in the station names. It was held as the complainant relied upon the rate as lawfully published in an effective manner, he was entitled to reparation for his damages sustained, as he paid charges at the rate of $2.50 a ton, when the rate published was $1.85 a ton. § 376. Status of carriers as shippers or consignees. — A very considerable volume of the interstate railroad traffic of the country is that of shipments for railroads themselves who may be shippers or consignees. The commission has had occasion in several cases to consider the status of a carrier, which is a shipper or consignee as well as a transporter and the duty and responsibility of other carriers in routing such shipments, and the commission has expressed its view in Rule 225 Conference Rulings Bulletin No. 5 (1909): "In answer to inquiries the commission expresses the opin- ion, that under the law a carrier, or a person or corporation operating a railroad or other transportation line, may not, as a shipper over the lines of another carrier, be given any preference in the application of tariff rates on interstate shipments, but it may lawfully and properly take advantage of legal tariff joint rates applying to a convenient junction or other point on its own line, provided such shipments are §377] THE INTERSTATE COMMERCE ACT. 513 consigned through to such point from point of origin and are, in good faith sent to such billed destination. In other words, \one carrier shipping its fuel, material, or other sup- plies over the lines of another carrier must pay the legal tariff rates applicable to the same commodities shipped by an individual, but when a carrier is the consignee of a ship- ment of its own property which moves under a joint rate and is to participate in the haul of same via its own line, routing instructions of consignor to a specified junction point on the line of consignee carrier must be observed. There may be some instances, such as the movement of needed fuel, in which, in order to keep the trains or boats moving, such traffic could temporarily be given preference in movement without creating unjust or unwarranted discrimination. "Where stock in one carrier company is owned by another carrier company, but both maintain separate organizations and report separately to the commission, they may not law- fully carry property free for each other." For applications of these rulings in cases of misrouting claims against the initial carrier in shipment of property where carrier was the consignee, see 21 I. C. G. p. 280, where reparation was awarded for damages resulting from mis- routing shipment of lumber. In 21 I. C. C. 270, the com- mission condemned the practice of applying a portion of a joint rate from the point of origin to the point of destination, to-wit, that portion from the point of origin to the junction point, for the use of a particular shipper which is not pub- lished for the benefit at large nor filed with the Interstate Commerce Commission under section 6. But the commis- sion said that nothing therein was to be construed as denying the carriers themselves the benefits of through rates on com- pany material according to lawfully published tariffs. In another case, 21 I. C. C. 290, it was said that a carrier was liable for damages resulting from a disregard of a shipper's specific routing instructions, even though it sends a shipment via a route taking a lower rate to the originally billed desti- nation, and that it was no part of the carrier's duty to speculate upon the reasons which actuated such instructions and assume that they do not express the shipper's desire. See also 21 I. C. C. 270. § 377. What is included in schedules. — The section provides for the publication, not only of the charges for car- J— 33. 514 THE INTERSTATE COMMERCE ACT. [SECTION 6 riage, but for a separate statement of terminal charges, storage charges, icing charges and all other charges which the commission may require, all privileges and facilities granted or allowed, or any rules and regulations which in any wise change, affect or determine any part of the aggre- gate of such aforesaid rates, fares, and charges, or the value of the service rendered to the shipper or consignee. In the Grand Haven Cartage Case, supra, the Supreme Court said, quoting the opinion of the commission, that cartage was in general a terminal expense, and was not in general assumed by the carrier. That it was informed by the report of the commission for 1889 that there were many railroad companies throughout the country which furnished cartage at their stations, but that in no instance did the rate sheets of schedules contain anything to that effect. At that time the statute made no such requirement. The Court suggested that it was proper for the commission to include the cartage, if furnished, as one of the terminal charges. The commission acted upon the suggestion (see 7 I. C. C. 592; 8 I. C. C. 560), and made a general order February 8, 1898, requiring a statement of cartage and other terminal services. For the views of the commission on this subject, see also 10 1. C. C. 352, and 9 I. C. C. 1. As to division of joint rates on fuel other than Coal and statements required, see 38 I. C. C. 169. As to the requirement of the separate publication of ter- minal charges, see also Interstate Commerce Commission v. Stickney, supra, § 153, where it was held by the Supreme Court that terminal charges for the delivery of live stock at the Union Stock Yards in Chicago, must be separately stated in tariff schedules. See also decision of the circuit court of appeals, seventh circuit. Walker v. Keenan, supra, where it was held that a railroad could post a schedule for a separate terminal charge of a fixed sum for a car for delivery to the stock yards where located off its own lines. The requirement of separate schedules is also illustrated in Baltimore & Ohio R. R. Co. v. Hamberger, et al., 155 Fed. 849 (1907), circuit court of Va., where it was held that the failure to insert in the schedule a limitation of non-transfer- ability of passenger tickets, made such a provision in the ticket void, and hence the railroad could not thereafter maintain a suit to enjoin the transfer of the ticket. §378] THE INTERSTATE COMMERCE ACT. 515 § 378. What is sufficient publication and filingr.— Schedules of joint tariffs required to be filed with the commis- sion need not be duplicated by each company which unite in making them. 1 I. C. C. 225, 1, Int. Com. Rep. 598. The receipt of a written statement from each company acknowl- edging the authority for filing the tariff on its behalf is sufficient. The posting of notices in a railroad station, that all rates are on file in the office of the station agent and may be examined on application to the agent, is not sufficient. 7 I. C. C. 43. 9 I. C. C. 221. Shippers and consignees cannot depend for the lawful rate and charge upon statments, as they must be guided by the published rates themselves, and the schedules must therefore be sufficient to give the necessary information. 7 I. C. C. 255. The only satisfactory method of publishing rates, 6 I. C. C. R. 488, is to definitely state the charges fixed between points clearly specified, without burdening and confusing the public with the need of making of involved calculations or with an- alyzing a series of statements to determine whether a par- ticular rate has been changed since the particular tariff was issued. Thus published tariffs specifying rates upon stand- ard articles, as vegetables shipped from Florida, should state plainly the weight or dimensions of the cars to which the rate should apply. 8 I. C. C. 585. Rules or regulations which, if enforced, would result in changing or affecting rates or charges shown on published schedules, must be notified to the pubhc for the time required by law for other rate changes. The notice should set forth the changes proposed to be made in the schedules then in effect, and such changes must be shown by printing new schedules or be plainly indicated upon the schedules in force at the timL 7 I. C. C. 255. As to publication and filing of rate schedules, see annual report of commission of 1904, p. 64. In Berwind- White Coal Mining Co. v. Chicago & Erie R. R. Co. 235 U. S. 371, 59 L. Ed. 275, (1915) in affirming the judgment in 171 111. App. 302, awarding demurrage on car loads of coal a demurrage tariff was declared to be sufficiently published and filed where the carriers filed with the commis- sion and book of rules of a car service association of which 516 THE INTERSTATE COMMERCE ACT. [SECTION 6 it was a member relating to demurrage, and a few days later wrote a letter stating that the demurrage charges would be $1.00 per day both of which documents were received and placed on file by the commission without any objection whatever as to their form and as a matter of fact were ade- quate to give notice. The Court ruled in this case that posting for public inspection is not essential to make effective the carrier's tariffs filed with the interstate commerce com- mission. In this case cars billed to Chicago for re-consign- ment were held to have reached their destination for the purpose of a demurrage charge, where in accordance with the practice which had existed for more than twenty years, they were held on storage tracks at Hammond, Indiana, a con- siderable distance from the terminals of the carrier nearer the center of the city, but convenient to the belt line by which cars could be transferred to any desired new des- tination. § 379. Joint tariffs and through rates. — An important change made by the amendment of 1906 was the requirement in the same publication of a joint rate as of separate rates. Prior to this the publication of joint rates had been regulated by orders of the commission, which, by order of March 23, 1889, prescribed that the carriers should publish their joint rates as separate individual roads were required by law to do. See 9 I. C. C. 182. In 1907 (see 12 I. C. C. 164) the commission had a hearing at the request of various shippers and railroads with reference to the construction of this amendment of 1906, and par- ticularly with reference to the matter of through rates, which should govern shipments over more than one railroad where no joint rate had been made. (See also report of 1907, p. 75). The commission ruled that when a through route has been formed, the rate charged is a through rate and the shipment will move upon the rate existing at the time it is billed by the initial carrier. Any increase or decrease made in the through rate after the date of shipment, is not applicable to such through shipment. A through route is a continuous line of railway^formed by an arrangement, express or implied, be- tween connecting carriers. A through bill of lading is con- §380] THE INTERSTATE COMMERCE ACT. 517 elusive evidence of the existence of a through route, under the principle established in the Social Circle Case, 162 U. S. 184, supra; L. & N. R. Co. v. Behlmer, 175 U. S. 650, supra. A through route must have a through rate for every service that it offers. If a through rate is established notice must be given to the world of such arrangement by publication. If no through rate is established over a through route the sum of the locals will make up the rate. 5 I. C. C. 44, 3 Int. Com. Rep. 706. As to jurisdiction of commission, under amendments of 1906 and 1910 to establish through routes without consent of carriers, see infra, section 15 of act. When the rates established applying between the points within a single state are applied as part of combination rates in transportation between different states, such state rates, as well as the interstate rates with which they are combined, must be published and filed as provided by section 6. See also as to application of the section, 8 I. C. C. 316. So passenger excursion rates are required to be published and filed. 3 I. C. C. 465, 2 Int. Com. Rep. 729. § 380. Responsibility for through rates. — When rail- road companies make a through and continuous line and offer it for the use of the pubhc, the commission has ruled that they cannot rid themselves of responsibility for unjust charges by breaking the haul in two and calling themselves carrier of the separate ends of their through line. Through and continuous lines imply through rates, which must be reasonable rates, and suitable instrumentalities of shipment and carriage. 6 I. C. C. 378. The commission, in 2 I. C. C. 131 and 2 Int. Com. Rep. 78, appHed this principle to the Pennsylvania railroad company, which operated a part of a through line and owns a controlhng interest in the capital stock of a connecting line, the Pittsburgh, Cincinnati & St. Louis, and the commission ruled that the Pennsylvania Railroad Com- pany could not free itself of the responsibility for the through rates by hiding behind the corporation of the other company as a separate carrier. The carrier however does not assume responsibility for rates made by a connecting road because merely of its giving 518 THE INTERSTATE COMMERCE ACT. [SECTION 6 them in connection with its own rates by way of information to parties desiring to make through shipments. 1 I. C. C. 401, and 1 Int. Com. Rep. 703. In the absence of some agree- ment or understanding with a connecting line, by which the joint tariff rates is authorized, the carrier cannot lawfully publish or apply any other rates than those fixed for trans- portation between the points reached by its railroads, and it cannot publish the sum as a rate to points on the Une of another carrier without its consent. Such a through rate is not a joint rate, for joint rates can be made only by concur- rence or assent, and it is not a combination rate, for one of its component parts is not a subject for a separate charge. There must be lawful rates for each of the roads before there can be a lawful combination of rates. It has been held that where the lines of several railroad cor- porations are conducted as a single system for the purpose of trafTic between different points originating on either, and such corporations divide the profits of such business on a mileage basis, the several corporations as to such business are partners liable to third persons on the principles of the law of agency. See Lehigh Valley R. Co. v. Dupont, C. C. A. second circuit, 128 Fed. 840 (1904). But the fact that a railroad company owns stock and bonds of another railroad does not show partnership or agreement to run the roads of the latter on a common account. See Pennsylvania R. Co. v. Jones, 155 U. S. 333, 39 L. Ed. 176 (1894). § 381. Published joint rates must be duly author- ized. — ^The only rates, which a carrier is authorized to pub- lish, are its own local rates, that is, to points on its own line, and such through rates, as it is authorized by agreement with any connecting carrier to combine ^ith the rates of such carrier to points on its line. It cannot lawfully add to the duly estabUshed rates of another carrier any amount it pleases less than its own local rates, and publish and use them the same as a through rate to points on the line of another carrier without its consent. Such a through rate is not a joint rate, for joint rates can be made only by concurrence or assent, nor is it a combination rate, for one of its component parts has no legal existence or sanction as a through rate or §382] THE INTERSTATE COMMERCE ACT. 519 through charge. There must be lawful rates upon each of the roads before there can be a lawful combination of rates. This was ruled in a case, 7 I. C. C. R. 323, where the receivers of a road connecting with the New York, New Haven & Hartford Railroad, published what purported to be a joint tariff of coal rates from the point on its road to a number of destinations reached by the New York & New Haven road, whereby the complainant company received its full local charges to said destinations from the junction points with defendant's road, and the defendant accepted the remainder, which was in each instance less than the established local rate from the place of shipment to the point of connection. The New York & New Haven road which carried coal to the same destinations by a longer route over its own rails thereby securing greater compensation than was afforded to it by coal coming to it from defendant's road, refused to unite in these rates published by the connecting carriers so unauthorized and its complaint was sustained. Commis- sioner Clemens dissented, saying that a carrier could make and publish through rates to points on a connecting line less than its regular locals, provided the rates on its own line were duly filed and published, and are themselves just and reasonable and are not in themselves unjustly discriminative against local shippers. § 382. The commission's power of modification as to filing of tariffs. — The proviso allowing the commission to allow changes in rates less than a thirty days' notice, and to modify the requirements of the section as to posting and filing tariffs, either in particular instances or by a general order, applicable to special instances, on good cause shown, was inserted in the amendment of 1906, because it was found that a literal enforcement of the "posting" provisions and of the thirty day notice in the matter of import and export rates and of special excursion rates, would be impracticable. It was not clear that the excursion rates under section 22 were changes under this clause but the commission ruled that they were so subject. The commission made an exhaustive in- vestigation upon the subject of import and export rates (see 10 I. C. C. 55), and there said that the practical difficulty 520 THE INTERSTATE COMMERCE ACT. [SECTION 6 arose from the fact that ocean rates from the ports are not under the control of the commission and are constantly varying; that the rate varied from day to day, and sometimes from hour to hour. The same kind of merchandise may be carried in the same vessel, even for the same person, at different charges for the transportation. See the full discus- sion of this subject in the report of the commission for 1904, . page 49. The purpose of this proviso was therefore to make the section adaptable to commercial conditions and environ- ments. See annual report for 1905, page 8. § 383. Inclusion of transit privileges in tariffs. — ^The entire subject of transit privileges on commodities and the relation between the privileges as practiced and the privileges as pubUshed in the tariffs, was considered by the commission in the so-called transit case, 26 I. C. C. 204. It seems that an order made effective August 15th, 1912, was directed against the publication of transit privileges and required the carriers to place certain restrictions around the privileges, which was found unsatisfactory and especially so to shippers and millers who protested to the commission. A new rule was therefore prepared to the effect that when a tariff clearly defined the purposes and the terms under which transit privileges were granted and for the effective policing of the operations under the arrangement, a shipment may be stopped in transit and the same shipment, or a proper equivalent, could be forwarded at the through rate provided by tariff from the original point of shipment to final destina- tion, plus the charge for the transit privilege, if any. This did not mean the substitution of one commodity for a com- modity of a different kind. § 384. The commission on request for waiver of time limitation on loss claims. — In 29 I. C. C. 417, 1914, the commission made a preliminary report on the request of the carriers and shippers in the official and western classifica- tion territories, that the approval by the commission of the specified territory of the four months limitation in which claims for loss, damage or delay was determined as contained in the previous rating referred to in the tariffs on file with the §385] THE INTERSTATE COMMERCE ACT. 521 commission. The commission reported that they had no authority to order carriers to disregard their tariffs. It was claimed that this time hmitation was of doubtful legality because of the existence of state statutes prohibiting and declaring such provisions of limitations to be void, although there was a question of whether such statutes con- trolled interstate traffic, and it was urged that the waiver of this four months limitation with respect to all claims presented prior to December 1, 1913, and all claims accruing within two years prior to the date of the report, provided such claims were presented on or before April 1, 1914. The commission said that for the purpose of preventing dis- criminations the carriers should present all claims within the dates herein specified upon their merits, but they did not pass on the reasonableness of this territory limitation. § 385. Control of accessory charges in tariffs by the commission. — In its control of tariff rates filed under this section, which include all terminal and miscellaneous charges made by the carriers, the commission has in a number of cases passed upon the validity and reasonableness of charges against the shipper which are included in these necessary charges, which the carrier is bound to include in its pub- lished tariff. Thus in 28 I. C. C. 316, the regulation in a tariff rate requiring the shipper of securities to state the market value of the securities, the carrier was under no obligation to transport the shipment and could refuse it; but at the same time it was not entitled to assess charges on the shipment at a valuation in excess of the actual value of the securities. It has been ruled by the commission that the carriers must include in their tariffs any transit charges wherein transit privileges are allowed. In 33 I. C. C. 276, charges for dump- ing coal into boats from the railroad piers in the harbors in addition to the regular transportation rate was held reason- able. So the rates to and from the stations of a tunnel company, and a lighterage company, in Chicago, were held proper, 34 I. C. C. 234. In 34 I. C. C. 516, the commission held that the proposed charges of a carrier for the "trap cars" and for 522 THE INTERSTATE COMMERCE ACT. [SECTION 6 "ferry cars" were not justified, as the carrier failed to prove their reasonableness. In 34 I. C. C. 609, the commission condemned a tariff proposing a "spotting" charge for placing cars for loading and unloading at convenient points on tracks specially named by the tariff, as such a charge would result in unjust discrimina- tion, and that the service should be included in the line-haul. In 30 I. C. G. 538, the commission found that the carrier was justified in the cancellation from their tariffs applying to points in the southwestern territory a provision for dunnage allowances on shipments in closed cars. It was claimed by the railroads that dunnage allowances encouraged inferior and unsafe packing and added to the transportation risk. The commission thought it unsound in principle and en- couraged car fitting or the use of dunnage in order to secure minimum loads and to produce larger payments and allow- ances to offset expenses thus incurred. The commission had ruled in the exercise of this jurisdic- tion 33 I. C. C. 93, that it has power to strike a tariff from the files if it is filed and put in effect as a claim by shippers to secure unlawful allowances by carriers under the pretense of a common carriage. As to the jurisdiction of the commission in the suspension of proposed rate increases, see section 16, infra. The com- mission said in its annual report of 1911, that their experience had shown conclusively that the exercise of the power to reject or to refuse to file a tariff schedule, is much more effective than an effort to recover penalties could be. The commission recommended that this section be amended so as to authorize the commission to reject or refuse to file any schedule tendered for filing which has the effect of restricting the number of supplements and the volume of supplemental matter permitted under the tariff regulations of the commission. Such amendment has not as yet been enacted. § 386. Section 11 of Panama Canal Act of Aug. 24, 1912. — Section six was amended by section 11 of the Panama Canal Act of Aug. 24, 1912 as follows: "When property may be or is transported from point to point in the United States by rail and water through the § 386] THE INTERSTATE COMMERCE ACT. 523 Panama Canal or otherwise, the transportation being by a common carrier or carriers, and not entirely within the lim- its of a single State, the Interstate Commerce Commission shall have jurisdiction of such transportation and of the carriers, both by rail and by water, which may or do engage in the same, in the following particulars, in addition to the jurisdiction given by the Act to regulate commerce, as amended June eighteenth, nineteen hundred and ten: "(a) To establish physical connection between the lines of the rail carrier and the dock of the water carrier by direct- ing the rail carrier to make suitable connection between its line and a track or tracks which have been constructed from the dock to the limits of its right of way, or by directing either or both the rail and water carrier, individually or in connection with one another, to construct and connect with the lines of the rail carrier a spur track or tracks to the docks. This provision shall only apply where such connection is reasonably practicable, can be made with safety to the pub- lic, and where the amount of business to be handled is suffi- cient to justify the outlay. "The commission shall have full authority to determine the terms and conditions upon which these connecting tracks, when constructed, shall be operated, and it may, either in the construction or the operation of such tracks, determine what sum shall be paid to or by either carrier. The provisions of this paragraph shall extend to cases where the dock is owned by other parties than the carrier involved. "(b) To establish through routes and maximum joint rates between and over such rail and water lines, and to deter- mine all the terms and conditions under which such lines shall be operated in the handling of the traffic embraced. "(c) To establish maximum proportional rates by rail to and from the ports to which the traffic is brought, or from which it is taken by the water carrier, and to determine to what traffic and in connection with what vessels and upon what terms and conditions such rates shall apply. By pro- portional rates are meant those which differ from the corre- sponding local rates to and from the port arid which apply only to traffic which has been brought to the port or is car- ried from the port by a common carrier by water. "(d) If any rail carrier subject to the Act to regulate com- merce enters into arrangements with any other w&ter carrier operating from a port in the United States to a foreign coun- try, through the Panama Canal or otherwise, for the handling of through business between interior points of the United States and such foreign country, the Interstate Commerce Commission may require such railway to enter into similar arrangements with any or all other lines of steamships oper- ating from said port to the same foreign country. 524 THE INTERSTATE COMMERCE ACT. [SECTION 6 "The orders of the Interstate Commerce Commission re- lating to this section shall only be made upon formal com- plaint or in proceedings instituted by the commission of its own motion and after full hearing. The orders provided for in the two amendments to the Act to regulate commerce enacted in this section shall be served in the same manner and enforced by the same penalties and proceedings as are the orders of the commission made under the provisions of section fifteen of the Act to regulate commerce, as amended June eighteenth, nineteen hundred and ten, and they may be conditioned for the payment of any sum or the giving of security for the payment of any sum or the discharge of any obligation which may be required by the terms of said order." § 387. Construction by commission of the amend- ment of 1912. — On the application of the Augusta & Savan- nah Steamship Company, operating a line of steamboats on the Savannah river, for the establishment of through routes and joint rates with the defendant railroad companies and also with two steamship companies operating hnes between Savannah and North Atlantic ports, leading from various North American parts to interior destinations, the claim was set up that the commission had no jurisdiction for the reason that it had no jurisdiction over the two steamship company defendants, 26 I. C. C. 380. The commission conceded that under the original act it had no jurisdiction over traffic moving entirely by water, but it said that the steamship company defendants had subjected themselves to the re- quirements of the act with respect to certain traffic, as they were parties to joint tariffs covering the movement by rail- water and rail between Augusta and all the points in ques- tion. The commission said, however, that their jurisdiction did not rest on that ground alone, but they had been given additional jurisdiction over water carriers by the amendment to section 6 in the Panama act. It was contended that this amendment did not apply for the reason that it related only to traffic which passes through the Panama Canal, and that the words "or otherwise," in the first paragraph, modified the phrase, "by rail and water," and not the phrase, "through the Panama Canal." The commission said that the plain everyday reading of the act is, "through the Panama Canal or otherwise," and there was no reason for disregarding the § 387] THE INTERSTATE COMMERCE ACT. 525 obvious meaning of those words. If the position of the defendants was correct, the words "or otherwise" were pure surplusage, as traffic through the Panama Canal could then only move by rail and water. In the Transcontinental Commodity Rate case, 32 I. C. C. 449 (1914), the commission commented on the stipulation filed in the case as to the effect of the opening of the Panama Canal. It seemed that the Atlantic and Pacific ocean lines, in desiring to come within the purview of the amendment of August 12, 1912, now confined the application of their rates from port to port and would not accept traffic on through bills of lading through or from interior points. This, it was said, was probably due to the fear on their part that the traffic, if handled on through bills of lading, would constitute transportation by land and water, and, therefore, be subject to the jurisdiction of the commission and to the requirements of the act. 526 THE INTERSTATE COMMERCE ACT. [SECTION 7 Section 7. § 388. Continuous carriage of freights from place of shipment to place of destination. 389. Judicial application of section. § 388. Continuous carriagfe of freights from place of shipment to place of destination. — Sec. 7. That it shall be unlawful for any common carrier subject to the provisions of this act to enter into any combination, contract, or agree- ment, expressed or implied, to prevent, by change of time schedule, carriage in different cars, or by other means or de- vices, the carriage of freights from being continuous from the place of shipment to the place of destination; and no break of bulk, stoppage, or interruption made by such com- mon carrier shall prevent the carriage of freights from being and being treated as one continuous carriage from the place of shipment to the place of destination, unless such break, stoppage, or interruption was made in good faith for some necessary purpose, and without any intent to avoid or un- necessarily interrupt such continuous carriage or to evade any of the provisions of this act. § 389. Judicial application of section. — This section, which has not been amended, prohibiting any combination for preventing the continuity of traffic and providing for the continuous carriage of freights from the place of ship- ment to the place of destination, is to be considered in connection with the provision of section 3 concerning the interchange of traffic {supra, § 327), which has been con- strued as leaving the carriers free ta make arrangements for through traffic among themselves. It was said by the commission, 10 I. C. C. 188, that in view of this construction of section 3 of the act, it was not clear what the seventh section was intended to accomplish, and that possibly congress had in mind that railways might attempt to inter- rupt traffic at state lines, thereby depriving the traffic of the character of interstate business, and that the seventh section may have been intended to prevent this. The commission was clear that it added nothing to the third section in support § 389] THE INTERSTATE COMMERCE ACT. 527 of the claim made requiring the defendant carrier to deliver its cars to another carrier. This section has also been cited in the cases wherein the courts have been asked to protect interstate carriers against interference by unlawful combinations. See chapter VI, supra. 528 THE INTERSTATE COMMERCE ACT. [SECTION 8 Section 8. § 390. Liability of common carriers for damages. 391. Right of action based on the statute. 392. Plaintiff must allege and prove damage. 393. Allowance of attorney's fee as costs. 394. Limitation of actions. 395. Assignability of claims. 396. The jurisdiction of federal courts. 397. Jurisdiction of the federal courts in equity under the act. 398. Jurisdiction in equity for protection in interstate commerce. § 390. Liability of common carrier for damages. — Sec. 8. That in case any common carrier subject to the pro- visions of this act shall do, cause to be done, or permit to be done any act, matter, or thing in this act prohibited or de- clared to be unlawful, or shall omit to do any act, matter, or thing in this act required to be done, such common carrier shall be liable to the person or persons injured thereby for the full amount of damages sustained in consequence of any such violation of the provisions of this act, together with a reasonable counsel or attorney's fee, to be fixed by the court in every case of recovery, which attorney's fee shall be taxed and collected as part of the costs in the case. § 391. Right of action based on the statute. — Section 8 and succeeding section 9, which have not been amended, provide for private actions at law for damages by persons injured by violation of the provisions of the act, and are the only provisions of the act other than actions for reparation under section 16, directly relating to such private actions in the courts. The importance of these sections 8 and 9 is very much qualified by the construction given to the remedial features of the act under the amendments of 1906 and 1910 by the recent decisions of the Supreme Court. See section 9, infra. As to the relation of this section to section 2, see supra, § 256. § 392. Plaintiff must allege and prove damage. — Under this section the common carrier is liable only to the person or persons injured thereby for the full amount of damages sustained in the violation of the act. Under the § 392] THE INTEBSTATE COMMERCE ACT. 529 amendments of the act, the pubUshed rate is made the only lawful rate until it has been determined by the action of the commission that the rate is unreasonable; and plaintiff's damage is the amount he has paid in excess of what the com- mission judges to be reasonable. On the other hand, where complaint is made that the plaintiff has paid the lawful rate but that rebates have been paid to others, the plaintiff cannot recover the amount of this rebate as such, but he must show direct damage to himself from such unlawful act and his recovery is limited to such damage proved. This was first ruled in the case of Parsons v. C. & N. W. R. Co., 167 U. S. 447, 42 L. Ed. 231, (1897) affirming 63 Fed. 903. This ruhng was reaffirmed in Pennsylvania R. R. Co. v. International Coal Mining Co., 230 U. S. p. 184, 57 L. Ed. ,(1912) p. 1446, in 1913, Pitney, J., dissenting where the Court reversed the circuit court of appeals, third circuit, 173 Fed. 1, on this point. In this case the shipper made no a'legation or proof that he had suffered any injury from what the court adjudged to be an unlawful rebate paid to the other shippers. It was contended that it was not necessary to make such allegation or proof for the reason that as a matter of law he was entitled to recover as damages the same rate per ton as had been rebated to any other person who shipped at the same time over the same route ; but the Court said that plaintiff having paid the only lawful rate, he was not overcharged though the favored shipper was illegally undercharged. For that violation of law the carrier was liable for the payment of a fine to the government and in addition was liable for all damages it thereby occasioned plaintiff or any other shipper. The Court cited and approved Knudsen-Ferguson Fruit Co. V. Michigan Central R. R. Co., 148 Fed. 968, C. C. A., eighth circuit (1906) and also Hoover v. Pa. R. Co., 156 Pa. 282. The Court said, therefore, that it was error to re- fuse to charge that to entitle plaintiff to recover the jury must be satisfied that plaintiff sustained some loss or injury due to the fact that the defendant was carrying at the same time at lower rates coal shipped by other shippers. A discriminating rate must be actually charged to make an offense or cause of action under the act. Merely making or J-34. 530 THE INTERSTATE COMMERCE ACT. [SECTION 8 offering an illegal rate when it is not shown that an actual shipment was made, constitutes no legal injury to a shipper who was charged a higher rate. Lehigh Valley R. Co. v. Rainey, 112 Fed. 487, E. Dist. of Penn. (1902.) § 393. Allowance of attorney's fee as costs. — The provision of this section for the allowance of attorney's fee, does not apply in case of an action by a shipper against an initial carrier for loss on a connecting line under the so-called Carmack amendment of 1906 to section 20, since the cause of action in such case is the loss of property which is in no way traceable to a violation of the provisions of the act. Atlantic Coast Line R. R. v. Riverside Mills, 219 U. S. 186, 55 L. Ed. 167 (1911). The allowance of an attorney's fee does not include services before the commission, but it does include services in an appellate court. See section 16, infra. § 394. Limitation of actions. — The Interstate Com- merce Act prescribes no limitation of time within which actions based thereon shall be instituted, and therefore, under R. S., U. S. 721, the statute of limitations of the state in which the action is brought must apply and control. Michi- gan Insurance Bank v. Eldred, 130 U. S. 693, 32 L. Ed. 1080 (1889). This was directly ruled in Rattican v. Terminal Railroad Association, 114 Fed. 666 (1902) (E. Dist. of Mo.), and in Copp v. Louisville & Nashville R. Co., 50 Fed. 164 (1891), Dist. of Ky.; Murray v. Railroad Co., 35 C. C. A. 62, 92 Fed. 868 (1892). In both cases the state statutes of limitations were held to apply. Where under the statute of a state the defense of the statute of limitations can be in- voked by the defendant by demurrer, the same procedure will apply in the federal court. It was ruled in the Missouri case, that an action to recover damages for a discrimination in violation of section 2 was one to recover money in the nature of a penalty, and therefore must be brought within the time allowed by the state statutes for such action. In this case the court held, that the allegations of the petition were not sufficient to prevent the running of the statute, as there was no allegation that plaintiff believed and relied on defendant's announcement, that it made no discrimination §396] THE INTERSTATE COMMERCE ACT. 531 in the rates, or that he exercised diligence to ascertain the facts. In action at common law, not founded on the statute, to recover unreasonable charges, the unreasonableness being established by the payment of rebates, it has been held that the statute of limitation did not begin to run against the ship- per as long as he had no knowledge of his rights owing to the fault of the carrier in concealing the facts. See Cook v. C, R. I. & P. R. Co., 81 Iowa, 551, 9 L. R. A. 764 (1890). As to the limitations governing proceedings for reparation before the commission, see infra, section 16. § 395. Assignability of claims. — Claims for damages under sections 8 and 9 constitute property rights, which may be assigned, so as to convey the beneficial interests to the assignee; and suits brought in the United States circuit court under these sections are maintainable in the name of the assignee under provisions of the law of the state, requiring all suits to be brought in the name of the real party in interest. Edmunds v. Illinois Central R. Co., 80 Fed. 78 (1897). In Pennsylvania R. R. Co. v. International Coal Mining Co., supra, it was held that a pending action to recover damages for discrimination in violation of section 2, is not abated by a judicial sale of plaintiff's corporate property, including the choses in action in such suit; and proof of such sale constitutes no defense to the action. § 396. The jurisdiction of federal courts. — It is spe- cifically provided in section 9 that a person claiming to be damaged by any common carrier subject to the provisions of the act may at his election make complaint to the commis- sion, or may bring suit in any district or circuit court of the United States of competent jurisdiction. It follows that the jurisdiction of the federal court when invoked is not based upon diverse citizenship, but on a cause of action arising under the laws of the United States. Diverse citizenship therefore is not necessary to jurisdiction of the federal court. In Van Patten v. C, M. & St. P. R. R. Co., 74 Fed. 981 (1896), it was decided by Shiras, J., of the northern district of Iowa, that the limitation as to the district in which suit may be brought in the United States circuit court contained in the 532 THE INTERSTATE COMMERCE ACT. [SECTION 8 Judiciary Act of 1887 and 188S, did not apply to suits brought under sections 8 and 9 of the Interstate Commerce Act, but that such suits may be brought in any district in which the defendant may be found, as the Umitations contained in those acts are appUcable only to the cases whereof the state and federal courts have concurrent jurisdiction, citing In re Hor- horst, 150 U. S. 653, 37 L. Ed. 1211. It was said in the same case that the jurisdiction under these sections was exclusive in the courts of the United States, as the use of the words in sec- tion 9 concerning certain courts in the United States indi- cated that in the view of congress there were courts in the United States who were competent to take jurisdiction over such cases as arise under the provisions of the act, and courts not competent to take jurisdiction. But see Connor v. V. & M. R. Co., 36 Fed. 273 (1888>; Lowry v. C. B. & Q. R. R. Co., 46 Fed. 83 (1888). In Swift V. Railroad Co., 58 Fed. 858 (1893), it was held that a court had no jurisdiction over a suit under the act, removed from a state court, where the state court had none. This did not apply where a state court had jurisdiction of the cause of action stated in the petition, but a federal question was raised in the answer, which set up an alleged discrimina- tion violative of the act. See also Sheldon v. Wabash Rail- road Co., 105 Fed. 785 (1900). The exclusiveness of the jurisdiction over suits brought un- der these remedial sections of the act to enforce its provisions must be distinguished from the concurrent jurisdiction of the state court over questions in interstate commerce, not arising from or based upon the act. Murray v. Railroad Co., 62 Fed. 24 (1894). See supra, § 49. § 397. Jurisdiction of the federal courts in equity under the act. — The general chancery jurisdiction of the circuit courts of the United States in cases arising under the Interstate Commerce Act was sustained by the Supreme Court in the Lennon Case, 166 U. S. 548, 41 L. Ed. 1110 (1897). The Court held that a bill brought solely to enforce compliance with the Interstate Commerce Act, and to compel railroad companies to comply with such act, and to offer proper and reasonable facilities for the interchange with the § 397] THE INTERSTATE COMMERCE ACT. 533 complainant and enjoining them from refusing to receive from complainant for transportation over their lines any cars which might be tendered, made a case arising under the constitution and laws of the United States, of which the circuit courts had jurisdiction. A case arises under the con- stitution and laws of the United States whenever the plaintiff sets up a right which the parties had denied to him, and the correct decision of the case depends upon the construction of such laws. In Central Stockyards Co. v. L. & N. R. Co., 112 Fed. 823 (1902), which was a proceeding to enforce by injunction rights claimed under section 3 of the act, the court, though deciding against the plaintiff on the merits, was of the opinion that the remedies provided in section 9 were exclusive for remedies at law, where the parties did not apply in the first instance to the Interstate Commerce Commission and that a bill for injunction to enforce obedience to the section would not he. The Supreme Court however in affirming the judg- ment, assumed, without deciding, that such rights as plaintiff had, could be enforced by bill in equity. See 192 U. S. 568, 48 L. Ed. 565 (1904). In Interstate Stockyards Co. v. Indianapolis U. R. Co., 99 Fed. Rep. 472, the circuit court of Indiana sustained the ju- risdiction in equity, saying that where a wrong was con- tinuing in character an^ not susceptible of accurate pecuniary estimation and resorts to actions at law would involve a multipHcity of suits, none of which would end the litigation, a resort to equity was proper. In the case of Missouri Pacific Railway Co. v. United States, 189 U. S. 774, 47 L. Ed. 811 (1903), the Supreme Court held that prior to the passage of the act of February 19, 1903, infra, § 519, known as the Elkins Law the district attorney of the United States under the direction of the attorney general in pursuance of a request made by the com- mission, was without power to commence a proceeding in equity against a railroad corporation to restrain from dis- criminating in its rates between different locahties (Justices Brewer and Harlan dissenting). This amendatory act pro- vides for equity jurisdiction in such cases, where proceedings are instituted at the instance of the Interstate Commerce 534 THE INTERSTATE COMMERCE ACT. [SECTION 8 Commission, but makes no change in the law so far as to the remedies open to private individuals. The general chancery jurisdiction has been sustained in several cases in the federal circuit courts where it was invoked by both railroads and shippers for the enforcement of rights under the act. For the equity jurisdiction in protection of rights in interstate commerce under the decisions of United States Supreme Court holding that resort must be had to the Interstate Commerce Commission, where the matters are within the jurisdiction of that body. See infra, § 405. The radical change effected by those decisions in the right to resort to the courts without going before the commission makes it unnecessary to recite the different decisions of the circuit courts prior thereto. § 398. Jurisdiction in equity for protection of inter- state commerce. — In another class of cases, jurisdiction in equity has been successfully invoked not only by the United States, as in the Debs Case, 158 U. S. 564, but by railroad companies for the protection of interstate commerce against unlawful combinations preventing the performance by such railroad companies of the duties imposed upon them by the statute. Thus in Toledo, A. A. & N. W. R. Co. v. Pennsyl- vania Company, 54 Fed. 730 (1893), Judge Taft in the northern district of Ohio, sustained the equitable jurisdiction in a suit filed against several railroad companies connecting with complainant company at Toledo, and asking an order enjoining the companies from refusing to receive and deliver complainant's freight, such refusal being threatened on the ground that the locomotive engineers of the defendants refused to handle trains containing such freight because the complainant employed on its line engineers who were not members of their brotherhood. The court sustained the jurisdiction irrespective of citizenship, saying it was im- material what rights the complainant would have had before the passage of the Interstate Commerce Act. "It was sufficient that congress in the exercise of constitutional power had given a positive sanction of the federal law to the rights secured in the statute, and any action involving the enforce- ment of those rights was a case arising under the laws of the § 398] THE INTERSTATE COMMERCE ACT. 535 United States." See also Ex parte Lennon, 166 U. S. 548, supra. The court also held that a mandatory injunction was a proper remedy to restore the passage of freight backwards and forward, as each carrier had the right to enjoy this without interruption. \ 536 THE INTERSTATE COMMERCE ACT. [SECTION 9 Section 9. § 399. Right of election in appealing to commission or the court. 400. The limitation of the right of private action in the courts. 401. Discrimination in a rule of a carrier and in the enforcement of a rule distinguished. 402. The complainant must show right of action under the act. 403. Complainant must show specific and final determination of Com- mission. 404. Application of the rule to telegraph companies. 405. Jurisdiction in equity under the act. 406. When the court has jurisdiction at law. 407. Judicial application of section. [Persons claiming to be damaged may elect whether to complain to the Commission or hring suit in a United States court.] § 399. Right of election in appealing to commission or the court. — Sec. 9. That any person or persons claim- ing to be damaged by any common carrier subject to the provisions of this act may either make complaint to the commission as hereinafter provided for, or may bring suit in his or their own behalf for the recovery of the damages for which such common carrier may be liable under the provi- sions of this act, in any district or circuit court of the United States of competent jurisdiction; but such person or persons shall not have the right to pursue both of said remedies, and must in each case elect which one of the two methods of pro- cedure herein provided for he or they will adopt. In any such action brought for the recovery of damages, the court before which the same shall be pending may compel any {Officers of defendant may be compelled to testify.] director, officer, receiver, trustee, or agent of the corporation or company defendant in such suit to attend, appear, and testify in such case, and may compel the production of the books and papers of such corporation or company party to any such suit ; the claim that any such testimony or evidence may tend to criminate the person giving such evidence shall not excuse such witness from testifying, but such evidence or testimony shall not be used against such person on the trial of any criminal proceeding. § 400. The limitation of the right of private action in the courts.— While sections 8 and 9 of the act, which specifically provide for a remedy at the choice of the shipper § 400] THE INTERSTATE COMMERCE ACT. 537 either by appeal to the commission or to the courts by private action against the carrier, have remained unchanged through the successive amendments, the general scope of the act has been so radically changed by these amendments and the powers of the commission thereunder have been so materially enlarged that the judicial construction of these sections as to the jurisdiction of the courts to entertain private actions under the act has been profoundly affected thereby. In Texas & Pacific Ry. Co. v. Abilene Cotton Oil Co., 204 U. S. 246, 51 L. Ed. 553 (1907), plaintiff brought suit in a state court in the state of Texas to recover because of the exaction by the carrier on an interstate shipment of an alleged unreasonable rate, although the rate charged was that stated in the schedules duly filed and published in accordance with the act. The Court held that the relief prayed was incon- sistent with the act to regulate commerce, since by that act the rates so filed were controlling until they had been held to be unreasonable by the Interstate Commerce Commission on a complaint made to that body. In this case the Court held that the independent right of the individual to maintain actions to obtain pecuniary redress for violations of the act under sections 9 must be confined to such wrongs, as are consistent with the context of the act to be redressed without previous action of the commission ; and that the provision of section 22, infra, expressly preserving the common law and statutory remedies, could not be construed as continuing for shippers the common-law right, the continued existence of which will be absolutely inconsistent with the provisions of the statute. The suit in this case was brought in the state court, but the conclusion of the Court did not depejid upon that, as the reasoning would apply equally to a suit brought in the court of the United States. See also Cisco Coal Case, 204 U. S. 449, 51 L. Ed. 552 (1907). This ruling in the Abilene Cotton Oil Case was reaffirmed in B. & 0. R. Co. v. United States, 215 U. S. 481, 54 L. Ed. 292 (1910), in a case involving the remedy of mandamus specifically provided under section 23; and the Court said that it was settled in the Abilene case that the right to question in the courts the rates established in accordance with the act to 538 THE INTERSTATE COMMERCE ACT. [SECTION 9 regulate commerce, without previous resort by colnplaint to the commission in order to determine their unreasonableness, would be destructive of the act, and therefore was not per- missible. The Court said in its opinion that the Abilene Case was decided before the amendment of 1906 and that the construction given in that case was made the more imperative by these later amendments of 1906, as the commission is now empowered, and it is made its duty, in disposing of the complaints, not only to determine the illegality of the prac- tices alleged to give rise to an unjust preference or undue discrimination, and to forbid the same, but moreover to direct the practice to be followed as to such subject for a future period not exceeding two years, the order to become operative without judicial action. The Court therefore said that the primary interference of the courts with the ad- ministrative functions of the commission was wholly in- compatible with the act. The court said there was nothing in the case of Southern Railroad Company v. Tift, 206 U. S. 428, 51 L. Ed. 1124 infra, which quahfied the ruhng of the Abilene Case. In Loomis v. Lehigh Valley R. Co., 240 U. S. 43, 60 L. Ed. 000, (1916) affirming New York court of appeals, 208 N. Y. 302, the rule declared in the above cases was re- affirmed, and it was held that a state court had no jurisdiction of an action by a shipper to recover from an interstate carrier sums expended by them in constructing grain doors or bulk heads in cars furnished by the carrier for interstate carload shipments of foreign products in bulk, the applicable duly filed interstate rates making no reference to allowance for grain doors or bulk heads. The court said that this was a comphcated administrative problem, and that it was for the commission to approve some general rule of action. This ruling has been followed in the several circuit courts. See Howard Supply Co. v. Chesapeake & Ohio R. Co., 162 Fed. 188, where the court held that the plaintiff had no right to sue in the circuit court for damages for an alleged over- charge until the commission had passed upon the matter, although the rate charged was higher than the former rate passed on by the commission and held unreasonable. In Clement v. L. & N. R. Co., 153 Fed. 979 (1908), the cir- cuit court (E. D. of La.), held that the action by a shipper to §401] THE INTERSTATE COMMERCE ACT. 539 recover damages because of an alleged discrimination in exacting a charge from one class not required from another class for the same service, was not within the jurisdiction of the court as a case arising under the Interstate Commerce Act, where it is not alleged that the charge was not in accord- ance with the schedule of rights in interstate commerce, whether private or public, has been made to the commission to correct the alleged discrimination. P This principle was apphed by the C. C. A. of the eighth circuit in Montgomery v. C. B. & Q. R. Co., 228 Fed. 617, (1915) to the matter of the establishment of rail-> road eating houses and the transportation of articles and commodities therefor at less than the published rate. The court said this was a matter of administrative policy to be regulated by the Interstate Commerce Commission, and in the absence of such a ruhng there was no cause of action stated in the petition asking damages on account of alleged loss of business from the competition of a railroad eating house. § 401. Discrimination in a rule of a carrier and in the enforcement of a rule distinguished. — This limita- tion of the right of action in the state court was exhaustively considered by the Supreme Court in the case of Pennsylvania Railroad Co. v. Puritan Coal Mining Co., 237 U. S. 127, 59 L. Ed. 867 (1915), where the Court affirmed the Supreme Court of Pennsylvania, 237 Penn. 420, which in turn had afTirmed a judgment in favor of a shipper in an action against the railroad company for damages caused by the failure of the latter to furnish cars. The Court said that sections 8, 9 and 22 must be construed together, as the latter section expressly reserved the remedies then existing at common law or by statute; and that there were two forms of discrimination, one in the rule, and the other in the manner of its enforcement — that is, one in the promulgation of the discriminating rule by the carrier, and the other in the unfair enforcement of a reasonable rule. In a suit where the rule of practice itself is attacked as unfair or discriminatory, the question is raised which calls for the exercise of the judgment and administrative power which have been vested 540 THE INTERSTATE COMMERCE ACT. [SECTION 9 by congress in the commission, and it is for that body to say whether such a rule in itself would discriminate against one class of shippers in favor of another, and until it has so declared, no court has jurisdiction of a suit against an interstate carrier for damages caused by the enforcement of such a rule. But when the commission has declared a rule to be unjust, redress must be sought before the commission, or in the United States, courts of competent jurisdiction, as provided in section 9. But if, on the contrary, the carrier's rule, reasonable on its face, has been unequally applied, and the suit is for damages because of this violation and discriminatory en- forcement, such a suit may be prosecuted either in the state or federal courts. The Court said that in the case pre- sented, the pleadings contained no reference to the com- merce act. The duty of the carrier to furnish cars is not an absolute one. If the failure to furnish them is the result of sudden and great demands, it could not fairly have been anticipated. The common law of old recognized that if a coach be full, the carrier was not liable for failing to transport more than he could carry. Where unexpected demands came in times of car shortage, it might be necessary to consider the character of the freight, and so on, in determining what should be the proper system of distribution, and such an issue would call for the exercise of the regulating functions of the commission. In the case presented however, there was no administrative quesion presented, and the state and federal courts have concurrent jurisdiction of such claim against the carrier without a preliminary finding by the commission. The same rule was stated in Illinois Central R. R. Co. v. Mulberry Co., 238 U. S. 275, 59 L. Ed. 1306 (1915), where the Court affirmed 257 111. 80, and held that the state court had jurisdiction in a suit against a carrier to recover damages caused by the latter's failure to furnish cars needed by the shipper within a reasonable time after demand, since the carrier's rule of car distribution was not questioned, and there was no administrative question involved requiring the action of the Interstate Commerce Commission. This distinction was illustrated also in the case of the Morrisdale Coal Co. v. Pennsylvania Railroad Co., 230 U. S. §401] THE INTERSTATE COMMERCE ACT. 541 * 304, 57 L. Ed. 1494, (1913) affirming 183 Fed. 929, where the Court said that the case could not be maintained in advance of a ruUng by the Interstate Commerce Commission, that the method of distribution adopted by the carrier was unreasonable. And in this case the Court refused to stay the dismissal of the suit until the plaintiiT could apply to the Interstate Commerce Commission, as the right to apply to the commission had been barred by limitation. In Texas & Pacific Railroad Co. v. American Tie Co., 234 U. S. 138, 58 L. Ed. 1255, (1914) the Court reversed the circuit court of appeals of the fifth circuit, 190 Fed. 1022, holding that action for damages for refusal to accept a certain class of interstate shipments, where the refusal v/as based upon the want of any applicable filed and pubhshed rate for that class, could not be maintained in the absence of any previous action by the Interstate Commerce Commission. In the case of Mitchell Coal and Coke Co. v. Pennsylvania Railroad Co., 230 U. S. 247, 57 L. Ed. 1472, (1913) the Court affirmed in part and reversed in part the judgment of the district courtin 183 Fed. 908. The Court affirming the judg- ment where the alleged rebates were made under the rule recognized by the commission, but reversing it in the case of payments made which were absolutely forbidden without any previous requirement of the Interstate Commerce Commission. The plaintiff was entitled to recover damages sustained by reason of such illegal allowances to his com- petitors. Under the peculiar facts of the case and the unsettled state of the law at the time the suit was begun, and the failure of the defendant to make the jurisdictional point in limine, so that the plaintiff could then have presented his case to the commission, direction was made that the dis- missal be set aside so as to give the plaintiff a reasonable opportunity within which to apply to the commission for a rule as to the reasonableness of the practice under which the payments were made. Where a suit against a carrier for overcharges in violation of the Interstate Commerce Act involves only a construction of the pubhshed rate, and its application to shipments, the district court has no jurisdiction to determine the controversy without prior application to the commission. Gimble Bros. V. Barrett (Dist. Ct. Pa.), 215 Fed. 1004, (1914). 542 THE INTERSTATE COMMERCE ACT. [SECTION 9 The right to sue in a state court, even where the action is brought to recover damages caused by the discriminatory enforcement of the carrier's own rule, does not exist in a case where the apphcant has made complaint to the commission and secured from the commission a finding as to the illegality of the rule and violation of the act. In such a case suit can only be brought under the federal statutes in this section. See Penn. R. Co. v. Clark Bros. Mining Co., 238 U. S. 456, 59 L. Ed., p. 1406, (1915) reversing 241 Pa., 515. § 402. The complainant must show right of action under the act. — This was illustrated in the case of Geraty V. Atlantic Coast Line R. Co., district court of South Carolina, 211 Fed. 227, (1914) where the court sustained the demurrer to a complaint suing for an alleged excess charge for icing upon interstate transportation. The court said that at common law no action lay against a common carrier for unreasonable and excessive charges on foreign trans- portation, and that all the states of the American union were foreign to each other in the matter of commerce and trans- portation and the same reason would apply. It was further held that as plaintiff's right to recover must depend upon rights given him by the Interstate Commerce Act, it must appear from the complaint that the rates paid were in excess of the rates allowed as reasonable by the Interstate Com- merce Commission, and plaintiff must therefore show that under the rates filed with the commission, the rate charged was unreasonable and, therefore, illegal. It was further ruled that as the complaint was based upon the theory that the charge for icing was unreasonable because it was in excess of the actual cost of the ice, the court said the carrier was not limited to the charge for the cost of such service but could rightfully make a charge for a reasonable profit thereon. Southern Ry. Co., v. St. Louis Ry. Co., 214 U. S., 297, 53 L. Ed. 1004, (1909). § 403. Complainant must show specific and final determination of commission. — It has been ruled in the district courts that it is not sufficient for complainant, in a case where it was necessary to show a previous submission § 403] THE INTERSTATE COMMERCE ACT. 543 to and action by the commission, to set out that the case had been previously submitted to the Interstate Commerce Com- mission in another proceeding by different shippers and a rate pronounced unreasonable and invalid. See National Coal Co. V. Chicago & N. W. Ry. Co., E. Dist. Wis., 200 Fed. 185 (1912), where the court sustained a demurrer to the complaint. This ruling was followed by the district court of Pennsylvania in Franklin v. Philadelphia & Reading R. Co., 203 Fed. 134 (1913), where the court said, after reviewing the decisions of the Supreme Court, that the court had no power to hear primarily claims concerning the redress of wrongs as to which there must be previous action by the commission, and upon the other hand it could not be main- tained as a suit to recover damages upon a previous com- plaint to the commission, because it is not based upon an order of the commission for the payment of money, as provided by section 16 of the act, and without an award of reparation to the plaintiffs by the commission the court is without jurisdiction. It was urged in this case that the commission had passed upon the only question necessary to preserve uniformity of administration, which was one of the primary objects of the act, having awarded reparation to other parties and the ascertainment of the amount of damages to plaintiffs was a mere question of mathematical calculation ; but the court said that the only provision for • bringing a suit under the act was under the provisions of section 16 after a determination by the commission, and it was clear that a suit for recovery of damages must be based upon an order of the commission for the payment of money. It was said, however, by the Supreme Court in A. J. Phillips Co. V. Grand Trunk W. R. Co., 236 U. S. 662, 59 L. Ed. 774 (1915), that a proceeding before a commission to determine the reasonableness of an advance, was not in the nature of private litigation between the complainant lumber association and the carriers, but was a matter of public concern in which the whole body of shippers was interested. The finding as to the reasonableness of the advance was general in its nature and inured to the benefit of every person who had been obliged to pay the unjust rate, and that plaintiff and every other shipper similarly situated 544 THE INTERSTATE COMMERCE ACT. [SECTION 9 was entitled by appropriate proceedings before the commis- sion or the courts, to obtain the benefit of the general finding and order. In this case, however, it seemed that plaintiff did not assert his right within the time fixed by law, and therefore judgment of the court sustaining a demurrer, was affirmed. See 195 Fed. 12, for the opinion in the same case by the C. C. A. of the sixth circuit. § 404. Application of the rule to telegraph com- panies. — In Wilhams v. Western Union Tel. Co., E. Dist. Pa., 203 Fed. 140 (1913), in an action to recover damages for alleged negligence in sending a telegram from plaintiff to his purchasing agent in Florida, the court held that the mistake causing the damage resulted from ordinary, and not gross, negligence, and was within the limitation of the company's liability for mistakes in the case of unrepeated messages to the tolls paid therefor. The court said that the right to make such stipulations was especially recognized by section 1 of the act which brought the telegraph companies within its provisions, and that the claim that the regulation was un- reasonable was a question which could not be entertained primarily in the court but must be first raised before the Interstate Commerce Commission. The judgment was therefore entered for the defendant. § 405. Jurisdiction in equity under the act. — The general jurisdiction of courts in equity for the protection of rights in interstate commerce, whether private or public has been considered in the cases cited under the previous section. There has been a difference of judicial opinion since the de- cision of the Supreme Court in the Abilene Cotton Oil case, supra, as to the jurisdiction of the courts under the law there declared to grant any equitable relief in relation to matters which were within the jurisdiction of the commission. In Southern Railway Co. v. Tift, 206 U. S. 428, 51 L. Ed. 1124, (1907) though the original suit was filed in 1903, the Court affirmed the decree of the C. C. A., fifth circuit, 138 Fed. 753, affirming an injunction granted by the circuit court, southern district of Georgia, enjoining an inter- state carrier from enforcing an increased freight rate on § 405] THE INTERSTATE COMMERCE ACT. 545 lumber. The railroad had filed a demurrer to the bill for want of jurisdiction which was overruled; but the court made an order that the complainant should make a proper applica- tion to the Interstate Commerce Commission, and the court would then entertain a renewed application on the record as made. Application was made to the commission, which found that the advance was unreasonable; and thereupon, upon that record, the court enjoined the enforcement of the advance. The parties had made a stipulation that in the subsequent proceedings in the court the circuit court could adjudge the amount of reparation to be made. The final decree in the circuit court directed an order of reference with instructions to ascertain the amount of increase in rates paid since the rate went into effect. Referring to the Abilene case, the Court said : "We are not required to say, however, that because an action at law for damages to recover unreasonable rates which have been exacted in accordance with the schedule of ' rates as filed is forbidden by the Interstate Commerce Act a suit in equity is also forbidden to prevent the filing or enforcement of a schedule of unreasonable rates or change to unjust or unreasonable rates." These decisions of the Supreme Court have been considered by the circuit court of appeals in the second, fourth, fifth, seventh and ninth circuits, and varying conclusions reached as to the jurisdiction of the circuit court to grant an injunc- tion against an increase of rates before or pending an in- vestigation by the commission. Thus, while the power to grant such an injunction was sustained in the ninth circuit in Northern Pacific Ry. Co. v. Pacific Coast Lumber Mfg. Ass'n, 165 Fed. 1, 1908 (Judge Ross dissenting), affirming the circuit court of Washington, on same day, in the Kalispel Lumber Co. Case, 165 Fed. 25, an injunction order was reversed, where the rates had been filed and gone into effect, the court saying that the thirty days' notice required to be given of a change in schedules gave ample time for invoking the aid of equity if irreparable injury would result from their being put into effect. On the other hand, the C. C. A. of the fifth circuit, in Atlantic Coast Line v. Macon Grocer Co., 166 Fed. 206 (1909), reversed J-38. 546 THE INTERSTATE COMMERCE ACT. [SECTION 9 the circuit court (163 Fed. 738), in granting a temporary injunction and ordered a dismissal of the bill, Shelby, J., dis- senting. The court said that a decree in equity would work incalculably greater mischief in interfering with the statutory rates than would an action at law. The same ruling was made in the fourth circuit (Columbus I. & Steel Co. v. Kan- awha & N. Ry. Co., 178 Fed. 261, afRrming 171 Fed. 173), in February 1910; and these cases were followed by the C. C. A. of the second circuit in Wickwire Steel Co. v. New York Central Co., 181 Fed. 316, June, 1910. In this case the order which was reversed, restrained defendants from promulgating a proposed schedule through the com- mission and from putting it into effect pending the deter- mination of the reasonableness of the rate by the commission, the complainant being required to file bond to indemnify defendants from loss in case the commission found the rate to be reasonable. In Jewett Bros. v. C. M. & P. Ry. Co., 156 Fed. 161, (1907) southern district of Dakota, it was held by Garland, J., that the court could not grant a temporary injunction to restrain a carrier from putting' into effect an alleged unlawful rate, where the suit was merely in aid of a proceeding before the commission, since the commission was without power to pass upon a rate which was merely proposed by a carrier. In Sandusky-Portland Cement Co. v. B. & 0. R. Co., in the C. C. A. of the seventh circuit, 187 Fed. 583 (1911), the complainant sought to enforce a contract whereunder the railroad company agreed under the consideration of his establishing a cement factory on its line of a certain capacity, that the railroad's regular established tariff rates on cement during a specified period should not exceed those made out in the schedule. The court refused to grant relief saying that the Interstate Commerce Commission was charged with the unitary administration of interstate regula- tions and that the court could not grant relief, in advance of a finding by the commission on an issue whether the rates were reasonable or unreasonable to be obtained in the light of the railroad's operations as an entirety. The court said that the Interstate Commerce Commission superseded a primary jurisdiction over all other tribunals upon the ques- tion of facts arising upon interstate rates. § 406] THE INTERSTATE COMMERCE ACT. 547 It should be observed, however, that these decisions ex- cepting the last cited were rendered prior to the amendment of 1910, which enlarges the power of the commission in the very matter in which the temporary injunctions were sought to prevent irreparable injury pending the investigation by the commission, as now the commission is empowered to suspend an increase of rates for a stated period for the pur- pose of investigating their reasonableness. The principle discussed in these cases would seem not to apply where the aid of the court is sought to enforce the performance of a duty by a carrier imposed by general law and therefore not within the duty of the commission as specified in the act. Thus, in L. & N. R. Co. v. F. W. Cook Brewing Co., 172 Fed. 117 (1909), C. C. A. seventh circuit, where the court had jurisdiction of the parties and the suit was brought to compel the carrier to carry intoxicating liquors into a district where the sale was prohibited by law, the court held that an application of the statute to shipments from other states was void as an attempted regulation of interstate commerce and that such a case was not one for submission to the commission, and that the court had jurisdiction to entertain the same. It follows from the rulings of the Supreme Court and the reasoning whereon decisions are based, that there can be no resort to the courts, whether in law or equity, under the act, if the subject matter of the complaint is within the juris- diction of the commission and can be there determined under the procedure provided in the act ; but if the aid of the court is required in furtherance of the jurisdiction of the commis- sion or the protection of property rights pending such deter- mination, or if any of the common law duties of the carrier are sought to be enforced on any of the recognized grounds of equitable cognizance, such as the prevention of irreparable wrong, the jurisdiction of equity will be sustained. § 406. When the court has jurisdiction at law. — ^The same rule applies in case of actions at law. Thus, where the action requires the determination of the unreasonableness of a rate or of a regulation in interstate commerce, whereof the commission has jurisdiction under the act, an action for 548 THE INTERSTATE COMMERCE ACT. [SECTION 9 damages cannot be maintained until the prior determination by the commission of the unreasonableness of such rate or regulation. On the other hand, if the action does not require such a determination, but seeks to recover for a discrimina- tion in rates where the measure of damages is the difference between the amount paid by plaintiff and that paid by others under substantially the same circumstances and conditions during the same time, and there is no occasion to resort to the commission, and there is no question to submit to them, then the court has jurisdiction. The same reasoning would apply in the case of car distribution, as in the Morrisdale Coal Company case, where the court held that an action could not be maintained in advance of a ruling by the com- mission, if the method of distribution adopted by the carrier was unreasonable. In the case of International Coal Mining Company already cited, where the cause of action was based on claim for dams ges for alleged discrimination between free and contract coal, supra, (1913), the question of jurisdiction was not raised in the court below; but in the Supreme Court it was argued that the case should be remanded with instructions to dismiss on the ground that courts had no power to adju- dicate, the administrative question as to whether a carrier could make a difference in rates between shipments of free and contract coal; but the Court said that no question of administration was involved. Even if a difference in rates could be made between free and contract coal, none was made in the only way in which it could have been lawfully done. The published tariffs made no distinction between contract and free coal but named one rate for all alike. The tariff, so long as it was in force, was in this respect to be treated as thoueh it had been a statute, binding as such upon railroad and shipper alike. If as a fact the rates were unreasonable, the sliipper was nevertheless bound to pay, and the carrier to regain what had been paid, leaving however, to the former the right to apply to the commission for reparation. In view of this imperative obligation to pay the tariff rate, there was no call for the rate-regulating discretion of the administrative body; and it was a case, therefore, for the court, and not for the commission, and jurisdiction was there- § 407] THE INTERSTATE COMMERCE ACT. 549 fore vested in the former to entertain the action under sec- tion 8, whereunder plaintiff could recover such damages as he could prove he had sustained from this unlawful dis- crimination. § 407. Judicial application of section. — See notes in section 8, supra. The provisions in this section for the com- pelling of testimony and the production of books and papers were in effect held unconstitutional by the decision of the Supreme Court in the case of Hitchcock v. Counselman, infra, section 12, in that the protection given to the witness forced to give self-incriminating testimony was not sufficient under the fifth amendment of the constitution. The act of 1893, infra, section 12, only related to testimony given before the commission and did not apply to this section. This, however, was remedied by the act of 1903. See infra, § 424. The case of Webster Coal & C. Co. v. Cassatt, 207 U. S. 181, 52 L. Ed. 160 (1907), an action for damages (see 150 Fed. 32, 50), came before the Supreme Court on a writ of error involving the production of books and papers, and the Court held that the order was insufficient to support the writ, and the merits of the original action were not considered. A final order of the Interstate Commerce Commission and remaining of record in full force and effect is a bar in the United States circuit court to a suit brought for the recovery of damages alleged to be sustained by plaintiff from the same acts complained of in the statement before the commission. See Riddle v. New York, Lake Erie & Western Railroad Co., U. S. Circuit Court W. Dist. of Penn., 3 Int. Com. Rep. 230, 39 Fed. 290 (1889). A party is not barred' from prosecuting an action in court for an individual claim because of proceedings instituted be- fore the commission by an association of which he is a mem- ber, where it does not appear that the association presented a claim for the plaintiff to the commission. Junod v. C. & N. W. R. Co., 47 Fed. Rep. 290 (1892). It appears from the discussion in congress that the purpose of this provision of the section, that a party must elect whether to proceed before the commission or in the court, was intended to prevent a party from using the commission merely as a means of procuring evidence for a suit in court. 550 THE INTERSTATE COMMERCE ACT. [SECTION 9 Under this section suit may be brought in any district court of the United States. In New Mexico v. Baker, 196 U. S. 432, 49 L. Ed. 540 (1905), the question was suggested, though not decided, whether either under the Interstate Commerce Act or the Anti-Trust Act of 1890 a suit could be brought in a territorial district court, or whether congress intended that only courts of the United States invested by the third article of the constitution with the judicial power of the United States should have original jurisdiction in such suits. See section 16 infra, as to jurisdiction in cases for rep- aration. 408] THE INTERSTATE COMMERCE ACT. 551 Section 10. § 408. Penalties for violation of act by carriers. 409. Amendments to the section. 410. The amendment of 1903. 411. Section 10 not repealed by the Elkins Act 412. Illegal combinations under section 10. 413. The incidental interference with commerce by a peaceable strike not a violation of the section. 414. Construction of the statute. 415. Sufficiency of indictment for violation of section. 416. Removal of indicted persons to other districts for trial. 417. Limitation of criminal prosecution under the act. [Penalties for violations of Act by carriers or when the car- rier is u corporation, its officers, agents, or employees; Fine and imprisonment.] § 408. Penalties for violations of act by carriers. — Sec, 10. (As amended March 2, 1889, and June 18, 1910.) That any such common carriers subject to the provisions of this act, or, whenever such common carrier is a corporation, any director or officer thereof, or any receiver, trustee, lessee, agent, or person acting for or employed by such corpora- tion, who, alone or with any other corporation, company, person, or party, shall willfully do or cause to be done, or shall willingly suffer or permit to be done, any act, matter, or thing in this act prohibited or declared to be unlawful, or who shall aid or abet therein, or shall willfully omit or fail to do any act, matter, or thing in this act required to be done, or shall cause or willingly suffer or permit any act, matter, or thing so directed or required by this act to be done not to be so done, or shall aid or abet any such omission or fail- ure, or shall be guilty of any infraction of this act for which no penalty is otherwise provided, or who shall aid or abet therein, shall be deemed guilty of a misdemeanor, and shall, upon conviction thereof in any district court of the United States within the jurisdiction of which such offense was com- mitted, be subject to a fine of not to exceed five thousand dollars for each ofTense. Provided, That if the offense for which any person shall be convicted as aforesaid shall be an unlawful discrimination in rates, fares, or charges for the transportation of passengers or property, such person shall, in addition to the fine hereinbefore provided for, be liable to imprisonment in the penitentiary for a term not exceeding two years, or both such fine and imprisonment, in the dis- cretion of the court. 552 THE INTEESTATE COMMERCE ACT. [SECTION 10 [Penalties for false billing, etc., by carriers, their officers or agents: Fine and imprisonment.] Any common carrier subject to the provisions of this act, or, whenever such common carrier is a corporation, any offi- cer or agent thereof, or any person acting for or employed by such corporation, who, by means of false billing, false classi- fication, false weighing, or false report of weight, or by any other device or means, shall knowingly and willfully assist, or shall willingly suffer or permit, any person or persons to obtain transportation for property at less than the regular rates then established and in force on the line of transporta- tion of such common carrier, shall be deemed guilty of a mis- demeanor, and shall, upon conviction thereof in any court of the United States of competent jurisdiction within the district in which such offense was committed, be subject to a fine of not exceeding five thousand dollars, or imprison- ment in the penitentiary for a term of not exceeding, two ye&rs, or both, in the discretion of the court, for each offense. [Penalties for false billing, etc., by shippers and otber per- sons: Fine and imprisonment.] Any person, corporation, or company, or any agent or officer thereof, who shall deliver property for transportation to any common carrier subject to the provisions of this act, or for whom, as consignor or consignee, any such carrier shall transport property, who shall knowingly and willfully, directly or indirectly, himself or by employee, agent, officer, or otherwise, by false billing, false classification, false weigh- ing, false representation of the contents of the package or the, substance of the property, false report of weight, false statement, or by any other device or means, whether with or without the consent or connivance of the carrier, its agent, or officer, obtain or attempt to obtain transportation for such property at less than the regular rates then estab- lished and in force on the line of transportation; or who shall knowingly and willfully, directly or indirectly, himself or by employee, agent, officer, or otherwise, by false state- ment or representation as to cost, value, nature, or extent of injury, or by the use of any false bill, bill of lading, re- ceipt, voucher, roll, account, claim, certificate, affidavit, or deposition, knowing the same to be false, fictitious, or fraudulent, or to contain any false, fictitious, or fraudulent statement or entry, obtain or attempt to obtain any allow- ance, refund, or payment for damage or otherwise in con- nection with or growing out of the transportation of or agree- ment to transport such property, whether with or without the consent or connivance of the carrier, whereby the com- pensation of such carrier for such transportation, either be- fore or after payment, shall in fact be made less that the regular rates then established and in force on the line of §410] THE INTERSTATE COMMERCE ACT. 553 transportation, shall be deemed guilty of fraud, which is hereby declared to be a misdemeanor, and shall, upon con- viction thereof in any court of the United States of com- petent jurisdiction, within the district in which such offense was wholly or in part committed, be subject for each offense to a fine not exceeding five thousand dollars or imprison- ment in the penitentiary for a term of not exceeding two years, or both, in the discretion of the court: Provided, That the penalty of imprisonment shall not apply to artificial persons. [Peoalties for inducing common carriers to discriminate unjustly: Fine and imprisonment. Joint liability -with carrier for damages.] If any such person, or any officer or agent of any such cor- poration or company, shall, by payment of money or other thing of value, solicitation, or otherwise, induce or attempt to induce any common carrier subject to the provisions of this act, or any of its officers or agents, to discriminate un- justly in his, its, or their favor as against any other con- signor or consignee in the transportation of property, or shaU aid or abet any common carrier in any such unjust discrimination, such person or such officer or agent of such corporation or company shall be deemed guilty of a misde- meanor, and shall, upon conviction thereof in any court of the United States of competent jurisdiction within the dis- trict in which such offense was committed, be subject to a fine of not exceeding five thousand dollars, or imprisonment in the penitentiary for a term not exceeding two years, or both, in the discretion of the court, for each offense; and such person, corporation, or company shall also, together with said common carrier, be liable, jointly or severally, in an action to be brought by any consignor or consignee dis- criminated against in any court of the United States of com- petent jurisdiction for all damages caused by or resulting therefrom. § 409. Amendments to the section. — This section as originally enacted contained only the general penalty clause in the first paragraph. By the amendment of March 2, 1889, the substance of the remainder of the section was added, including specific penalties for false billing, classifica- tion, etc., recommended by the commission. The amend- ment of 1910 specifically included corporations. § 410. The amendments of 1903. — In the original act and until the enactment of the Elkins Law of 1903, this action contained all the provisions relating to criminal 554 THE INTERSTATE COMMERCE ACT. [SECTION 10 responsibility for violation of the provisions of the Interstate Commerce Act. Very important amendments were made by the act of February 19, 1903, or Elkins Act, infra, § 519, which in view of the multitude of prosecutions for rebating, has become of great importance in the enforcement of the act. Under the original Elkins Act, the penalty of imprisonment was abolished, and the only penalties for offenses, whether committed before or after the passage of the Elkins Act, was the imposition of fines, which were limited from a minimum of one thousand dollars to a maximum of twenty thousand dollars. By the amendment of 1906, this penalty of im- prisonment was restored. For the construction of the Elkins Act, see infra, § 519 ef seq. § 411. Section 10 not repealed by the Elkins Act. — In Nichols & Cox Lumber Co. v. United States, C. C. A. sixth circuit, 212 Fed. 588 (1914), it was claimed that the provisions of this section upon which indictment for receiving a rebate was made was in conflict with section 1 of the Elkins Act as amended by the Hepburn Act of June 9, 1906, and this conflict was such as to work an implied repeal. But the court quoted from Frost v. Wenie, 157 U. S. 46, 39 L. Ed. 614 (1895). "Where two statutes cover in whole or in part the same matter and are not absolutely irreconcilable, the duty of the Court — no purpose to repeal being clearly expressed or enacted — is, if possible, to give effect to both." And said that the comparison of the two sections showed that they were aimed at different evils, and they defined the defences and acts constituting such evils as separate and distinct offences. It was therefore held that there was no repeal by implication and both this section and the Elkins Act were in force. § 412. Illegal combinations under section 10. — The most important application of section 10 has been made in connection with labor combinations, and attempted boycotts of interstate railroad traffic by employes of other interstate railroads on account of strikes among classes of employes of such railroads. The law of conspiracy has been invoked §412] THE INTERSTATE COMMERCE ACT. 555 under section 5440 R. S. U. S., which provides that if two or more persons conspire to commit an offense against the United States, and one or more of such parties do any act to effect that object for the conspiracy, all parties to the con- spiracy shall be liable to the penalty prescribed. (Supra, chapter VI.) See United States v. Stephens, 44 Fed. 132 (1890), where the statute was applied to the case of a con- spiracy to commit acts made misdemeanors by section 13 of the Census Act. In the case of Toledo, A. A. & N. W. R. Co. v. Pennsyl- vania Co., 54 Fed. 730 (1893), the court, Taft, J., held that Rule No. 12 of the Brotherhood of Locomotive Engineers, then in force, declaring that the handling of the property of a railroad, when the brotherhood was at issue with such com- pany, was in violation of the obligation of the brotherhood, constituted a combination to induce the violation of section 3 of the Interstate Commerce Act, providing for the inter- change of facilities by railroads engaged in interstate com- merce, and made criminal by section 10, and that the chief of the brotherhood and all members engaged in en- forcing that rule were equally guilty with him as principals, and all guilty of conspiring to commit an offense against the United States subject to the penalties of section 5440, R. S. U. S. The court granted a mandatory injunction to compel the interchange of facilities. It was said however that the defendants could avoid obedience to the injunction by actually ceasing to be employes of the company, although if they left the service of the company under rule 12 of their order so as to compel the defendant company to injure the complainant company, they were doing an unlawful act and rendering themselves liable in damages for any injuries which are thereby inflicted and might be liable to a criminal penalty. The arm of a court of equity could not be extended by mandatory injunction to compel the performance of personal services. See 54 Fed. 746 (1893), where one of the engineers was adjudged guilty of contempt. See also C, B. & Q. R. Co. V. B., C. R. & N. R. Co., 34 Fed. 481 (1888). See also Arthur v. Oakes, 11 C. C. A. 209, 63 Fed. 310 (1894). In Beers, v. Wabash, St. Louis & Pacific Railroad Co., 34 Fed. 244 (1889), the court made the same holding as to rule 556 THE INTERSTATE COMMERCE ACT. [SECTION 10 12 of the brotherhood, and as the railroad was operated by a receiver, the court said the receiver could not refuse to receive from and deliver to a connecting road, although by doing so his own road may be involved in a strike with its employes. It was decided by the Supreme Court, in U. S. v. Adams Express Co., 229 U. S. 381, 57 L. Ed. 1237 (1913), affirming 199 Fed. 321 that a joint stock association organized under the laws of New York to do an express business, was subject to criminal prosecution under this section as amended by act of June 18, 1910, since under the first section of the act as amended the term "carrier" was defined to include express companies. § 413. The incidental interference with commerce by a peaceable strike not a violation of the section. — While the employes of a railroad corporation cannot lawfully combine to compel their employer to discriminate against the traffic of a connecting railroad for any reason, the incidental interference with interstate traffic resulting from a combined cessation of employment by railroad employes for the pur- pose of bettering their own conditions of service does not constitute a criminal conspiracy or an offense under section 10 of the Interstate Commerce Act. See Arthur v. Oakes, 1 1 C. C. A. 209, 63 Fed. 310 (1894). The point was directly ruled by Adams, J., in the case of the Wabash Railroad Co. v. Hannahan et al., 121 Fed. 563 (1903), where the court dis- solved a temporary injunction granted without notice against the officers of the brotherhoods of trainmen and firemen restraining them from ordering a strike on the Wabash Railroad. The court said that while the employes, the members of the brotherhoods, had the right to combine in leaving their employment, the court would retain juris- diction of the case so that in the event of any molestation of or interference with interstate commerce by them after leaving employment, the lawful powers of the court could be invoked to restrain such interference. See also Hopkins v. United States, 171 U. S. 578, 43 L. Ed. 290 (1898), Taft, J., in Thomas v. Cincinnati, N. 0. & T. 0. Railroad, 62 Fed. 803. This subject of what constitutes a conspiracy in restraint of trade has been more extensively dis- §414] THE INTERSTATE COMMERCE ACT. 557 cussed in connection with the more comprehensive provisions of the so-called Anti-Trust Law of 1890, infra, § 531 et seq. See also charge to grand jury by Orosscup, J., as to what constituted a criminal conspiracy in interstate commerce, 62 Fed. 838 (1893); charge to grand jury in California by Ross, J., 62 Fed. 834 (1893); by Morrow, J., 62 Fed. 840. See supTa, ch. VI. § 414. Construction of the statute. — Under the statute before its amendment in 1903 it was held that a cor- poration could not be indicted thereunder, as the only parties punishable were individuals. United States v. Michigan Central Railroad Co., 43 Fed. 26. (But see act of Feb. 19, 1903, infra, § 519.) The agent who was a party to the carrying of freight or passengers at a rate less than the pub- lished tariff was subject to indictment. Under that pro- vision of the section making it unlawful for carriers to receive greater or less compensation from one shipper than from another for an equal service, an indictment stating that a carrier gave a rebate to one shipper without stating any instance in which he refused a like rebate to another shipper, is defective in not showing discrimination. United States v. Hanley, 71 Fed. 672 (1896). It was held in the same case that an indictment for paying or receiving rebates would not lie under the clause making it unlawful for the carrier by means of false billing, classification or any other device knowingly to assist or suffer any person to obtain transporta- tion at less than the regular tariff rates. An agent of a railroad who merely collects freight and has nothing to do with fixing the rates is not indictable under the act for collecting a greater rate for a shorter than for a longer haul. United States v. MelUn, (Dist. of Kan.), 53 Fed. 229 (1893). As to essentials of indictments under the act, see also United States v. De Coursey, 82 Fed. 302 (1897); United States v. Hanley, 71 Fed. 672 (1896). This offense of obtaining transportation of property at less than regular rates by means of false billing, etc., is not one that requires the transportation of the property to its destina- tion to make it complete, but the offense is complete when the contract for the illegal rate was secured, and could only be 558 THE INTERSTATE COMMERCE ACT. [SECTION 10 prosecuted in that district. Davis v. United States, 104 Fed. 136 (1900). In United States v. Howell, 56 Fed. 21 (1894), West. Dist. of Ark., it was held that shippers of lumber could be con- victed of conspiracy to violate the Interstate Commerce Act upon showing that their servants procured unlawful dis- crimination in rates by false weights, provided they knew of the unlawful acts and permitted them to continue. United States V. De Coursey, 82 Fed. 302 (1897). For an indictment for alleged violation of section 3, held de- fective for want of sufficient allegations of alleged undue pref- erence in the furnishing of switching connections and car dis- tribution, in 1906 before the amendment of that year, see U. S. V. B. & 0. R. R., 153 Fed. 997 (1907). § 415. Sufficiency of indictment for violation of section.— In U. S. v. Steriing Salt Co., Dist. Ct'., W. D. of N. Y. (1912), 200 Fed. 593, the court held that in a prosecu- tion for obtaining transportation for interstate freight at an unlawful rate by misrepresentation, it was sufficient to charge the offense in the language of the statute, the essential elements being set forth with suflTicient definiteness to apprise the defendants of the nature of the charge against them. Thus, in a prosecution for a fraudulent obtaining of an illegal rate for the transportation of salt in interstate commerce, the gravamen of the offense was the misrepresentation by which the rate was obtained, and it was therefore not necessary to the validity of the indictment that the different tariffs be averred verbatim. In this case the misrepresentation con- sisted in a misstatement in the shipping order, and the court held that if the carrier was induced to rely upon this and give a lesser rate, such conduct, if intentional, con- stituted a false representation under this section, and the demurrer to the indictment was overruled. § 416. Removal of indicted persons to other districts for trial.— In Davis v. United States, 43 C. C. A. 448, 104 Fed. 136 (1900), the appellant was indicted in the northern district of Texas for trial under an indictment alleging viola- tion of section ten, paragraph three, of the act to regulate §417] THE INTERSTATE COMMERCE ACT. 559 commerce. The United States district court at Cincinnati made an order directing the removal of the appellant for trial to the northern district of Texas. It was claimed that the offense was committed in Texas, although the shipment was made from Cincinnati to Texas under the provision of section 781, R. S. U. S., providing that when any offense against the United States was begun in one judicial circuit and completed in another, it should be deemed to have been committed in either and may be dealt with, inquired of and tried or punished in either district, in the same manner as if it had been actually and wholly committed therein. The court held that this section was intended to provide for that class of cases where the crime was not completed in one dis- trict, but where a separate and essential act of commission constituting the crime is committed in another district, and that this section therefore had no application to the case of a shipper who obtains lower rates by means of false classifica- tion, billing, etc. The offense in that case is complete when the shipment is made. The court therefore held that the district court erred in ordering a removal of the defendant to Texas, and he was ordered discharged. As to removal of United States prisoners from one district to another under 1014, R. S., see Green v. Henkel, 183 U. S. 249, 46 L. Ed. 177 (1904); Beaver v. Henkel, 194 U. S. 73, 48 L. Ed. 882 (1906). § 417. Limitation of criminal prosecution under the act. — While there is no limitation of criminal prosecution fixed in the act, sec. 1044, R. S. U. S. provides limitation of three years, in case of all offenses "other than capital." "Suits and prosecutions for penalties and forfeitures" are sub- ject under sec. 1047, R. S. U. S. to limitation of five years. 560 THE INTERSTATE COMMERCE ACT. [SECTION 1 1 Section 11. § 418. Interstate Commerce Commission — how appointed. 419. The organization and membership of the commission. § 418. Interstate Commerce Commission — ^how ap- pointed. — Sec. 11. That a commission is hereby created and estabUshed to be known as the Interstate Commerce Commission, which shall be composed of five Commission- ers, who shall be appointed by the President, by and with the advice and consent of the Senate. The Commissioners first appointed under this Act shall continue in office for the term of two, three, four, five, and six years, respectively, from the first day of January, Anno Domini eighteen hun- dred and eighty-seven, the term of each to be designated by trie President; but their successors shall be appointed for [Terms of cominisBioiiers,] terms of six years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired time of the Commissioner whom he snail succeed. Any Commissioner may be removed by the President for inefficiency, neglect of duty, or malfeasance in office. Not more than three of the Commissioners shall be appointed from the same pohtical party. No person in the employ of or holding any official relation to any common carrier subject to the provisions of this act, or owning stock or bonds thereof, or who is in any manner pecuniarily interested therein, shall enter upon the duties of or hold such office. Said Commissioners shall not engage in any other business, vocation, or employment. No vacancy in the Commission shall impair the right of the remaining Commissioners to exercise all the powers of the Commission. (See section 24, enlarging Commission and in- creasing salaries.) § 419. The organization and membership of the commission. — The commission was organized in 1887 by the appointment by President Cleveland and confirmation by the senate of the following members: Hon. Thomas M. Cooley, of Michigan, Hon. William R. Morrison, of Illinois, Hon. Walter Bragg, of Alabama, Hon. Aldace F. Walker, of Vermont, Hon. Augustus Schoonmaker, of New York. §419] THE INTERSTATE COMMERCE ACT. 5,61 Judge Cooley served as chairman until his retirement in 1891. He was succeeded by Mr. Morrison, who served as chairman until December 31, 1897, when he was succeeded by Judge Martin A. Knapp, who had succeeded Mr. Schoon- maker, of New York, on the commission. Judge Knapp continued as chairman of the board until his appointment and confirmation as presiding justice of the commerce court in December, 1910. Vacancies in the commission have been filled from time to time in accordance with the directions of the act that not more than two shall be members of the same political party. The commission is now (January 1916) composed of the following members : Hon. James F. Harlan, of Illinois, Chairman. Hon. Judson C. Clemens, of Georgia, Hon. Edgar E. Clark, of Iowa, Hon. Charles C. McChord, of Kentucky, Hon. Balthasar H. Meyer, of Wisconsin, Hon. Henry C. Hall, of Colorado, Hon. Winthrop M. Daniels, of New Jersey. George P. McGinty, Secretary. J-36. 562 THE INTERSTATE COMMERCE ACT. [SECTION 12 Section 12. § 420. General investigating powers of commission. 421 . Amendments of tlie section. 422. Compelling of self-incriminating testimony. 423. Corporations not included in immunity of witness. 424. Immunity acts of February 25, 1903 and June 13, 1906. 425. Corporate official compelled to produce corporate books con- taining personally incriminating matter. 426. Probative effect of self-incriminating testimony. 427. Immunity is limited to the subject of testimony. 428. Power of the court to enforce testimony before the commission sustained. 429. Relevancy of testimony before the commission. 430. Limitation of the power of the commission to enforce testimony. 431. No provision for inspection by examiners in this section. 432. Investigating powers of a grand jury in the United States courts. 433. General powers of the commission. 434. In the special investigations and reports of Commission. [Power and duty of Commissioti to inquire into business of carriers and keep itself informed in regard thereto.] § 420. General Investigating powers of commission. — Sec. 12. {As amended March 2, 1889, and February 10, 1891 ) That the Commission hereby created shall have authority to inquire into the management of the business of all common carriers subject to the provisions of this Act, and shall keep itself informed as to the manner and method in which the same is conducted, and shall have the right to [Commissions required to execute and enforce provisions of this Act.} obtain from such common carriers full and complete infor- mation necessary to enable the Commission to perform the duties and carry out the objects for which it was created; and the Commission is hereby authorized and required to execute and enforce the provisions of this Act; and, upon the request of the Commission, it shall be the duty of any [Duty of district attorney to prosecute under direction of Attorney-General.] district attorney of the United States to whom the Commis- sion may apply to institute in the proper court and to prosecute under the direction of the Attorney-General of the United States all necessary proceedings for the enforce- ment of the provisions of this Act and for the punishment of all violations thereof, and the costs and expenses of such § 420] THE INTERSTATE COMMERCE ACT. 563 [Costs and expenses of prosecution to be paid out of appro- priation for courts.] prosecutions shall be paid out of the appropriation for the expenses of the courts of the United States; and for the pur- poses of this Act the Commission shall have power to re- [Power of Commission to require attendance and testi- mony of witnesses and production of documentary evi- dence.] quire, by subpoena, the attendance and testimony of wit- nesses and the production of all books, papers, tariffs, con- tracts, agreements, and documents relating to any matter under investigation. [Commiseion may invoke aid of courts to compel witnesses to attend and testify.] Such attendance of witnesses, and the production of such documentary evidence, may be required from any place in the United States, at any designated place of hearing. And in case of disobedience to a subpoena the Commission, or any party to a proceeding before the Commission, may in- voke the aid of any court of the United States in requiring the attendance and testimony of witnesses and the produc- tion of books, papers, and documents under the provisions of this section. [Penalty for disobedience to order of the court.] And any of the circuit courts of the United States within the jurisdiction of which such inquiry is carried on may, in case of contumacy or refusal to obey a subpoena issued to any common carrier subject to the provisions of this Act, or other person issue an order requiring such common carrier or other person to appear before said Commission (and pro- duce books and papers if so ordered) and give evidence touching the matter in question; and any failure to obey [Claim that testimony or evidence will tend to criminate will not excuse witness.] , such order of the court may be punished by such court as a contempt thereof. The claim that any such testimony or evidence may tend to criminate the person giving such evi- dence shall not excuse such witness from testifying; but such evidence or testimony shall not be used against such person on the trial of any criminal proceeding. [Testimony may be taken by deposition.) The testimony of any witness may be taken, at the in- stance of a party in any proceeding or investigation pending before the Commission, by deposition, at any time after a [Commission may order testimony to be taken by deposi- tion.] cause or proceeding is at issue on petition and answer. The Commission may also order testimony to be taken by deposi- 564 THE INTERSTATE COMMERCE ACT. [SECTION 12 tion in any proceeding or investigation pending before it, at any stage of such proceeding or investigation. Such depo- sitions may be taken before any judge of any court of the United States, or any commissioner of a circuit, or any clerk of a district or circuit court, or any chancellor, justice, or judge of a supreme or superior court, mayor or chief magis- trate of a city, judge of a county court, or court of common pleas of any of the United States, or any notary public, not being of counsel or attorney to either of the parties, nor in- [Rcaeonable notice must be given.] terested in the event of the proceeding or investigation. Rea- sonable notice must first be given in writing by the party, or his attorney, proposing to take such deposition to the oppo- site party or his attorney of record, as either may be nearest, which notice shall state the name of the witness and the time and place of the taking of his deposition. Any person may be [Testimony by deposition may be compelled in the same manner as above specified.] compelled to appear and depose, and to produce documen- tary evidence, in the same manner as witnesses may be com- pelled to appear and testify and produce documentary evi- dence before the Commission as hereinbefore provided. [Manner of taking depositions.] Every person deposing as herein provided shall be cau- tioned and sworn (or affirm, if he so request) to testify the whole truth, and shall be carefully examined. His testimony shall be reduced to writing by the 'magistrate taking the depo- sition, or under his direction, and shall, after it has been re- duced to writing, be subscribed by the deponent. [When witness is in a foreign country.] If a witness whose testimony may be desired to be taken by deposition be in a foreign country, the deposition may be taken before an officer or person designated by the Commis- [Depositions must be filed with the Commission.] sion, or agreed upon by the parties by stipulation in writing to be filed with the Commission. All depositions must be promptly filed with the Commission. [Fees of witnesses and magistrates.] Witnesses whose depositions are taken pursuant to this Act, and the magistrate or other officer taking the same, shall severally be entitled to the same fees as are paid for like services in the courts of the United States. § 421. Amendments of the section. — Section 12 was not changed in the amendatory acts of 1906, 1910 and 1912, but it was amended by the act of March 2, 1889, and again §422] THE INTERSTATE COMMERCE ACT. 565 on February 10, 1891, in respect to the duties of the district attorney and the provisions for the summoning of witnesses. It has also been materially amended and enforced by the acts of 1893, 1903, and 1906 concerning self incriminating testimony. § 422. The compelling of self-incriminating testi- mony. — The most important judicial discussion under this section has been in relation to the power of enforcing self- incriminating testimony. The provision of the third para- graph of the section, that a party could be compelled to give self-incriminating testimony, but providing that the evidence given by him should not be used against him, was held in Counselman v. Hitchcock, 142 U. S. 547, 35 L. Ed. 1110 (reversing 44 Fed. Rep. 271), to be unconstitutional as violative of the fifth amendment to the constitution, which declares that no person shall be compelled in any criminal case to be a witness against himself. The Court disapproved the decision of the New York court of appeals in People v. Kelley, 24 N. Y. 74, which held the immunity in a similar statute sufficient, and ruled that the statutory enactment to be valid must afford absolute immunity against further prose- cutions. The petitioner who had dechned to answer, whether he had received a rebate or not, on the ground that it would incriminate him, was discharged on habeas corpus. After this decision, the statute was amended by the passage of the act of February 11, 1893, as follows: That no person shall be excused from attending and testi- fying or from producing books, papers, tariffs, contracts, agreements and documents before the Interstate Commerce Commission, or in obedience to the subpoena of the Commis- sion, whether such subpoena be signed or issued by one or more of the Commissioners, or in any case or proceeding, criminal or otherwise, based upon or growing out of any alleged violation of the act of Congress, entitled "An act to regulate commerce," approved February fourth, eighteen hundred and eighty-seven, or of any amendment thereof on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him, may tend to criminate him or subject him to penalty or forfeiture. But no person shall be prosecuted or subjected to any penalty or for- feiture for or on account of any transaction, matter or thing, concerning which he may testify, or produce evidence, docu- 566 THE INTERSTATE COMMERCE ACT. [SECTION 12 mentary or otherwise, before said Commission, or in obedi- ence to its subpoena, or the subpoena of either of them, or in any such case or proceeding: Provided, That no person so testifying shall be exempt from prosecution and punishment for perjury committed in so testifying. Any person who shall neglect or refuse to attend and tes- tify, or to answer any lawful inquiry, or to produce books, papers, tariffs, contracts, agreements and documents if in his power to do so, in obedience to this subpoena or lawful requirement of the Commission shall be guilty of an offense and upon conviction thereof by a court of competent juris- diction shall be punished by fine not less than one hundred dollars nor more than five thousand dollars, or by imprison- ment for not more than one year or by both such fine and imprisonment. The act of 1893 was sustained in Brown v. Walker, 161 U. S. 591, 40 L. Ed. 819 (1896), the Supreme Court holding that if afforded absolute immunity against prosecutions, federal or state, for the offense to which the question related, and there- fore deprived the witness of his constitutional right to decline to answer. (Justices Shiras, Gray, White and Field dissent- ing on the ground that the state courts would not be com- pelled to accept the saving clause of the federal statute in re- spect to crimes against the state.) This amendment of 1893 only refers to testimony before the Interstate Commerce Commission, and does not refer to testimony given before a court in a suit brought under the provisions of sections 8 and 9 of the act. The decision in the Counselman Case would clearly apply to the provision of section 9, providing that self-incriminating testimony forced from a witness should not be used against him. The Amendatory Act of February 19, 1903, known as the Elkins Act, in section 3 specifically provides : "In proceedings under the act the court shall have the power to compel the attendance of witnesses both upon the part of the carrier and the shipper who should be required to answer on all subjects relating directly or indirectly to the matter in controversy, and to compel the production of all books and papers both of the carrier and shipper which relate directly or indirectly to such action. The claim that such testimony or evidence may tend to criminate the person giving such evidence shall not excuse such person from testi- fying or such corporation from producing its books or pa- § 423] THE INTERSTATE COMMERCE ACT. 567 pers; but no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he may testify or produce evidence, documentary or otherwise, in such proceeding." The same provision of immunity is, therefore, extended to all witnesses, whether before a commission or court, who are compelled to give self-incriminating testimony under the act. § 423. Corporations not included in immunity of witness. — In a prosecution under section 10, before the amendments of 1903, it was held that corporations could not be indicted, as the only parties punishable thereunder were individuals ; an ofTicial could not therefore excuse himself from testifying on the ground that his testimony would implicate the corporation, his employer. In re Peasley, 44 Fed. 271 (1890). In a prosecution under section 5 of the act, where- under pooling between carriers is made unlawful, and each day of its continuance made a separate offense, indictments against carrier corporations were returned by the grand jury in western district of Tennessee under charge of Hammond, J., 115 Fed. 588 (1902). In this charge the opinion was ex- pressed not only that corporations were indictable under sec- tion 5, but that under the act of 1893 there was no vicarious immunity and that there was no immunity to the corporation from the enforced testimony of the officers, or productions of its books and papers. The Elkins Act of February 19, 1903 {infra, § 519), has dis- tinctly changed the relations of corporations to the act, first, in making (sec. 1) the corporation liable for conviction for misdemeanor and fine on account of any act done or omitted in violation of the statute by any officer acting in its behalf, and, second, in expressly authorizing (sec. 3) the enforced production of the corporate books and papers; and it then grants immunity in the language above quoted. It was held by the Supreme Court in Hale v. Henkel, 201 U. S. 43, 50 L. Ed. 652 (1906), in a case of habeas corpus sued out by a witness who was summoned under a subpoena duces tecum to bring certain papers and agreements of the American Tobacco Company, his employer, in an examination before the grand jury for an alleged violation of the anti-trust act 568 THE INTERSTATE COMMERCE ACT. [SECTION 12 and he declined to obey on the ground of self incrimination, that the immunity given by the act of February 25, 1903 (see infra, § 605), was sufficient for the protection of the witness. It was also held that he could not claim the privilege of an- other person or the corporation of which he was an officer or employe. While the corporation could not claim immunity under the fifth amendment it was entitled to protection against unreasonable searches and seizures under the fourth amendment. The corporation was a creature of the state. Although the corporation in this case was a state corporation, the power of the general government to the exercise of this authority was the same as if the corporation had been created by act of congress, although the Court claimed no general visitatorial power over the state corporations. Justices Brewer and Fuller dissented, holding that corpora- tions were protected by both the fourth and fifth amend- ments. See also McAlister v. Henkel, 201 U. S. 90, 50 L. Ed. 671 (1906), where the papers called for were specifically described, and the judgment was affirmed. The same ruling was made in Nelson v. U. S., 201 U. S. 92, 51 L. Ed. 673 (1906), in a case arising under the anti-trust act in a suit of the government against the General Paper Com- pany. The refusal of the corporate officers to obey the order of appellate court in such a case to produce documentary evidence could not be justified on the theory that the evi- dence was not in their possession or under their control, when their possession was not personal but that of a cor- poration. It was also ruled that evidence, whether docu- mentary or oral, sought to be elicited from witnesses in such an action, was material where it would tend to establish the manner in which the agent executed its functions, and that the immateriality of the evidence would not justify their refusal to answer questions put to them and to produce written evidence in examination before a special master; and the materiality of the evidence was not open to con- sideration on a writ of error sued out by witnesses to review a judgment for contempt. These cases were both under the Anti-Trust Act, but the principle decided that the immunity is personal to the wit- ness and did not extend to the corporation of which he was an § 424] THE INTERSTATE COMMERCE ACT. 569 employe, was clearly applicable to proceedings before the commission or the courts under the Interstate Commerce Act. There is, therefore, no immunity to the corporation by reason of the enforced testimony of its officers, nor can an officer or an employe refuse to produce books of an employer corporation on the ground that it would implicate the cor- poration employer. Gardner v. Early, 69 Iowa, 42. The ruling in Hale v. Henkel was re-affirmed in Wilson v. United States, infra, in 1911. In proceedings under the Interstate Commerce Act there- fore the immunity as regards books and papers extends in any event only to those which are private, that is, to those whose production or inspection can only be enforced when in- criminating under statutory immunity. It does not include records, whether corporate or individual, which are made public by law. Thus the railroad rates and regulations concerning rates are required by law to be public. A tariff sheet of a railroad which is required by law to be publicly posted is not a private paper, and its enforced production in a prosecution against a railroad company is not compelling it in a legal sense to give evidence against itself. L. & N. R. Co. v. Commonwealth (Ky. 1899), 51 S. W. Rep. 167; as to applications of same principle, see People v. Coombs, 158 N. Y. 532 (1899); State V. Donovan, 10 N. Dak. 203; State v. Smith, 74 Iowa, 580. § 424. Immunity act of Feb. 26, 1903 and June 13, 1906. — By the act of February 25, 1903 it was provided both as to the Interstate Commerce Act and the Anti-Trust Act that no person shall be subjected to any penalty or forfeiture for or on account of any transaction, matter or thing con- cerning which he may testify or produce evidence, docu- mentary or otherwise, in any suit proceeding or prosecution under said act, and provided further that no person so testifying shall be exempt from prosecution or punishment for perjury committed in so testifying. In U. S. V. Armour, 142 Fed. 808, (1906) district court northern district of Illinois, it was held on a motion to quash indictments of corporations and individuals for conspiracy 570 THE INTERSTATE COMMERCE ACT. [SECTION 12 in violation of the Anti-Trust Act that a corporation, whether state or federal, could not claim immunity from prosecution for violation of the Interstate Commerce or Anti-Trust laws of the United States because of testimony given or produced by its officers or agents before the Interstate Commerce Com- mission or the Commissioner of Corporations or in any pro- ceeding, suit, or prosecution under such laws, the right to immunity being limited to individuals who, as witnesses, gave testimony or produced evidence; but as to the individual defendants it was held that the immunity under the acts of congress extended to a person who gave self-incriminating statements to the Commissioner of Corporations in the course of his official investigation under section 6 of the act of February 14, 1903, creating the Department of Commerce and Labor and authorizing the Commissioner of Corporations to make investigations and compel the attendance of wit- nesses. The indictment as to individual defendants was therefore quashed. Under the recommendation of the presi- dent, in view of this ruling, the act of June 13, 1906 was passed providing that "under the several immunity acts im- munity shall extend only to a natural person who, in obed- ience to a subpoena, gives testimony under oath or produces evidence, documentary or otherwise, under oath." In a subsequent indictment of the parties whose indict- ment was quashed in U. S. v. Armour, supra, it was held in U. S. V. Swift, 186 Fed. 1002 (1911), that this immunity act did not make the defendants immune from prosecution thereafter for continuing the same offense. See infra, Anti-Trust Act, sec. 2. § 425. Corporate official compelled to produce cor- porate books containing personally incriminating matter.— In Wilson v. The United States, 220 U. S. 614, 55 L. Ed. 581 (1911), the Supreme Court affirmed the judg- ment of the circuit court for the southern district of New York in committing the president of the United Wireless Telegraph Company, the main corporation, for contempt for refusing to produce the corporate books in his custody before the grand jury. The Court said that Wilson was protected against giving oral self-incriminating testimony and against §427] THE INTERSTATE COMMERCE ACT. 571 the production of his private books and papers; but the copies of letters written by the president of the corporation in the course of his transactions were as much a part of its documentary property, subject to its control and to its duty to produce when lawfully required in judicial proceedings, as its ledgers and minute books. He could not make the books his private or personal books by keeping copies of personal letters in them. It seems that the court had suggested the removal of the strictly private letters from the books. The Court said the fact that the appellant himself wrote or signed the official letters copied into the books neither conditioned nor enlarged his privilege, and that the principle applied not only to public documents and pubhc offices, but also to records required by law to be kept in order that they may be suitable information for transactions which are appro- priate subjects of governmental regulation and the enforce- ment of restrictions validly established; there the privilege which existed as to private papers cannot be maintained. Wilson held the corporate books subject to the corporate duty. If the corporation was guilty of misconduct, he could not withhold its books to save it; and if he were implicated in the violations of law, he could not withhold the books to protect himself from the effect of their disclosures. It was immaterial that the corporation was organized understate law, and that Wilson's own conduct was under investigation with a view to his own indictment. Justice McKenna dissented. § 426. Probative effect of enforced self-incriminat- ing testimony. — It was held in Burrell v. Montana, 194 U. S. 572 (1904), 48 L. Ed. 1122, that testimony given in an examination in bankruptcy, which was used without objec- tion on the trial of the bankrupt on indictment in the state court did not violate any federal right. Section 7 of the Bankrupt Act providing that the testimony should not be offered, did not deprive the evidence of probative force when admitted without objection in the state court. § 427. Immunity is limited to the subject of testi- mony.— In United States v. Price, 96 Fed. 960 (1899), 572 THE INTERSTATE COMMEKCE ACT. [SeCTION 12 parties were indicted for conspiring to obstruct justice by taking from a witness subpoenaed to appear before a United States grand jury, certain papers which he had been directed to produce as furnishing testimony concerning a charge of violation of the act to regulate commerce then before the grand jury. Two of the indicted persons testified that they had been called before and had testified before the grand jury concerning the violation of the act to regulate commerce, and had also testified concerning the taking of the papers from the witness. The court overruled the pleas, saying it was not the intention of congress to grant to a witness amnesty as to other crimes merely because he had testified to the violation of the Interstate Commerce Act. The amnesty was only co-extensive with the requirement to tes- tify. The first clause of the act of 1893 made necessary the second clause; otherwise neither would have been effective. The latter supplemented the former and was limited by it, and referred to nothing except to matters that witnesses should not be excused from testimony by virtue of the act. The court said that this was not the proper construction of the act of 1893. The least collusion with a friendly grand jury might enable the worst violator of the laws of the United States to entitle himself to testify by procuring himself to be summoned as a witness nominally to testify, or to be asked about a violation of the Interstate Commerce Law. § 428. Power of the court to enforce testimony before the commission sustained. — In Brimson v. Inter- state Commerce Commission, 154 U. S. 447, 38 L. Ed. 1047 (1893), the Supreme Court, reversing 53 Fed. 476, sustained the authority of the circuit court under this section of the Interstate" Commerce Act to enforce the giving of testimony and the production of books and papers. It was strongly urged that the provision was in conflict with the constitution in that it imposed on judicial tribunals duties that were not judicial in their character. But the Court ruled that the proceeding under the twelfth section of the act was not merely ancillary and advisory, nor was its object merely to obtain an opinion of the circuit court, which would be with- § 429] THE INTERSTATE COMMERCE ACT. 573 out operation upon the rights of the parties. Any judgment would be a final and indisputable basis of action as between the commission and the defendant, and furnish a precedent for similar cases. The judgment was none the less one of a judicial tribunal, dealing with questions judicial in their nature, and presented in the customary forms of judicial pro- ceedings, because its effect may be to aid an administrative or executive body in the performance of duties legally imposed upon it by congress in the case of a power granted by the con- stitution. The issue made in such a case was not one for the determination of a jury, nor could any question of contempt arise until the issue of law in the circuit court was determined adversely to the defendants and he had refused to obey, not the order of the commission, but the final order of the Court. Such a power to adjudge for contempt could not, under our system of government and consistently with due process of law be vested in a subordinate and administrative or execu- tive tribunal for final determination. There was a dissenting opinion by Justice Brewer, in which Chief Justice Fuller and Justice Jackson concurred. 155 U. S. 1, 39 L. Ed. 49. § 429. Relevancy of testimony before the commis- sion. — In a later decision, Interstate Commerce Commission V. Baird, 194 U. S. 25 (1904) 48 L. Ed. 860 the Supreme Court sustained an application of the commission, reversing the circuit court, for the production of papers and the giving .of testimony in an investigation pending before the commission concerning an alleged pooling agreement in the transporta- tion of coal. The complaint filed before the commission alleged that the railroad companies were natural competitors and had made an agreement or combination in coal rates which were unreasonable and unjust. The witness refused to produce contracts for purchasing coal by the railroads from operators in Pennsylvania and to answer certain questions as to the sale and price of coal, and it was claimed that the enforced production of these papers and the compelling of this testimony would be violative of the fourth and fifth amendments to the constitution. The Supreme Court said that while the contracts might not establish the poohng ar- rangement, they would have a legitimate bearing upon the in- 574 THE INTERSTATE COMMERCE ACT. [SECTION 12 quiry, and that the testimony should not be so limited as to unreasonably hamper the commission by narrowing its field of inquiry beyond the reasonable requirements of the rights of ' citizens, as such a course would seriously impair its usefulness and prevent a realization of the salutary purposes of congress. The Court held also that as under the act of 1903 the witnesses were given immunity, there was no invalid objections under the fourth and fifth amendments to the constitution. It was also ruled in this case that the contracts, under which the railroad companies engaged in interstate carriage of anthra- cite coal had acquired certain collieries, whose proprietors were about to build competing lines and guaranteed the stock and bonds issued in payment thereof by a corporation whose charter they had purchased for that purpose, could properly be produced, although they had been made with third persons not parties of the proceeding. § 430. Limitation of the power of the commission to enforce testimony. — In Harriman v. Interstate Com- merce Commission, 211 U. S. p. 407, 53 L. Ed. 253, (1908) the Court reversed the circuit court of the United States, southern district of New York, in one case where the court directed appellant to answer certain questions in an investi- gation by the Interstate Commerce Commission, and affirmed its judgment in another case where it refused to compel an answer. See 157 Fed. 432. This was an investi- gation by the commission on its own order (see 12 I. C. C. 277), as to certain consoUdations and combinations in inter- state commerce. Appellant Harriman was interrogated about the ownership of certain stock of the Chicago & Alton Railway Company, deposited with his bankers, and certain stock of other railroads so purchased and deposited. He was asked whether he or any other director bought stocks of the Union & Southern Pacific in anticipation of dividends; and appellant Kuhn, member of the firm of Kuhn, Loeb & Co., was asked concerning the same matters. The Court held that the witnesses could not be required to answer before the Interstate Commerce Commission except in connection with complaints for violation of the Interstate Commerce Act or with the investigation by the commission of subjects that §431] THE INTERSTATE COMMERCE ACT. 575 might have been made the object of complaint, these being the only matters contemplated by the provision of section 12 of that act which gave the commission power to require testimony for the purposes of the act, which power could not be exercised by the commission performing its duty under that section to keep itself informed as to the manner and method in which the business of common carriers was con- ducted, nor in connection with the enforcement of the requirement of section 20 concerning reports by carriers nor to aid the commission in recommending, pursuant to section 21, additional legislation by congress. Justices Day, Har- lan, and McKenna dissented. The Court said the act clearly showed that the power to compel the attendance of witnesses was to be exercised only in connection with the ^uasf-judicial duties of the commission. This decision was rendered after the amendments of 1906, but prior to the amendment of 1910. See section 15, infra. In Elhs v. Interstate Commerce Commission, 237 U. S. 434, 59 L. Ed. 1036 (1915) the "Supreme Court decided that the commission had no general power to go into a fishing expedition, into the affairs of a stranger for the chance that something discredible might turn up and that a corporation which owned and maintained refrigerator tank cars and leased them to railway companies or shippers and iced cars for shippers and railroads was not a common carrier, and until it was shown that such a company was in some way connected with unlawful rebates, which were subject to the commission under section 15, there was no power to compel the testimony called for, so the decree was reversed without prejudice in view of the possibility that the case might be brought under section 15. § 431. No provision for inspection by examiners in this section. — It was ruled by the Supreme Court in United States ex rel. v. L. & N. R. Co., 236 U. S. 317, 59 L. Ed. 598, (1915) afTirming 212 Fed. 486, in a proceeding by mandamus to compel the inspection by examiners of the accounts, records and memoranda of the railway company, that no provision was made by section 12 for inspection by examiners. That it only dealt with the production of evidence in certain 576 THE INTERSTATE COMMERCE ACT. [SECTION 12 cases. The provision for inspection by examiners was added by the amendment to section 20 in 1906. § 432. Investigating power of a grand jury in United States courts. — It was also ruled in the Wilson Case, supra, that a grand jury could make investigation, summon and examine witnesses, and compel the production of books and papers, although there was no case or specific charge pending before it, and that a subpoena duces tecum is not invalid because it contains no ad testificandum clause but simply directs a corporation which could not give oral testimony, to produce books. It is not necessary that a subpoena duces tecum directed to a corporation should conform to the provisions of the U. S. R. S. 877, concerning the summoning of witnesses; nor is an accused accorded the right to be apprised of the names of witnesses who appeared before the grand jury. § 433. General powers of the commission. — The powers of the commission have been so enlarged by the amendments of 1906 and 1910 which are set forth in succeed- ing sections that the general provisions of this section, giving the commission authority to inquire into the management of the business of common carriers to obtain full and complete information, and to execute and enforce the provisions of the act, have been superseded by the comprehensive range of powers set forth in sections 15, 16, and 20, as enacted in the amendments referred to. The commission in taking testimony before itself, whether in original investigations or in the hearing of complaints, is empowered to summon witnesses or to produce documentary evidence from any place in the United States to any desig- nated place of hearing. The power of the commission in this respect is greater than the power of the courts of the United States, as witnesses living out of the district are not required to attend court at a greater distance than a hundred miles, nor to attend the taking of depositions under a commission at any place out of the county, nor more than forty miles from the place of their residence. Section 870 R. S. U. S. This power however has been rarely used, as the commission § 433] THE INTERSTATE COMMERCE ACT. 577 has arranged its hearings as authorized by the act (section 19) in different parts of the country convenient for the witnesses. In 29 I. C. C. 139 the commission made an exhaustive report on the receivership of the St. Louis & San Francisco Railroad Company, the Chicago and Eastern Illinois Rail- road Company, and the facts and circumstances concerning the purchase of the Chicago and Eastern Illinois and the St. Louis, Brownsville and Mexico Railroads, and the St. Louis and San Francisco Railroad Company. This report was made without any expressions of opinion by the com- mission. For exhaustive consideration of the rates, classifications and properties of carriers in New England, see 27 I. C. C. 560. The commission also reported in response to a resolution of the senate on the financial relations, rates and practices of the Louisville & Nashville Railroad Company, the Nashville, Chattanooga & St. Louis Railroad Company, and other carriers, 33 I. C. C. 168, in February, 1915. The commission in its report to the senate refers to the decision by the Su- preme Court handed down a few days before, that the commission had no power under the act to regulate com- merce, supra, section 353, to inspect the correspondence of interstate carriers. The report of the commission answers in detail the questions submitted in the resolution of the senate. The commission also made a report of its own motion, July 31, 1915, 36 I. C. C. 43, on the financial transactions, history, and operations of the Chicago, Rock Island & Pacific Ry. Co., wherein they criticised the methods by which a great railway may be manipulated into a receivership, and said that the record emphasized the need of railway directors who actually direct, and that the need of some limitation on the issuance of stocks and bonds by common carriers, whether directly or indirectly, through holding company devices or other- wise, was again demonstrated. The commission also made a report to the senate, Decem- ber 10, 1915, in response to a resolution of inquiry from the senate, on the ownership, management and control of the Little Kanawha Company, June 14, 1915, 36 I. C. C. 560. j-sr. 578 THE INTEESTATJ; COMMERCE ACT. [SECTION 12 § 434. The special investigations and reports of the commission. — These general investigating powers of the commission have been made use of by congress in the authori- zation of investigations into the practices of carriers, not only as to freight rates, but as to other practices, such as the issuance of passes, railroad consolidations, and the hke. See report on the eastern bituminous coal situation. These inquiries have sometimes been made on its own motion and sometimes on specific direction of congress; see report of January 25, 1907, and the report on block signal systems, February 23, 1907. Also the report on the matter of con- solidations and combinations of carriers, 12 1. C. C. 943, relating mainly to the relations of the Union Pacific Rail- road and the Southern Pacific Company. Report was also made in 30 I. C. C. 147, in 1914, in the matter of the proposed bond issue by the New York Central & Hudson River Railroad Company, a report made in response to a resolution of the senate, and supplemental report in the same matter, 31 I. C. C. 32. The commission reported that from the standpoint of economy and facility in operation the consolidation and proposed bond issue was warranted. In 31 I. C. C. 193 and 242, in 1914, the commission under a resolution of congress, considered the relations of traffic lines and their officials to coal companies in the state of Illinois, and incidentally in the state of Indiana. The commission reported the facts disclosed, and said that they believed it important that the public business and trans- portation should be clearly separated from private business; that railroad should be prohibited from furnishing either directly or indirectly capital or loans to private enterprises; that railroads should be prohibited from extending the use of their credit for the benefit of private individuals or com- panies; that the commodities clause in the interstate com- merce act should be enforced and extended to all traffic. On December 10, 1915, the commission submitted a report to the senate in response to a resolution of inquiry, 36 1. C. C. 557, on alleged rebate to the United States Steel Corporation to the effect that they found that there was no basis for the allegation that such "wholesale" rebates had been paid. In response to a resolution in the senate, the commission made an exhaustive report in October, 1915, 36 I. C. C. 429, § 434] THE INTERSTATE COMMERCE ACT. 579 on the conditions affecting the production, transportation and marketing of crude petroleum, stating the facts relative to the control of pipe line companies and the discontinuance of the running and purchase of petroleum in 1914, and the reasons therefor. The commission said in this report that a portion of the information desired could be secured only from the records of the producing, purchasing, manufactur- ing, refining and other industrial companies which were under the jurisdiction of the Federal Tr^ade Commission, which was examining their records under senate resolution: and to avoid a duplication of work, the investigation of the Interstate Commerce Commission had been confined to the records of the several common carrier pipe line companies, and that other matters would be covered by the report of the Trade Commission. The commission also made an exhaustive report on the subject of the petroleum industry, 36 I. C. C. 109, August, 1915, in the Mid-Continent Oil Rate case, wherein it grouped all points in the mid-continent field with respect to rates and fixed the reasonable maximum rates on low grade products from mid-continent points to St. Louis and Chicago. 580 THE INTERSTATE COMMEECE ACT. ' [SECTION 13 Section 13. § 435. Complaints to commission — How and by whom made — How served upon carriers. 436. The amendment of 1910. 437. Procedure before commission — Parties. 438. Pleadings and proofs. 439. Demand for reparation must be specifically stated. 440. Burden of proof. 441. Production of books and papers. 442. The rulings of the commission as precedents. § 435. Complaints to commission — How and by whom made — How served upon carriers. — Sec. 13, {As amended June 18, 1910.) That any person, firm, corpo- ration, company, or association, or any mercantile, agricul- tural, or manufacturing society or other organization, or any body politic or municipal organization, or any common car- rier, complaining of anything done or omitted to be done by any common carrier subject to the provisions of this Act, in contravention of the provisions thereof, may apply to said Commission by petition, which shall briefly state the facts; whereupon a statement of the complaint thus made shall be forwarded by the Commission to such common carrier, who shall be called upon to satisfy the complaint, or to answer the same in writing, within a reasonable time, to be specified by the Commission. If such common carrier within the time [Reparation by carriers before investigation.] specified shall make reparation for the injury alleged to have been done, the common carrier shall be relieved of liability to the complainant only for the particular violation of law [Investigations of complaints by the Commission.] thus complained of. If such carrier or carriers shall not sat- isfy the complaint within the time specified, or there shall appear to be any reasonable ground for investigating said complaint, it shall be the duty of the Commission to investi- gate the matters complained of in such manner and by such means as it shall deem proper. Said Commission shall, in hke manner and with the same authority and powers, investigate any complaint forwarded by the railroad commissioner or railroad commission of any State or Territory at the request of such commissioner or commission, and the Interstate Commerce Commission [Commission may issue orders in investigations begun on its own motion.] shall have full authority and power at any time to institute §437] THE INTERSTATE COMMERCE ACT. 581 an inquiry, on its own motion, in any case and as to any matter or thing concerning which a complaint is authorized to be made, to or before said Commission by any provision of this Act, or concerning which any question may arise under any of the provisions of this Act, or relating to the enforce- ment of any of the provisions of this Act. And the said Com- mission shall have the same powers and authority to proceed with any inquiry instituted on its own motion as though it had been appealed to by complaint or petition under any of the provisions of this Act, including the power to make and enforce any order or orders in the case, or relating to the matter or thing concerning which the inquiry is had except- ing orders for the payment of money. No complaint shall at any time be dismissed because of the absence of direct damage to the complainant. § 436. The amendment of 1910. — This section was not amended until the act of June 18th, 1910. In its original form it provided for complaints by shippers, or their repre- sentatives, but made no provision for a complaint by a common carrier, and while authorizing an inquiry by the commission on its own motion, made no specific provision for the powers which the commission could exercise in such investigation made upon its own motion. Thus in the Harriman Case, supra, decided after the amendment of 1906, it was held that in such investigation the commission had no power of compelling testimony. The commission (see page 8 of report of 1909) had said that it was a question whether it could make an order under the fifteenth section in a proceeding instituted on its own motion under section 13. The amendatory act of 1910 amends this section, providing for the making of a complaint by a common carrier, and also that the "commission shall have the same powers and author- ity to proceed in any inquiry instituted on its own motion as though it had been appealed to by complaint or petition under any of the provisions of this act, including the power to make and enforce any order or orders, in the case, or relating to the matter or thing concerning which the inquiry is had, excepting the orders for the payment of money." In this connection also should be read section 9 of the act. § 437. Procedure before commission — Parties. — This section regulating procedure before the commission has been 582 THE INTERSTATE COMMERCE ACT. [SECTION 13 liberally construed by the commission in furtherance of the obvious purpose of securing a summary investigation and with only so much formality as was essential to justice. Dilatory proceedings are considered objectionable and a single speedy hearing is desired in every case. 1 1. C. C. 223, 1 Int Com. Rep. 410. Any person or association is entitled to complain either for himself or for any community in which he is ii^terested. Many complaints have been made before the commission by local trade organizations interested in the locality or in specific industries. Thus the Boston Fruit & Produce Exchange was held a mercantile society within the meaning of the section and could maintain a proceeding without showing special damage to itself as a society. 4 I. C. C. 664, 3 Int. Com. Rep. 493. The Chicago Live Stock Exchange, whose members were engaged in the sale of Uve stock on commission in Chicago, was held entitled to maintain a proceeding to correct an unreasonable freight rate upon live stock from various points to Chicago, notwithstanding cer- tain by-laws and proceedings of the association Were claimed to be in violation of the Anti-Trust law. 7 I. C. C. 513. It is immaterial that such trade organizations are unincor- porated. See also 10 I. C. C. 428. The Forest City Freight Bureau, which admitted members upon written contract to perform certain services in return for an annual fee, is an association competent to bring a com- plaint before the commission. The fact that it must be able to answer in costs in case such should be awarded against it on appeal taken into the courts does not take away the right to bring a complaint under the act; 13 I. C. C. 109. It was therefore an "association" within the meaning of section 13 of the act. The prior leave of court is not necessary to entitle a shipper to proceed against a railroad in the hands of a receiver. 6 I. C. C. 520. When one makes a complaint under the act to regulate commerce and sets up a personal grievance which he fails to prove before the commission, if a violation of law by the defendant appears, the commission can take the necessary steps to bring the violation of the law to an end. 1 I. C. C. 208, 1 Int. Com. Rep. 611. I 438] THE INTERSTATE COMMERCE ACT. 583 In Nashville Grain Exchange v. U. S. 191 Fed. 37, com- merce court decided (1911) that an incorporated grain exchange or board of trade could intervene in a suit in the commerce court, in a suit wherein its members were inter- ested in the enforcement of an order made by the commission. As to parties defendant, it was held by the Supreme Court in Texas Pacific R. Co. v. Interstate Commerce Commission, supra, that the owner of the portion of Hne over which through freight is carried is a proper but not a necessary party in a proceeding concerning the alleged discrimination between inland and import rates. The commission however has exercised the right to bring in all parties interested in a case. 4 I. C. C. 276, 3 Int. Com. Rep. 282, 5 I. C. C. 571, 4 Int. Com. Rep. 230. The disposition of the commission to simplify its practice and procedure was illustrated in its ruling, 20 I. C. C. 486, in a case involving a demand for a switch track connection, which under the ruling of the Supreme Court under the statute then existing in force, could only be made by a shipper. See Interstate Commerce Commission v. D. L. & N. R. Co., supra. The complainant, an Electric Traction Company, in order to obviate this objection produced at the hearing two letters from shippers authorizing the application. The commission ruled that for all practical purposes this was sufTicient to make them parties to the proceeding. See also 12 I. C. C. 483. § 438. Pleadings and proofs. — A complaint concerning classification of rates should not be made against the classi- fication committee or rate committee, but against the car- riers who were represented by such committees, and the complaint should point them out by name. 4 I. C. C. 276, 3 Int. Com. Rep. 282. The commission has early announced and it has always insisted that it would not express opinions on abstract questions, nor on questions presented on ex parte statements of facts, nor on questions of the statute pre- sented for its advice, but without any controversy pending before it on complaint of violation of law. 1 I. C. C. 8, 1 Int. Com. Rep. 18. The commission will not consider the claim of a party for injury to goods resulting from delay. 584 THE INTERSTATE COMMERCE ACT. [SECTION 13 detention, etc., or from any cause not attributable to any violation of the provision of the act to regulate commerce. 6 I. C. C. 85. Where reparation is asked to the extent of al- leged excessive charges, reasonable time is allowed for making proof of the amounts paid when the evidence adduced shows excessive charges without disclosing the amount of the excess. 6 I. C. C. 335. The procedure is in the simplest form con- sistent with reasonable certainty. No replication is required. When the facts are not agreed upon, deposition may be taken upon notice or the hearing entered upon immediately after answer. Assignments of hearing are made upon the request of either party and parties are heard orally or on briefs, as they may prefer. See 1 I. C. C. 223, 1 Int. Com. Rep. 408. When a carrier fails to answer the complaint filed, the com- mission takes such proof of the facts as may be deemed proper and reasonable, and makes order therein accordingly. 5 I. C. C. 663, 4 Int. Com. Rep. 318. In the C. C. A. of the sixth circuit in L. & N. R. Co. v. Dickerson, 191 Fed. 705, (1912) a letter to the commission setting out the facts containing a substantial prayer for relief was adjudged a suflTicient complaint. § 439. Demand for reparation must be specifically stated. — In order to avoid multiplicity of actions and con- sequent unnecessary labor and expense, and in order that defendants as well as the commission might have due notice of the full extent of a complaint, the commission has an- nounced that reparation will not ordinarily be awarded in a formal case attacking a rate as unreasonable or otherwise in violation of law, unless intent to claim reparation is speci- fically disclosed therein, or in an amendment thereof filed before the submission of the case. See 20 I. C. C. 612. The commission said in this case that it was not a court and added, "its proceedings partake somewhat of a judicial or semi-judicial character, but its work is distinctively adminis- trative" and said further that it was obviously fair that a complainant be required to disclose his whole case, and the demands upon the time of the commission was so many and pressing that unnecessary multiplicity of proceedings could not be encouraged or even tolerated. § 440] THE INTERSTATE COMMERCE ACT. 585 § 440. Burden of proof. — ^The question of burden of proof has been construed in the matter of reasonableness of rates, section 1, discriminations, section 2, and unjust prefer- ences, section 3. In general terms it may be said that the commission adopts the rules in regard to the burden of proof and the shifting of the weight of testimony in accordance with the established rules of courts of justice liberally and not technically administered. Thus the burden is upon the party making the complaint, 8 I. C. C. 561, and rehef will not be granted without proof. 1 I. C. C. 185, 1 Int. Com. Rep. 627. But when the fact of a greater aggregate charge for a short or long haul on the same line is established, the burden is upon the carrier to justify such excess. 4 I. C. C. 104, 4 Int. Com. Rep. 348. But where the carrier makes application for relief under the fourth section, he assumes the burden in the first instance. So where there is a departure from equal rates on several branches' of a road, the carrier is called upon to justify. 2 I. C. C. 604, 2 Int. Com. Rep. 431. 8 I. C. C. R. 93, ruled that the burden is upon the car- rier in all cases, where the departure from the rule of the law is made, to show clearly that his departure is justified, citing Missouri Pacific Ry. Co. v. Texas & Pacific Ry. Co., 31 Fed. Rep. 862. When the facts justifying an apparent disparity in rates are peculiarly within the knowledge of the carrier (6 I. C. C.) 4, the burden is on -him; thus the carrier must justify the disparity between rates on grain and grain pro- ducts. 3 I. C. C. 252, 2 Int. Com. Rep. 604. As to the burden of proof on carriers as to the reasonable- ness of increase of rates, where such increase is made after January 1st, 1910. See section 15, infra. The informal character of the procedure before the commis- sion is illustrated by the case (9 I. C. C. 602) where the general freight agent of the Texas & Pacific Railroad Com- pany referred to the commission a claim of a shipper for car- load rating on a mixed carload of lemons and pineapples, it appearing that the tariff provided for a mixed carload of lemons and bananas and pineapples and bananas, but not for a mixed carload of lemons and pineapples, the general freight agent expressing his belief that the claim was equit- able. The commission said that a matter submitted in this 586 THE INTERSTATE COMMERCE ACT. [SECTION 13 way should be treated as a complaint and answer; the rail- road company should make answer and make reparation to the complainant for the rate above the carload rate. When an important question is raised by the pleadings in a case, the determination of which will affect others quite as much as the parties before the commission, but the parties give their attention almost exclusively to other questions, and neither by the evidence nor in argument supply the commis- sion with the information to enable it to be understandingly determined, the commission will decline to decide it, and leave the parties to bring it forward again as they may be advised. 1 I. C. C. 503, 1 Int. Com. Rep. 722. § 441. Production of books and papers. — In 3 I. C. C. 186, 2 Int. Com. Rep. 584, the commission suggested the modes of procedure by which the inconvenience to defendant carriers of producing books where many entries were in- volved, might be avoided by petitioner, as by requiring statements of specific charges and facilities during specified period, or taking depositions by consent in advance of hearing. As to proceedings for taking testimony and the production of books and papers, see this case, in which the commission said that there was a very manifest difference between order- ing the production of books and papers of carriers directly interested and those of other parties, strangers to the pro- ceeding. It was said in this case that the books of defendant carrier as to the rates charged, the facilities furnished and the general movements of freight were in the nature of semi- public records, and statements should be made therefrom on request as promptly as practicable. (See this case for what is required for an order for the production of books and papers). As to the general powers of the commission in compelling the production of books and papers, see section 12, supra. As to the construction of this section see U. S. v. L. & N. R. Co., infra, § 500. § 442. The rulings of the commission as precedents. — The rulings of the commission are based so distinctively § 442] THE INTERSTATE COMMERCE ACT. 587 upon the special facts of the cases submitted that the doctrine of judicial precedent has only a limited application. Thus in deciding a case against one or more carriers charged with making rates which are unjustly discriminating in a certain line of trafTic, the decision may not apply at all to the rates in other sections where facts may be altogether different. 2 I. C. C. 365, 2 Int. Com. Rep. 245. One case can seldom be an exact precedent for another, for each traffic situation presents points of difference, and each complaint must be judged upon its own pecuhar facts. 8 I. C. C. 409. A rate may be unreasonable at one time, and through changed conditions may become reasonable at another time, even before the conclusion of the litigation as to the reason- ability of the rate. See conclusion of opinion in Nebraska Rate case, 169 U. S. 1. c. p. 550, 42 L. Ed. 819 (1898). The essentially shifting character of the conditions under which orders of the commission are made, that is, administra- tive orders regulating the conduct of the business of the carrier, and not involving payments for reparation, is recog- nized in the provision of the following section that such orders continue in force for a period not exceeding two years. 588 THE INTERSTATE COMMERCE ACT. [SECTION 14 Section 14. § 443. Commission's report of investigation. 444. Amendments of the section. 445. The changed relation of the commission to the courts. 446. Procedure before commission. 447. Reports of decisions. § 443. Commission's report of investigation. — Sec. 14. {Amended March 2, 1889, and June 29, 1906.) That whenever an investigation shall be made by said commis- sion, it shall be its duty to make a report in writing in respect [Commission must make report of investigations, stating its conclusions and order.] thereto, which shall state the conclusions of the Commission, together with its decision, order, or requirement in the prem- [Reparation.] ises and in case damages are awarded such report shall in- clude the findings of fact on which the award is made. All reports of investigations made by the commission shall be entered of record, and a copy thereof shall be furnished to [Reports of investigations must be entered of record. Service of copies on parties.] the party who may have complained, and to any common carrier that may have been complained of. The Commission may provide for the publication of its re- ports and decisions in such form and manner as may be best [Reports and decisions. Authorized publication com- petent evidence.] adapted for public information and use, and such authorized publications shall be competent evidence of the reports and decisions of the commission therein contained in all courts of the United States and of the several states without any fur- ther proof or authentication thereof. The commission may [Publication and distribution of annual reports of Com- mission.] also cause to be printed for early distribution its annual re- ports. § 444. The amendments of the section. — Under this section, before the amendment of 1906, the commission was required to "report its findings of fact upon which its con- clusions were based," and these "findings of fact" were made prima facie evidence thereafter as to all judicial proceedings as to every fact found. Under the section as amended in § 446] THE INTERSTATE COMMERCE ACT. 589 1906, the findings of fact are required to be reported only in case of an award of money damages ; and these are the only cases in which such findings are made prima facie proof for any judicial proceedings, see infra, section 16. In other cases, the commission's report is only required to state its conclusion with its order. § 446. The changed relation of the commission to the courts. — Under the act before the amendments of 1906, it was said by Justice Jackson in the Kentucky and Indiana Bridge Case, 37 Fed. 567 (1889), the first important decision under the act, that the commission could be regarded as the general referee upon each and every circuit court of the United States upon which the jurisdiction was conferred of enforcing the rights, duties and obligations recognized and enforced by the act. This was a case under the original act, and orders of the commission were not enforcible without the approval and assistance of the courts. In several cases the Supreme Court commented upon the fact that the act attributed prima facie effect to the findings of fact made by the commission. See East Tennessee, etc., Ry. Co. v. Inter- state Commerce Commission, 181 U. S. 1, 45 L. Ed. 719 (1901); and L. & N. R. Co. v. Behlmer, 175 U. S. 648, 44 L. Ed. 309 (1901). Under the act as amended, it is only in the case of an award of money damages that the findings of the commission are made prima facie evidence in judicial proceedings, and those are the only cases which require a proceeding and judgment in court. The Supreme Court, however, has ruled with respect of the administrative orders of the commission, that the findings of fact made by the commission and concurred in by a federal circuit court, would not be disturbed unless the record established that a clear and unmistakable error had been committed. See Illinois Central R. Co. v. Interstate Commerce Commission, 206 U. S. 441, 51 L. Ed. 1128, (1907) enforcing an order of the commission. See also 10 I. C. C. 505; and the Baltimore & Ohio Coal Case, supra. § 446. The procedure before the commission. — In order to determine a claim of reparation for the charge of an 590 THE INTERSTATE COMMERCE ACT. [SECTION 14 unreasonable rate, the commission must decide what rate should have been charged, that is, what is a reasonable rate, in order to determine the amount of damage to which the party is entitled. As to the procedure of the commission in claims of reparation, it was ruled that the complainant must make proof of his damage (8 I. C. C. 158); that all the carriers on the route need not be before the commission (6 I. C. C. 378), jind that speculative damages will not be allowed. 5 I. C. C. 97, 3 Int. Com. Rep. 740. Nor will the commission consider claims not arising out of the duties im- posed by the act. 4 I. C. C. 265, 3 Int. Com. Rep. 278. It is sufficient for the complainant to consult the pubhshed sched- ule of charges, and he is entitled to recover thereon the excess over such schedules charged him. 7 I. C. C. 255. See also as to conclusions of commission as to its jurisdictions in matter of awarding reparation. 5 I. C. C. 84, 3 Int. Com. Rep. 711. The subjects of reparation was discussed by the commis- sion in the case of the Independent Refiners Association, 6 I. C. C. 378, 7 I. C. C. 513. In this case claims of reparation were allowed to be filed in the same proceeding by the in- dividual shippers who were members of the complaining association. The circuit court however for the western district of Pennsylvania, 82 Fed. 192 (1897), refused to enforce this order, holding that each complainant had a plain, adequate and complete remedy at law. Thereafter in the case of the Cattle Raisers Association of Texas, 10 I. C. C. 83, the commission held that in view of the unsettled state of the law as to the recovery of claims of reparation, the members of the complaining association should file interven- ing petitions, each for his own demand. While there is no requirement in the act that carriers com- plained of shall produce all of their evidence before the com- mission, and in numerous cases parties have reserved such evidence until hearing was had in the courts on proceedings instituted by the commission to enforce their orders, the Supreme Court has said that this was not the proper pro- cedure (162 U. S. 1. c. 196, 40 L. Ed. 935), but that all the testimony should be submitted to the commission for their determination of the questions of fact. The commission has §447] THE INTERSTATE COMMERCE ACT. 591 ruled that it is not required to report the details of evidence, but only its findings of fact. See 1 I. G. C. 490, 1 Int. Com. Rep. 773, where it said that the report and findings of the commission upon evidence related only to the ascertainment and presentation of all the material facts necessary to clearly and justly present the merits of the controversy, and the commission therefore does not report evidence which is only cumulative, or which is immaterial or irrelevant, or show details of evidence all embraced in the substantial facts stated upon which the findings and conclusions of the commission are made. As to the effect of the commission's findings upon the questions of reparation in view of the con- stitutional guaranty of trial by jury, see infra, sections 15 and 16. § 447. Reports of decisions. — The provision for the publication of the reports of the commission was added to the section by the amendment of 1889. There were originally two series of reports containing the opinions of the Interstate Commerce Commission. The Interstate Commerce Reports, cited as "Int. Com. Rep." were pubUshed by the Lawyer's Co-Operative PubUshing Company of Rochester, New York, and included not only the reports of the commission but also the proceedings of the commission, and the reports of deci- sions of the courts on interstate commerce questions. The Interstate Commerce Commission Reports, cited as "I. C. C," were first published by L. K. Strouse & Co., of New York. The Lawyer's Co-Operative PubUshing Company pur- chased the other series and continued the publication of what was then the old series of reports of the commission up to and including Volume XIII, June, 1908. Since that time the publication has been assumed and carried on by the Government Printing Office at Washington which has pub- lished the reports from Volume XIV to Volume XXXVIII, Volume XXXVIII being now (1916), issued in advance sheets. The reports now published are cited as I. C. C. The five volumes of the discontinued Strouse Series contain the same cases included in Volumes I to IV of the Go- Operative Series. 592 THE INTERSTATE COMMERCE ACT. [SECTION 14 The reports contain not only the written opinion or reports of the commission but also a list of the cases disposed of by the commission without printed report during the time covered by the volume. Volume XV (1910), contains an appendix and a table of commodities, the transportation whereof was considered in the reports of the commission from Volumes I to XV, that is, during the years 1887 to 1909. In addition to these published reports of what may be termed the formal opinions of the commission, it issues from time to time, reports of "conference rulings" of the commis- sion, which are made in conference on questions informally raised or submitted in correspondence. It also issues from time to time, as occasion requires, tariff circulars containing regulations concerning the filing and construction of freight tariffs, classifications and passenger fare schedules, and also concerning the tariffs and classifications of express com- panies. These bulletins of conference rulings, and tariff circulars are issued as circumstances require, for the infor- mation of carriers and shippers, and are printed by the Gov- ernment Printing Office. Bulletins are also issued quarterly by the commission, containing statements of accidents reported to the commission as required by law, see infra. Appendix — . 448] THE INTERSTATE COMMERCE ACT. 593 Section 15. § 448. Section 15 as amended in 1910. 449. The amendments of 1906 and of 1910. 450. The constitutionality of the amendment of 1906 sustained. 451. The enlarged powers of the commission. 452. The establishment of through routes. 453. The establishment of through routes and joint rates by rail and water. 454. Switch connections and through routing with street railways denied. 455. Interstate street railways and interstate electric railways distin- guished. 456. The two year limitation of commission's orders. 457. Selection of the route by the shipper. 458. The advanced rate cases of 1910. 459. The advanced rate cases of 1914 and 1915. 460. Jurisdiction over contracts of carriers. 461. Jurisdiction of the commission under the Clayton anti-trust act. 462. Allowances by carriers for shipper's services must not involve undue preference. 463. The powers of the commission construed. § 448. Section 15 as amended in 1910. — Sec. 15. {As amended June 29, 1906, and June 18, 1910.) That whenever, after full hearing upon a complaint made as provided in sec- [Commisaion may determine and prescribe juat and reasonable ratea and claeaificationa to be observed as maximum chargea.] tion thirteen of this Act, or after full hearing under an order for investigation and hearing made by the Commission on its own initiative (either in extension of any pending com- plaint or without any complaint whatever) the Commission shall be of opinion that any individual or joint rates or charges whatsoever demanded, charged, or collected by any common carrier or carriers subject to the provisions of this Act for the transportation of persons or property or for the transmission of messages by telegraph or telephone as de- fined in the first section of this Act, or that any individual or joint classifications, regulations, or practices whatsoever of such carrier or carriers subject to the provisions of this Act are unjust or unreasonable or unjustly discriminatory, or unduly preferential or prejudicial or otherwise in viola- tion of any of the provisions of this Act, the Commission is hereby authorized and empowered to determine and pre- scribe what will be the just and reasonable individual or J-88. 594 THE INTERSTATE COMMERCE ACT. [SECTION 15 joint rate or rates, charge or charges, to be thereafter ob- [CommiBsion may determine and prescribe just and rea- sonable regulations or practices. Commission may order carriers to cease and desist from full extent of violations found. Orders of the commission eifective as prescribed, but in not less tban thirty days.] served in such case as the maximum to be charged, and what individual or joint classification, regulation, or prac- tice is just, fair, and reasonable, to be thereafter followed, and to make an order that the carrier or carriers shall cease and desist from such violation to the extent to which the Commission finds the same to exist, and shall not thereafter publish, demand, or collect any rate or charge for such trans- portation or transmission in excess of the maximum rate or charge so prescribed and shall adopt the classification and [Orders shall continue in force not exceeding two years, unless suspended or set aside by commission or court.] shall conform to and observe the regulation or practice so prescribed. All orders of the Commission, except orders for the payment of money, shall take effect within such reason- able time, not less than thirty days, and shall continue in force for such period of time, not exceeding two years, as shall be prescribed in the order of the Commission, unless the same shall be suspended or modified or set aside by the Commission, or be suspended or set aside by a court of com- [When carriers fail to agree on divisions of joint rate, commission may prescribe proportion of such rate to be received by each carrier.] petent jurisdiction. Whenever the carrier or carriers, in obedience to such order of the Commission or otherwise, in respect to joint rates, fares, or charges, shall fail to agree among themselves upon the apportionment or division thereof, the Commission may, after hearing, make a supple- mental order prescribing the just and reasonable proportion of such joint rate to be received by each carrier party thereto, which order shall take effect as a part of the original order. [Investigation of new schedules.] Whenever there shall be filed with the Commission any schedule stating a new individual or joint rate, fare, or charge, or any new individual or joint classification, or any new new individual or joint regulation or pracrice affecting any rate, fare, or charge, the Commission shall have, and it is hereby given, authority, either upon complaint or upon its own initiative without complaint, at once, and if it so orders, without answer or other forrtial pleading by the in- terested carrier or carriers, but upon reasonable notice, to enter upon a hearing concerning the propriety of such rate, fare, charge, classification, regulation, or practice ; and pend- ing such hearing and the decision thereon the Commission §448] THE INTERSTATE COMMERCE ACT. 595 [Commission may suspend new schedules.] upon filing with such schedule and delivering to the carrier or carriers affected thereby a statement in writing of its reasons for such suspension may suspend the operation of such sched- ule and defer the use of such rate, fare, charge, classifica- tion, regulation, or practice, but not for a longer period than one hundred and twenty days beyond the time when such rate, fare, charge, classification, regulation, or practice would otherwise go into effect; and after full hearing, whether com- pleted before or after the rate, fare, charge, classification, regulation, or practice goes into effect, the Commission may make such order in reference to such rate, fare, charge, classification, regulation, or practice as would be proper in a proceeding initiated after the rate, fare, charge, classifica- tion, regulation, or practice had become effective: Provided, [Commission may extend suspension.] That if any such hearing can not be concluded within the period of suspension, as above stated, the Interstate Com- merce Commission may, in its discretion, extend the time of suspension for a further period not exceeding six months. [Burden of proof on carrier as to reasonableness of in- creased rates.] At any hearing involving a rate increased after January first, nineteen hundred and ten, or of a rate sought to be increased after the passage of this Act, the burden of proof to show that the increased rate or proposed increased rate is just and reasonable shall be upon the common carrier, and the Com- mission shall give to the hearing and decision of such ques- tions preference over all other questions pending before it and decide the same as speedily as possible. The Commission may also, after hearing, on a complaint or upon its own initiative without complaint, establish through [Commission ma,y establish through routes and joint rates and classifications.] routes and joint classifications, and may establish joint rates as the maximum to be charged and may prescribe the divi- sion of such rates as hereinbefore provided and the terms and conditions under which such through routes shall be operated, whenever the carriers themselves shall have re- fused or neglected to establish voluntarily such through routes or joint classifications or joint rates; and this pro- vision shall apply when one of the connecting carriers is a water line. The Commission shall not, however, establish any through route, classification, or rate between street electric passenger railways not engaged in the general busi- ness of transporting freight in addition to their passenger and express business and railroads of a different character, nor shall the Commission have the right to establish any 596 THE INTERSTATE COMMEECE ACT. [SECTION 15 route, classification, rate, fare, or charge when the trans- portation is wholly by water, and any transportation by water affected by this Act shall be subject to the laws and regulations applicable to transportation by water. And in establishing such through route, the Commission [Limitation on through route power.] shall not require any company, without its consent, to em- brace in such route substantially less than the entire length of its railroad and of any intermediate railroad operated in conjunction and under a common management or control therewith which lies between the termini of such proposed through route, unless to do so would make such through route unreasonably long as compared with another practic- able through route which could otherwise be established. [Selection of route by shipper.] In all cases where at the time of delivery of property to any railroad corporation being a common carrier for trans- portation subject to. the provisions of this Act to any point of destination, between which and the point of such delivery for shipment two or more through routes and through rates shall have been established as in this Act provided to which through routes and through rates such carrier is a party, the person, firm, or corporation making such shipment, sub- ject to such reasonable exceptions and regulations as the Interstate Commerce Commission shall from time to time prescribe, shall have the right to designate in writing by which of such through routes such property shall be trans- ported to destination, and it shall thereupon be the duty of the initial carrier to route said property and issue a through bill of lading therefor as so directed, and to transport said property over its own line or lines and deliver the same to a connecting line or lines according to such through route, and it shall be the duty of each of said connecting carriers to re- ceive said property and transport it over the said line or lines and deliver the same to the next succeeding carrier or con- signee according to the routing instructions in said bill of lading: Provided, however. That the shipper shall in all in- stances have the right to determine, where competing lines of railroad constitute portions of a through line or route, over which of said competing lines so constituting a portion of said through line or route his freight shall be transported. [Unlawful to give or receive information relative to rival's ship men te.] It shall be unlawful for any common carrier subject to the provisions of this Act, or any officer, agent, or employee of such common carrier, or for any other person or corporation lawfully authorized hj such common carrier to receive in- §448] THE INTERSTATE COMMERCE ACT. ^ 597 formation therefrom, knowingly to disclose to or permit to be acquired by any person or corporation other than the shipper or consignee, without the consent of such shipper or consignee, any information concerning the nature, kind, quantity, destination, consignee, or routing of any property tendered or delivered to such common carrier for interstate transportation which information may be used to the detri- ment or prejudice of such shipper or consignee, or which may improperly disclose his business transactions to a competi- tor; and it shall also be unlawful for any person or corpora- tion to solicit or knowingly receive any such information [Exceptions.] which may be so used: Provided, That nothing in this Act shall be construed to prevent the giving of such information in response to any legal process issued under the authority of any state or federal court, or to any officer or agent of the Government of the United States, or of any State or Terri- tory, in the exercise of his powers, or to any officer or other duly authorized person seeking such information for the prosecution of persons charged with or suspected of crime; or information given by a common carrier to another carrier or its duly authorized agent, for the purpose of adjusting mutual traffic accounts in the ordinary course of business of such carriers. [Penalty.] Any person, corpo.ration, or association violating any of the provisions of the next preceding paragraph of this section shall be deemed guilty of a misdemeanor, and for each of- fense, on conviction, shall pay to the United States a penalty of not more than one thousand dollars. [Commission may determine just and reasonable charge or allowance for service rendered by owner of property transported or for any instrumentality furnished by such owner and used in such transportation.] If the owner of property transported under this Act di- rectly or indirectly renders any service connected with such transportation, or furnishes any instrumentality used there- in, the charge and allowance therefor shall be no more than is just and reasonable, and the Commission may, after hearing on a complaint or on its own initiative, determine what is a reasonable charge as the maximum to be paid by the carrier or carriers for the services so rendered or for the use of the instrumentality so furnished, and fix the same by appropriate order, which order shall have the same force and effect and be enforced in like manner as the orders above provided for under this section. [Enumeration of powers in this section not exclusive.] The foregoing enumeration of powers shall not exclude any power which the Commission would otherwise have in the making of an order under the provisions of this Act. 598 THE INTERSTATE COMMERCE ACT. [SECTION 15 § 449. The amendments of 1906 and of 1910.— This section has been more radically changed by the successive amendments of the act than any other. In its original form, it provided only for a notice to the common carrier to cease from the violation of the act, after the commission had found that such violation had been committed. Under the act as originally framed, this notice was jurisdictional, as it was a necessary basis for a subsequent procedure in court against the carrier to enforce the order of the commission. See 7 I. C. C. 286. In the amendatory act of 1906, known as the Hepburn -Act, section 15 was in effect re-written, as radical changes were made in the enlargement of the powers of the commission, in empowering it to declare any rate or regulation or practice of a carrier was unjust or unreasonable, and also to determine and prescribe a rate or regulation in futuro, to estabhsh through routes under certain conditions, and joint rates and classifications. In 1910, further radical enlargements were made in the powers of the commission, in that it was given authority to investigate any rate increase, and to suspend the same pending investigation, with the burden of proof upon the carrier to show the reasonableness of the increased rate; to establish through routes and joint rates and classifications without the limitation "that no reasonable or satisfactory through routes exists" imposed in the original amendment of 1906; and also empowering the shipper to elect his own through route, and making it unlawful for any carrier to give information concerning rival shipments, and authorizing the commission to determine the just and reasonable allow- ance for any service rendered by any owner of property transported and for any instrumentality furnished by the owner. The provision in the original section for a formal notice of the commission's order to the carrier is omitted, as under the succeeding sections the orders, other than for the payment of reparation damages, are made directly enforcible under penalties on the carrier by order of the commission, and a court procedure for enforcement is no longer required. § 460. The constitutionality of the amendment of 1906 sustained. — This section as amended by the act of §451] THE mXERSTATE COMMERCE ACT. 599 1906, prior to the amendment of 1910, was held constitutional and valid by the circuit judges of the fifth circuit in L. & N. R. Go. V. Interstate Commerce Commission, 184 Fed. 118 (1910). Suit was brought by the railroad company to enjoin the enforcement of the orders of the commission reducing rates and fixing maximum rates between New Orleans and certain other southern cities. 17 I. C. C. p. 231. The court said, that the power delegated by congress to the commission to prescribe railroad rates was legislative in its nature, and since it concerned the administrative affairs of the govern- ment, which by reason of variable conditions could not be covered in detail by direct legislation, its delegation was not in violation of the constitution and the power may be as fully exercised by the commission, as congress might have exer- cised it, subject to any limitation imposed by congress itself. "The provision of the constitution, art. I, par. 9, that no preference should be given by any regulation of commerce or revenue to the ports of one state over those of another" did not prevent such exercise of the power of congress by delegated authority to regulate commerce between ports of different states, merely because such regulation may inci- dentally affect the commerce of a port in still another state. It was also held that in fixing a maximum rate to be charged by a carrier there was no restriction of the commis- sion in respect to the matters which it may take into con- sideration, or the weight which it should give to such matters in informing itself what opinion it ought to give, except that it should not abuse its authority and proceed arbitrarily without regard to the justice of the case or give a judgment not fairly within its power. § 451. The enlarged powers of the commission. — It was contended before the Supreme Court in the Illinois Central Coal Car Distribution case, supra (1910), that section 15 of the act as amended in 1906 did not empower the Interstate Commerce Commission to make the order regulat- ing coal car distribution and that the power conferred related^ only to rates which were not involved in this case; but the Court said that this contention would frustrate the very purpose for which the amendment was enacted and that the 600 THE INTERSTATE COMMERCE ACT. [SECTION 15 antecedent construction which the Interstate Commerce Act had necessitated and the remedial character of the amend- ments of 1906 all served to show the want of merit in this contention. The Court, therefore, held that the commission was fully empowered under the act as amended in 1906 to make the order regulating coal car distribution. In the "general damage" case, 17 I. C. C. 361 (1909) it was said that section 15 was the dominating and controlling ex- pression of the real object and meaning of the act in its present form, and that it made of the commission what it was undoubtedly intended to be, a special expert body created for the purpose of dealing with the rates and rules, regulations and practices of carriers affecting rates. In this case the commission said that since its original enactment the act to regulate commerce had been amended many times, without being redrafted as a whole in order to bring its various provisions into harmony with one another, and the result was the act was not free from inconsistencies, and that sometimes doubt arose as to its real meaning; and by way of illustration it was shown that the Supreme Court had been compelled in the Abilene Coal case to read out of the act certain language of sections 8, 9 and 22, in order that the act should not destroy itself. See supra, sec. 9. The commission, prior to the amendment of 1906, was an investigating administrative board, its recommendations being enforced only by the action of the courts ; while under the amendments of 1906 and 1910 primarily in this section 15, it has not only the ^uas/-judicial power of determining what existing rates and regulations are unreasonable and also of suspending the taking effect of an increased rate pending the investigation thereof, but also the essentially legislative and administrative power of substituting therefor a rate and regulation in futuro; and its conclusions and orders are directly enforcible by penalties unless suspended or set aside by the action of the court invoked by the carrier. This power of the commission to determine the reasonableness of an existing rate or regulation is incidental and essential in fixing a reasonable rate or regulation for the future. It was held in N. Y. C. & H. R. R. Co. v. Interstate Com- merce Commission, supra, that the commission has authority § 452] THE INTERSTATE COMMERCE ACT. 601 under this amended section to make an order that a carrier shall cease and desist from violating the Interstate Commerce Act to the extent to which the commission finds that such violation exists; and where discrimination exists, it may pre- scribe a relative rate, instead of a maximum rate, which will enable the carrier to discontinue the discrimination without reducing the rate to other shippers or to other commodities, and that the commission was not required to prescribe doubt- ful regulations and remedies which are not necessary to remove the discrimination, and that it may properly author- ize the carrier to make such regulation should the necessity arise. In this case the court made an order that the com- plainant, a New York miller, was entitled to a milling in transit rate given western shippers for purposes of export. § 452. The establishment of through routes. — In more than one instance, the amendments in the act of 1910 were the result of the judicial construction of the provisions of the act of 1906. Thus in the section as amended in 1906, the commission was authorized to establish an additional through route when no reasonable or satisfactory through route existed, and the commission acting thereunder, 16 I. C. C. 300, established a through route and joint rate for passenger travel between points in the northwestern part of the state of Washington to eastern destinations via Portland, and this order was resisted in the courts upon the grounds that there was already in existence a reasonable and satis- factory route. It was held by the Supreme Court in Inter- state Commerce Commission v. Northern Pacific Ry. Co., 216 U. S. 538, 54 L. Ed. 608 (1910), that this condition whether a reasonable or satisfactory through route existed was jurisdictional, and the conclusion of the commission was subject to review by the courts, and that the personal preferences of travelers for a more southern route to the Pacific were not sufficient to justify the order, and the judg- ment of the circuit court enjoining the enforcement of the commission's order was affirmed. In the amendment of 1910, this provision as to the reason- ableness of an existing route was stricken out, and the com- mission was given authority to establish, either on a com- 602 THE INTERSTATE COMMERCE ACT. [SECTION 15 plaint or upon its own initiative, through routes and joint classifications and joint rates, and the terms and conditions under which those through routes shall be operated, when- ever the carriers shall have failed or refused to voluntarily estabhsh such through routes and classifications and joint rates; and this provision applies when one oft he connecting carriers is a water line. Other limitations in the right of the commission to order through routing remain. The commission can not require a company, without its consent, to embrace in the route sub- stantially less than the entire length of its railroad, etc. In 31 I. G. C. R. 182, the commission ordered a through route between the Louisville & Nashville, Tennessee Rail- road Company, the Nashville, Chattanooga & St. Louis Railroad Company on the one hand, and the Tennessee Central Railroad Company on the other, for through routes and joint interstate passenger fares from points on their lines to points on the latter line on which the resorts of the complainants were located. The commission found that this refusal was an unjust discrimination when these railroads made joint rates and through fares to points on the line of the Southern Railroad and the Illinois Central Railroad Com- pany and other carriers. The complainants in this case were the proprietors of hotels, and the commission said that there was some considerable travel to and from these resorts, and there would be more were it not for the refusal of the rail- roads to make joint fares. The commission said the plain- tiffs were entitled under section 13 of the act to make the complaint. See also 24 I. C. C. 22, and 32 I. C. C. 568, where appli- cations for joint routes were denied. Also 26 I. C. C. 241, where the commission held it had no power to order a physical connection between the Baltimore & Ohio Railroad and the Frederick Railroad at Frederick, though they recommended that the connection be made. In 27 I. C. C. 353, 1913, the commission approved the cancellation of joint rates on coal and other commodities on the application of the carriers with what was termed the Zeigler road, operating between Zeigler, Illinois, and certain interstate points, on the ground that the service performed by §453] THE INTERSTATE COMMERCE ACT. 603 the Zeigler road in drawing empty cars from the tracks of the Une-haul carriers to the coal mines and returning the loaded cars, was private transportation and it should not be the recipient of dividends from joint through interstate rates on coal traffic, and not being the owner of the property trans- ported, it could not receive an allowance for the services rendered. The continuations of the joint rates would con- stitute an undue and unjust discrimination against other coal mines served by the carriers, and the joint rates were therefore cancelled. § 463. The establishment of through routes and joint rates by rail and water. — While the commission has no jurisdiction over water routes, that is, over traffic moving entirely by water, it has jurisdiction over through trans- portation by railroad and water, and the commission has held that it has been given additional jurisdiction over water carriers by the amendment to sections 5 and 6 by the Panama Canal Act of 1913, and therefore it has exercised this juris- diction in preventing discriminations and preferences, see supra, § 290, and also in the making of joint routes and rates. Thus in 31 I. C. C. 281, the commission required the Louisville & Nashville Railroad Company and other carriers to join with the Decatur Navigation Company, a responsible carrier operating on the Tennessee river, to establish through routes and joint rates between certain Tennessee river landings and eastern destinations. The commission said it was immaterial that navigation on the river was difficult and that the Decatur boat line was a mere plant facility of a lumber company, and not a common carrier. The com- mission said that under the ruling of the Supreme Court in the Tap Line case, the road was none the less a common carrier when only a very small amount of the traffic carried was the property of others. It was immaterial also that it was claimed that one boat line gave adequate service, as that was no reason for not establishing an additional through route. See also 31 I. C. C. 301, where through routes and rates were established to the Ohio river with railroads and boats navigating on the river. See also 30 I. C. C. 377, where the commission, on the complaint of the Tampa Board of 604 THE INTERSTATE COMMERCE ACT. [SeCTI0n15 Trade, ordered that through routes should be established in connection with the Mallory Steamship Company. And see 32 I. C. C. R. 238, where the refusal by the Baltimore & Ohio Railroad Company to establish through routes and joint rates with complainant, a water line, between landings on the Chesapeake Bay and its tributary waters on the one hand and points on the B. & 0. and its tributary lines on the other, was found to be unreasonable and discriminatory. In 31 I. C. C. 472, the commission ordered through routes and joint fares on the application of the Pacific Navigation Company which operated steamers between San Francisco and San Pedro and San Diego, Cahfornia, with the railroads, to the same extent as they, the railroads, had established through routes and joint fares with the Pacific Coast Steam- ship Company and the San Francisco & Portland Steamship Company. The commission said that if rail carriers were permitted to select particular boat lines with which they would establish through routes and joint rates, they would be able to dictate who should operate by water and who should not. In this case the commission held they had jurisdiction, not only of water through routes and joint fares with the Western Pacific and the San Pedro, Los Angeles and Salt Lake Rail- road, but also with the Southern Pacific and the Santa Fe, which had rails of their own between Los Angeles and San Francisco, notwithstanding the limitation contained in the act. The commission said it would be contrary to public policy to allow this limitation of section 15 as to through routing to be a protection in the violation of section 3 of the act. In 34 I. C. C. 67, in 1915, the commission ordered a through route and joint rate between a water line operating on the Missouri and Mississippi rivers between Kansas City and East St. Louis with a railroad from East St. Louis to Norfolk and Newport News, Virginia. They said that the public interest was involved, and that the Panama Canal Act especially empowered the commission to establish through routes and joint rates between rail and water carriers, and that the imputation of the doubtful financial responsibility of complainant did not justify the defendant in refusing to § 454] THE INTEESTATB COMMERCE ACT. 605 establish through routes and joint rates, as under the law they had recourse to the commission for an order protecting them in that respect, if necessary. § 464. Switch connections and through routing with street railway denied. — The authorization of the commission to establish through routes and joint rates and classifications is subject to the proviso that the commission shall not establish any "through route classification or rate between street electric passenger railways not engaged in the general business of transporting freight in addition to their passenger and express business and railroads of a different character." The commission, in 20 I. C. C. 486, construed the section with this proviso as authorizing through routes and joint rates between a steam railroad and a street electric railway where the latter has a freight as well as a passenger trafTic. The commission said that it was the purpose of congress to widen the scope of the powers of the commission to establish through routes and joint rates rather than to narrow them, and to leave in the commission full discretion to act in such cases in the light of all the facts and circum- stances and do what may seem fair, reasonable and equitable in the case. This order of the commission was enjoined by the commerce court 195 Fed. 962, and the ruling of this court was affirmed by the Supreme Court in United States v. Baltimore & Ohio Southwestern R. Co., 226 U. S. 14, 57 L. Ed. 104, (1912) which held that the words "lateral branch line" in the statute did not refer to what the applicant line may become, or may be made by the commission, but what it already was at the time of the application, and that the street electric railway applicant was not a lateral branch line of the steam railway within the meaning of this section. The Court said that the power of the commission did not extend to ordering a con- nection whenever it saw fit but was limited to an extent of somewhat narrow class of cases, and the traction company was not within this class. That street passenger railroads though doing an interstate business are not included in the act to regulate commerce, see supra, § 164. 606 THE INTERSTATE COMMERCE ACT. [SECTION 15 § 456. Interstate street railways and interstate electric railways distinguished. — In the Omaha & Council Bluff Street Railway case, supra, the Supreme Court de- cided that interurban street railroads were not included in the act. It seems that in that case the company did not hold itself out to be a carrier of freight of any kind, and never engaged in the transportation of freight. The commission has ruled that this decision does not exclude from the act or from the jurisdiction of the commission companies which transport by electric power carload and less than carload freight, and have joint rates with steam roads for both inter- state and intrastate shipments. Thus in 33 I. C. C. 573, the commission said that its authority upon a proper showing to require the establishment by steam railroads of through routes and joint rates with interurban electric railroads engaged in interstate transportation of freight had been settled. See supra, § 165. The commission said that the act was intended to serve the needs of the shipping and receiving public. A number of the railroads of the country operate their trains by electricity, instead of steam, and they are none the less common carriers and subject to the act. In the case before the commission, the electric railway com- pany claimed that it was prohibited by the city authorities from hauling carload freight through the streets of certain cities. But the commission said that it was none the less a common carrier engaged in the interstate transportation of freight as well as passengers. The commission said, however, that the law contemplated that the commission should exer- cise its judgment upon the facts disclosed, and that the evidence failed to show such public necessity for the through rating as would justify them in making an order. § 456. The two year limitation of commission's orders. — The statute as amended provides that all orders of the commission, excepting orders for the payment of money, shall take effect within such reasonable time, not less than thirty days, and shall continue in force for such period of time, not exceeding two years, as shall be prescribed in the order of the commission. The effect of this limitation in time is to give the carrier freedom at the expiration of the § 456] THE INTERSTATE COMMERCE ACT. 607 time to exercise his own initiative as to matters affected by the order. This was illustrated in a case recently decided by the Supreme Court, supra, § 273, known as the Trade Zone Case, wherein the order of the commission, directing the reduction of class rates from East St. Louis to Kansas City when applied to business from the Atlantic seaboard on the ground that the through rates of the Missouri river cities were too high and unreasonable, was finally affirmed by the Supreme Court only ten days before the expiration of the two years' limitation of the two years' order ; and immedi- ately upon that expiration the rate thus adjudged unreason- able was restored by the railroads. See commission's report 1909 p. 33, and 1910 p. 16. An order of the commission relating to rates is not invali- dated because it fails to prescribe the time it shall remain in force; but in such case the order remains in force for two years. N. Y. C. & H. R. R. Co. v. Interstate Commerce Commission, circuit court of N. Y., 168 Fed. 131 (1909). An appeal from a decree dismissing a suit to enjoin the en- forcement of an order of the commission requiring a carrier to desist from granting a shipper an alleged undue preference, will not be dismissed by the Supreme Court as presenting merely a moot case because the period of two years during which the order was by its terms continued, had expired. See Southern Pacific Terminal Co. et al. v. Commission, 219 U. S. 498, 55 L. Ed. 310 (1911). The Court said that not- withstanding this limitation the orders of the commission were in one sense continuing and might be the basis of further proceedings by way of reparation, and that otherwise the parties would have their rights determined without a chance of redress. The same ruling was made in Southern Pacific Co. V. Commission, 219 U. S. 498, 55 L. Ed. 310 (1911), where the Court reversed the circuit court, northern district of California, in their opinion in 177 Fed. 963, which sus- tained the order of the commission, 14 I. C. C. R. 461, and held the order void, though more than two years had elapsed since it became effective. In L. & N. R. Co. V. Dickerson, 191 Fed. 705, (1912) the circuit court of appeals of the sixth circuit, took the view that a claim which accrued prior to the passage of the act of 1906 608 THE INTERSTATE COMMERCE ACT. [SECTION 1 5 might be presented at any time within two years after the date of its accrual although more than a year had elapsed since the passage of the act. In 25 I. C. C. R. 675, an application for reparation on account of unreasonable rates, it was held by the commission that the fact that a rate was found unreasonable upon a given date did not mean that it had been unreasonable during the whole two years preceding, and the commission could not order reparation upon such a theory, and therefore only reparation could be allcJwed from the date when the rate was shown to be unreasonable. § 457. Selection of the route by the shipper. — The Supreme Court had, held in the Southern California Fruit case, (supra § 358), that the control of through routing by the carrier as a condition of granting a through rate was not violative of any section of the Interstate Commerce Act. It is provided in this section by the amendment of 1910, that the shipper shall have the right to select his own through route, where there are two or more and to designate in writing by which of said through routes his property shall be transported to its destination. It is made the duty of the carrier, and of each of the connecting carriers, to receive and transport the property accordingly. Where more than one route is available for forwarding a shipment, it is the duty of the carrier, in the absence of routing instructions, to forward it by route taking the lowest rate. A reparation is awarded where there is a failure of a carrier to do this. 22 I. C. C. R. 463. § 458. The advanced rate cases of 1910. — In June, 1910, prior to the enactment of the amendatory statute of that year the principal carriers in the "Western Trunk Line Territory through their agents acting in unison prepared and filed tariffs increasing their rates upon a number of important articles. Before these rates had gone into effect the Attorney General of the United States caused suit to be brought in the circuit court of the United States in the eighth circuit at Hannibal, Missouri, alleging that such increased rates were the result of a combination and conspiracy in restraint of § 458] THE INTERSTATE COMMERCE ACT. 609 the Sherman Anti-Trust Act. A temporary injunction having been secured against putting these rates in effect, the carriers thereafter agreed to suspend the effectiveness of the rates pending a determination of their reasonableness by the Interstate Commerce Commission. This agreement was made in view of the bill then pending in congress vesting in the commission the power under this section 15 to suspend advanced rates. When the bill became law the carriers refiled their tariffs, but their taking effect was suspended by the commission pending the investigation. Similar advances were attempted in what is known as the official classification territory including the territory in the northeastern section of the United States, east of the Missis- sippi river and north of the Ohio and Potomac rivers. These carriers also suspended the advances pending the investiga- tion by the commission. These advances were sought to be justified in both these cases on the ground of the increased cost of operation and the very general advance in wages. In both cases (20 I. C. C. 243, and 20 I. C. C. 307), it was ruled (Feb. 22, 1911), that the burden being upon the carriers to establish the reason- ableness of the advanced rates, that they had failed to justify such increased rates. It was ruled also that the pro- vision of this act differed from the English act, that under that statute the railway company need only prove that the increase of rate was not unreasonable, while under the act to regulate commerce the carrier is called upon to prove that the new rate as a whole is reasonable. In both cases it was ruled, that before any general advance of rates could be permitted it must appear with reasonable certainty that carriers had exercised proper economy in the purchase of their suppUes, in the payment of their wages, and in the general conduct of their business. In the Official Classification Case it was ruled that class rates had been continuously in effect for thirty years and their business had become adjusted to them while the situation was somewhat different with reference to commodity rates, and it was intimated that these rates might with justice be revised in some cases. The carriers were requested in both cases to withdraw their proposed tariffs, such action being without J-39. 610 THE INTERSTATE COMMERCE ACT. [SECTION 15 prejudice to the carriers, if changed conditions should be submitted to the commission. § 459. The advance rate cases of 1914 and 1916. — In 31 I. C. C. 351, the commission (1914) approved an increase of five per cent in the intra territorial class and commodity rates in the Central Freight Association territory which did not include New England territory, this increase, however, not affecting certain heavy commodities, but it was ruled that no showing had been made warranting the general increase in trunk line rates, in rail and lake rates, or in the rate on traffic moving between the different rate territories in the official classification territory. After the outbreak of the European War in September 1914, a further hearing was granted in these cases on the ground that the carriers net income had been diminished with the menace to the prosperity of the whole country. In 32 I. C. C. 325, (1914) the commission ordered a terri- torial extension of the relief granted to the Central Freight Association lines by permitting the carriers to file tariffs providing with certain exceptions named for horizontal rate increases in all of the official classification territory. In their previous report the commission had declined to allow increase of rates in the Central Freight Association territory on cements, starch, brick, tiles, coal and plaster. On the further consideration in the light of the existing situation in the fall of 1914 these rates were increased throughout the official classification territory. Certain exceptions were made of lake and rail rates and of rates on coal and coke and iron ore. On December 7, 1915, 37 I. C. C. 1, the commission re- ported that the carriers had justified increased interstate passenger fares to 2i^ cents per mile in the states of Illinois, Wisconsin, Michigan (upper peninsula) and in Kansas, and northern line of the Union Pacific from Kansas City to Colorado state fine and 2^^ per mile in Missouri south of Missouri river and in Kansas south of the Union Pacific. The commission said this case was supplementary to that reported in 35 I. C. C. 497; that the evidence showed substantial improvements in passenger service since 1900 at § 460] THE INTBESTATE COMMERCE ACT. 611 large expense to the carriers, resulting in great comfort and safety to the travehng pubhc and increased cost of service not capable of being offset by economies to the same extent as in freight service. The commission however recommended an ascertainment of the cost of passenger and freight service respectively by allocating and apportioning the expenses of operation. In 36 I. C. C. 675, Dec. 2, 1915, the commission reported in favor of increasing the rates of Uvestock excepting horses and mules but not of packing house products in Central Freight Association territory. § 460. Jurisdiction over contracts of carriers.— While the commission has no general common law or equity jurisdiction, and has no concern with the contractual relation of carriers other than with shippers and relating to trans- portation, it is especially authorized under this section as amended in 1906 to determine the just and reasonable charge or allowance for services rendered by a shipper to the carrier. This power was doubtless conferred to prevent the conceal- ment of rebates or other discriminations or preferences to favored shippers in the guise for payments of services. The provision was strongly recommended by the commission in its annual report for 1905, where it says that there was no doubt that the payment of extravagant sums for such serv- ices was resorted to for the purpose and with the effect of preferring one shipper to another. It said also that this remedy will not be altogether adequate, and that any remedy was extremely difficult of application, but that nothing better appeared to be available. This section has no application to the case of a contract made by a carrier with a third party. This was ruled in the case, 17 I. C. C. 98, where complaint was made of allowances made to a warehouse company which was not the owner of the cotton which was there compressed and stored; and it was ruled that the mere fact that the owners of a majority of the stock were also shippers of freight did not show a violation of the act and did not make the allowance one for services rendered by a shipper to the carrier within the meaning of this provision. 612 THE INTERSTATE COMMERCE ACT. [SECTION 15 This provision was invoked by the General Electric Com- pany, 14 I. C. C. 238, which asked the commission to deter- mine and fix the just and reasonable rates for the services which it rendered to the railroad in the industrial tracks upon its plant which it owned and operated and wherewith it hauled the loaded and empty cars to the main track. The commission ruled that the complainant did nothing within its plant enclosure which it could lawfully call upon the de- fendants to do for it, and therefore nothing for which it could lawfully demand compensation. It was claimed in this case that the railroad company had incurred contractual obhga- tion by its course of conduct, but the commission said it had no power under the law either to enforce the specific per- formance of contracted obligations or to award damages for the breach of any such agreement. § 461. Jurisdiction of the commission under the Clayton Anti-trust act. — An important jurisdiction is vested in the commission under the Clayton anti-trust act of 1914. The commission is charged with the duty of en- forcing compliance with sections 2, 3, 7 and 8 of that act, wherever they are applicable to common carriers. Section 7 prohibits the holding by any corporation engaged in com- merce of the whole or any part of the stock of another cor- poration engaged also in commerce, where the effect of the acquisition is to lessen competition between the corporations, or to restrain commerce in any sections of the community, or tends to create a monopoly in any line of commerce. The same section, however, provides that it shall not be construed to prohibit a common carrier from aiding in the construction of branches or short lines so as to become feeders, where there is no substantial competition between them, from extending its lines through the medium of the acquisition of stock when there is no substantial competi- tion between them. It is provided by section 10 of the same act that after two years from the approval of the act, that is, after October 15th, 1917, no common carrier shall make purchases to the amount of more than fifty thousand dollars in any one year of another corporation or association when the common carrier has upon §462] THE INTERSTATE COMMERCE ACT. 613 its board of directors, or president or agent to the trans- action, any person who is at the time a director or manager, or has any substantial interest with the party or company from whom the purchase is made, unless by competitive bidding under regulations to be prescribed by rule or other- wise by the Interstate Commerce Commission. A full and detailed statement must be fded with the Interstate Com- merce Commission showing the manner of the competitive bidding, under penalty of fine and imprisonment declared in the act. See act, infra, appendix. If the commission after investigation believes the law has been violated in the matter of such purchases, is to transmit all the papers and documents to the Attorney-General and violation of the sec- tion is punished by fine and imprisonment. The enforce- ment of the other provisions of the anti-trust act devolved upon the commission is made through a proceeding in the circuit court of appeals. § 462. Allowances by carriers for shippers' services must not involve undue preference. — As this provision of the statute was enacted for the purpose of preventing con- cealment of rebates or other discriminations or preferences the commission has carefully examined such allowances when brought before it and has insisted that no such allowances can be recognized in favor of one shipper, when a similar allow- ance is refused to another shipper competing in the same market and in the same line of business who offers to provide a similar facility and perform the same service in the trans- portation of his property. This principle was applied in the Federal Sugar Refining Company Case, involving an allow- ance made by railroads to the competitors of the Refining Company for lightering services in New York harbor. This case was twice before the commission. 17 I. C. C. 40, 20 I. C. C. 200. There was a difference of opinion as to the appli- cation of this principle to the facts in the case; but on the second hearing it was ruled by the majority that the allow- ance paid by the defendant railroads for the sugar brought by Arbuckle Brothers on floats and lighters to the regular railroad freight stations on the Jersey shore, no allowance being paid to complainant on sugar being brought by it on 614 THE INTERSTATE COMMERCE ACT. [SECTION 15 lighters to the same station, was unduly prejudicial to the complainant. Commissioners Prouty and Knapp dissenting said that the disadvantage under which complainant was laboring in regard to its lighterage was owing to its location at Yonkers outside of the lighterage lirnit. Both the commerce court, U. S. v. B. & 0. Ry. Co. 200 Fed. 779, and the Supreme Court, 231 U. S. 274, 58 L. Ed. 218 (1913) agreed with the minority of the commission and held that the allowances for so-called lighterage service were proper, and the disadvantages complained of were those incident to a disadvantageous location. See supra. There is no undue reference however when a carrier makes with one independent company a contract more favorable than with another for a service, which that carrier is bound or undertakes to perform. The act deals only v/ith the obliga- tion of carriers as carriers, and in no way attempts to regulate or interfere with other matters not involving their duty to shippers or passengers as such. The principle has no appli- cation to exclusive contracts for station facilities and the like. § 463. The powers of the commission construed. — It was said by the commission prior to the amendment of 1910 (17 I. C. C. 369), that this section in their judgment was the determinating and controlling expression of the real object and meaning of the act in its present form; and by the Supreme Court in the Pitcairn Coal Case, supra, after the amendment of 1906, but before that of 1910 that "the commission is empowered" indeed it has made it its duty in disposing of a complaint, not only to determine the legality of the practice alleged to give rise to unjust preference or un- due discrimination, and to forbid the same, but moreover to direct the practice to be followed as to such subject for a future period, not exceeding two years, with a power in the commission if it finds reason so to do, to suspend, modify or set aside the same, the order being operative without judicial action. The powers of the commission have been sustained in lowering the through rates between the Atlantic seaboard and Missouri river though such lowering involved the changing §463] THE INTERSTATE COMMERCE ACT. 615 of the basing points theretofore adopted by the carriers (see supra, § 273). In enforcing an equitable distribution of the supply of coal cars, when there was a shortage of cars available for the busi- ness of the shippers. See United States ex rel. v. B. & 0. R. Co., 215 U. S. 481, 54 L. Ed. 292 (1910). In ordering the discontinuance of a discrimination in the grant of a milling in transit privilege, supra, § 301. In directing a carrier to desist from further charging the freight rate under certain classification, which produced pref- erences and discriminations. See Cincinnati, H. & D. F. Co. Case, supra, § 324. In directing a railroad to discontinue undue preferences and advantage to a party under a lease of the wharves of a terminal company at Galveston. Southern Pac. Lum. Co. v. Commission, supra, § 288. In Philadelphia & R. Ry. Co. v. U. S., 219 Fed. 988 (1915), the district court E. dist. of Penn. (three judges sitting) in dismissing a bill brought to annul an order of the Interstate Commerce Commission, 27 I. C. C. 448, and 31 I. C. C. 277, (three judges sitting) held that the commission had power to make a finding of discrimination against Jersey City when that locality was not a complainant, and was not specially designated in the complaint as the locality discriminated against, and that undue discrimination against the locality as contemplated by the statute is not restricted to dis- crimination in rates by a carrier between points exclusively on its own line entirely without regard to its effect upon commerce or the movement of traffic, but extends to dis- crimination against a locality caused by a carrier and fixing a rate from one point to another of its own right, that is, relatively different from rates in which it and other carriers participate in making for competing points upon the lines of all of them. The finding of the commission upon the facts as to this discrimination was held conclusive. 616 THE INTERSTATE COMMERCE ACT. [SeCTIOn16 Section 16. § 464. Section 16. Enforcement of orders. 465. The amendments of 1906 and 1910. 466. The saving of the right of trial by jury. 467. The time limitation of actions for reparation. 468. Not necessary to fix future rate before ordering reparation. 469. Proceedings before the Commission inure to the benefit of all parties interested. 470. The jurisdiction of the Commission in awarding reparation. 471. Jurisdiction of Commission in reparation for discrimination in car distribution. 472. Jurisdiction of Commission in awarding general damages. 473. Jurisdiction of federal and state courts in reparation actions. 474. Limitation of right to sue in State Court. 475. The prima facie effect of the Commission's orders. 476. The conclusiveness of orders enforcing the Clayton Act. 477. The procedure in court in reparation cases. 478. Damages recoverable in reparation actions. 479. Allowance of attorney's fees. 480. The jurisdiction of the district court in reparation actions. 481. The judicial review of the Commission's orders. 482. The Supreme Court on the judicial review of Commission orders. 483. Interlocutory injunctions in judicial review. 484. Venue of court review of the orders of commission. 485. Court's review limited to cases of affirmative action by the Com- mission. 486. The finality of the orders of the Commission. § 464. Section 16. Enforcement of orders. — Sec. 16. {Amended March 2, 1889, June 29, 1906, and June 18, 1910.) [Award of damages by commiaaion.] That if, after hearing on a complaint made as provided in section thirteen of this Act, the Commission shall determine that any party complainant is entitled to an award of dam- ages under the provisions of this Act for a violation thereof, the Commission shall make an order directing the carrier to pay to the complainant the sum to which he is entitled on or before a day named. [Petition to United States court in caae carrier does not comply with order for payment of money.] If a carrier does not comply with an order for the pay- ment of money within the time limit in such order, the com- plainant, or any person for whose benefit such order was made, may file in the circuit court of the United States for the district in which he resides or in which is located the §464] THE INTERSTATE COMMERCE ACT. 617 principal operating office of the carrier, or through which the road of the carrier runs, or in any state court of general jurisdiction having jurisdiction of the parties, a petition setting forth briefly the causes for which he claims damages, and the order of the Commission in the premises. Such suit [Findings of fact of commission shall be prima facie evidence in reparation cases.) in the circuit court of the United States shall proceed in all respects like other civil suits for damages, except that on the trial of such suit the findings and order of the Com- mission shall be prima facie evidence of the facts therein [Petitioner not liable for costs in circuit court.] stated, and except that the petitioner shall not be liable for costs in the. circuit court nor for costs at any subsequent stage of the proceedings unless they accrue upon his appeal. [Petitioner's attorney's fees.] If the petitioner shall finally prevail he shall be allowed a reasonable attorney's fee, to be taxed and collected as a part of the costs of the suit. All complaints for the recovery of damages shall be filed with the Commission within two ]Limitation upon action.] years from the time the cause of action accrues, and not after, and a petition for the enforcement of an order for the payment of money shall be filed in the circuit court or state court within one year from the date of the order, and not after. [Joint plaintiffs may sue joint defendants in courts on awards of damages.] In such suits all parties in whose favor the Commission may have made an award for damages by a single order may be joined as plaintiffs, and all of the carriers parties to such order awarding such damages may be joined as defendants, and such suit may be maintained by such joint plaintiffs and against such joint defendants in any district where any one of such joint plaintiffs could maintain such suit against [Service of process.] any one of such joint defendants; and service of process against any one of such defendants as may not be found in the district where the suit is brought may be made in any district where such defendant carrier has its principal oper- ating office. In case of such joint suit the recovery, if any, may be by judgment in favor of any one of such plaintiffs against the defendant found to be Uable to such plaintiff. [Service of order of commission.] Every order of the Commission shall be forthwith served upon the designated agent of the carrier in the city of Wash- ington or in such other manner as may be provided by law. 618 THE INTERSTATE COMMERCE ACT. [SECTION 16 [CommiBaion may suspend or modify order.] The Commission shall be authorized to suspend or modify its orders upon such notice and in such manner as it shall deem proper. [Carriers, their agents and employees, must comply with such orders.] It shall be the duty of every common carrier, its agents and employes, to observe and comply with such orders so long as the same shall remain in effect. Any carrier, any ofTicer, representative, or agent of a car- rier, or any receiver, trustee, lessee, or agent of either of them, [Punishment by forfeiture for refusal to obey order of commission under section 15.] who knowingly fails or neglects to obey any order made under the provisions of section fifteen of this act shall for- feit to the United States the sum of five thousand dollars for each offense. Every distinct violation shall be a separate offense and in case of a continuing violation each day shall be deemed a separate offense. [Forfeiture payable into treasury and recoverable in ciTil suit.] The forfeiture provided for in this Act shall be payable into the Treasury of the United States, and shall be recoverable in a civil suit in the name of the United States, brought in the district where the carrier has its principal operating office or in any district through which the road of the carrier runs. [Duty of district attorneys to prosecute.] It shall be the duty of the various district attorneys, under the direction of the Attorney-General of the United States, to prosecute for the recovery of forfeitures. The costs and [Costs and expenses to be paid out of appropriation for court expenses.] expenses of such prosecution shall be paid out of the appro- priation for the expenses of the courts of the United States. [Commission may employ attorneys.] The Commission may employ such attorneys as it finds necessary for proper legal aid and service of the Commission or its members in the conduct of their work or for proper rep- resentation of the public interests in investigations made by it or cases or proceedings pending before it, whether at the Commission's own instance or upon complaint, or to appear for and represent the Commission in any case pending in the commerce court; and the expenses of such employment shall be paid out of the appropriation for the Commission. [Petition to commerce court in cases of disobedience to order of commission other than for payment of money.] If any carrier fails or neglects to obey any order of the Commission other than for the payment of money, while the § 465] THE INTERSTATE COMMERCE ACT. 619 same is in effect, the Interstate Commerce Commission or any party injured thereby, or the United States, by its Attorney-General, may apply to the Commerce Court for the enforcement of such order. If, after hearing, that Court determines that the order was regularly made and duly served, and that the carrier is in disobedience of the same, (Commerce court must enforce disobeyed order if regu- larly made and duly served.] the Court shall enforce obedience to such order by a writ of injunction or other proper process, mandatory or otherwise, to restrain such carrier, it officers, agents, or representatives, from further disobedience of such order, or to enjoin upon it or them obedience to the same. The copies of schedules and classifications and tariffs of [Rate schedules, contracts, or agreements, and carriers^ annual reports filed with commission and in custody of secretary are public records, receivable in courts and by tbe commission as prima facie evidence. CertiBed copies or extracts therefrom also prima facie evidence.] rates, fares, and charges, and of all contracts, agreements, and arrangements between common carriers filed with the Commission as herein provided, and the statistics, tables, and figures contained in the annual or other reports of carriers made to the Commission as required under the provisions of this Act shall be preserved as public records in the custody of the secretary of the Commission, and shall be received as prima facie evidence of what they purport to be for the purpose of investigations by the Commission and in all judicial proceedings; and copies of and extracts from any of said schedules, classifications, tariffs, contracts, agreements, arrangements, or reports, made public records as aforesaid, certified by the secretary, under the Commis- sion's seal, shall be received in evidence with like effect as the originals. § 465. The amendments of 1906 and 1910. — This section was also in effect re-written in the amendatory act of 1906 and substituted for the original section, this being necessitated by the radical changes in the powers conferred upon the commission in the preceding section. The original section provided for the enforcement of the orders of the commission by the courts on the petition of the commission, the findings of fact by the commission being prima facie evidence of the matters therein stated, and under the amend- ment of 1889, the saving of the right of trial by the jury under the seventh amendment of the constitution. 620 THE INTERSTATE COMMERCE ACT. [SECTION 16 The amendments of 1906 provided for the filing of repara- tign complaints, for a limitation of time in bringing actions, for the service of the order of the commission by mailing, with penalties upon the carriers for non-observance of the orders, the employment of special counsel, the enforcement of orders for reparation, the venue of suits against the com- mission the application of the provisions of the expediting act, the regulation of the procedure and the granting of interlocutory orders in suits against the commission, and for appeals to the Supreme Court from final as well as inter- locutory orders in such suits, and for the use of schedules, tariffs and tables as evidence. The act of 1910 provided for the institution of suits for reparation in state courts, for service upon the agent of the carrier at Washington in lieu of the service by registered mail, for the employment of official attorneys by the commission, whereas in the act of 1906 it was with the consent of the Attorney-General that special counsel was employed. The provisions of the act of 1906 as to suits against the commission were omitted in view of the creation of the commerce court under the same act. § 466. The saving of the right of trial by jury. — The seventh amendment of the constitution provides that in suits at common law, where the value in controversy shall exceed twenty dollars;, the right of trial by jury .shall be preserved, and no fact tried by a jury shall be otherwise examined in the courts of the United States than according to the rules of the common law. The amendment of 1889 of the original act was made in view of the express require- ment in section 14 of the original act, that the commission should make recommendation as to what reparation, if any, should be made by the carriers as to any party or parties who may have been found to have been injured. As to the application of the original act, that is, prior to the amendment of 1906, in actions of reparation, see Interstate Commerce Commission v. N. W. Y. R. R. Co., 82 Fed. 192, W. D. of Pennsylvania (1897), wherein the court ruled that each shipper had a right to reparation and damages as a separate legal controversy which would entitle him to a §467] THE INTERSTATE COMMERCE ACT. 621 trial by jury when in excess of twenty dollars. In the Texas Cattle Raisers Case, 10 I. C. C. 83 (1904), this question was considered by the commission, and it was said that it had been the practice of the commission to order reparation in behalf of the members of complaining associations; but it was suggested as the law was unsettled that the members of the association should file separate intervening claims. Under the act as amended suits for reparation, wherein orders for the payment of money are made, are brought in the circuit court of the United States or in any state court having jurisdiction of the parties; and such a suit in the circuit court of the United States proceeds in all respects like other civil suits for damages, except that on the trial of such suit the finding and order of the commission shall be prima facie evidence of the facts therein stated; and the petitioner is not liable for costs in the circuit court nor subsequently except upon his own appeal; and if he prevail, is allowed a reasonable attorney's fee. The right of trial by jury is thus preserved. While the statute provides for the joining as plaintiffs of all parties in whose favor the commission may have made the award for damages by a single order, it would seem that the constitutional right of trial by jury where the demand exceeds twenty dollars, would require a separate trial for each sepa- rate claimant if he demanded, and that the procedure would have to be adapted thereto. Under the new judicial code, wherever reference is made to the circuit court of the United States in this section as a trial court, the reference will be deemed and held to confer the power and impose the duty upon the district court after the code was in effect on January 1st, 1912. § 467. The time limitation of actions for reparation. — There was no provision in the Interstate Commerce Act before the amendment of 1906, prescribing a limitation of time within which actions in court or proceedings before the commission should be commenced. The discussions there- fore prior to this time of this question of limitation, whether in the commission or the court, have now only an historical interest. Under the section as amended complaints for 622 THE INTERSTATE COMMERCE ACT. [SECTION 16 recovery of damages must be filed with the commission within two years after the cause of action accrues, and not after; and suit thereon must be filed in the circuit court or state court within one year of the date of the order of the com- mission and not later. This limitation was applied by the commission in its ruling in 19 I. C. C. 592, where the com- plaint included shipments covering an extended period of time, and said that it would only consider such shipments as moved within two years prior to the time the complaint embracing them was filed, and that with respect to shipments moving prior to such two year period the commission believed that they were without jurisdiction and therefore, made no finding whatever. In A. J. Phillips v. Grand Trunk Western Railway Co., 236 U. S. 662, 59 L. Ed. 774 (1915) affirming 195 Fed. 12, the Supreme Court held that the lapse of time limitation not only barred the remedy but destroyed the liability. This rule was applied in a case where the overcharges were paid prior to August 1904, and the suit was brought May 9, 1909, less than two years after the validity of the commission's order was sustained by the Supreme Court but more than a year after the passage of the Hepburn Act, and more than four years after the plaintiff's cause of action arose. The Court held that the action was barred. It was immaterial that the company was not a party to the proceedings before the commission. In Meeker v. Lehigh Valley R. Co., 236 U. S. 412, 59 L. Ed. 644, (1915) affirming 211 Fed. 785, the Court said that the limitation of five years for penalties under the laws of the United States was not applicable, because the liability was not punitive but strictly remedial, and the Pennsylvania statute of limitations was not applicable because the federal statute applied to claims already accrued as well as to those thereafter accruing, and it was evident that congress in- tended to take all other claims out of the operation of the varying laws of the several states and subject them to limi- tations of its own creation which would operate ahke in all the states. The Court in this case said that the proviso per- mitted all accrued claims not already barred to be presented within the year after the passage of the act, and this date was computed from the date the act took effect, August 28, 1906. § 468] THE INTERSTATE COMMERCE ACT. 623 See also as to the limitation of time Arkansas Fertilizer Co. V. U. S., (1911) 193 Fed. 667 commerce court, where the cause of action was adjudged to accrue when the shipment terminated and the complainant became liable for the freight, and not when he actually paid it. § 468. Not necessary to fix future rate before order- ing reparation. — In Baer Bros. Mercantile Co. v. Denver & Rio Grande Railroad Co., 233 U. S. 479, 58 L. Ed. 1055, (1914), the Supreme Court reversed the C. C. C. of the eighth circuit, 187 Fed. 486, which had reversed a judg- ment of the circuit court for the district of Colorado enforcing a reparation order of the Interstate Commerce Commission. The reversal by the C. C. A. was on the ground that the reparation order was void and could not be the basis of a recovery for the reason that while reparation had been awarded on the ground that the old rate was unreasonable, the commission had not fixed a new and just rate for the future; but the Supreme Court said there was no necessary connection between the two and persons entitled to the one order might have no interest in the other. And a rate un- reasonable when made might become reasonable as result in change of conditions, so that no reparation is ordered, although a new rate be established for the future. Con- versely a rate which was unreasonable might become reason- able after the date of the hearing. In the case before the Court there was no through routing or joint rate between St. Louis and Leadville, Colorado, and no through bill of lading was issued, the Denver & Rio Grande receiving its local rate as its charge from Pueblo to Leadville and this was the rate held unreasonable and was the basis of the reparation order. The Court said that the commission had jurisdiction because it was in effect a through shipment from St. Louis to Leadville. In this case the carriers were given an opportunity to agree on a through rate and how it should be divided, but the court said that the delay for this purpose should not prejudice the plaintiff in his right to damages for the past. It was held in litigation between the same parties that a rate may be settled over through route by an established 624 THE INTERSTATE COMMEKCE ACT. [SECTION 16 course of business. See the commerce court in Denver & Rio Grande R. R. v. U. S. Commerce Commission, 195 Fed. 968 (1912), affirming the ruling of the commission in 17 I. C. C. 225. See also Baer Bros. Mercantile Co. v. Denver & R. G. R. R., 200 Fed. 614 (1913). § 469. Proceedings before the commission inure to the benefit of all parties interested. — In A. J. Phillips v. Grand Trunk Western Railway Co., 236 U. S. 662, 59 L. Ed. 774, (1913) affirming the C. C. A. of the sixth circuit, 195 Fed. 12, it was held that a shipper who was not a party to the proceedings before the commission to have an increase of freight rates declared unreasonable could maintain a reparation claim by appropriate proceedings before the commission or court based upon the commission's general finding that such increase was unreasonable. The Court said that the proceedings before the commission to determine the reasonableness of the advance was not in the nature of private litigation, but was a matter of public concern in which the whole body of shippers was interested, and the plaintiff and every other shipper similarly situated were entitled, by appropriate proceedings before the commission or courts, to obtain the benefit of the general finding and order that the rate was unreasonable. In Atlantic Coast Line Ry. Co. v. Interstate Commerce Commission, 194 Fed. 449 (1911), it was held by the com- merce court that interstate carriers, although not parties to proceedings before the commission, nor named by the commission in an order fixing rates on a commodity between certain points, are competitors of the carriers named therein in such traffic, and therefore necessarily affected by the order, and have such an interest therein as entitles them to maintain a suit to enjoin its enforcement; and while they may properly apply to the commission for a rehearing, such action is not a necessary condition precedent to such a suit. § 470. The jurisdiction of the commission in award- ing reparation. — The commission has ruled that its award of reparation is simply a recommendation which can only be enforced by a suit at law affording full opportunity for a jury § 470] THE INTERSTATE COMMERCE ACT. 625 trial, and that upon this theory the act giving them this authority is vahd and constitutional. 10 I. C. C. 83. Reparation, the commission has said, should not be awarded in any informal proceedings which would not be awarded under the same state of facts in a contested case and in the face of defendant's protestation instead of its admission. The commission, therefore, could not accept as conclusive any stipulation of parties as to the reasonableness of a rate or transportation regulation. 16 I. C. C. 426. The right to reparation is not confined to shipments made by parties to any given proceeding, but extends to all shipments moving under the same circumstances and conditions and charged for on the basis found to be unlawful by whomsoever made. 171. C. C. 253. It was ruled by the commission, in 17 I. C. C. 90, that where a transportation service has been rendered for which no tariff authority exists, and where the shipper has paid the sum claimed by the carrier for that service, the commission has jurisdiction to inquire what was the reasonable charge for that service. In this case the extra service was for ice and refrigeration. (Commissioner Cockrell dissented on the ground that the commission had no power under the act to inquire into the value of service rendered by the carrier independently of a rate lawfully fixed by the carrier for such service.) On the general question of the jurisdiction of the commis- sion to award reparation it was said by the Supreme Court, in the Abilene Cotton Oil Case, supra. "Although an established schedule of rates may have been altered by a carrier voluntarily or as the result of an enforce- ment of the order of the commission to desist from violating the law rendered in accordance with the provisions of the statute, it may not be doubted that the power of the commis- sion would nevertheless extend to hearing legal complaints of and awarding reparation to individuals for wrongs un- lawfully suffered from the application of the unreasonable schedule during the period when such schedule was in force." See also 15 I. C. C. p. 334. In 15 I. C. C. 147, decided in 1909, the commission said that in passing upon the reasonableness or unreasonableness J— 40. 626 THE INTERSTATE COMMERCE ACT. [SECTION 16 of a rate it acted as an administrative body having quasi- judicial functions; when it determines what the rate should have been and shall be in the future it exercises certain legislative functions. When it computes the damages or reparation due the shipper by reason of the enforcement and collection of a rate unreasonable to the extent that it exceeds a rate which is declared to be reasonable, there is a mathe- matical determination of the damages the shipper should receive, and that elements of conjecture, speculation and inference are entirely eliminated. It said further that the commission did not assess costs or allow attorneys' fees, nor did its order for the payment of money have the effect of a judgment of the court. Such orders were not enforcible by process nor did they become liens upon the property of the defendant. In 29 I. C. C. 391, the commission held that in awarding reparation, they did not attempt to determine in what pro- portion payment should be made by the different carriers, but awarded a gross sum against all the carriers. If the carriers are not able to agree upon a division among them- selves, they could not apply to the commission for a deter- mination of the matter. In 27 I. C. C. 302, the commission considered the claim for reparation made under its decision in 18 I. C. C. 552, on the complaint of a commercial club. It held that the finding that the complainant's members were entitled to reparation did not include members of the association other than those named in the complaint, and the mere submission of an expense bill to the commission was not proof of damage. In 30 I. C. C. 1, the commission cited the International Coal Mining case, 230 U. S. 183, supra, and they ruled that it did not necessarily follow that because a rate was found unduly discriminatory and unduly prejudicial, that the com- plaining parties are the ones that have been damaged through its exaction. § 471. Jurisdiction of commission in reparation for discrimination in car distribution. — The jurisdiction of the commission in awarding reparation, extends as well to the damages which are suffered from unjust discrimination in § 472] THE INTERSTATE COMMERCE ACT. 627 car distribution as to the damages due from the exaction of unreasonable rates. The damages in both cases arise from the violation of the act, and their ascertainment is within the scope of the authority of the commission. In a case of alleged discrimination in car distribution it is immaterial that practically all the coal mined by the plaintiff was sold f. o. b. cars at the mines and the coal was loaded on cars to be transported to various points in that state, Pennsylvania, and in other states. The Supreme Court held, in Penn. R. Co. v. Clark Bros. Mining Co., 238 U. S. p. 1406, 59 L. Ed. p. 000, (1915) reversing 241 Pa. 515, that the jurisdiction of the commission is determined by the essential character of the commerce in question. In that case it appeared that the movement was essentially an inter- state movement and the facilities required were facilities of interstate commerce. A very large part of the interstate business of the country is conducted upon that basis, and the arrangements made between seller and purchaser with respect to the place of taking title to the commodity, or as to the payment of freight, where the actual movement is interstate, did not affect either the power of congress or the jurisdiction of the commission. The commerce court in Pennsylvania Railroad Co. v. Interstate Commerce Commission, 193 Fed. 81, sustained an order of the commission in 19 I. C. C. 356, 392, and held that the rule made by the railroad company for the distribution of coal cars in times of shortage to coal mines, which used such cars indiscriminately for shipments to points within or with- out the state as their business may require, was discriminatory and in violation of law, and that the commission had juris- diction to make orders requiring a different basis of dis- tribution even though such orders applied to all cars whether used in interstate or intrastate shipments. § 472. Jurisdiction of the commission in awarding general damages. — While the commission has uniformly awarded damages in reparation, where the subject matter of the complaint was an unreasonable rate and the award was merely a matter of calculation, there has been a difference of opinion in the commission as to its jurisdiction or its duty to 628 - THE INTERSTATE COMMEECB ACT. [SECTION 16 award damages in demands for reparation other than those which could be ascertained by mere calculation of differences in rates. The question has been presented in two classes of cases: first, where an individual claimant suffered loss in business through delays in consequence of defaults of the carrier which are in contravention of some provision of the act and second where the complainant is one of a class of shippers, who are damaged by some rule or regulation declared discriminatory by the commission. In a case of the first class, 17 I. C. C. 361, the majority of the commission de- clined to take jurisdiction saying that the award of such resulting damages, loss of trade and the like should be deter- mined by action brought in a court of competent jurisdiction. It was conceded that the language of the act was of doubtful interpretation, and therefore the commission, being a special tribunal of limited powers, should resolve the doubt in favor of courts where claims of this nature ordinarily belong. The minority opinion, in which three commissioners con- curred, was that the decision of the majority was a surrender of jurisdiction clearly conferred and theretofore exercised without question. The ruling in this case was considered by the circuit court of appeals, third circuit, in the Morrisdale Coal Case, which involved a claim for damages on account of a prej- udicial distribution of coal cars, wherein the court declined jurisdiction on account of the ruling of the Supreme Court in the Abilene Coal Case, as the rule claimed to be discrimina- tory had not been passed upon by the commission; and the court intimated that the letter of the statute seemed to confer upon the commission the power to assess damages in every case of discriminatory practices. Its procedure, said the court, in making the assessment, constitutes no part of judi- cial procedure. In a court of law its findings and order are but prima facie evidence of the damages sustained. This case was affirmed by the Supreme Court 230 U. S. 304, 57 L. Ed. 1494 (1912). In a later case the subject came again before the commis- sion in the other class of cases involving claims for damages on account of the discriminating rule of distributing coal cars in time of shortage by the Pennsylvania Railroad, which was § 472J THE INTERSTATE COMMERCE ACT. 629 found by the commission to be illegal and discriminatory as against a class of shippers. These were the same coal car distribution rules that were involved in the litigation in the Morrisdale Coal Company Case, wherein the circuit court and the circuit court of appeals declined to take jurisdiction. The majority of the commission, 19 I. C. C. 35'6, were still of the opinion that it was not for them under the law to assess and determine the damages sustained by the complainant, and that it was a judicial question for the courts, and at the most any finding by the commission as to the amount of damages woujd be the expression of an opinion that could not be enforced by the commission, and therefore in any event resort must be had by the complainant to the courts. Commissioner Prouty, in a dissenting opinion, considered that there was a clear distinction between the former case (17 I. C. C. 361), which he said was a case of individual wrong, which could be redressed in court consistently with the position declared in the Abilene Case, and this case, wherein discrimination inhered not against a particular shipper, but under a rule applicable to all shippers and there- fore peculiarly within the jurisdiction of the commission. The commission concluded in view of this position of the courts (at this time the opinion of McPherson, J., in the circuit court, Morrisdale Coal Co. v. Penn. Ry. Co. 176 Fed. 748 (1910), was before the commission but the opinion of the circuit court of appeals had not then been reported) to order a further argument with respect to the amount of damages suffered by the complainant in the proceedings as the result of the discriminations that were found to exist. For discussion of the jurisdiction of the courts in such cases, see supra, § 406. The jurisdiction of the commission in awarding reparation seems to extend under the act to all cases where parties are prejudiced by any rate or regulation of the carrier which is declared by the commission unreasonable or prejudicial. There seems to be no basis for distinction in the ascertain- ment of damages — if they are proximate so asto be cogniz- able in law, and not consequential, that it, speculative — because they require weighing of evidence, and are not determined by merely a calculation of the figures of rates. 630 THE INTERSTATE COMMERCE ACT. [SECTION 16 In any case the award of the commission is only advisory and must be confirmed by the court. This subject of the awarding of damages was discussed also in 23 I. C. C. 186, and in 28 I. C. C. 645. In this last case, the commission held that under the facts presented, there could be no award of damages under the general prin- ciple of the law of torts, that one who files a tort damage, must use due diligence to minimize the loss. § 473. Jurisdiction of federal and state courts in reparation actions. — Under the section as amended in 1910 the complainant in a reparation case, or any person for whose benefit the order is made, may bring the suit for the dajnages awarded by the commission in "any state court of general jurisdiction having jurisdiction of the parties." The section specifically provides for the procedure in the suit, if brought in the circuit (district) court of the United States, that is, that it should proceed like other civil suits for dam- ages; that the finding and order of the commission shall be prima facie evidence of facts and further provides as to liabil- ity for costs, taxation of attorney's fee, and the joinder of parties both as plaintiffs and defendants. The limitation pro- vision requires that the suit must be filed in the federal court or state court within one year from the date of the order. Such a suit, if brought in the state court, would necessarily be controlled in its procedure by the law of the forum. Whether a state court would be bound to assume jurisdiction of a cause of action created by federal statute, see supra, § 50, on federal actions in state courts, also Hoxsie v. N. Y., N. H. & H. R. Co., 82 Conn. 352. In the suits in the district courts of the United States for the recovery of reparation ddjnages there is no exception to the general provision of the judiciary act requiring $3,000 as a Ininimum amount in controversy. The suit if brought in the district court of the United States proceeds in all respects like other civil suits for damages in that court subject to the provision of the section. The provision in the section for the joining of parties as plaintiffs who may be awarded damages by a single order of the com- mission may have been inserted on account of this juris- dictional amount in controversy required by the judiciary § 474] THE INTERSTATE COMMERCE ACT. 631 act, and in case of such joinder it would seem that the aggre- gate of the claims thus authorized to be included in the action would be the amount in controversy. In suits for reparation the action may be brought by the party making the com- plaint, or by the party for whose benefit the order is made. § 474. Limitation of right to sue in state court. — The right to sue in the state courts under this section, does not extend to a case where the plaintiff has invoked the juris- diction of the commission and secured from the commission a finding as to the legality of the rule of car distribution. In such case the federal statute binds both parties, and plaintiff cannot then disregard the provisions of the statute for the purpose of measuring relief by legal standards enforced in the state courts. This was decided in the case of Clark Bros. Coal & Mining Co., supra, where the state statute of Pennsylvania provided that a carrier guilty of unjust dis- crimination should be hable for damages treble the amount of the injury suffered. The plaintiff brought this suit after he had applied to the commission and obtained a ruling (see 19 I. C. C. 392) that the company had been guilty of discrimination. After he had brought suit in the state court the commission made a finding of the amount of damages as reparation. Plaintiff thereafter prosecuted his suit in the state court and secured a judgment for treble damages. This judgment was afTirmed by the state supreme court, 241 Pa. 515, but this judgment was reversed by the Supreme Court, which held that the plaintiff, having made apphcation to the commission, was bound to proceed for the recovery for damages in accordance with the act, and not otherwise. The Court said that the finding of the commission as to the amount of damages did not have any other effect than that prescribed in section 16 of the act. In such a case, where it appeared that the act had been violated and requisite ruhng had been made as to the unreasonableness of the practice assailed, the provisions of section 9 were applicable. The provision of this 16th section that action may be brought in either a state or federal court, is apphcable after the com- mission's award of reparation has been made. 632 THE INTERSTATE COMMERCE ACT. [SECTION 16 § 475. The prima facie effect of the commission's orders. — The complaints for reparation are now the only cases wherein the commission is required under section 14 to report its findings of fact, and where their report with the findings of fact is made prima facie evidence. The subject of the prima facie effect of the findings of fact by the com- mission was considered by the circuit court of appeals of the third circuit in a reparation case, W. N. Y. & P. R. Co. v. Penn. Refining Co., 137 Fed. 343,^ in 1905, under the act before its amendments. The court, while sustaining the constitutionality of the provision as within the power of congress in regulating the rules of evidence, held that it was only the findings of fact which the law made prima facie evidence, and that the opinions and arguments and regula- tions of the commission were not made prima facie evidence, or evidence of any kind in any judicial proceedings. The findings of fact must therefore be offered in evidence, un- accompanied with extraneous matter calculated to confuse or mislead. The causes of action in the case of reparation must be included in an order of reparation made by the com- mission. It was held in this case also that the receivers of a railroad who had been finally discharged before the making of the order of reparation, were not liable. In Meeker v. Lehigh Valley R. Co., supra, the Supreme Court held that the provision that the findings and order of the commission should be prima facie evidence of the fact therein stated was not repugnant to the constitution and did not infringe upon trial by jury or operate as a denial of due process of law. It only established a rebuttable presumption and took no question of fact from the court or jury. In Mills V. Lehigh Valley Ry. Co., 238 U. S. p. 473, 59 L. Ed. 1414 (1915), affirming 207 Fed. 107, the Supreme Court held that the ultimate, rather than the evidential facts should be set out in the report, and that a specific finding that the rate exacted was "unjust and unreasonable" to the extent specified with a finding that the plaintiff was entitled to the stated amount "as reparation," was a sufficient report under the statute. In Lehigh Valley R. Co. v. American Hay Co., 219 Fed. 539, (1914) it was held by the circuit court of appeals of the § 476] THE INTERSTATE COMMERCE ACT. 633 second circuit, that the Interstate Commerce Commission is not required to make any formal marked and numbered findings but that its findings may be contained in the collo- quial statements of an opinion. In Darnell Taenzer v. Southern Pacific Co., 221 Fed. 890, (1915) the C. C. A. of the sixth circuit took the view that a report of the commission that a freight rate was excessive and awarding reparatitjn and a supplemental report determining the amount of reparation to which different shippers were entitled, amounted to a finding that the shippers were damaged in the amount stated, and that the amounts awarded represented the actual pecuniary loss of the respective shippers. The court reversed a directed verdict for defendants, 190 Fed. 659, and said that under the Meeker case, supra, the prima facie effect of the commission's findings required direct evidence to overcome the same. The C C. A. for the ninth circuit, determined in Southern Pacific Co. v. Goldfield Consolidated Milling & T. Co., 220 Fed. 14, that a finding of the commission is not defective which holds that the rate was unreasonable, and that plaintiff was not entitled to recover reparation in a certain sum together with interest, because it did not ex- pressly allege that plaintiff had been damaged by the excessive rate. § 476. The conclusiveness of orders enforcing the Clayton Act. — Under section 11 of the Clayton Act the commission is authorized to enforce a compliance with sections 2, 3, 7, and 8, of that act (see appendix p. 853, for full text of act) where appHcable to common carriers; and wherever the commission has reason to believe that any one of these sections has been violated, it is to serve a complaint, stating its charge, containing a notice of a hearing at least thirty days thereafter. The testimony at such hearing is to be reduced to writing, and the commission makes a report of its finding, and this finding is made conclusive. Addi- tional testimony may be ordered by the court to be taken by the commission, and the commission may modify its findings ; but the finding is made conclusive when this additional evidence is considered. The order is enforced through the 634 THE INTERSTATE COMMERCE ACT. [SECTION 16 circuit court of appeals, but the finding of the commission is made "conclusive" if supported by testimony. The judg- ment of the circuit court of appeals is made final, except that it is subject to review by the Supreme Court by certiorari. No provision is made for a money judgment, as in repara- tion eases; and the prohibitions in these sections of the act relate rather to business combinations and methods under the control of the Federal Trade Commission than to common carriers, except, possibly, the prohibition as to holding com- panies in section 7. See supra, § 81. In view of the opinion of the Supreme Court in the Meeker case, supra, that the provision of this section 16 of the Inter- state Commerce Act, making the findings of the order of the commission prima facie evidence, was sustainable because, and only because it established only a rebuttable presump- tion, taking no question of fact from either court or jury, it is difficult to see how this provision for a "conclusive" finding upon the facts by a non-judicial body can be con- sistent with due process of law. There is an obvious distinction between the finality of the orders of an administrative commission under the limitations declared by the Supreme Court, where a justiciable question is not presented for judicial review (see section 481, infra), and making the finding of facts by such an administrative body conclusive, leaving no question of facts for a court or jury. In this connection it may be said that substantially the same provision is contained in the Trade Commission Act as to the "conclusiveness" of its findings in the case of "unfair methods of competition." § 477. The procedure in court in reparation cases. — Before the amendment of 1906, the aid of the court was neces- sary to enforce the orders of the commission rather than for the payment of money. After that amendment the orders of the commission were directly enforcible, but with juris- diction in the courts to enjoin or suspend any order of the commission. Under the commerce court act, while in force, the jurisdiction now vested in the district courts was vested in the commerce court. § 477] THE INTERSTATE COMMERCE ACT. 635 The only suits under the act as amended to be brought in the district court are those to enforce the reparation orders of the commission, wherein the state court will have concurrent jurisdiction, and it may be added, suits in district courts to recover penalties from the carriers for disobedience of other orders. In the Texas & Pacific case, 162 U. S. 197, 40 L. Ed. 940, supra, it was held by the Supreme Court that the Interstate Commerce Commission was ~a body corporate in a legal capacity to be a party plaintiff or defendant in the federal courts and that proceedings in the courts to enforce the orders of the commission could be filed by any person interested therein or by the commission itself as a party complainant. Testimony in the circuit court is not limited to that taken before the commission, that is, either party may introduce other testimony. See N. 0. & T. P. R. Co. v. Commission, 162 U. S. 184, 40 L. Ed. 935. The Supreme Court however expressed disapproval of such a method of procedure on the part of the railroad companies, in withholding a large part of their evidence from the commission, and first introducing it in court, and it was said that the purposes of the act called for a full inquiry by the commission in the first instance. It has been uniformly held in such suits to enforce the orders of the commission that the burden rested upon the railroad to show the orders to be erroneous. See Commission v. S. N. Ry. Co. 102 Fed. 709; and Same v. C. R. & Q. R. Co. 94 Fed. 272. In Nayler v. Lehigh Valley R. Co. 188 Fed. 860 (1911) C. C. Pa., the court decided that a suit to enforce an order for reparation was one in tort for damages, and that the State Procedure Act requiring affidavits of defense in suits upon contracts did not apply to such a proceeding. The subject of procedure in reparation suits in the federal courts, was considered by the Supreme Court in the Meeker case, supra. The Court there said that the findings of the Interstate Commerce Commission must be presumed, there being no showing to the contrary, to be justified by the evidence where there is a recital in the commission's report that the findings are based upon the evidence adduced. An objection to admitting the reports of the commission in evidence in such an action on the ground that the report 636 THE INTERSTATE COMMERCE ACT. [SECTION 16 contains other statements than findings of fact if not obviated by excluding the supposed objectionable portions of the report from what was read by counsel to the jury was waived where the court's attention was not decided to subject when jury was charged. § 478. Damages recoverable in reparation actions. — The Supreme Court held in the Meeker case that the damages should be the full amount of damages sustained by the com- plainant and may be measured respectively by the rebate to a favored competitor and the excess over what would have been a reasonable rate if the evidence shows that such amount represents the claimant's actual pecuniary loss. In Lehigh Valley Ry. Co. v. Clark, 207 Fed. 717, it was held by the C. C. A., third circuit (1913), that a suit to recover an award of damages made by the commission by way of reparation, is not a suit on the award, as an award, to recover that amount, but a plenary suit 'for damages sustained by the plaintiff by reason of the violation of the act, and he must prove facts from which defendant's liability may properly be inferred, and not merely the con- clusion of the commission from the facts. It does not follow from the com.mission's finding that a given tariff rate is unreasonable and that a lower rate fixed by the commission is reasonable, and that the plaintiff has suffered pecuniary damages by restraining the exaction of the former rate, nor that the measure of such damages is the difference between the two rates; nor is an order of the commission awarding damages to the extent of the difference in rates by way of reparation prima facie evidence of the plaintiff's liability in a subsequent action onthe award which is a private suit for damages and not for a penalty. - § 479. Allowance of attorney's fees. — The provision for an attorney's fee made in this section, and also in section 8, to be taxed and collected as a part of the costs of a suit, it was held by the Supreme Court in the Meeker and Mills cases, supra, applies only to the services incident to the action in court in which the recovery is had, and does not include the services before the commission. In both of these cases § 480] THE INTERSTATE COMMEECE ACT. 637 the Supreme Court modified the judgments of the courts below by ehminating the allowance of attorney's fees for services before the commission, but affirmed the judgment as to the allowance for services in court. The commission fixes a hmit of time within which the award is paid, and if the carrier pays the award within the time named no right to an attornev's fee arises. In the Riverside Mills case, 219 U. S. 186, 55 L. Ed. 167, (1911) the Supreme Court held that an attorney's fee was not taxable where there was a recovery under the provisions of the Carmack amendment. See section 20, infra. It was held by the C. C. A. of the sixth circuit, in L. & N. R. Co. V. Dickerson, supra, that if the petition finally prevails he is entitled to an attorney's fee on account of the appellate proceedings in addition to the allowance made by the circuit court if the case is brought within the commerce act. The Court said that the Riverside Mills case did not apply because there the damage claimed was the loss by a connecting carrier, but in the case of reparation under section 16 the attorney fee is provided for by that section. Where an attorney's fee is allowed in the district court to cover services in that court, and the case is thereafter ap- pealed, and the petitioner finally prevailj in the appellate court, and no fee is awarded for services in the appellate court, the district court has authority to allow a counsel fee for the services in addition to the fee allowed for services in the district court. See Mills v. Lehigh Valley R. Co., 226 Fed. 812 (1915), dist. court, E. D. of Pa. § 480. The jurisdiction of the district court in reparation actions. — The suit of the party claiming repa- ration under an order of the commission is to be brought in the district court of the United States in the district, wherein he resides and in which is located the principal operating office of the carrier, or through which the road of the carrier runs. In Interstate Commerce Commission v. W. N. Y. & Pa. R. Co., 82 Fed. 192, the court said that the violation within the judicial district of an order of commission by any one of the defendants or one of the parties to a common arrangement for interstate shipments, was violation or dis- 638 THE INTERSTATE COMMERCE ACT. [SECTION 16 obedience of all the parties defendant, where the parties were all acting under a common arrangement, and that all of them were subject to the jurisdiction of the court wherein any of them were located. Such suits if brought in the district courts of the United States are conducted as other suits in that court and are subject to the rights of appeal to the circuit courts of appeal while if brought in the state courts they are subject to the law regulating appeal in the state courts. § 481. The judicial review of the commission's orders. — When the amendatory act of 1906 was before congress, the question of the regulation and the exercise of the judicial power in enjoining and suspending any order or requirement of the commission, was the subject of extended discussion, and the provisions of the act of 1906, including suits against the commission, were the result of a compromise between the opposing parties of what was called the "broad review" and a "narrow review." Under the act as amended in 1906, provision was made for the filing of these suits to set aside, annul or suspend any order of the commission in the districts, where the carrier against whom the order or require- ment was made had its principal operating ofTice, and jurisdiction to determine such suits was vested in the circuit courts; and under the provisions of the Expedition Act, which was made applicable, finally determined in the circuit court by the circuit judges of such circuit and appealed directly to the Supreme Court. A number of cases have been deter- mined both in the circuits, and some by the Supreme Court, which have been cited in connection with different subjects involved. The amendatory act of 1910 provided also for the estab- lishment of the commerce court which was vested with juris- diction of all cases brought to enjoin, set aside, annul, suspend in whole or in part any order of the commission subject to an appeal to the Supreme Court. By the act of 1913 abolishing that court, supra, appendix, the jurisdiction theretofore vested in the commerce court was vested in the district courts of the United States and it was provided by this act that the procedure in the district court § 482] THE INTERSTATE COMMERCE ACT. 639 in such cases should be the same as that theretofore prevaiUng in the commerce court, and the same right of appeal is given direct from the district court in such case to the Supreme Court. In L. & N. R. Co. V. U. S., Dist. Ct. of Va., W. D. Va. (1914), 218 Fed. 89, it was held if a railroad company is dissatisfied with the decision of a commission that a given rate is reasonable, and desires to introduce further evidence, it should apply to the commission for rehearing under section 16a, and that the court would review the order only on the evidence which was before the commission unless the tribunal had refused to hear evidence that was material. § 482. The Supreme Court on the judicial review of commission orders. — The Supreme Court in several cases has considered the power of judicial review under this section as amended in 1910. Thus, in Interstate Commerce Commission v. Union Pacific R. R., 222 U. S. 541, 56 L. Ed. 308, (1913) the court reversed the decree of the circuit court of Minn, which had enjoined the enforcement of an order of the Interstate Commerce Commission reducing lumber rates in that state. The court said that it had been settled by the repeated decisions of the court that the orders of the commission are final unless (1) beyond the power which it could constitutionally exercise; or (2) beyond its statutory power; or (3) based upon a mistake of the law; but it was said that questions of fact may be involved in the deter- mination of questions of law so that an order regular on its face may be set aside if it appears that (4) the rate is so low as to be confiscatory and in violation of the constitutional prohibition against taking property without due process of law; or (5) if the commission acted so arbitrarily and un- justly as to fix rates contrary to evidence or without evidence to support it; or (6) if the authority therein involved has been exercised in such an unreasonable manner as to cause it to be within the elementary rule that the substance, and not shadow, determines the validity of the exercise of the power. The Court said, in determining these mixed questions of law and fact, that the Court confines itself to the ultimate question as to whether the commission acted within its 640 THE INTEESTATE COMMEECE ACT. [SECTION 16 power. It will not consider the expedience or wisdom of the order or whether, on like testimony, it would have made a similar ruling. The Court examined the record, and finding that the commission's order was based upon substantial testimony, it reversed the judgment of the circuit court and held that as the commission acted within its power its lawful orders could not be enjoined. In the following year, 1913, the contention was made by the government in the case of Interstate Commerce Commis- sion V. L. & N. R. R., 227 U. S. 88, 57 L. Ed. 431, where the commerce court, 195 Fed. 541, the United States being made a party, held on final hearing that the order was void because there was no material evidence to support it. It was in- sisted, on behalf of the government, that while the act of 1887 to regulate commerce made the orders of the commission only prima facie correct, a different result followed from the amendments of the act of 1906. But the Court said this position was untenable as the statute gave the right to a full hearing, and that conferred the privilege of introducing testimony and at the same time imposed the duty of deciding in accordance with the facts proved. The statute, instead of making the orders conclusive against a direct attack, expressly declared that they may be suspended or set aside by a court of competent jurisdiction. "Of course," said the Court, "That can only be done in cases presenting a justi- ciable question." "The Commission is an administrative body, and even where it acts in a quasi-judicial capacity, is not hmited by the strict rule as to admissibility of evidence which prevails in suits between private parties. But the more liberal the practice in admitting testimony, the more imperative the obligation to observe the essential rule of evidence by which rights are asserted or defended. In such cases the Commis- sioners cannot act upon their own information, as could jurors in primitive days. All parties must be fully apprised of the evidence submitted or to be considered, and must be given opportunity to inspect documents and to offer evi- dence in explanation or rebuttal." The Court therefore overruled the contention of the govern- ment, and examined the record with a view of determining whether there was substantial evidence to support the order, § 483] THE INTERSTATE COMMERCE ACT. 641 and finding that there was such evidence, the Court said that its weight was pecuUarly for the body experienced in such matters and familiar with the complexities, intricacies and history of rate-making in each section of the country. As the courts could not settle the conflict or put their judgment against that of the rate-making body, the decree was reversed. On the other hand in Florida E. G. R. Co. v. United States, 234 U. S. 167, 58 L. Ed. 1267, (1914) where the Court reversed the commerce court, 200 Fed. 797, and held that the order of the commission should be enjoined as it appeared that it was entered without any evidence to support it, and the existence of any evidence is a question of law which it is the duty of the courts to examine and decide. § 483. Interlocutory injunctions in judicial review. — The act of 1913 abolishing the commerce court vesting jurisdiction in the district courts makes detailed provision for interlocutory injunctions providing that the application should be presented to a circuit or a district judge and heard and determined by three judges of whom at least one should be a circuit judge, and five days notice of the hearing must be given to the Interstate Commerce Commission, to the Attorney General of the United States and to such other persons as may be defendants, A tentiporary stay may be granted in cases where otherwise irreparable damage would ensue through the operation of the order of the commission continuing for not more than 60 days pending the application of the order of injunction, and at the time of the hearing of the application upon a like finding the stay may be continued until decision upon the application. An appeal is taken direct to the United States from the order granting or denying the temporary injunction if the appeal is taken thirty days after the order, and after a final hearing an appeal to the Supreme Court must be taken within 60 days. In the case of the L. & N. R. Co. v. United States, 238 U. S. 1, 59 L. Ed. 1177 (1915) affirming 216 Fed. 672, it was held that on an appeal under this act the Court should not be bound by the general rule that an appellate court would not interfere with a decision of a chancellor refusing to grant an 642 THE INTERSTATE COMMERCE ACT. [SECTION 16 interlocutory injunction unless it clearly appeared that there had been an abuse of discretion, but in view of the fact that the decision on an interlocutory injunction against the en- forcement of an order of the commission reducing a freight rate and would operate to reduce revenue it might be equivalent to a final decree, and the court of appeals should therefore consider that fact with others and grant the injunction, and grant it on terms as the equities of the case may require. The Court therefore determined whether the findings of fact by the commission sustained its order and concluded that it was so sustained. § 484. Venue of court review of the orders of com- mission. — These suits are brought in the district court in the place of the commerce court and the act provides they should be brought in the judicial district wherein is the residence of the party or of any of the parties upon whose petition the order was made, except that where the order does not relate to transportation or is not made upon the petition of any party, the venue shall be in the district where the matter complained of in the petition before the commis- sion arises, and except where the order does not relate to either transportation or to a matter so complained of before the commission, the matter covered by the order should be deemed to arise in the district where one of the parties in suit has either his principal office or his principal operating office. In case such transportation relates to a through shipment the train destination should be construed to mean final destination of such shipments. The orders, writs and processes of district courts in such cases are to run and be served and be returnable anjrwhere in the United States. § 485. Court's review limited to cases of affirmative action by the commission. — It was ruled by the Supreme Court in Proctor and Gamble Co. v. United States, 225 U. S. 282, 56 L. Ed. 1021 (1912) that the jurisdiction of the then existing commerce court under the judicial code, section 207, embraced only complaints of affirmative action by the com- mission and did not convey the power to redress a complaint based solely upon the refusal of the commission to award the § 486] THE INTERSTATE COMMERCE ACT. 643 relief asked by a shipper against demurrage regulations upon the ground that the federal statutes gave no right to relief claimed. In this case the commerce court took jurisdiction of the complaint overruhng a motion to dismiss and after hearing the case dismissed the petition, 188 Fed. 221. The Supreme Court said the commerce court erred in taking jurisdiction of the case, and therefore reversed the case with orders to dismiss the petition for want of jurisdiction. The Court said that to allow jurisdiction in such a case would virtually overthrow the entire system, which had arisen from the adop- tion and enforcement to regulate commerce and would be a substitution of a court for a commission and bring about contradiction and confusion. The distinction made in this case between affirmative and negative actions is illustrated by the decision in the tap line cases, supra, which was also an appeal from the then existing commerce court, reviewing the action of the commission, 1913, where it was claimed that the order of the commission in that case concerning the tap Hues was not reviewable for it was merely of the negative character, and this was insisted upon under authority of the decision in the Proctor & Gamble case, supra, — but the Court held that the determination by the commission of the status of the tap lines, to the effect that they were not common carriers was an affirmative, and not a negative action, and therefore it was reviewable by the courts. This distinction between affirmative and negative actions of the commission, or between action of the commission and the refusal of the commission to take action, illustrates the broad and administrative jurisdiction vested in the commission. § 486. The finality of the orders of the commission. — It necessarily follows from this limitation of the power of judicial review, that the administrative orders of the com- mission in the exercise of this jurisdiction when based upon substantial evidence in determining the reasonableness of a railroad rate or regulation are final. In the words of the Supreme Court in the Coal Regulation Case, supra, "power 644 THE INTERSTATE COMMERCE ACT. [SECTION 16 to make the order and not the mere expediency or wisdom of having made it, is the question," when brought into court. In making such administrative orders the commission has necessarily a wide discretion and many factors may require consideration in any specific case. The conclusion may be the determination of a mixed question of law and fact. The announcement by the commission that a certain factor is controlling in the consideration of a rate or regulation would be a conclusion of law, which would be subject to judicial review, though the conclusion of the commission upon a reasonableness of the rate or regulation without any such conclusion of law as to any controlling factor would not be subject to review. This was illustrated in the deci- sion of the Supreme Court in the So. Pacific Case, supra, § 201, that the fixing a rate for the encouragement of certain business interests was beyond the power of the commission. If the commission, however, had simply determined the reasonableness of the rate upon substantial evidence without recognizing any such controlling factor in the determination, its conclusion would not have been open to review. In this connection, it should be noted that there is no requirement in the Act of any statement by the commission of the reasons of its conclusions. § 487] THE INTERSTATE COMMERCE ACT. 645 Section 16a. § 487. Section 16a. § 487. Section 16a.— Sec. 16a. {Added June 29, 1906.) That after a decision, order, or requirement has been [Commission may grant rehearings.] made by the Commission in any proceeding any party thereto may at any time make application for rehearing of the same, or any matter determined therein, and it shall be lawful for the Commission in its discretion to grant such a rehearing [Application for rehearing shall not operate as stay of proceedings, unless so ordered by commission.] if sufficient reason therefor be made to appear. Applica- tions for rehearing shall be governed by such general rules as the Commission may estabhsh. No such application shall excuse any carrier from complying with or obeying any de- cision, order, or requirement of the Commission, or operate in any mannner to stay or postpone the enforcement thereof, without the special order of the Commission. In case a re- hearing is granted the proceedings thereupon shall conform as nearly as may be to the proceedings in an original hearing, except as the Commission may otherwise direct; and if, in its judgment, after such rehearing and the consideration of all facts, including those arising since the former hearing, it shall appear that the original decision, order, or require- ment is in any respect unjust or unwarranted, the Commis- [Gommission may, on rehearing, reverse, change, or modify order.] sion may reverse, change or modify the same accordingly. Any decision, order, or requirement made after such rehear- ing, reversing, chaiiging, or modifying the original determi- nation shall be subject to the same provisions as an original order. It would seem that this section was needless, though it was recommended by the commission, as the right to review and to modify its own decisions probably existed under the very comprehensive grant of powers under the preceding sections. 646 THE INTERSTATE COMMERCE ACT. [SECTION 17 Section 17. § 488. Interstate Commerce Commission — Form of procedure. § 488. Interstate Commerce Commission — Form of Procedure.— Sec. 17. (As amended March 2, 1889.) That the commission may conduct its proceedings in such manner as will best conduce to the proper dispatch of business and to the ends of justice. A majority of the Commission shall constitute a quorum for the transaction of business, but no Commissioner shall participate in any hearing or proceed- ing in which he has any pecuniary interest. Said Commis- sion may, from time to time, make or amend such general rules or orders as may be requisite for the order and regula- tion of proceedings before it, including forms of notices and the service thereof, which shall conform, as nearly as may be, to those in use in the courts of the United States. Any [Parties may appear before the coimnission in person or by attorney.] party may appear before said Commission and be heard in person or by attorney. Every vote and official act of Com- mission shall be entered of record, and its proceedings shall be public upon the request of either party interested. Said [Official seal.] Commission shall have an official seal, which shall be judi- cially noticed. Either of the members of the Commission may administer oaths and affirmations and sign subpoenas. For rules of practice adopted by the commission in the conduct of cases and proceedings under the act, see appendix, p. 887, infra; and as to forms of procedure adopted by the commission, see p. 902, infra. These rules and forms have been very liberally construed by the commission. See supra, § 446. § 490] THE INTERSTATE COMMERCE ACT. 647 Section 18. § 489. Salaries of commissionere, secretary, etc. 490. Expenses of the commission. § 489. Salaries of commissioners, secretary, etc. — Sec. 18. {As amended March 2, 1889.) [See Section 24, in- [Salaries of commisBionere.] creasing salaries of Commissioners.] That each Commissioner shall receive an annual salary of seven thousand five hun- dred dollars, payable in the same manner as the judges of the courts of the United States. The Commission shall ap- [Secretary — how appointed; salary.] point a secretary, who shall receive an annual salary of three thousand five hundred dollars,* payable in like manner. The Commission shall have authority to employ and fix the com- [Employees.] pensation of such other employees as it may find necessary to the proper performance of its duties. Until otherwise provided by law, the Commission may hire suitable offices [Offices and supplies.] for its use, and shall have authority to procure all necessary office suppfies. Witnesses summoned before the Commission [Witnesses' fees.] shall be paid the same fees and mileage that are paid witnesses in the courts of the United States. [Expenses of the commission — how paid.] AH of the expenses of the Commission, including all neces- sary expenses for transportation incurred by the Commission- ers, or by their employees under their orders, in making any investigation, or upon official business in any other places than in the city of Washington, shall be allowed and paid on the presentation of itemized, vouchers therefor approved by the chairman of the Commission. (This section is amended by section 24, infra, added by the amendatory act of June 29, 1906, increasing the number and salaries of the commission.) § 490. Expenses of the commission. — The secretary of t he Interstate Commerce Commission is entitled to be reim- * Increased to $5,000 by sundry civil act of March 4, 1907, 34 Stat. L., 1311. 648 THE INTERSTATE COMMERCE ACT. [SECTION 18 bursed for telegrams sent by him in pursuance of directions of the commission, approved by the chairman of the commis- sion, and accompanied by the request of the chairman that the rules of the comptroller as to the production of copies of telegrams for which credit is asked be disregarded on account of the confidential character of the messages, the secretary having also offered to submit the books of the commission to the comptroller and auditing officers of the treasury. United States V. Moseley, 187 U. S. 322, 47 L. Ed. 198 (1902), affirming the judgment of the court of claims. § 492] THE INTERSTATE COMMERCE ACT. 649 Section 19. § 491. Principal office of the commission, etc. 492. Practice of commission in hearings. § 491. Principal office of the commission, etc. — Sec. 19. That the principal office of the Commission shall be in the city of Washington, where its general sessions shall be held; but whenever the convenience of the public or the par- ties may be promoted, or delay or expense prevented thereby, [Sessions of the commission.] the Commission may hold special sessions in any part of the United States. It may, by one or more of the Commission- [ComniissioD may prosecute inquiries by one or more of its members in any part of the United States.] ers, prosecute any inquiry necessary to its duties, in any part of the United States, into any matter or question of fact pertaining to the business of any common carrier sub- ject to the provisions of this Act. § 492. Practice of commission in hearing. — The com- mission has from its first organization followed the practice of directing cases involving local rates to be heard before one or more members of the commission at a central point in the territory immediately affected by the rates. This section was amended by act of congress, March 1913, providing for the physical valuation of the property of common carriers subject to the act. See section 19a, infra. 650 THE INTERSTATE COMMERCE ACT. [SECTION 19A Section 19a. § 493. Text Of Act of March 1, 1913 on Physical Valuation. 494. Reports of Commission on Physical Valuation. § 493. Text of Act of March 1, 1913 on Physical Valuation. Sec. 19a. {Act of March 1, 1913, ch. 92.) (Interstate commerce regulations — physical value of prop- erty of common carriers.) That the Act entitled "An act to regulate commerce," approved February fourth, eighteen hundred and eighty-seven, as amended, be further amended by adding thereto a new section, to be known as section nineteen a, and to read as follows : "Sec. 19a. That the commission shall, as hereinafter pro- vided, investigate, ascertain, and report the value of all the property owned or used by every common carrier subject to the provisions of this Act. To enable the commission to make such investigation and report, it is authorized to em- ploy such experts and other assistants as may be necessary. The commission may appoint examiners who shall have power to administer oaths, examine witnesses, and take tes- timony. The commission shall make an inventory which shall list the property of every common carrier subject to the provisions of this act in detail, and show the value thereof as hereinafter provided, and shall classify the physical property, as nearly as practicable, in conformity with the classification of expenditures for road and equipment, as prescribed by the Interstate Commerce Commission. "First. In such investigation said commission shall ascer- tain and report in detail as to each piece of property owned or used by said common carrier for its purposes as a com- mon carrier, the original cost to date, the cost of reproduc- tion new, the cost of reproduction less depreciation, and an analysis of the methods by which these several costs are obtained, and the reason for their differences, if any. The commission shall in like manner ascertain and report sepa- rately other values, and elements of value, if any, of the property of such common carrier, and an analysis of the methods of valuation employed, and of the reasons for any differences between any such value, and each of the fore- going cost values. "Second. Such investigation and report shall state in de- tail and separately from improvements the original cost of all lands, rights of way, and terminals owned or used for the purposes of the common carrier, and ascertained as of the time of dedication to public use, and the present value, of § 493] " THE INTERSTATE COMMERCE ACT. 651 the same, and separately the original and present cost of condemnation and damages or of purchase in excess of such original cost or present value. "Third. Such investigation and report shall show sepa- rately the property held for purposes other than those of a common carrier, and the original cost and present value of the same, together with an analysis of the methods of valua- tion employed. "Fourth. In ascertaining the original cost to date of the property of such common carrier the commission, in addition to such other elements as it may deem necessary, shall in- vestigate and report upon the history and organization of the present and of any previous corporation operating such property; upon anj' increases or decreases of stocks, bonds, or other securities, in any reorganization; upon moneys re- ceived by any such corporation by reason of any issue of stocks, bonds, or other securities; upon the syndicating, banking, and other financial arrangements under which such issues were made and the expense thereof; and upon the net and gross earnings of such corporations; and shall also ascertain and report in such detail as may be determined by the commission upon the expenditure of all moneys and the purposes for which the same were expended. "Fifth. The commission shall ascertain and report the amount and value of any aid, gift, grant of right of way, or donation, made to any such common carrier, or to any pre- vious corporation operating such property, by the Govern- ment of the United States or by any State, county, or mu- nicipal government, or by individuals, associations or cor- porations; and it shall also ascertain and report the grants of land to any such common carrier, or any previous corpora- tion operating such property, by the Government of the United States, or by any State, county, or municipal gov- ernment, and the amount of money derived from the sale of any portion of such grants and the value of the unsold portion thereof at the time acquired and at the present time, also, the amount and value of any concession and allowance made by such common carrier to the Government of the United States, or to any State, county, or municipal government in consideration of such aid, gift, grant, or donation. "Except as herein otherwise provided, the commission shall have power to prescribe the method of procedure to be followed in the conduct of the investigation, the form in which the results of the valuation shall be submitted, and the classification of the elements that constitute the ascer- tained value, and such investigation shall show the value of the property of every common carrier as a whole and sepa- 652 THE INTEBSTATE COMMERCE ACT. [SECTION 19a rately the value of its property in each of the several States and Territories and the District of Columbia, classified and in detail as herein required. "Such investigation shall be commenced within sixty days after the approval of this Act and shall be prosecuted with diligence and thoroughness, and the result thereof reported to Congress at the beginning of each regular session there- after until completed. "Every common carrier subject to the provisions of this Act shall furnish to the commission or its agents from time to time and as the commission may require maps, profiles, contracts, reports of engineers, and any other documents, records, and papers, or copies of any or all of the same, in aid of such investigation and determination of the value of the property of said common carrier, and shall grant to all agents of the commission free access to its right of way, its property, and its accounts, records, and memoranda when- ever and wherever requested by any such duly authorized agent, and every common carrier is hereby directed and re- quired to cooperate with and aid the commission in the work of the valuation of its property in such further particulars and to such extent as the commission may require and direct, and all rules and regulations made by the commission for the purpose of administering the provisions of this section and section twenty of this Act shall have the full force and effect of law. Unless otherwise ordered by the commission, with the reasons therefor, the records and data of the commis- sion shall be open to the inspection and examination of the public. "Upon the completion of the valuation herein provided for the commission shall thereafter in like manner keep itself informed of all extensions and improvements or other changes in the condition and value of the property of all common carriers, and shall ascertain the value thereof, and shall from time to time, revise and correct its valuations, showing such revision and correction classified and as a whole and separately in each of the several States and Territories and the District of Columbia, which valuations, both original and cor^pcted, shall be tentative valuations and shall be reported to Congress at the beginning of each regular session. "To enable the commission to make such changes and corrections in its valuations of each class of property, every common carrier subject to the provisions of this Act shall make such reports and furnish such information as the com- mission may require. "Whenever the commission shall have completed the tentative valuation of the property of any common carrier, as herein directed, and before such valuation shall become § 493] THE INTERSTATE COMMERCE ACT. 653 final, the commission shall give notice by registered letter to the said carrier, the Attorney General of the United States, the governor of any State in which the property so valued is located, and to such additional parties as the com- mission may prescribe, stating the valuation placed upon the several classes of property of said carriers, and shall allow thirty days in which to file a protest of the same with the commission. If no protest is filed within thirty days, said valuation shall become final as of the date thereof. "If notice of protest is filed the commission shall fix a time for hearing the same, and shall proceed as promptly as may be to hear and consider any matter relative and material thereto which may be presented in support of any such protest so filed as aforesaid. If after hearing any pro- test of such tentative valuation under the provisions of this Act the commission shall be of the opinion that its valuation should not become final, it shall make such changes as may be necessary, and shall issue an order making such corrected tentative valuation final as of the date thereof. All final valuations by the commission and the classification thereof shall be published and shall be prima facie evidence of the value of the property in all proceedings under the Act to regulate commerce as of the date of the fixing thereof, and in all judicial proceedings for the enforcement of the Act approved February fourth, eighteen hundred and eighty- seven, commonly known as "the Act to regulate commerce," and the various Acts amendatory thereof, and in all judicial proceedings brought to enjoin, set aside, annul, or suspend, in whole or in part, any order of the Interstate Commerce Commission. "If upon the trial of any action involving a final value fixed by the commission, evidence shall be introduced re- garding such value which is found by the court to be differ- ent from that offered upon the hearing before the commis- sion, or additional thereto and substantially affecting said value, the court, before proceeding to render judgment shall transmit a copy of such evidence to the commission, and shall stay further proceedings in said action for such time as the court shall determine from the date of such transmission. Upon the receipt of such evidence the commission shall consider the same and may fix a final value different from the one fixed in the first instance, and may alter, modify, amend or rescind any order which it has made involving said final value, and shall report its action thereon to said court within the time fixed by the court. If the commission shall alter, modify, or amend its order, such altered, modi- fied, or amended order shall take the place of the original order complained of and judgment shall be rendered thereon 654 THE INTERSTATE COMMERCE ACT. [SECTION 19A as though made by the commission in the first instance. If the original order shall not be rescinded or changed by the commission, judgment shall be rendered upon such original order. "The provisions of this section shall apply to receivers of carriers and operating trustees. In case of failure or refusal on the part of the carrier, receiver, or trustee to comply with all the requirements of this section and in the manner pre- . scribed by the commission such carrier, receiver, or trustee shall forfeit to the United States the sum of five hundred dollars for each such offense and for each and every day of the continuance of such offense, such forfeiture to be recov- erable in the same manner as other forfeitures provided for in section sixteen of the Act to regulate commerce. "That the district courts of the United States shall have jurisdiction, upon the application of the Attorney General of the United States at the request of the commission, alleg- ing a failure to comply with or a violation of any of the pro- visions of this section by any common carrier, to issue a writ or writs of mandamus commanding such common carrier to comply with the provisions of this section." (37 Stat. L. 701.) Congress by act of August 1, 1914, made a further enact- ment, section 8509a compiled statutes: "It shall be the duty of every common carrier by railroad whose property is being valued under the Act of March first, nineteen hundred and thirteen, to transport the engi- neers, field parties, and other employees of the United States who are actually engaged in making surveys and other ex- amination of the physical property of said carrier necessary to execute said Act from point to point on said railroad as may be reasonably required by them in the actual discharge of their duties; and, also, to move from point to point and store at such points as may be reasonably required the cars of the United States which are being used to house and main- tain said employees; and, also, to carry the supplies neces- sary to maintain said employees and the other property of the United States actually used on said railroad in said work of valuation. The service above required shall be regarded as a special service and shall be rendered under such forms and regulations and for such reasonable compensation as may be prescribed by the Interstate Commerce Commission and as will insure an accurate record and account of the service rendered by the railroad, and such evidence of trans- portation, bills of lading, and so forth, shall be furnished to the commission as may from time to time be required by the commission." § 494] THE INTERSTATE COMMEECB ACT. 655 § 494. Reports of commission on physical valua- tion. — The commission reports (1913) that in carrying out this provision of the act, it had divided the United States into five sections and distributed the work so that it could be conducted both during the summer and the winter months, and including approximately 50,000 miles of railway. The districts are as follows : Eastern district. — Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, Connecticut, New York, New Jersey, Pennsylvania, Maryland, Delaware, District of Columbia, Virginia, West Virginia, and North Carolina. Central district. — Michigan, Wisconsin, Minnesota, Iowa, Illinois, Louisiana, and Arkansas. Western district. — North Dakota, South Dakota, Ne- braska, Colorado, Kansas, Missouri, Oklahoma, and Texas. Southern district. — Ohio, Indiana, Kentucky, Tennessee, Alabama, Mississippi, Georgia, South Carolina, Florida, Panama, and Porto Rico. Pacific district. — Montana, Wyoming, Utah, Idaho, Ne- vada, Washington, Oregon, California, Arizona, New Mexico, and Alaska. Five principal engineers were appointed : one in charge of these, headquarters being in Washington; the Central district in Chicago; the Western district Kansas City; the Southern district Chattanooga; Pacific district San Fran- cisco. It was expected that actual operation would be begun early in January, 1914. In its report of 1914, the commission says that: "the manifest pupose of the Act is to secure a complete and accurate inventory and valuation of the property of common carriers, subject to the Act to regulate commerce and that the present work of the commission falls under two heads : First, the ascertainment of the cost of reproduc- tion of property, and less depreciation; Second, the ascer- tainment of the original cost of the property to date, with certain information as to its financial and corporate distri- bution." 656 THE INTERSTATE COMMERCE ACT. [SECTION 19a The first is largely engineering; the second accounting. Details are given of progress made in this work. Its com- pletion will doubtless require several years. The National Securities Commission in its report. (1911) suggested physical valuation of the railroads, as a pre- requisite to any extension of the federal powers in the matter of regulating the issue of railway securities. 495] THE INTERSTATE COMMERCE ACT. 657 Section 20. § 495. Section 20 as amended. 496. The amendments of 1906 and 1910. 497. Railroads not subject to section 20 of the act. 498. The enforcement of reports by mandamus. 499. The power of Commission in enforcing reports sustained. 500. Limitation of the power of the Commission in enforcing inspec- tion. § 495. Section 20 as amended. — Sec. 20. {As amended June 29, 1906, February 25, 1909, and June 18, 1910.) That [Officers subject to act, and owners of railroads engaged in interstate commerce must render full annual reports to commission; and commisBion is authorized to pre- scribe manner in which reports shall be made and re- quire specific uns'werB to all questions.] the Commission is hereby authorized to require annual re- ports from all common carriers subject to the provisions of this Act, and from the owners of all railroads engaged in interstate commerce as defined in this Act, to prescribe the manner in which such reports shall be made, and to require from such carriers specific answers to all questions upon which the Commission may need information. Such annual [What reports of carriers shall contain.] reports shall, show in detail the amount of capital stock issued, the amounts paid therefor, and the manner of pay- ment for the same; the dividends paid, the surplus fund, if any, and the number of stockholders; the funded and float- ing debts and the interest paid thereon; the cost and value of the carrier's property, franchises, and equipments; the number of employees and the salaries paid each class; the accidents to passengers, employees, and other persons, and the causes thereof; the amounts expended for improvements each year, ho\y expended, and the character of such im- Erovements; the earnings and receipts from each branch of usiness and from all sources; the operating and other ex- penses; the balances of profit and loss; and a complete ex- hibit of the financial operations of the carrier each year, including an annual balance sheet. Such reports shall also [Commission may prescribe uniform system of accounts and manner of keeping accounts.] contain such information in relation to rates or regulations concerning fares or freights, or agreements, arrangements, oi contracts affecting the same as the Commission may require ; and the Commission may, in its discretion, for the purpose J-42. 658 THE INTERSTATE COMMERCE ACT. [SECTION 20 of enabling it the better to carry out the purposes of this Act, prescribe a period of time within which all common carriers subject to the provisions of this Act shall have, as near as may be, a uniform system of accounts, and the man- ner in which such accounts shall be kept. [Annual reports to Be filed with commiBsion by September 30 of each year.] Said detailed reports shall contain all the required sta- tistics for the period of twelve months ending on the thirtieth day of June in each year, or on the thirty-first day of De- cember in each year if the Commission by order substitute that period for the year ending June thirtieth, and shall be made out under oath and filed with the Commission at its office in Washington within three months after the close of the year for which the report is made, unless additional time [Commission may grant additional time.] be granted in any case by the Commission; and if any car- rier, person, or corporation subject to the provisions of this Act shall fail to make and file said annual reports within the time above specified, or within the time extended by the Commission, for making and filing the same, or shall fail to make specific answer to any question authorized by the provisions of this section within thirty days from the time it is lawfully required so to do, such party shall forfeit to the [Penalty.] United States the sum of one hundred dollars for each and every day it shall continue to be in default with respect thereto. The Commission shall also have authority by gen- [Monthly or periodical reports.] eral or special orders to require said carriers, or any of them, to file monthly reports of earnings and expenses, and to file periodical or special, or both periodical and special, reports concerning any matters about which the Commission is authorized or required by this or any other law to inquire or to keep itself informed or which it is required to enforce; and such periodical or special reports shall be under oath whenever the Commission so requires; and if any such car- rier shall fail to make and file any such periodical or special report within the time fixed by the Commission, it shall be subject to the forfeitures last above provided. [Recovery of forfeitures.] Said forfeitures shall be recovered in the manner provided for the recovery of forfeitures unde^ the provisions of this Act. [Oath to annual reports, how taken.] The oath required by this section may be taken before any person authorized to administer an oath by the laws of the State in which the same is taken. § 495] THE INTERSTATE COMMERCE ACT. 659 [Commission may prescribe forms of accounts, records, and memoranda, and have access thereto.] The Commission may, in its discretion, prescribe the forms of any and all accounts, records, and memoranda to be kept by carriers subject to the provisions of this Act, including the accounts, records, and memoranda of the movement of traffic as well as the receipts and expenditures of moneys. The Commission shall at all times have access to all accounts, records, and memoranda kept by carriers subject to this Act, and it shall be unlawful for such carriers to keep any [Carrier can not keep other accounts than those pre- scribed by commission.] other accounts, records, or memoranda than those prescribed or approved by the Commission, and it may employ spe- cial agents or examiners, who shall have authority under [Commission may employ special examiner to inspect accounts and records.] the order of the Commission to inspect and examine any and all accounts, records, and memoranda kept by such carriers. This provision shall apply to receivers of carriers and operating trustees. [Punish ment of carrier by forfeiture for failure to keep accounts or records as prescribed by commission or allow inspection of accounts or records.] In case of failure or refusal on the part of any such carrier, receiver, or trustee to keep such accounts, records, and mem- oranda on books and in the manner prescribed by the Commission, or to submit such accounts, records, and memoranda as are kept to the inspection of the Commission or any of its authorized agents or examiners, such carrier, receiver, or trustee shall forfeit to the United States the sum of five hundred dollars for each such offense and for each and every day of the continuance of such offense, such for- feitures to be recoverable in the same manner as other for- feitures provided for in this Act. [Punishment of person for false entry in accounts or rec- ords, or mutilation of accounts or records, or for keeping other accounts than those prescribed by commission. Fine or imprisonment or both. Any person who shall wilfully make any false entry in the accounts of any book of accounts or in any record or memo- randa kept by a carrier, or who shall willfully destroy, muti- late, alter, or by any other means or device falsify the record of any such account, record, or memoranda, or who shall willfully neglect or fail to make full, true, and correct entries in such accounts, records, or memoranda of all facts and transactions appertaining to the carrier's business, or shall keep any other accounts, records, or memoranda than those prescribed or approved by the Commission, shall be deemed 660 THE INTERSTATE COMMERCE ACT. [SECTION 20 guilty of a misdemeanor, and shall be subject, upon convic- tion in any court of the United States of competent juris- diction, to a fine of not less than one thousand dollars nor more than five thousand dollars or imprisonment for a term not less than one year nor more than three years, or both [Amendment of February 25, 1909.] such fine and imprisonment: Provided, That the Commis- sion may in its discretion issue order specifying such oper- ating, accounting, or financial papers, records, books, blanks, tickets, stubs, or documents of carriers which may, after a [When destruction of papers permissible.] reasonable time, be destroyed, and prescribing the length of time such books, papers, or documents shall be preserved. [Punishment of special examiner who divulges facts or information without authority. Fine or imprisonment or both.] Any examiner who divulges any fact or information which may come to his knowledge during the course of such ex- amination, except in so far as he may be directed by the Commission or by a court or judge thereof, shall be subject, upon conviction in any court of the United States of com- petent jurisdiction, to a fine of not more than five thousand dollars or imprisonment for a term not exceeding two years, or both. [United States courts may issue mandamus to compel compliance with provisions of act.] That the circuit and district courts of the United States shall have jurisdiction, upon the application of the Attorney- General of the United States at the request of the Commis- sion, alleging a failure to comply with or a violation of any of the provisions of said Act to regulate commerce or of any Act supplementary thereto or amendatory thereof by any common carrier, to issue a writ or writs of mandamus com- manding such common carrier to comply with the provisions of said Acts, or any of them. [Cozniuissioii may employ special agents or examiners to administer oaths, examine witnesses, and receive evi- dence.] And to carry out and give effect to the provisions of said Acts, or any of them, the Commission is hereby authorized to employ special agents or examiners who shall have power to administer oaths, examine witnesses, and receive evidence. [Receiving common carrier liable for loss or damage on through shipments carried by it or by any connection, irrespective of contract to contrary.] Carmack amend- ment 1906. That any common carrier, railroad, or transportation com- pany receiving property for transportation from a point in one State to a point in another State shall issue a receipt or §496] THE INTERSTATE COMMERCE ACT. 661 bill of lading therefor and shall be hable to the lawful holder thereof for any loss, damage, or injury to such property caused by it or by any common carrier, railroad, or trans- portation company to which such property may be deliv- ered or over whose line or lines such property may pass, and no contract, receipt, rule, or regulation shall exempt such common carrier, railroad, or transportation company from (Remedies under existing law not barred.] the liabihty hereby imposed : Provided, That nothing in this section shall deprive any holder of such receipt or bill of lading of any remedy or right of action which he has under existing law. [Initial earricr may have recourse upon carrier respon- sible for loss or damage.] That the common carrier, railroad, or transportation com- pany issuing such receipt or bill of lading shall be entitled to recover from the common carrier, railroad, or transportation company on whose line the loss, damage, or injury shall have been sustained the amount of such loss, damage, or injury as it may be required to pay to the owners of such property, as may be evidenced by any receipt, judgment, or transcript thereof. § 496. The amendments of 1906 and 1910. — This section has been extensively amended. Thus by the act of 1906 the provision for the annual reports was made more specific, and also the reports of accidents, and detaileci regulation of the forms of accounts, records, memoranda of the carriers, and the prohibition of any other records or memoranda than those prescribed by the rules of the com- mission; the power of inspection, and penalties to enforce this right of inspection, and punishment for false entries, and mandamus to compel compliance with the provisions of the act, with the employment of special agents and ex- aminers, and the provision as to the hability of the initial carriers, were all added in this amendment of 1906. In 1910 was added the provision for filing of reports at the end of the calendar year, if so ordered by the commission ; the requirement of filing monthly or special reports was made more specific, and provision was also enacted for authorizing the destruction of books and papers of the carriers after a reasonable time. As to Carmack amendment to this section in 1906, as amended by Cummings amendment of Mar. 4, 1915 see infra, § 501. 662 THE INTERSTATE COMMERCE ACT. [SECTION 20 § 497. Railroads not subject to section 20 of the act. — A railroad which is not subject to the provisions of the Interstate Commerce Act is not bound to make any report of its business to the Interstate Commerce Commission under this section. Thus a railroad located wholly within a state, which transports freight, whether coming from within or without the state, solely on local bills of lading, under a special contract limited to its own lines, and without dividing charges with any other carriers, or assuming any other obligations to or for it, is not bound to make any report of its business to the Interstate Commerce Commission. United States exrel. v. K. & S. R. Co., 81 Fed. 783 (1897), W. Dist. of Mich. See also Commission v. Belaire C. & Z. R. Co., 77 Fed. 942 (1897). But where a carrier operates a rail- road wholly within a state, but is engaged in interstate trans- portation by agreements for through traffic, it is required under the act to report to the commission as to the interstate commerce. Commission v. Seaboard Ry. Co., 82 Fed. 563 (1897). § 498. The enforcement of reports by mandamus. — Prior to the amendatory act of 1906, it had been held by the Supreme Court in a suit brought by the commission against the Lake Shore and Michigan Southern Railroad Company, that the circuit court had no jurisdiction under the section before the amendment of 1906 to enforce reports by writ of mandamus, as such power to issue original writs of man- damus only existed in the circuit courts when specifically conferred by statute. Under the act as amended the right to issue mandamus to compel a compliance with any of the provisions of the ac!t is conferred upon the circuit courts and district courts, upon application of the Attorney General at the request of the commission. § 499. The power of commission in enforcing report sustained. — In Kansas City S. R. Co. v. United States, 231 U. S. 423, 58 L. Ed. 296, the Supreme Court affirmed the decree of the commerce court, 204 Fed. 641, dismissing the petition of the Kansas City S. R. Co. in an action to enjoin enforcement of the regulations of the Inter- § 500] THE INTERSTATE COMMERCE ACT. 663 state Commerce Commission relative to uniform accounting and bookkeeping system described for railway carriers. The regulations were the "classification of expenditures" for additions and betterments, effective July 1, 1909, under revised issue effective July 1, 1910. The Court said in its opinion that there was no unlawful delegation of power in this authorization of the commission to prescribe a uniform system of accounting, even though such uniformity may control the conduct of the carrier in its capacity as a public servant engaged in interstate commerce. There was no abuse of their authority, in that they rejected the theory that the cost of property abandoned as an incident of permanent improvement should remain in the property accounts, rather than to be charged to operative expense; nor because they did not allow the railroad company to carry into its property account the full cost of reducing rates. The Court said that these requirements did not involve taking of property without due process of law, as to the company nor as to the mortgagees or stockholders of the company; that the requirements made by the commission did not involve any abuse of its powers, and as long as it acted fairly and reasonably, within the grant of power con- stitutionally conferred by congress, its orders were not open to judicial review. The constitutionality of this section was also sustained in the Interstate Commerce Commission v. Goodrich Transit Co., 224 U. S. 194, 56 L. Ed. 729 (1912). In 30 I. C. C. 676, the commission held that sufficient reason existed for requiring carriers to separate their operat- ing expenses between freight and passenger service as out- lined by the Statistical Serial Circular No. 3. The commis- sion said that this circular would be revised, and if sufficient progress could be made, the carriers would be asked to file special reports for the year ending June 30, 1915, and as early as practicable all carriers would be required to assign and apportion all operating expenses between freight and passenger service on the bases which would be prescribed. § 500. Limitation of the power of the commission in enforcing inspection.— In United States ex rel v. L. & N. R. Co., 236 U. S. 317, 59 L. Ed. 598, (1915) the Supreme 664 THE INTERSTATE COMMERCE ACT. [SECTION 20 Court affirmed the district court of Kentucky, 212 Fed. 486, in refusing a mandamus to compel the railway company to permit an inspection of their accounts, records, memoranda and correspondence by special agents of the Interstate Com- merce Commission. The Court said that it was not necessary to consider whether this section of the act intended to re- quire the confidential communications with the counsel of the company to be subject to examination and pubhcation, as the section in the opinion of the Court did not authorize the compulsory submission of the correspondence of the company to inspection. The right to inspect and examine the accounts, records and memoranda of interstate railway carriers by this section was not intended to be limited to such accounts, records and memoranda as were made after the passage of the act, but it was intended that an >examination be permitted of all such accounts, records and memoranda for the purpose of carrying out the provisions of the act. The language used however, was not broad enough to indicate an intention to include the correspondence of the company. The Court therefore affirmed the order dismissing the petition without prejudice, and in view of this the Court refused to reverse the order so as to permit the granting of rehef within the limits which the statute permitted. §501] THE INTERSTATE COMMERCE ACT. 665 Section 20a. § 501. The Carmack amendment as amended by Cummings Act of 1915. 502. The Carmack amendment sustained by Supreme Court. 503. The displacement of State laws by Carmack amendment. 504. Intermediate carrier not liable under this amendment, even though issuing bill of lading. 505. Limitation of liability by carrier under Carmack amendment. 506. Construction of Cummings amendment by Interstate Commerce Commission. § 601. The Carmack Amendment, as amended by the Cummings Act of 1915. — Sec. 20a. On March 4, . 1915, the following act, anaiendatory of the act to regulate commerce, and hereinafter called the Cummings amendment, was approved. "Be it enacted by the Senate and House of Representatves of the United States of America in Congress assembled. That so much of section seven of an Act entitled 'An Act to amend an Act entitled "An Act to regulate commerce," ap- proved February 4, 1887, and all Acts amendatory thereof, and to enlarge the powers of the Interstate Commerce Com- mission," approved June 29, 1906, as reads as follows, to-wit: " 'That any common carrier, railroad or transportation company receiving property for transportation from a point in one state to a point in another state shall issue d receipt > or a bill of lading therefor, and shall be liable to the lawful holder thereof for any loss, damage or injury to such prop- erty caused by it or by any common carrier, railroad or transportation company to which such property may be de- livered, or over whose line or lines such property may pass, and no contract, receipt, rule or regulation shall exempt such common carrier, railroad or transportation company from the hability hereby imposed: Provided, That nothing in this section shall deprive any holder of such receipt or bill of lading of any remedy or right of action which he has under existing law," be, and the same is hereby, amended so as to read as follows, to-wit: " 'That any common carrier, railroad or transportation company subject to the provisions of this Act receiving property for transportation from a point in one state or ter- ritory or the District of Columbia to a point in another state, territory. District of Columbia, or from any point in the United States to a point in an adjacent foreign country 666 THE INTERSTATE COMMERCE ACT. [SECTION 20a shall issue a receipt or a bill of lading therefor, and shall be liable to the lawful holder thereof for any loss, damage or injury to such property caused by it or by any common carrier, railroad or transportation company to which such property may he delivered or over whose line or lines such property may pass within the United States or within an adjacent foreign country when transported on a through bill of lading, and no contract, receipt, rule, regulation or other limitation of any character whatsoever, shall exempt such common carrier, railroad or transportation company from the liabihty hereby imposed; and any such common carrier, railroad or transportation company so receiving property for transportation from a point in one state, ter- ritory or the District of Columbia to a point in another state or territory, or from a point in a state or territory to a point in the District of Columbia, or from any point in the United States to a point in an adjacent foreign country, or for transportation wholly within a territory shall be liable to the lawful holder of said receipt or bill of lading or to any party entitled to recover thereon, whether such receipt or bill of lading has been issued or not, for the full actual loss, damage or injury to such property caused by it or by any such common carrier, railroad or transportation company to which such property may be delivered or over whose line or lines such property may pass within the United States or within an adjacent foreign country when transported on a through bill of lading, notwithstanding any limitation of liability or limitation of the amount of recovery or repre- sentation or* agreement as to value in any such receipt or bill of lading, or in any contract, rule, regulation, or in any tariff filed with the Interstate Commerce Commission; and any such limitation, without respect to the manner or form in which it is sought to be made is hereby declared to be unlawful and void: Provided, however, That if the goods are hidden from view by wrapping, boxing or other means, and the carrier is not notified as to the character of the goods, the carrier may require the shipper to specifically state in writing the value of the goods, and the carrier shall not be liable beyond the amount so specifically stated, in which case the Interstate Commerce Commission may establish and maintain rates for transportation, dependent upon the value of the property shipped as specifically stated in writing by the shipper. Such rates shall be published as are other rate schedules: Provided, further, That nothing in this sec- tion shall deprive any holder of such receipt or bill of lading of any remedy or right of action which he has under the ex- isting law: Provided further, That it shall be unlawful for *33I. C. R. R. 685. § 502] THE INTERSTATE COMMERCE ACT. 667 any such common carrier to provide by rule, contract, regu- lation or otherwise a shorter period for giving notice of claims than ninety days and for the filing of claims for a shorter period than four months, and for the institution of suits than two years: Provided, however. That if the loss, damage or injury complained of was due to delay or damage while being loaded or unloaded, or damaged in transit by carelessness or negligence, then no notice of claim nor filing of claim shall be required as a condition precedent to re- covery. "Sec. 2. That this Act shall take effect and be in force from ninety days after its passage." This act was further amended by Act of January 20, 1914, amending the Judicial Code, by adding, at Section 28 of Chapter 3 (38 Statutes at Large 278), that "No suit brought in any state court of competent juris- diction against a railroad company * * * to recover damages for delay, loss of, or injury to property received for transportation by such common carrier under Section 20 of the Act to Regulate Commerce * * * shall be re- moved to any court of the United States, where the matter in controversy does not exceed, exclusive of interest and costs, the sum or value of $3000." § 602. Carmack amendment sustained by the Su- preme Court. — The so-called Carmack amendment im- posing upon the official carrier the liabihty for loss on through shipments with the remedy over, was inserted in 1906 in this section, and has been sustained by the Supreme Court as a rightful exercise of the power of congress under the commerce clause, and as controUing and invahdating state legislation conflicting therewith in interstate shipments. See Atlantic R. R. Co. v. Riverside Mills, 219 U. S. 186, 55 L. Ed. 167, (1911). In this case the Court affirmed the circuit court of the southern district of Georgia, 168 Fed. 990, in holding the initial carrier in an interstate shipment liable to the shipper for a loss while the goods were in the hands of connecting carriers, though the bill of lading provided no carrier should be liable for loss or damage not occurring on its portion of the route. The Court said the liability of the receiving carrier in such case was that of a principal for the neghgence of his own 668 THE INTERSTATE COMMERCE ACT. [SECTION 20a agents. It held, however, that the attorney's fee allowed as part of the costs under section. 8 of the commerce act, was not allowable in this case under the Carmack amendment, since the cause of action was the loss of property, which in no way was traceable to the violation of the provision of the statute. In Galveston H. & S. A. R. Co. v. Wallace, 223 U. S. 481, 56 L. Ed. 516, (1913) the Court afhrmed the judgment of the Texas court and held that a state court could properly enforce a liability of an initial carrier of an interstate ship- ment under this amendment and that the proof of delivery of an interstate shipment to the initial carrier and of failure to deliver the same to the consignee raised the presumption of negligence so as to give rise to the liability irrespective of any contract and the burden was placed upon the carrier proving that the loss resulting from such cause for which the initial carrier was not responsible by law or contract, but it must be in spite of any agreement or stipulation limiting liability to its own line. In New York & P. & N. R. Co. v. Peninsula Produce Exchange, 240 U. S. 34, 60 L. Ed. , (1916) the Court, affirming 122 Md. 215, sustained the recovery of damages for the loss of a market against the initial carrier under this Act, because of unreasonable delay in transportation. The Court said the words of the Act were comprehensive enough to embrace all damages resulting from any failure to dis- charge a carrier's duty with respect to any part of the trans- portation to the agreed destination. The Court said that this view found support in the explicit terms of the Act of January 20, 1914, supra §501, and that it was immaterial that the trial court erroneously by ita instructions, per- mitted the jury to award as damages the amount of the decline in value, without reference to the limitation in the bill of lading and the carrier's published tariff, or because the trial court erroneously excluded the tariff with its con- ditions when offered in evidence, as the agreed maximum of liability recoverable was not exceeded by the judgment rendered. § 603. The displacement of state laws by Carmack amendment. — In Atchison, Topeka & Santa Fe v. Robin- § 504] THE INTERSTATE COMMERCE ACT. 669 son, 233 U. S. 173, 58 L. Ed. 901, (1914), the Court reversed the Supreme Court of Oklahoma, 36 Okla. 435, and reafTirmed the exclusive rule of the Hability of a railway carrier under contracts, for interstate shipment under this Carmack amendment. The same rule had been declared in Chicago, B. & Q. v. Miller, 226 U. S. 512, 57 L. Ed. 323, (1913). See also Missouri, Kansas, etc. R. Co. v. Harriman, Bros. 227 U. S. 657, 57 L. Ed. 690. (1913) Chicago, R. I. & Pac. R. Co. v. Cramer, 232 U. S. 490, 58 L. Ed. 697, (1914) reversing 153 la. 103. This principle of the paramount authority of congress in interstate commerce, is subject to the qualifications that the displacement of the state law is only where the repugnancy is direct and positive, so that the two acts cannot stand together. This principle was apphed in M. K. & T. R. R. Co. V. Harris, 234 U. S. 412, 58 L. Ed. 1377, (1914) where the Court sustained a Texas statute allowing a fee, if not over $20.00, to the attorney who was actually employed, in a claim not exceeding $200.00. The Court said this would not enlarge the limit of a carrier for loss of property and was only a remedy for enforcing that responsibility, and dealt with the question of costs, respecting which congress had not spoken ; and until congress did speak the state could en- force such an allowance in such a case as that presented. In Charleston & W. C. R. Co. v. Varnville F. Co., 237 U. S. 597, 59 L. Ed. 1137, (1915) the Supreme Court re- versed the Supreme Court of South Carohna in 98 S. C. 63, which imposed a $50.00 penalty for a failure to pay promptly a claim for damages on an interstate shipment, and held that congress had so far taken over the subject on a carrier's liability for loss of damage to interstate shipment as to invalidate such act, and the statute was not saved by calling it an exercise of a police power, nor by the- proviso in the act of congress saving the rights of holders of bill of lading under existing law. § 604. Intermediate carrier not liable under this amendment even though issuing a bill of lading. — In Hudson v. Chicago, St. P. M. & 0. Ry. Co., (Dis. of 670 THE INTERSTATE COMMERCE ACT. [SECTION 20a Minn.) (1915) 226 Fed. 38, the defendant was an inter- mediate carrier, but it had issued a new bill of lading. There was no evidence that the delay in the shipment oc- curred on its own line. The court examined the history of the amendment and held that, as construed in the Riverside Mills case, supra, that its purpose was to simplify rather than to render complex interstate commerce and interstate shipments and to unify and simplify, rather than multiply and mystify the remedies of the shippers in obtaining com- pensation for their losses, and that the amendment therefore could not bear the construction claimed by plaintiff that the common carrier in the line may be sued, not only for its own default, but for that of a succeeding carrier. It seems that it has been ruled by the IHinois court of appeals in Looney v. Railway "Co., 192 111. App. 273 that while an intermediate carrier in a line of connecting carriers was under no obhgations to issue a bill of lading, yet if it did so, it came under the purview of this amendment and there- fore liable for a default by a succeeding carrier. The court declined to follow this ruling, however, and said that if such an obhgation could be assumed by an intermediate carrier by the issuance of a bill of lading, it would in effect allow it to give special privileges in violation of the Interstate Commerce Act. The court therefore held that neither in the absence of a bill of lading, nor by issuing a bill of lading, could an inter- mediate carrier be held liable for loss or damage occurring on the line of a succeeding carrier. The status of a connecting carrier was also considered by the district court of Iowa in Adams v. Chicago Great Western Ry. Co., 210 Fed. 362 (1914), where the court sustained the motion to remand to the state court a suit which involved less than the jurisdictional amount and was filed against certain connecting carriers for loss of goods shipped in interstate com- merce. The court said that the fact that the initial carrier's liability was based solely upon the Carmack amendment which made the initial carrier liable for the fault of the con- necting carriers forming part of a through route in interstate commerce, was insufficient to confer federal jurisdiction of the controversy between the plaintiff and the initial carrier when the amount in controversy did not exceed $3000. §505] THE INTERSTATE COMMERCE ACT. 671 Held, in Hamlin & Sons Co. v. Illinois Central R. R. Co., 212 Fed. 324, Dist. Ct. of Arkansas, (1914) that the Carmack amendment had no application to foreign commerce. § 605. Limitation of liability under Cajrmack amendment. — The limitation of liability under the Car- mack amendment prior to the amendment by the Cummings Act of 1915, dealt directly only with the question of the liability of the initial carrier, and had no direct connection wilji the matter of the hmitation of liability by the carrier, and under the requirements of the publication of rate tariffs under section 6 of this act. In the Oklahoma case, supra, which involved a shipment of live stock, it was held that a special contract for an inter- state railway shipment without limitation of the carriers' liability, could have no binding force where the carriers published tariff on file in the Interstate Commerce Commis- sion, and graduated the rates according to declared value, and limited the carriers' liabihty accordingly. The shipper, as well as the carrier, was bound to take notice of the filed tariff rates, and so long as they remained operative they are conclusive as to the rights of the parties, in the absence of facts and circumstances showing an attempt at rebating or false billing. The court therefore reversed the judgment of the Texas court for $1500, and directed a judgment for the limited liability under the published rates. In the case of George N. Pierce Company v. Wells Fargo & Co., 236 U. S. 278,59 L. Ed. 576, (1915) the Court, affirm- ing 189 Fed. 561, held that a gross disproportion between the value of an interstate express shipment and the arbitration value fixed in the express company's receipt did not prevent the application of the rule, that the carrier could under the Carmack amendment limit its liability to an accurate value made to secure the lower of two or m9re published rates based upon value. The Court therefore directed a judgment for $50 on a shipment of four automobiles, which were alleged to be of the value of $20,000, as $50 was the sum named in the rate tariffs as the amount of liability, in the absence of a declaration of a greater value by the shipper, who was given the privilege of paying reduced rate and having the liability extended thereby to the full value of the goods. 672 THE INTERSTATE COMMERCE ACT. [SECTION 20A In Pacific Ry. Co. v. Harper Bros., C. C. A. seventh circuit, 201 Fed. 671 (1912), it was decided that neither the common law nor the Carmack amendment, which made an interstate carrier Uable for damage caused by it or a connect- ing carrier to property in shipment, prohibited contracts exempting it from such UabiUty. § 606. Construction of the Cummin^s amendment by the Interstate Commerce Commission. — This Cum- mings amendment was enacted as an amendment of the Carmack amendment of 1906. The Interstate Commerce Commission in its report, 33 I. C. C. 682, on May 7, 1915, says "Many widely varying diametrical opposed ideas have been expressed as to the effect of this amendment and as to what will be lawful rates under present tariffs when it be-' comes effective on June 2, 1915." The commission ex- pressed a tentative view of the law that the effect of the amendment except as otherwise provided therein, was to invahdate all limitations of carriers' liabihty for loss, damage or injury to property transported, caused by the initial carrier or by another carrier to which it may be delivered or which may participate in transporting. The commission further says that "There was nothing in the express terms of the act or in the history of the legislation that shows any intention or purpose on the part of congress to effect in any degree existing rates charged by carriei* transporting property." The legislation was aimed at specified contracts and declares them to be unlawful. The lawful rates on file at this time therefore are the rates for limiting the liability. The commission also ruled that the carriers could lawfully provide in their tariffs a rate schedule that their UabiUty should be for the full value of the property at the time and place of shipment. The commission also expressed the opinion that the act did not apply to export and import shipment, to and from foreign countries, not adjacent to the United States. As to the proviso in the act the commission was of the opinion that the word "character" included the true, actual value as stated by the shipper. When the goods are not hidden from view, and the carrier is advised as to their character, all contracts or agreements § 506] THE INTERSTATE COMMERCE ACT. 673 purporting to limit the liability of the carrier for loss or damage caused by it are void. There was, however, no inhibition in the act as to the limitation of the liability of the carrier for loss not caused by it, or succeeding carrier, to which the property may be delivered. The commission also considered that the terms of this amendment applied to the transportation of baggage, (see the consideration of this same subject by the commission in 32 I. C. C. 152). The commission ordered that the carrier should make effective on June 2, 1915, for not less than three days to the public, and the commission entered in the manner prescribed in the act and in the commission's regulations, amendments to the classifications and rate schedules which eliminate pro- visions or rules that are in conflict with the terms of the new law, providing that no amendment is to conflict in any manner with the rate for such service. The commission said further that it did not appear that the amendment to the act afforded jufetification for any increased rates on commodities in general. The commission made a further ruling on this amendment in a proceeding brought by the Iowa State Board of Railroad Commissioners against several railroads, 36 I. C. C. 79, July, 1915, and it was found that the regulations of the carriers concerning the shipment of livestock undeV shipping con- tracts restricting the carrier's hability for loss or damage to certain specified amount were unreasonable. The commis- sion said that the Cummings amendment had in effect abolished in interstate commerce the whole system of released rates based on agreed valuations as distinguished from actual value. They found that the schedule valuations of each class of animals was unjustly and unreasonably low and not repre- sentative of the average actual value of the animals shipped. See also report of Commission, February 1914, in the mat- ter of Bills of Lading and discriminations respecting loss and damage claims. J-43. 674 THE INTEEBTATK COMMERCE ACT. [SECTION 21 Section 21. § 507. Section 21 as amended. 508. The annual reports of the commission. [Annual reports of the commission to congress.] § 507. Section 21 as amended.— Sec. 21. (As amended March 2, 1889.) That the Commission shall, on or before the first day of December in each year, make a report, which shall be transmitted to Congress, and copies of which shall be distrbuted as are the other reports transmitted to Con- gress. This report shall contain such information and data collected by the Commission as may be considered of value in the determination of questions connected with the regula- tion of commerce, together with such recommendations as to additional legislation relating thereto as the Commission may deem necessary; and the names and compensation of the persons employed by said Commission. § 508. The annual reports of the commission. — The annual reports of the commission published by the Govern- ment Printing Office have been regularly issued since the organization of the commission and are now (1916) 28 in number. The reports contain a discussion of the work of the commission during the year with recommendations for further legislation; a full report of decisions during the year and of pending litigation both civil and criminal in the en- forcement of the act to regulate commerce. A statement of the clerical force and other employes of the commission several hundred in number at an annual expense of, including the valuation expenses, of over $4,000,000.00 during the past year (1915) is also included. The reports contain a digest of reported cases during the .year, a digest of the court decisions relative to the commission and to the enforcements of the act, and also of cases in interstate commerce relative to matters arising before the commission. The vast range of the duties of the commission, and their great expansion under the successive acts of congress are indicated in these annual reports. 509] THE INTEESTATE COMMERCE ACT. 675 Section 22. § 509. Persons and property that may be carried free or at reduced rates, etc. 510. Amendments to section 511. The section illustrative and not exclusive. 5i2. The section permissive only. 513. Withdrawal of commutation tickets. 514. The commission on excursion rates. 515. The jurisdiction of the commission as to commutation rates. § 509. Persons and property that may be carried free or at reduced rates, etc. — Skc. 22. (As amended March 2, 1889, and February 8, 1895.) [See sectian 1, 5th par.] That nothing in this act shall prevent the carriage, storage, or handling of property free or at provided rates foi the Un'ted States, State, or municipal governments, or for charitable purposes, or to or from fa'rs and expositions for exhibition thereat, or the free carriage of destitute and homeless per- [Mileage, excursion, or commutation passenser tickets.] sons transported by charitable societies, and the necessary agents employed in such transportation, or the issuance of mileage, excurs-on, or commutation passenger tickets; nothing in this Act shall be construed to prohibit any com- rnon carrier from giving reduced rates to ministers of reli- gion, or to municipal governments for the transportation of indigent persons, or to iijmates of the National Homes or State Homes for Disabled Volunteer Soldiers,, and of Sol- diers' and Sailors' Orphans Homes, including those about to [Passes and free transportation to officers and employea of railroad companies.] enter and those returning home after discharge, under ar- rangements with the boards of managers of said homes; nothing in this Act shall be construed to prevent railroads from giving free carriage to their own oflTicers and employees, or to prevent the principal officers of any railroad company or companies from exchanging passes or tickets with other [Provisions of act are in addition to remedies existing at common law. Pending litigation not affected by act,] railroad companies for their officers and employees; and nothing in this Act contained shall in any way abridge or alter the remedies now existing at common law or by stat- ute, but the provisions of this Act are in addition to such remedies: Provided, That no pending litigation shall in any way be afTected by this Act: Provided further. That nothing in this Act shall prevent the issuance of joint interchange- 676 THE INTERSTATE COMMERCE ACT. [SECTION 22 able five-thousand-mile tickets, with special privileges as to [Joint interchangeable five-thousand- mile tickets. Amount of free baggage.] the amount of free baggage that may be carried under mile- age tickets of one thousand or more miles. But before any common carrier, subject to the provisions of this Act, shall issue any such joint interchangeable mileage tickets with special privileges, as aforesaid, it shall file with the Inter- state Commerce Commission copies of the joint tariffs of rates, fares, or charges on which such joint interchangeable mileage tickets are to be based, together with specifications of the amount of free baggage permitted to be carried under such tickets, in the same manner as common carriers are re- quired to do with regard to other joint rates, by section six [Publication of rates.] of this Act; and all the provisions of the said section six re- lating to joint rates, fares, and charges shall be observed by said common carriers and enforced by the Interstate Commerce Commission as fully with regard to such joint interchangeable mileage tickets as with regard to other joint rates, fares, and charges referred to in said section six. It shall be unlawful for any common carrier that has issued or [Sale of tickets.] authorized to be issued any such joint interchangeable mile- age tickets to demand, collect, or receive from any person or persons a greater or less compensation for transportation of persons or baggage under such joint interchangeable mile- age tickets than that required by the rate, fare, or charge Penalties. specified in the copies of the joint tariff of rates, fares, or charges filed with the Commission in force at the time. The provisions of section ten of this Act shall apply to any viola- tion of the requirements of this proviso. § 510. Amendments to section. — The amendment of March 2, 1889, incorporated in the act to regulate com- merce, a provision as follows: "Nothing in this act contained shall in any way abridge or alter the remedies now existing at common law, or by statute but the provisions of this act are in addition to such reme- dies." Notwithstanding the collocation of this provision in the twenty-second section, it clearly is to be construed with all of these sections, and relates to all the remedies provided by the §511] THE INTERSTATE COMMERCE ACT. 677 act and has been so construed by the courts. See section 8 of act, supra. The amendment of 1895 incorporated a second proviso con- cerning the issuance of joint interchangeable five thousand mile tickets. This section in its regulation of passes and free transporta- tion, must be construed with the very comprehensive regula- tion of the same subject in section 1, see supra § 179. § 511. The section illustrative and not exclusive. — This section was construed in the Party Rate case, § 231 (supra), where the Court said, that the provision that the dis- criminations in favor of certain persons therein named shall not be deemed unjust, did not forbid discriminations in favor of others under circumstances and conditions so substan- tially alike as to justify the same treatment. The object of section 22 was to settle beyond all doubt that discriminations in favor of certain persons therein named should not be deemed unjust, and the section was rather illustrative than exclusive. The Court said that many, if not all, of the excepted classes named in section 22, are those which in the absence of the section would not necessarily be held the subjects of an unjust discrimination, if more favorable terms were extended to them than to ordinary passengers. In ex parte Koehler, 31 Fed. 315 (1887), it was ruled by the circuit court under this section, that the exception allowed for the issuance of passes in favor of officers and employees, did not include the families of such persons, such preferences being forbidden by section 2 of the act. In U. S. V. Chicago & N. W. Ry., 127 Fed. 785 (1904), it was ruled by the C. C. A. of the seventh circuit, that the government of the United States in buying transporta- tion of a railroad for its soldiers in lots of ten or more, was not entitled to the benefit of the reduced ten party rate given by the company's schedule to theatrical, operatic or concert companies, hunting and fishing parties, glee clubs, brass or string bands and other parties of like character. The court said that the refusal to give the same rates did not constitute an unjust discrimination. These rates were for tickets closely limited in time and paid for in 678 THE INTERSTATE COMMEECE ACT. [SECTION 22 cash in advance, while those furnished the government were furnished on requisitions and paid after a delayed auditing; that the tickets of other classes increased the company's business, while the carrying of soldiers for the .government did not. So that the conditions were essentially different under section 2. In American Express Company v. United States, supra, § 159, the Supreme Court affirmed the judgment of the cir- cuit court, northern district of Illinois, in enjoining the ex- press companies from giving free transportation of personal packages to the officers, employes and members of their families, and to officers of other companies and to members of their families, in exchange for passes issued by the latter to the officers of the express companies, affirming 161 Fed. Rep. 606. Although express companies are common carriers they were not included in the act piior to the amendment of 1896. See §159. § 512. The section permissive only. — This section is permissive only and imposes no restriction upon the carrier as to the issuance of such tickets. Congress intended by this provision to leave the issuance of such tickets free from re- striction. There is no discrimination therefore in issuing them on one occasion and not issuing them on another. 6 I. C. C. 113. When they are issued however whatever the occasion, they must be offered impartially to all who accept the conditions on which they are issued, and the rates at which they are sold must be published. The general require- ments of the act to regulate commerce are as applicable to these classes of tickets as to any others. 2 I. C. C. 649, 2 Int. Com. Rep. 340. In the latter case the commission recommended the amendment of the act so as to define what should be considered excursion and commutation tickets, and restrict their issue in interstate commerce so as to prevent the abuses pointed out in the opinion. § 513. Withdrawal of commutation tickets. — Under this section carriers are allowed to issue mileage and com- mutation as well as excurison tickets, but they cannot be compelled to do so. As it is their discretion when they shall issue such tickets, it is equally within their discretion wheH §513] THE INTERSTATE COMMERCE ACT. 679 to withdraw them. It was suggested in 8 I. C. C. 443, whether the allowance of commutation rates at stations on one line of a railroad system and the denial of such rates on another line of the same system, such stations being re- spectively of the same character, would be an undue prefer- ence or not, but the question was not involved in the case for decision. The commission in this case cited the opinion of the Supreme Court in Lake Shore & M. S. R. Co. v. Smith, 173 U. S. 684, 43 L. Ed. 858 (1899), where the Su- preme Court held that the power of the legislature to enact general laws regarding the company and its affairs did not include the power to compel it to make an exception in favor of some particular class or community and to carry the members of that class at a less sum than it has the right to charge those who were not fortunate enough to be members thereof. The commission said in this case that commutation tickets are extensively used and have become a recognized feature of suburban transportation, and that they were far from saying that a carrier who has established commutation rates for suburban service, especially when residences have been fixed and business interests adjusted in reliance upon their continuance, could suddenly or otherwise withdraw those rates and exact from its patrons the full rates charged to the occasional traveler. It was ruled in the case however that the action of the railroads in withdrawing the 180-1;rip quarterly tickets between Baltimore and Washington was within the limits of their discretion and did not constitute a violation of the act. As to thousand mile tickets, see 1 I. C. C. 156, 1 Int. Com. Rep. 393. As to mileage tickets, see 1 I. C. C. 147, 1 Int. Com. Rep. 369. Indian Supplies. — When under the statute the government contracts for the delivery of the supplies needed for the Indian service, at New York and other points designated, and then advertises for bids for the transportation of the supplies from the points of delivery to the points where they are to be made use of, this transportation at the cost of the govern- ment is "for the United States" within the meaning of section 22 of the act to regulate commerce, and is not required to be made at the regular pubhshed rates. See I. C. C. 15, 1 Int. Com. Rep. 22. 680 THE INTERSTATE COMMERCE ACT. [SeCTION 22 § 514. The commission on excursion rates. — In 17 I. C. C. 212, the commission discussed the subject of excur- sion rates in a case wherein the citizens of Ogden complained that the semi-annual excursion rates of the Oregon Short Line Railroad Company discriminated in favor of Salt Lake City and against Ogden. The railroad contended that excursion rates were entirely exempted from the operation of the act regulating conmierce or, at least, as to the pro- visions relating to discrimination. The commission says that the inference from the decisions was that the carrier could determine for itself whether it would sell conmiutation, mileage, or excursion tickets, but that if it elected to sell them it must do so subject to the provisions of the act. It was not prepared to admit that under no circumstances could the commission inquire whether undue discrimination had arisen from the issuance of such statements; but as the statute authorized discrimination in the issuance of the tickets the commission would only be justified in interfering where the privilege was plainly abused. The commission suggested that the railroad company should make a uniform passenger rate at one and one-half cents per mile each way to all state and county fairs, and not limit them to the Mormon con- ference gathering; but it said that that was a matter upon which it had no authority to make any requirement. In 23 I. C. C. 129, the commission held that the complaint of Baltimore that there was an unreasonable preference in favor of New York on excursion tickets for passengers were not sustained and that the rates were not unreasonable. In 28 I. C. C. 122, the commission ruled that special fares for the movement of passengers in guaranteed numbers in one day without baggage checking privileges may be provided by the carriers under the provisions of this section, but the com- mission has no power to prescribe such fares in the absence of discrimination. § 515. The jurisdiction of the commission as to commutation rates. — In the Commutation Rate case, 21 I. C. C. 428, (June, 1911), it was claimed that the commission had no jurisdiction over commutation fares. It seems that this section as originally enacted contained the provision, "That nothing in this act shall apply to * * * the issuance of §515] THE INTERSTATE COMMERCE ACT. 681 mileage, excursion or commutation passenger tickets." This was amended in March, 1889 so as to read, "That nothing in the act shall prevent, etc., * * * the issuance of mileage, ex- cursion or commutation tickets." The commission came to the conclusion that reading section 22 in the light of the spe- cial nature and character of commutation traffic and service, the utmost that reasonably may be said of it, as applied to commutation tickets is that it constitutes a statutory recogni- tion of the fact that commutation is a different kind of trafTic, and therefore, is not to be compared with any other kind of passenger trafTic. The commission calls attention to the fact that commuters in many cases make their homes sepa- rate from their places of business in reliance upon the com- mutation services. The carriage of a commuter, therefore, differs in many respects from other passenger traffic and is an independent and a special service and a special kind of traffic. The commission, therefore came to the conclusion that they had the right to examine into the reasonableness of com- mutation services under section 1. See supra, § 209. In 27 I. C. C. 549, the commission found that the commu- tation rates made by the New York Central & Hudson River Railroad from points in the state of Connecticut into New York city were not unreasonable rates as to certain stations specifically named in the report. The regulation of a rail- road in refusing to make a refund or allowance for an unused portion of a thousand mile ticket because it had been sold at a reduced rate and the ticket had been destroyed, and one of its conditions was that if it was lost or mislaid no refund would be made, was not unreasonable, 26 1. C. C. 359. la 33 I. C. C. 593, it was held that a fifty trip family ticket for the transportation of the complainant and members of his immediate family, did not include a son-in-law who lived with but was not dependent upon complainant. See also 23 I. C. C. R. 95 on the general subject of commuta- tion rates. For construction of the forfeiture clause in a mileage book which was held not to justify a forfeiture because of presenta- tion for transportation of another person accompanying the purchaser on a journey, see Southern Ry. v. Campbell, 239 U. S. p. 99, 60 L. Ed. p. affirming 94 S. C. 95. 682 THE INTERSTATE COMMERCE ACT. [SECTION 23 Section 23. § 516. Jurisdiction of United States courts to issue writs of mandamus. 517. Application of section to car shortage. 518. Commission to consist of seven members; salaries. [Jurisdiction of United States courts to issue writs of peremptory mandamus commanding the movement of interstate traffic or the furnishing of cars or other transportation facilities.] § 516. Jurisdiction of United State courts to issue writs of mandamus. — Sec. 23. {Added March 2, 1889.) That the circuit and district courts of the United States shall have jurisdiction upon the relation Of any person or persons firm, or corporation, alleging such violation by a common carrier, of any of the provisions of the Act to which this is a supplement and all Acts amendatory thereof, as prevents the relator from having interstate traffic moved by said common carrier at the same rates as are charged, or upon terms or conditions as favorable as those given by said com- mon carrier for like traffic under similar conditions to any other shipper, to issue a writ or writs of mandamus against said common carrier, commanding such common carrier to move and transport the traffic, or to furnish cars or other facilities for transportation for the party applying for the [Peremptory mandamus may issue, notwithstanding proper compensation of carrier^ may be undetermined.] writ: Provided, That if any question of fact as to the proper compensation to the common carrier for the service to be enforced by the writ is raised by the pleadings, the writ of peremptory mandamus may issue notwithstanding such question of fact is undetermined, upon such terms as to security, payment of money into the court, or otherwise, as the court may think proper, pending the determination of [Remedy cumulative, and shall not interfere ^rith other remedies provided by the act.] the question of fact: Provided, That the remedy hereby given by writ of mandamus shall be cumulative, and shall not be held to exclude or interfere with other remedies pro- vided by this Act or the Act to which it is a supplement. § 517. Application of section to car shortage. — This section was not a part of the original act, but was first en- acted in the amendatory act of March 2, 1889. It deals wholly with the remedial process of mandamus. The §517] THE INTERSTATE COMMERCE ACT. 683 remedy was unsuccessfully invoked in a number of cases in the courts in which an effort was made to enforce through routing; see "Interchange of Facilities," supra, § 327. The difficulty in these cases was not in the remedy, but with the right. The section, however, was successfully invoked in a case involving alleged discrimination in the supply of cars, see United States v. Norfolk & Western R. Co., 109 Fed. 831 ; (1901) United States v. West Virginia & N. R. Co., 125 Fed. 252; (1903) United States v. Del. L. & W. R. Co., 40 Fed. 101. See supia, "Undue preference in car service," § 291. See also West Virginia v. R. Co., 134 Fed. 198, C. C. A. fourth circuit, and affirming 125 Fed. 252. In this case, the court held that the circuit court had the power in a proceeding of this character to fix the percentage of cars the relator should have in times of shortage. See also same court in U. S. ex rel. v. Norfolk & Western R. R. Co., 143 Fed. 266 (1906), reversing 138 Fed. 849, and in Merchants Coal Co. v. Fairmont Coal Co., 160 Fed. 769 (1908). In B. & 0. R. Co. V. United States ex rel., 215 U. S. 481, 54 L. Ed. 292, (1909) the Supreme Court, in reversing the C. C. A., fourth circuit, 165 Fed. Rep. 113, which had awarded mandamus to compel equitable distribution, held that mandamus was no longer the proper remedy, though the statute had been specifically enacted for that purpose, in view of the very comprehensive amendments to the act enlarging the powers of the Interstate Commerce Commis- sion, and that one of the purposes of these amendments was to cure the presumed remedial inefficiency of the act, to supply efficient means for giving effect to the orders of the commission. The alleged discriminating practices in the distribution of cars in times of shortage, were within the pecuUar jurisdiction of the commission for investigation. The proper procedure, therefore, was to make complaint to and demand investigation through the commission. This de- cision overruled several decisions in the court of appeals, and circuit courts taking a contrary view. This decision of the Supreme Court was considered and applied by the commerce court in U. S. ex rel Stony Fork Coal Co. V. L. & N. R. Co., 195 Fed. 88, where the court held. 684 THE INTERSTATE COMMEECE ACT. [SECTION 23 two judges dissenting, that while it had no jurisdiction to consider a question of car distribution in advance of some action by the Interstate Commerce Commission on com- plaint of a shipper who claims that connecting carriers discriminate against it in refusing to carry freight, yet that this section did authorize a mandamus to compel connecting carriers who had estabhshed a through rate for carrying coal to carry petitioner's coal in such reasonable quantities as could be handled, though a dispute existed between the carriers as to which should furnish the cars or as to what proportion of cars should be furnished by each ; the court said that the facts in this case brought it within the limitation declared by the Supreme Court, that is, in the performance of duties which are so plain and so independent of previous administrative action of the commission as not to require a prerequisite exertion of power by that body. § 618. Commission to consist of seven members, terms, salaries. — Sec. 24. {Added June 29, 1906.) That the Interstate Commerce Commission is hereby enlarged so as to consist of seven members with terms of seven years, [Qualifications and enlargements of commission.] and each shall receive ten thousand dollars compensation annually. The qualifications of the Commissioners and the manner of the payment of their salaries shall be as already provided by law. Such enlargement of the Commission shall be accomplished through appointment by the President, by and with the advice and consent of the Senate, of two addi- tional Interstate Commerce Commissioners, one for a term expiring December thirty-first, nineteen hundred and eleven, one for a term expiring December thirty-first, nineteen hundred and twelve. The terms of the present Commis- sioners, or of any successor appointed to fill a vacancy caused by the death or resignation of any of the present Commis- sioners, shall expire as heretofore provided by law. Their successors and the successors of the additional Commission- ers herein provided for shall be appointed for the full terms of seven years, except that any person appointed to fill a vacancy shall be appointed only for the unexpired term of the Commissioner whom he shall succeed. Not more than four Commissioners shall be appointed from the same politi- cal party. §518] THE INTERSTATE COMMERCE ACT. 685 [Existing la^vs as to attendance of witnesses and produc- tion of evidence applicable in proceedings under this act.] (Additional provisions in Act of June 29, 1906.) (Sec. 9.) That all existing laws relating to the attendance of witnesses and the production of evidence and the compeUing of testi- mony under the Act to regulate commerce and all Acts amendatory thereof shall apply to any and all proceedings and hearings under this Act. [Conflicting laws repealed.] (Sec. 10.) That all laws and parts of laws in conflict with [Amendments not to affect pending causes in court.] the provisions of this Act are hereby repealed; but the amend- ments herein provided for shall not affect causes now pending in courts of the United States, but such causes shall be prose- cuted to a conclusion in the manner heretofore provided by law. [When act effective.] (Sec. 11.) That this Act shall take effect and be in force from and after its passage. [Time of taking effect extended 60 days (August 28, 1906).] Joint resolution of June 30, 1906, provides: "That the Act entitled 'An Act to amend an Act entled "An Act to regulate commerce," approved February 4, 1887, and all Acts amendatory thereof, and to enlarge the powers of the Interstate Commerce Commission,' shall take effect and be in force sixty days after its approval by the President of the United States." (For section 18 of the Commerce Court Act of June 18, 1910, not repealed, providing for the designation by carriers of an agent at Washington for service of process, see Ap- pendix, infra, p. 878). THE ELKINS ACT. § 519. The Elkins Act as amended. 520. The enactment and amendments to the act. 521 . The repealing clause of the Hepburn Act did not bar prior offenses. 522. The validity and enforcibility of the act. 5;!3. Participation in a joint rate under the act. , 5?4. Discrimination as a criminal offense under the act. 525. The unit of offenses under the act. The Standard Oil Company of Indiana case. 526. Prior contracts and want of criminal intent no defenses. 527. Conspiracy in rebating. 528. What are rebates under Elkins Act. 529. A corporation bound by knowledge of its agents. 530. Requisites of indictment under the act. § 519. The Elkins Act as amended. AN ACT To further regulate commerce with foreign nations and among the States. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. Sec. 1. [Carrier corporatioja as well as officer or agent liable to conviction for misdemeanor.] As amended June 29, 1906.) That anything done or omitted to be done by a corporation common carrier, subject to the Act to regulate commerce and the Acts amendatory thereof, which, if done or omitted to be done by any director or officer thereof, or any receiv.er, trustee, lessee, agent, or person acting for or employed by such corporation, would consti- tute a misdemeanor under said Acts or under this Act, shall also be held to be a midemeanor committed by such corpora- tion, and upon conviction thereof it shall be subject to like [Penalty.) penalties as are prescribed in said Acts or by this Act with reference to such persons, except as such penalties are herein changed. The willful failure upon the part of any [Failure of carrier to publish rates or observe tariifs a misdemeanor.] carrier subject to said Acts to file and publish the tariffs or rates and charges as required by said Acts, or strictly to observe such tariffs until changed according to law, shall be a misdemeanor, and upon conviction thereof the corpora- [Penalty, fine.] tion offending shall be subject to a fine of not less than one thousand dollars nor more than twenty thousand dollars for I 686) §519] THE ELKINS ACT. 687 each offense; and it shall be unlawful for any person, per- sons, or corporation to offer, grant, or give, or to solicit, ac- [Miedemeanor to offer, grant, give, solicit, accept, or re- ceive any rebate from published rates or other con- cession or discrimii»ation>] cept or receive any rebate, concession, or discrimination in respect to the transportation of any property in interstate or foreign commerce by any common carrier subject to said Act to regulate commerce and the Acts amendatory thereof whereby any such property shall by any device whatever be transported at a less rate than that named in the tariffs published and filed by such carrier, as is required by said Act to regulate commerce and the Acts amendatory thereof, or whereby any other advantage is given or discrimination is practiced. Every person or corporation, whether carrier or shipper, who shall, knowingly, offer, grant, or give, or solicit, accept, or receive any such rebates, concession, or discrimination shall be deemed guilty of a misdemeanor, [Penalty, fine or imprisonment, or both.] and on conviction thereof shall be punished by a fine of not less than one thousand dollars nor more than twenty thou- sand dollars: Provided, That any person, or any officer or director of any corporation subject to the provisions of this Act, or the Act to regulate commerce and the Acts amenda- tory thereof, or any receiver, trustee, lessee, agent, or person acting for or employed by any such corporation, who shall be convicted as aforesaid, shall, in addition to the fme herein provided for, be liable to imprisonment in the peni- tentiary for a term of not exceeding two years, or both such fine and imprisonment, in the discretion of the court. Every violation of this section shall be prosecuted in any court of [Judicial district in which cases may be prosecuted.] the United States having jurisdiction of crimes within the district in which such violation was committed, or through which the transportation may have been conducted; and whenever the offense is begun in one jurisdiction and com- pleted in another it may be dealt with, inquired of, tried, determined, and punished in either jurisdiction in the same manner as if the offense had been actually and wholly com- mitted therein. [Act of officer or agent to be also deemed act of carrier.] In construing and enforcing the provisions of this section, the act, omission, or failure of any officer, agent, or other person acting for or employed by any common carrier, or shipper, acting within the scope of his employment, shall in every case be also deemed to be the act, omission, or failure of such carrier or shipper as well as that of the person. 688 THE ELKINS ACT. [§519 [Rates filed or participated in by carrier Bhall, as against such carrier, be deemed legal rate.] Whenever any carrier files with the Interstate Commerce Commission or pubhshes a particular rate under the pro- visions of the Act to regulate commerce or Acts amendatory thereof, or participates in any rates so filed or published, that rate as against such carrier, its officers or agents, in any prosecution begun under this Act shall be conclusively deemed to be the legal rate, and any departure from such rate, or any offer to depart therefrom, shall be deemed to be an offense under this section of this Act. Any person, corporation, or company who shall deliver property for interstate transportation to any common car- rier, subject to the provisions of this Act, or for whom as signer or consignee, any such carrier shall transport prop- erty from one State, Territory, or the District of Columbia to any other State, Territory, or the District of Columbia, or foreign .country, who shall knowingly by employee, agent, officer, or otherwise, directly or indirectly, by or through any means or device whatsoever, receive or accept from such common carrier any sum of money or any other valuable [Forfeiture, in addition to other prescribed penalty, of three times amount of money and value of consideration illegally received shall be paid to the United States.] consideration as a rebate or offset against the regular charges for transportation of such property, as fixed by the sched- ules of rates provided for in this Act, shall in addition to any penalty provided by this Act forfeit to the United States a sum of money three times the amount of money so received or accepted and three times the value of any other consid- eration so received Or accepted, to be ascertained by the [Attorney-general to collect such forfeiture by civil action.] trial court ; and the Attorney-General of the United States is authorized and directed, whenever he has reasonable grounds to believe that any such person, corporation, or company has knowingly received or accepted from any such common car- rier any sum of money or other valuable consideration as a rebate or offset as aforesaid, to institute in any court of the United States of competent jurisdiction a civil action to collect the said sum or sums so forfeited as aforesaid; and in the trial of said action all such rebates or other considera- [Period covered to be six years prior to commencement of action. tions so received or accepted for a period of six years prior to the commencement of the action, may be included therein, and the amount recovered shall be three times the total amount of money, or three times the total value of such consideration, so received or accepted, or both, as the case may be. § 519] THE ELKINS ACT. 689 [Persons interested in matters involved in cases before Interstate Commerce Commission or circuit court may be made parties and shall be subject to orders or de- crees.] Sec. 2. That in any proceeding for the enforcement of the provisions of the statutes relating to interstate commerce, whether such proceedings be instituted before the Interstate Commerce Commission or be begun originally in any circuit court of the United States, it shall be lawful to include as parties, in addition to the carrier, all persons interested in or affected by the rate, regulation, or practice under consid- eration, and inquiries, investigations, orders, and decrees may be made with reference to and against such additional parties in the same manner, to the same extent, and subject to the same provisions as are or shall be authorized by law with respect to carriers. [Proceedings to enjoin or restrain departures from pub- lished rates or any discrimination prohibited by la^^r against carriers and parties interested in traffic] Sec. 3. That whenever the Interstate Commerce Commis- sion shall have reasonable ground for belief that any com- mon carriei is engaged in the carriage of passengers or freight traffic between given points at less than the published rates on file, or is committing any discriminations forbidden by law, a petition may be presented alleging such facts to the circuit court of the United States sitting in equity having jurisdiction; and when the act complained of is alleged to have been committed or as being committed in part in more than one judicial district or State, it may be dealt with, in- quired of, tried, and determined in either such judicial dis- trict or State, whereupon it shall be the duty of the court summarily to inquire into the circumstances, upon such notice and in such manner as the court shall direct and with- out the formal pleadings and proceedings applicable to ordinary suits in equity, and to make such other persons or corporations parties thereto as the court may deem neces- sary, and upon being satisfied of the truth of the allegations of said petition said court shall enforce an observance of the published tariffs or direct and require a discontinuance of such discrimination by proper orders, writs, and process, which said orders, writs, and process may be enforceable as well against the parties interested in the traffic as against the carrier, subject to the right of appeal as now provided by [Such proceedings shall not prevent actions for recovery of damages or other action authorized by act to regulate commerce or amendments thereof.] law. It shall be the duty of the several district attorneys of the United States, whenever the Attorney-General shall direct, either of his own motion or upon the request of the Interstate Commerce Commission, to institute and prose- J-44. 690 THE ELKINS ACT. [§519 cute such proceedings, and the proceedings provided for by this Act shall not preclude the bringing of suit for the re- covery of damages by any party injured, or any other action provided by said Act approved February fourth, eighteen hundred and eighty-seven, entitled "An Act to regulate commerce" and the Acts amendatory thereof. And in [Compulsory attendance and testimony of witnesses and production of books and papers.] proceedings under this Act and the Acts to regulate com- merce the said courts shall have the power to compel the attendance of witnesses, both upon the part of the carrier and the shipper, who shall be required to answer on all sub- jects relating directly or indirectly to the matter in contro- versy, and to compel the production of all books and papers both of the carrier and the shipper, which relate directly or [Immunity to testify witnesses.] indirectly to such transaction ; the claim that such testimony or evidence may tend to criminate the person giving such evidence shall not excuse such person from testifying or such corporation producing its books and papers, but no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing con- cerning which he may testify or produce evidence, docu- mentary or otherwise, in such proceeding: Provided, That [Expediting Act of Feb. 11, 1903, to apply in cases prose- cuted under direction of attorney-general in name of Interstate Commerce Commission.] the provisions of an Act entitled "An Act to expedite the hearing and determination of suits in equity pending or hereafter brought under the Act of July second, eighteen hundred and ninety, entitled 'An Act to protect trade and- commerce against unlawful restraints and monopolies.' 'An Act to regulate commerce,' approved February fourth, eighteen hundred and eighty-seven, or any other Acts hav- ing a like purpose that may be hereafter enacted, approved February eleventh, nineteen hundred and three," shall apply to any case prosecuted under the direction of the Attorney-General in the name of the Interstate Commerce Commission. [Conflicting laws repealed.] Sec. 4. That all Acts and parts of Acts in conflict with the provisions of this Act are hereby repealed, but such re- peal shall not affect causes now pending, nor rights which have already accrued, but such- causes shall be prosecuted to a conclusion and such rights enforced in a manner here- tofore provided by law and as modified by the provisions of this Act. §521] THE ELKINS ACT. 691 § 520. The enactment and amendments to the act. — This act, approved February 19, 1903, and known as the Elkins Act, made a very substantial amendment to the penal provisions of section 10, as well as to sections 6 and 2 of the act. First, in abolition of the penalty of imprisonment, which however, was restored by the amendment of the Hep- burn Act of 1906. Second, in making the railroad corpora- tion itself liable to prosecution in all cases where the officers or agents were liable under original act, the officers and agents continuing to be hable as theretofore; Third, in making the published tariff the standard of lawfulness and any departure therefrom declared to be a misdemeanor; Fourth, the jurisdiction of prosecutions of offenses under this act is given to any court of the United States having jurisdiction of crimes within the district within which the violation was committed, or through which the transportation may have been conducted ; and Fifth, in construing and enforcing the provisions of the act, the violation thereof by any person acting for or in the employ of any carrier, acting within the scope of his employment, is in every instance to be deemed the act and offense of such carrier. Under the Hepburn act of 1906, this section was amended so as to restore the penalty of imprisonment; so now the penalties of both fine and imprisonment are imposed on both carrier and shipper and a penalty of a three-fold forfeiture of the amount of rebate is superadded to the carrier, these changes made by the act of 1906 being shown in the bracket insertions. It was held in Illinois v. Terminal R. Co. (Dist. Ct. of Illinois, 1909), 168 Fed. 546, that under this Elkins Act the penalty for failure on the part of any carrier of not publishing and filing its rates is as severe as the penalty for not strictly observing such rates after filing, and the defendant though operating a terminal railroad entirely within the state was held subject to the act, as it was engaged in interstate com- merce and was convicted of moving cars in interstate com- merce where it had not filed its rates covering such services. § 621. The repealing clause of the Hepburn Act did not bar prior offenses. — The general repealing clause of the act of 1906, "repealing all acts and parts of acts in conflict 692 THE ELKINS ACT. [§ 522 therewith," did not release any penalty under the existing statute. Great Northern R. R. Co. v. United States, 208 U. S. 452, 52 L. Ed. 567 (1908), affirming 155 Fed. 945, and 151 Fed. 84. See also United States v. N. Y. C. & H. R. R. Co., 13 Fed. 630 (W. D. of N. Y.) and an indictment alleging that the carrier unlawfully and willfully gave re- bates, following the language of the original Elkins act, was sufficient, though under the Hepburn act, it was necessary to allege that the rebates were "given knowingly." United States V. D. L. & W. R. R. Co. (C. C. A. second district), 152 Fed. 269 (1907). The payment of a rebate after the passage of the Elkins act, paid upon shipments of property transported prior to that enactment is covered by the act. N. Y. C. & H. R. R. Co. V. United States, 212 U. S. 481, 53 L. Ed. 613 (1909), affirming 146 Fed. 298. § 522. The validity and enforcibility of the act. — The sixth amendment to the constitution is not violated by the provision of the act whereunder the offense of obtaining an interstate transportation of goods at less than the car- rier's published rate may be tried in any federal district through which the transportation was conducted. Armour Packing Co. v. United States, 209 U. S. 56, 52 L. Ed. 681 (1908), affirming 153 Fed. 1. The taking of a rebate is a continuing crime which may run through several jurisdic- tions. In this case the carrier obtained a through bill of lading from Kansas City to Christiania, Norway. The offense was held properly prosecuted in the western district of Missouri though the actual shipment and contract was made in Kansas City, Kansas. Neither is due process of law violated by the provision of the act whereunder the 'commission by corporate officers acting within the scope of their employment of criminal vio- lation of the act is imputed to the corporation, the Court saying that if the position invalidated such a provision as to individual carriers, if there were such, it did not affect the vahdity of the act as to corporate carriers, and that both the corporation and its agents may be joined in one indictment. N. Y. C. & H. R. R. Co. V. United States, 212 U. S. 481, § 523] THE elkins'act. 693 53 L. Ed. 613 (1908), affirming 146 Fed. 298. And in the Armour Packing case it was also held that it was immaterial that the shipment was under a through bill of lading to a foreign port, and that the act was not violative of the con- stitution forbidding the levying of export taxes, nor did it give preference to the ports of one state over another. § 523. Participation in a joint rate.— A carrier is bound by a published rate in which it participates, though it was filed by the initial carrier. The Supreme Court said that this distinction was immaterial in view of the con- cluding part of section 1, which was evidently enacted with the view to meet the various situations developed wherein a joint rate was established binding up all who are parties and filed by one of the participating carriers. N. Y. C. & H. R. R. Co., V. U. S. 212 U. S. 500, 53 L. Ed. 624 (1909), reversing 146 Fed. 298; U. S. v. N. Y. C. & H. R. R. Co., 212 U. S. 509, 53 L. Ed. 629, (1909) reversing 157 Fed. 293. Where there is no joint rate over the connecting lines pub- fished and filed, the lawful rate to charge is the sum'of the local rates; and where there are joint rates filed and several local rates, the lawful rate is the sum of the joint rate filed plus the local rates. C. B. & Q. R. Co. v. United States, 157 Fed. 830 (C. C. A. of eighth circuit 1907). It was held in this case that no formal contract was necessary to bring the carrier within the provisions of the law, and that the ac- ceptance by the initial carrier of a through shipment at less than the lawful rates is not made lawful by the fact that such carrier had a contract with a connecting carrier whose line formed a part of the through route ; and that the latter would not increase this rate during a certain time, and on the faith of such a contract, made a similar contract with the shipper; and in the meantime the connecting carrier had not in fact published and filed with the commission a new schedule increasing the rate. But it was held in a suit against a shipper. United States v. Wood et al., 145 Fed. 405 (Dist. Ct. of Pa., 1906), that it is not made a criminal offense to receive a rebate from a joint rate unless the rate has been both filed and published, though it was unlawful for a carrier to grant a rebate from a joint tariff rate which it had filed and 694 THE ELKINS ACT. [§ 524 published and in which it participated when filed and pub- lished by another carrier. The participation by a carrier by water on the great lakes in a through bill of lading did not make that a lawful rate as against the shipper, so as to sub- ject him to prosecution for a concession therefrom to him by such carrier. Camden Iron Works v. U. S., 158 Fed. 561 (1908), C. C. A. third circuit. § 624. Discrimination as a criminal ofEense under the act. — It was held by the C. C. A., sixth circuit, in Hock- ing Valley Ry. Co. v. U. S., 210 Fed. 735 (1914), that the provision of this act that it shall be unlawful to give any concession or discrimination in respect to the interstate transportation of property whereby such property shall, by any device whatever, be transported at a less rate than that named in the published tariffs, cannot be restricted by the narrower language of the Interstate Commerce Act, which prohibits unjust discrimination and the imposition of any undue or unreasonable prejudice or disadvantage. The court held that under this act the extension of longer credit to one shipper pursuant to a prior arrangement, while other shippers under similar circumstances are required to settle piomptly, was unlawful, although other shippers, not knowing of this privilege granted to the favored shipper, had not demanded that the same privilege be extended to them. The court distinguished the opinion of the court of the eighth circuit in the Gamble-Robinson case, supra, § 329 as that opinion held that such an extension of credit was not an undue or unreasonable preference. The court said the Elkins Act not only dropped the express words of limitation, but added a broad and sweeping "whereby" clause. The same court, in Nicholls & Cox Lumber Company v. United States, 212 Fed. 588 (1914), affirmed the conviction where the discrimination consisted in the wrongful applica- tion of transit rates on certain shipments of lumber which, were only entitled to higher local rates ; and where the shipper knowingly accepted such a settlement it was no defense to a prosecution for rebating that the railroad company did not keep its rate sheet posted in two public- and conspicuous places in its depot as required by law. §525] THE ELKINS ACT. 695 The same ruling was declared by the C. C. A., seventh circuit, in Vandalia R. R. v. U. S., 226 Fed. 713 (1915), where the court affirmed a conviction for rebating where it appeared that it had contracted with a coal company to loan it a large amount upon notes bearing interest at two per cent, borrowing this amount on its own notes at four per cent, and, at its own cost, constructed tracks on the land and obtained the coal company's exclusive tonnage. The court said that the jury were justified in finding that the provision was a subterfuge and warranted a conviction of rebating under the act. The court said the Elkins law aimed to prohibit not only discrimination between shippers, but any departure from the tariff rates, irrespective of its actual discriminatory effect; and that the collection of the full tariff rate does not negative the possibility of a rebate in respect thereto either in a lump cash sum in advance or by later or earlier indirect payments. In U. S. V. Sunday Creek Co., 194 Fed. 252, district court, N. D. Ohio, (1902) it was held that under the Elkins Act the receiving of payment by note was receiving a "different compensation" from that which only the law authorized, to-wit, money, and this was a discrimination within the meaning of the Elkins Act. § 626. The unit of offense under the act. The Standard Oil Co. of Indiana Case, — The act penalizes the acceptance of a rebate by the shipper as well as the pay- ment of a rebate by the carrier. It provides that when a carrier files a rate with the commission and participates in any rate so filed and published, that rate in any prosecu- tion against the carrier shall be deemed to be the legal rate. In a prosecution against the shipper it must be shown that the tariffs were published at least in the office of the railroad company where the shipments were received. In the prose- cution against the Standard Oil Company of Indiana it was held in the trial court that each carload shipment, made at the illegal rate where the public rate was in carlots, con- stituted a separate offense, although the freight bills were rendered and paid monthly. United States v. Standard OU Co. of Indiana (Dist. Ct. of N. D. of 111.), 155 Fed. 305. 696 THE ELKINS ACT. [§ 526 See also same case on demurrer, 148 Fed. 719. This ruling was reversed by the G. G. A. of the seventh circuit, the court holding that the gist of the offense was the receipt of the concession, irrespective of whether the property in- volved trainloads, carloads, or pounds, and that the trans- action was not completed until the shipper received the rate different from the established rate. Standard Oil of Indiana, 164 Fed. 376 (1908). The court also held that the district court had erred in excluding evidence that the shipper had no knowledge of the public rate and could not ascertain the same by a construction of the tariff sheets. On the retrial of this case in the district court this ruling was followed; and as the government failed to prove that the tariffs were published at least in the office of the railroad company where the shipments were received, the departure by the shipper from the rates did not constitute an offense. It seems that the freight rates did not contain a classification of rates, but merely referred to the classification published by other parties and were subject to a change by such other parties. United States v. Standard Oil Go. of Indiana, 170 Fed. 988 (1909). This ruling as to the unit of offense was followed in United States v. Bunch, 165 Fed. 736 (Ark. D. Gt.), (1908), and in United States v. Sterns S. & L. Go., 165 Fed. 736 (D. Gt. of Mich., 1908). But contra, see United States v. Vacuum Oil Go., 158 Fed. 536 (1908), district court of the western district of N. Y. In the prosecution of a carrier, N. Y. G. & H. R. R. Go. v. United States, 212 U. S. 481, 53 L. Ed. 613, it was said by the Supreme Gourt that the offense of giving rebates is complete, when the carrier to whom the shipper has paid the full local rate pays over to the shipper upon a claim pre- sented to him the amount of the rebate stipulated in the agreement under which the shipment was made. In U. S. V. Standard Oil Go. of New York, 192 Fed. 438, (1911), the court said that there were as many offenses com- mitted as there were distinct shipments, transportations or transactions, although all the shipments were contained in one freight settlement between the parties. § 526. Prior contract and want of criminal intent no defense. — It was held in the Armour Packing case by § 527] THE ELKINS ACT. 697 the Supreme Court that the acceptance of a rebate by a shipper under a prior contract is violative of the act, since the statute is read into the contract and becomes a part of it, and it is immaterial that the contract was taken in, good faith under a claim of right. The only criminal intent requisite to the criminal offense created by statute, which is not malum in se, is the purpose to do an act in violation of the statute. No moral turpitude or wicked intent is essential to conviction. On the other hand, it is proper to show that there was no in- tent to violate the act ; that is, to do what was prohibited by the act. Thus, in the prosecution of a carrier it was held by the C. C. A. of the ninth circuit. A., T. & S. F. R. R. Co. V. United States (1909), 170 Fed. 250, reversing 163 Fed. Ill, that in the prosecution of a carrier for giving a rebate, the intent of the carrier is the essence of the offense, and the departure from the published tariff rates must be will- ful; that is, the carrier had the right to show in defense that it had accepted in settlement various sums less than the established rate, and the claim of the shipper, that the cars had been loaded with the minimum amount, but that various amounts had been lost in transit, and that the carrier had not exacted freight on the amount so lost, was admissible as showing the absence of intent to violate the act. The fact that the shipper who contracts for and receives a rebate in violation of the statute receives no benefit there- from, does not relieve him from criminal liability; but the stockholder in a corporation which has accepted rebates, does not as such become personally subject to the penalties im- posed by the statute. United States v. Wood, et al., 145 Fed. 405 (D. C. of Pa.) (1906). The plea of nolo contendere to indictments under this act does not preclude defendant from contending in appellate court that the indictment does not charge an offense. Hocking Valley R. R. Co. v. United States, (C. C. A., sixth circuit) 210 Fed. 735, (1914). See also § 574 infia. § 527. Conspiracies in rebating. — Every agreement for rebates is in effect a conspiracy to violate the law pro- hibiting rebates. Prior to the restoration of the penalty of 698 THE ELKINS ACT. [§ 528 imprisonment, an effort was made to make agreements to give rebates punishable by imprisonment under the general con- spiracy statute section 5440 R. S. supra, § 106. But it was held in the southern district of New York by Holt, J., that such a prosecution was not sustainable under the conspiracy statute. United States v. Gailford et al., 146 Fed. 298 (1906). But where the persons charged with the offense are not limited to the giver and the receiver of the rebates, there is a basis for the charge of conspiracy. Thomas v. United States, 156 Fed. 897 (1907), reversing United States V. Thomas, 145 Fed. 74, on the ground of an improper instruction as to presumption of innocence. § 528. What are rebates under Elkins Act. — It has been held that the fact that a rebate is paid to one other than the shipper, was immaterial; but a payment which is bona fide a commission for obtaining business for the carrier, is not within the act. United States v. Delaware, etc. R. Co., 152 Fed. 269 (1907). A railroad company refunding to a shipper the elevator charges for transferring grain from trains to vessels on the lakes was held guilty of rebating, and it was no defense to the prosecution that other carriers did likewise and that competition necessitated the rebate. Chicago, M. & St. P. R. R. Co. v. United States, 162 Fed. 835, C. C. A. eighth circuit (1908), aflTirming 157 Fed. 84. The same court held that the railroad company was guilty of rebating in refunding elevator charges to consignees, where it had actual knowledge that the freight had been paid by these consignees, although the railroad company had not filed a schedule showing it had not absorbed the elevator charge as a part of its rate. It was held in U. S. v. Philadelphia Ry. Co., 188 Fed. 484 (1911), E. D. of Penn., that the Elkins Act did not apply to a car-load shipped from Hamburg, Germany, destined as stated in the bill of lading to Philadelphia for transportation in bond to Alberta, Canada, and taken to its destination by continuous and uninterrupted transportation at the hands of carriers; there being no delivery or change of title, but the defendant carriers merely assisting in a continuous trans- portation from one country to another. These facts being § 528] THE ELKINS ACT. 699 submitted to the court the verdict was directed for the de- fendant railway company, which had been indicted for viola- tion of the Elkins Act. See also supra, § 167. A refrigerating company, organized for the purpose of con- trolling the interstate business of a brewery company, having entered into a contract for rebates with certain railroads, was "a party interested in the traffic," and was therefore subject to the act. United States v. Milwaukee, etc., R. Co., 145 Fed. 1007 (1906). It was held in this case that it was un- lawful for a corporation organized to control the interstate transportation of the brewery to demand and receive as a consideration for the routing of the brewery company's product over certain hne of railroad a concession equal to one-eighth or one-tenth of the published freight rates. It was held by the C. C. A. of the seventh circuit, C. & A. Railroad Co. v. United States, 156 Fed. 559 (1907), affinning 53 Fed. 653 (1908) 148 Fed. 646, and affirmed by a divided court in 212 U. S. 563, that the private tracks built by the owner of a packing plant on its own property, extend- ing from the connection with the tracks of a belt line railroad to and around its buildings and used in loading cars for shipments, are not a part of the railroad system, but plant facilities, and the refunding by the railroad company which made and published a schedule of through rates, including the belt line cars, of one dollar per car to such packing com- pany on its shipments, which it made and paid for at the schedule rate, on the ground that it was a payment for the use of its private tracks, was in effect a rebate. The comprehensive scope of the penal provisions of the Elkins Act was illustrated in the affirmance by the C. C. A. of the third circuit, 188 Fed. 879 (1911), of the conviction of the Lehigh Valley Railroad, 184 Fed. 543, on the charge of an unlawful discrimination in making what purported to be a settlement to the Bethlehem Steel Company of de- murrage charges. The Court said that the demurrage was a proper terminal charge under the act, and when fixed by the rate schedule for a certain district these charges were binding upon the companies and shippers, and any departure therefrom constituted a misdemeanor. In this case it was claimed that there was a basis for a settlement. 700 THE ELKINS ACT. [§ 528 as the shipper had claimed that the demurrage charges collected by reason of certain exceptions were discriminatory as against them ; but the court held that the only legal mode o.f correcting such discrimination, if it existed, was by proper notice or under authority from the Interstate Commerce Commission. The question, therefore, was submitted to the jury to determine whether the settlement was an honest one or a cover for discrimination; and as the jury, by its verdict, found it was not made in good faith the conviction was sustained. In Clegg V. St. L. & S. F. R. Co., C. C. A. eighth circuit (1912), 203 Fed. 971, it was held that .where an interstate carrier had not established and published a rate for special expedition in the transportation of cattle to market, an oral agreement to expedite a shipment for which the regular established rate for ordinary transportation was charged was void as a discrimination in violation of the Elkins Act. See also in the same court the case of Ellwood Grain Co. V. St. Joe. G. I. R. Co. 202 Fed- 845 (1912) where the con- tract to pay an elevator company a certain amount per car on all grain received from stations on its line of railroad while passing through the elevator not allowed to all elevators nor covered by a published or filed schedule was void. See also in C. C. C. & St. L. R. Co. v. Hirsch, 204 Fed. 848, (C. C. A. sixth circuit) 1912, the making of a lease below the actual rental value of the real estate was held under the circumstances to constitute a rebate in violation of the Elkins Act. It was held in this case that the railroad could main- tain an action to terminate the lease but not for an accounting thereunder. In Merchants & Miners Transportation Co. v. U. S. 199 Fed. 902 (1912) the Court decided that in an indictment under this act the defendant could not show as a defense that the rate filed was not intended to apply on shipments originating on certain points further west where no other or different rate was provided on shipments from such points. In the Hocking Valley R. Co. case supra, the court held that although the word "undue" was employed in the pro- hibition against discrimination in section 3, it was not necessary in a prosecution under the Elkins Act to find that §530] THE ELKINS ACT. 701 the discrimination was "undue," but only that it was material and substantial. Neither was it necessary that there must be a finding by the commission that the dis- crimination existed. § 529. A corporation bound by the knowledge of its agents. — In the C. C. A. of the sixth circuit in Grand Rapids & I. Ry. Co. v. United States, 212 Fed. 577, (1914) where a judgment of conviction of a carrier was affirmed, it was claimed that the rebates, as they were called, were not made knowingly. That is, that the defendant's agents did not know that the lumber in the inbound cars had been used locally and been re-consigned at the transit point, a discrimination in the extention of the transit privileges. The court said that the papers and records were kept in the main offices of the defendant, which contained all the infor- mation upon the subject, and the court quoted the provision of the act enacted in the amendment of June 29, 1906: "In construing and enforcing the provisions of this sec- tion, the act, omission or failure of any person, agent or other person, acting for or employed by any common car- rier, or shipper, acting within the scope of his employment, shall in every case be also deemed to be act, omission or failure of such carrier or shipper, as well as that of the person." The court referred to the opinion of the Supreme Court in the New York Central case, supra, where the constitu- tionality of this provision has been sustained. The court said while it was true some agents might not have known the acts and could not be prosecuted, it did not follow that the corporation would not be held to know. The statutory provision evidently fastened upon the corporation the re- sponsibility for all the acts of all its agents whose combined knowledge and conduct necessarily affected the validity of any particular transaction that was executed by only some of its agents; if this were not so, the ordinary system of departmental corporate agencies could be used to frustrate the law. § 530. Requisites of indictment under the act. — An indictment under this act is sufficient if it states the offenses 702 THE ELKINS ACT. -.^ [§ 530 with sufficient particularity to advise fully the defendant of the crime charged, and to enable a conviction throughiit to be pleaded in bar of another subsequent prosecution for the same offense. N. Y. C. & H. R. R. Co. v. United States, 212 U. S., supra. It is not necessary to set out in an indictment against a shipper that the carrier's published rate was a reasonable one, nor set out the tariffs in full, it being sufficient to aver that a certain named rate was in force between designated points as shown by the tariffs. United States v. Standard Oil Co., 148 Fed. 719. It is insufficient to aver, however, that there was an arrangement between several carriers with connecting lines and that a lower total rate as shown by the public tariffs was a certain sum per one hundred pounds on a particular prod- uct, but that such product was transported by defendants at the lower rates, as it was not indicative of the existence of the joint through rate lower than the total local rates. See ruling on demurrer in Standard Oil case, 148 Fed. 719, supra. Prosecutions under this act are governed by the R. S. section 1045, as amended in r876, limiting all prosecutions to three years in cases of misdemeanors. The state statutes have no apphcation. United States v. Central of Vermont R. R., 157 Fed. 291 (Cir. Ct. of N. Y., 1907). For sufficiency of allegations to charge the establishment of a joint tariff rate and discrimination therein, see U. S. v. Penn. R. Co., 153 Fed. 625 (1907), dist. court of New York. It was held in this case that the burden is on the government to show a common arrangement for a continuous carriage between the points mentioned in the filed joint tariff. In U. S. V. Pomeroy (C. C. of N. Y., 1907), 152 Fed. 279, it was held that a judgment of conviction with sentence of fme was abated by the death of the convicted party after the judgment and before the fme was paid, and that the fme was not recoverable from his personal representative and the court wherein the judgment was rendered had jurisdiction to abate the judgment. THE ANTI-TRUST ACT OF 1890. Section 1. § 531. Section 1 of the act. 532. The Anti-trust acts and the supplementary act. 533. The Sugar Trust case. 534. Interstate transportation subject to the act. 535. Unlawful combinations other than transportation. The Addys- ton Pipe Trust Case. 536. The California Tile Trust case. 537. The Tennessee, California and Ohio coal cases. 538. The Chicago Meat Trust case. 539. The Washington Shingle Trust case. 540. Incidental restraint of trade not violative of the act. 541. The Kansas Live Stock Exchange case. 542. The Chicago Board of Trade Bucket Shop case. 543. The Calumet and Heckla Mining Co. case. 544. Combinations held to be within the act. 545. Agreements held not within the act. 546. The continuance of an association for social purposes after dis- solution, not violative of the act. 547. The Standard Oil case. 548. The American Tobacco Company case. 549. Railroad combinations held within the act. 550. The Eastern Retail Dealers Association. 551. The Powder Trust case. 552. Application of the act to labor combinations. 553. Labor unions as such not unlawful under the act. 554. Employment of common agency not necessarily within the act. 555. Acts done outside of the United States not within the act. 556. Combinations, wherever made, if affecting foreign commerce of this country, are within the act. 557. Patent monopoly not within the act. 558. Agreements of patentees and copyright holders violative of the act. 559. Secret formula contracts under the act. 560. The combination of non-competitive patents not violative of the act. 561. Tying contracts. The Shoe Machinery cases. 562. Restrictive sales under the Clayton Act and the Sherman Act. 563. Application of the Clayton Act and other acts to existing con- tracts. 564. The case of United States Steel Corporation. AN ACT To protect trade and commerce against unlawful restraints and monopolies. § 631. Contracts, combinations, conspiracies, in restraint of trade. — Be it enacted by the Senate and House [703] 704 THE ANTI-TEUST ACT OF 1890. [SECTION 1 o/ Representatives of the United States of America in Congress Assembled: Sec. 1. Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states, or with foreign nations, is hereby declared to be illegal. Every person who shall make any such contract or engage in any such combi- nation or conspiracy, shall be deemed guilty of a misde- meanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court. § 532. The anti-trust acts and the supplementary act. — The anti-trust act has been subject to very extended discussion as to its relation to the business of the country, both in and out of congress, and was not amended after its first enactment in 1890 until the supplementary legislation of 1914, therein differing from the Interstate Commerce Act, which has been the subject of frequent amendments during the thirty years it has been on the statute books. As to the circumstances of the passage of the act of 1890, its constitu- tionality and general construction by the courts in relation to the common law of restraint of trade and as to its relations to labor in interstate commerce, see Part I., Chapters V. and VI. For decisions concerning the penal provisions of the act, see infra, section 2 of this act. The so-called Clayton Act of 1914, which went into effect October 25th, 1914 (see infra, p. 853, appendix for full text of the act) is entitled "An Act to Supplement Existing Laws against Unfair Restraints and Monopohes and for other Purposes," and recites in its opening paragraph that "the anti-trust laws" as used herein include the act of July 2nd, 1890, the Sherman Act, sections 73 to 77 of the Tariff Act of 1894, and the acts amendatory thereof, and also the act of 1914. As the act of 1890 is thus expressly continued in force, and one of its provisions section 7, is re-enacted, the judicial construction and application of the act of 1890 are still im- portant, as it is clear that the provisions of the new legisla- tion must be construed in the light of the judicial application of the statute of 1890 thus expressly continued in force. As but few adjudications have been made under the Clayton Act, it was deemed best to consider such cases in §534] THE ANTI-TEUST ACT OF 1890. 705 connection with the annotations of the sections of the act of 1890. See also Chapters V. and VI. of Part I., supra. The so-called anti-trust amendments of the Tariff Act of 1894, which have been continued substantially in force in the tariff revisions, which contain substantially the same pro- visions as the act of 1890, and were enacted as one of the anti- trust laws of which the act of 1914 is supplemental, are set forth in full, infra, appendix, p. 851. § 533. The sug^ar trust case. — The first important case decided under the act of 1890 was the so-called sugar trust case, U. S. v. Knight Co., 156 U. S. 1, 39 L. Ed. 325, (1895) as it determined not only the construction and appli- cation of this act, but the limitations of the power of con- gress in dealing with business combinations or so-called monopolies. The American Refinery Company had acquired by pur- chase of stock of other refining companies through shares of its own stock nearly complete control of the manufacture of refined sugar in the United States. The bill filed by the United States charged that the contracts under which these purchases were made constituted combinations in restraint of trade and the relief sought was the cancellation of the agree- ments under which the stock was transferred, the redelivery of the stock to the vendors and an injunction against the further performance of the agreement. The Supreme Court affirmed the decree of the circuit court, 60 Fed. Rep. 306, and the circuit court of appeals, 60 Fed. Rep. 934, dismissing the bill. The Court said the monopoly and restraint de- nounced by the act were the monopoly and restraint of interstate trade and commerce. Manufacture was riot com- merce. Commerce succeeded manufacture and was not a part of it, and sale as an incident of manufacture therefore was distinguished from commerce. § 634. Interstate transportation is subject to the act. — Transportation is commerce, and the provisions of the act are subject to and cover common carriers by railroads. This apphcation of the act was first made in the Freight Association case, 166 U. S. 290, 41 L. Ed. 1007, (1897), where the court held (Justices White, Shiras, Field and Gray J— 15. 706 THE ANTI-TRUST ACT OF 1890. [SECTION 1 dissenting), that the agreement of the Trans-Missouri Freight Association for the purpose of mutual protection by estabUshing and maintaining reasonable rates on all freight traffic, both through and local, between competing carriers, was an unlawful combination within the meaning of the act. This ruling was reafTirmed at the following term with the same division of the Court (Justice Field having retired and his successor Justice McKenna not sitting), in the Joint TraflTic Association case, 171 U. S. 505, 43 L. Ed. 259. These rulings as to the applicability of the act to interstate railroads were again reaffirmed in the Northern Securities case, 193 U. S. 197, 48 L. Ed. 679 (1904), where the Court, four judges dissenting, held that the organization of a New Jersey corporation as a "holding corporation" for the shares of competing interstate railroads was an illegal combination and in restraint of interstate commerce. The act also applies to transportation by water between the states. In Darius Coal Transportation Company v. White Star Line, 186 Fed. 63, C. C. A., sixth circuit, (1911) the court found that a lease of a steamer plying between two states was for the purpose of enabling the parties to secure a monopoly of the business, and it was held void as a violation of the act. The application of this act is not, as is the interstate com- merce act, limited to carriers by railroad, or partly by rail- road and partly by water, but extends to every combination in restraint of trade in commerce among the states and with foreign nations. As to its enforcement in cases of foreign commerce, see infra, § 556. ' § 635. Unlawful combinations in commerce other than transportation — The Addyston Pipe Trust case. — A leading case as to the appUcation of the statute to unlawful combinations other than railroads, is Addyston Pipe & Steel Co. V. United States, 175 U. S. 211, 44 L. Ed. 136 (1899), wherein the Court unanimously affirmed the judgment of the C. C. A. 29 C. C. A. 141, 85 Fed. Rep. 271. In this case the Court held the agreement of certain pipe manufacturers void under the act, on the ground that the purpose of the combination directly and by means thereof was to increase §536] THE ANTI-TRUST ACT OF 1890. 707 the price at which pipe should be sold within the territory and to abolish all competition between the parties. The Court found that the output and price were regulated so as to deprive the public in a large territory of the advantages accruing from proximity of pipe factories, and that the prices were kept just low enough to prevent competition by eastern manufacturers, the parties agreeing to sell only at prices fixed by their committee, and the highest bidder at a secret auction became the lowest bidder at a public letting. The Court laid down the rule in this case that when the di- rect immediate and intended eifect of a contract and combi- nation among the dealers in a commodity was the enhance- ment of the price and the suppression of competition, it amounted to a restraint of trade in the commodity, even though contracts at the enhanced price were made and it was not a complete monopoly. § 536. The California Tile Trust case. — The prin- ciple, laid down in the Addyston case was applied by the Supreme Court in Montague v. Lowry, 193 U. S. 38, 48 L. Ed. 608 (1904), where an association formed in California by the manufacturers of and dealers in tiles, mantels and grates was held obnoxious to the act. Membership in the association was prescribed by rules and dependent on condi- tions, one of which was the carrying of at least three thousand dollars worth of stock, and whether applicants were admitted or not was a matter of arbitrary decision. The dealers in the association agreed not to purchase materials from manu- facturers who were not members and not to sell unset tiles to anyone other than members for less than list prices, which were fifty per cent higher than the prices to members; and the manufacturers who were residents of states other than CaUfornia agreed not to sell to any one other than members, violations of the agreement rendering the members subject to forfeiture of membership. The Court ruled with- out dissent, that although the sales of unset tiles were within the state of California and although such sales constituted a very small portion of the trade involved, the agreement of the manufacturers without the state not to sell to anyone but 708 THE ANTI-TRUST ACT OF 1890. [SECTION 1 members was part of a scheme which included the enhance- ment of the prices of unset tiles by dealers within the state, and that the whole thing was so bound together that the transactions within the state were inseparable, and became a part of the purpose which when carried out amounted to and was a combination in restraint of trade and commerce. The agreement therefore was brought within the rule declared in the Addyston case and distinguished from the Hopkins and Anderson cases, infra, § 540 et seq. § 637. The Tennessee, California and Ohio Coal cases. — The same construction and application of the act has been made by the federal circuit courts. In United States V. Jelico Mountain Coal & Coke Co., 46 Fed. 432 (1891), the circuit court for Tennessee held void an agreement between coal mining companies operating chiefly in one state and the deliveries of the coal in another state, creating a coal exchange and fixing the price for the coal at the mines, and the margin of profit to the dealer, and enforcing the same by fines. In United States v. Coal Dealers Association of Cal., 85 Fed. 252 (N. D. of Cal. 1898), an unincorporated association of coal dealers, regulating distribution and prices in inter- state coal traffic, was adjuged illegal. In United States v. Chesapeake & Ohio Fuel Co., 105 Fed. 93 (1900), the circuit court for the southern district of Ohio followed the Addyston Pipe & Steel Co. case in annulling a contract made by a corporation to take the entire product of a number of producing firms and corporations engaged in the mining of coal, intending to sell the same at not less than a price to be fixed by an executive committee, and to account •and pay over to the parties the entire proceeds above a fixed sum to be retained as a compensation, the stated purpose being to enlarge the western market. The court said that the agreement whereunder shipments were to be made in that and other states was one that affected interstate commerce and subject to the provisions of the Anti-Trust Act, and that it was no defense that the agreement had not in fact been productive of injury to the public, or even that it had been beneficial, enabling the combination to compete for the busi- ness of a wider field. §539] THE ANTI-TRUST ACT OF 1890. 709 § 538. The Chicago Meat Trust case. — The act was applied in the United States circuit court for the northern district of Illinois in the so-called Meat Trust case, United States V. Swift, 122 Fed. 529, (1903). The bill in this case set-out that the defendants controlled sixty per cent of the trade and commerce in fresh meats in the United States, buying the live stock from different parts of the United States, converting it into fresh meats and then shipping the meats to their agents to be sold to consumers in different parts of the United States. The court said that the pur- chases, shipments and transportation were commercially interdependent, and that it was immaterial that the fresh meats in the hands of the agents of the defendants were subject to ordinary state taxation. The court also said that the allegations of the bill of an unlawful combination to the effect that the purchasing agents were required to refrain from bidding against each other, and in bidding up at times so as to induce large shipments and agreeing upon prices to be adopted and restrictions upon the quantities of meats to be shipped, and the making of agreements between trans- portation companies for rebates and discriminating rates, was sufficient to show a violation of the law. The demurrer was overruled and the motion for an injunction was sus- tained. This judgment was affirmed by the Supreme Court (no dissent), 1905, supra, § 81. § 539. The Washington Shingle Trust case. — In Gibbs V. McNeeley et al., 55 C. C. A. 70, 118 Fed. Rep. 120, 60 L. R. A. 152 (ninth circuit (1902), reversing 107 Fed. Rep. 210 and 102 Fed. Rep. 594), it was held that an association of manufacturers and dealers in red cedar shingles in the state of Washington formed for the purpose of controlling the pro- duction and sale of such shingles, which are made only in the state, but are principally sold and used in other states, and by its action in closing the mills of its members, has reduced the production and has also arbitrarily increased the prices at which the product is sold, is a combination in restraint of commerce, in violation of the act of 1890. The court apphed the rule of the Knight and Addyston cases, and said that it was not essential for a contract to refer expressly to 710 THE ANTI-TRDST ACTOF 1890. [SECTION 1 interstate commerce, if its purpose and effect were necessarily to restrain such commerce. § 640. Incidental restraint of trade not violative of the act. — The contract condemned by the statute is one whose direct and immediate effect is a restraint upon that kind of trade or commerce which is interstate. It does not include regulations which are nothing more than a charge for a local facility provided for the transaction of commerce, nor does it include an agreement among business men for the better conduct of their own business which incidentally effects interstate commerce. The leading cases on this subject are those decided in relation to the Kansas City Live Stock Exchange, Hopkins v. United States, 171 U. S. 578, 43 L. Ed. 290 (1898), and Anderson v. U. S., 171 U. S. 604, 43 L. Ed. 300, (1898) wherein the Supreme Court reversed the judgment of the circuit court in 82 Fed. Rep. 529. § 641. The Kansas City Live Stock Exchange cases. — In the first of these cases the court held that the Kansas City Live Stock Exchange, an unincorporated voluntary association of men doing business at the stock yards situated partly in Kansas City, Missouri, and partly across the state line in Kansas City, Kansas, doing business as commission merchants, receiving consignments of cattle under rules which prohibited the employment of agents to solicit con- signments except upon a stipulated salary, and forbidding the sending of prepaid telegrams or telephone messages as to the conditions of the market, and providing that no member should transact business with any commission merchant of Kansas City not a member of the exchange, or that any person violating the rules or regulations or with any expelled or suspended member after notice of such vio- lation, was not in violation of the act. The Court said that the situation of the yards partly in Kansas and partly in Missouri was a fact without any weight, and that such busi- ness was not in fact interstate business or commerce. The association merely provided facilities for the transaction of commerce. There must be some direct and immediate effect upon interstate commerce to come within the act. The Court in this case cited a number of agreements incidentally affect- § 542] THE ANTI-TRUST ACT OF 1890. 711 ing commerce which would not be included, as agreements among land owners, enhancing the cost of transporting cattle, or that of railroad employes to cease from work unless paid a certain compensation, saying that these agreements would enhance the cost of interstate commerce, but only indirectly and incidentally. In Anderson v. United States, supra, the defendants were not commission men, but were themselves purchasers of cattle on the market. The members bore the same relation to the association and they had carried on the same business as they carried on in the Hopkins case. The Court said it was not called upon to decide whether the defendants were or were not engaged in interstate commerce, because the agreement was not one in restraint of trade, nor was there any combination to monopohze or attempt to monopolize such trade within the meaning of the act. The Court in this latter case laid down the general rule that where the subject-matter of the agreement does not directly relate to and act upon and embrace interstate commerce, and where the anticipated facts clearly show that the purpose of the agreement was not to regulate, obstruct or restrain that commerce, but that it was entered into with the object to properly and fairly regulate the transaction of the buisiness in which the parties to the agreement were engaged, such agree- ment will be upheld as not withifi the statute, where it can be seen that the character and terms of the agreement are all calculated to attain the purposes for which it was formed, and where the effect of its formation and enforcement upon interstate trade and commerce is in any event indirect and incidental, and not its purpose or object. These cases were decided with only one dissent, that of Mr. Justice Harlan. See also Field v. Barber Asphalt Co., 194 U. S. 618, 48 L. Ed. 1142 (1904), where the Court held that the specification in an ordinance, that a particular kind of asphalt produced only in a foreign country should be used in a city pavement, was vahd under the laws of the state and did not violate the act of 1890 or any federal right. § 642. The Chicago Board of Trade Bucket Shop case.— In Chicago Board of Trade v. The Christy G. & S. Co., 198 U. S. 236, 49 L. Ed. 1031 (1905). The Supreme 712 THE ANTI-TRUST ACT OF 1890. [SeCTION 1 Court reversed the C. C. A., eighth circuit, 125 Fed. 161, and affirmed that court of the seventh circuit, 130 Fed. 507, and held that the Chicago Board of Trade had the right to enjoin the defendants from using and distributing the continuous quotations of prices on sales of grain and pro- visions for future delivery which were collected by the board of trade and which could not be obtained by the defendants except through a known breach of the confidential terms on which the plaintiff communicated. The Court held that contracts with telegraph companies by which the Chicago Board of Trade limited the communication of quota- tion of prices of sales of grain and provisions for future delivery collected by it which it might have refrained from communicating to any one, did not make a monopoly or amount to an attempted monopoly, nor did it amount to a contract in restraint of trade either under the Anti-Trust Act or at common law. Justices Harlan, Brewer, and Day dissented. § 543. The Calumet & Heckla Mining Co. case. — The C. C. A. of the sixth circuit, in Bigelow v. Calumet & Co., in 167 Fed. 721 (1908), affirming 167 Fed. 704, held that the purchase by one Michigan mining corporation of the stock of another expressly authorized by the statute and thereby with the aid of proxies from other stockholders subject to control of the latter where the two together were shown to produce about one-ninth of the copper product of the country, was not illegal as a combination in restraint of trade or commerce in violation of the anti-trust act in the absence of evidence of an unlawful intent to use the control so as to bring about a monopoly. In this case, the court, opinion by Lurton J., said that the fundamental rule declared by the Supreme Court in the Knight case, supra, had not been overruled or qualified by subsequent decisions and that its last analysis was but an illustration of the rule that the monopoly or agreement to come within the act must directly and immediately affect interstate commerce. See also concurring opinion of Judge Cochran. In this case was laid down tlie rule following the Supreme Court in the Cinn. Packet Co. v. Bay, 200 U. S. 179, 50 L. Ed. 428 §544] THE ANTI-TRUST ACT OF 1890. 713 (1906), that a contract is not to be assumed to contemplate unlawful results, unless a fair construction required it upon the established facts. § 644. Combinations held to be within the act. — Whether a combination is in restraint of trade within the meaning of the act is thus made to depend upon the intent and purpose of the parties to control the market by unduly restraining trade and ehminating competition. Thus, in Wheeler Stencil Co. v. National Window Glass Association, 152 Fed. 864 (1907), it was held by the C. C. A., third circuit than an agreement between jobbers and wholesale dealers doing business in different states to control a pur- chasing corporation in the window glass business and through this corporation controlled by them enter into a combina- tion with a manufacturer operating factories in different states and manufacturing seven per cent of all the window glass in the United States, whereunder the defendant and the dealers agreed to buy window glass from no other manufacturer unless at materially lower rates, and the manufacturer agreed to sell to no other dealers except for higher prices than it charged them, with a further agreement for limiting the quantity of window glass to be purchased by each of the window dealers with the power to arbitrarily fix prices which were to be charged retail dealers, was an agree- ment to destroy competition and illegal under the act. Thus, also, an association of book publishers controlling ninety per cent of the book business of the country which agreed not to sell to persons who cut prices of copyrighted books, was held, in Mines v. Scribner, et al, 147 Fed. 927 (1906), by the circuit court in New York to constitute a conspiracy in restraint of interstate trade. In Penn. Sugar Refining Co. v. American Sugar Refining Co., the C. C. A., second circuit, 166 Fed. 254 (1908), reversing 160 Fed. 144, held the purchase of a controlling interest in the stock of a sugar refining company so as to acquire control thereof and prevent the corporation from refining sugar in competing with a purchaser so that the latter might control the business, constituted an unlawful conspiracy in restraint of trade under the act. 714 THE ANTI-TRUST ACT OF 1890. [SECTION 1 In the C. C. A., fifth circuit, Peoples Tobacco Company V. American Tobacco Co., 170 Fed. 396 (1909), it was held that an unlawful conspiracy was stated in the allegation that defendants conspired to render its Ijusiness unprofitable and to ruin and destroy the same through competing cor- porations, which they secretly controlled, by enticing away his workmen, by compelling it to pay more than the normal price for leaf tobacco, and to adopt unnecessary and ex- pensive means to sell its products. In United States Tobacco Co. v. American Tobacco Co., 163 Fed. 701 (1908, S. D. of N. Y.), an agreement between to- bacco manufacturers as set forth in a complaint for damages, was held on demurrer to be an unlawful interference with interstate commerce in that it charged an inducement to competitors to maintain arbitrary and non-competitive prices and apportioned the interstate trade and commerce, fixing the amount of business that their customers should do. See also Monarch Tobacco Works v. American Tobacco Co., circuit court (W. D. of Ky.), 165 Fed. 774 (1908), and Hale V. O'Connor Coal & Supply Co., 181 Fed. 267 (C. C. of Conn., 1908), where the combinations charged were held to be in violation of the act. See also Ware Cramer Tobacco Co. v. American Tobacco Co., 180 Fed. 160, (C. C. of N. C. 1910). See also decision of the CCA. fifth circuit, in McConnell v. Connors McConnell Co., 152 Fed. 321 (1907), where a cor- poration organized for monopohzing fruit importing business was held to violate the act. In Jayne v. Loder, 149 Fed. 21, C C A. third circuit, overruling 142 Fed. (1907), the court held a combination of manufacturers of proprietary medicines for the purpose of maintaining retail prices, to be a combination violative of the act. See also O'Halloran Sea Green Slate Company, 207 Fed. 187, district court of New York, (1913). The court in this case held unlawful a combination by most of the previously independent producers of sea green slate, placing the power to determine the amount of reduction in prices in a central body, though it was more or less in combination with black slate, and though such power may not have been unduly exercised to raise prices. §544] THE ANTI-TRUST ACT OF 1890. 715 In United States v. Great Lakes Towing Co., district court of Ohio, (1913) 208 Fed. 733, it was held that a combination formed for the express purpose and with the intent to elimi- nate the natural and existing competition in interstate com- merce by the employment of unusual and abnormal methods of business, or which applies the direct instrumentalities of interstate commerce in such a relation as to create a single dominating control in one corporation whereby the natural and free competition in such commerce is unduly restricted, is a violation of the act, and it was held that tugs employed in the business of towing into and out of the harbors and between ports, vessels engaged in interstate commerce and in the lightering and wrecking of vessels so engaged, were them- selves instrumentalities of interstate commerce. In United States v. Lake Shore & M. S. R. Co., district court of Ohio, (1912), 203 Fed. 295, a combination of a number of coal carrying railroads who were natural competi- tors in the acquiring by them of large coal mining interests continutory to their several lines, so that both railroad and mining interests were under a single controlling power, the result being a division of the traffic and the elimination of competition as to interstate as well as domestic shippers, and a discrimination against all new and independent lines, was in restraint of interstate commerce and created a monopoly in violation of the act. In the C. C. A. of the sixth circuit. United States Tele- phone Co. V. Central Union Telephone Co., 202 Fed. 66, (1913), decided that a contract between a local telephone company and a long distance company for a combination binding the local company not to permit any similar con- nection by any other long distance company for a term of 99 years, and from extending its own service as authorized by its charter, was invalid as tending to create a monopoly. See also Chesapeake & Ohio Fuel Co. v. United States. C. C. A. sixth circuit, 115 Fed. 610 (1902) affirming 105 Fed. 93, where the agreement was to take the entire product of coke intended for western shipment over the leading route for transportation and for sale at not less than a minimum price. See also American Biscuit Manufacturing Co. v. Klotz, 44 Fed. 721; and Clark v. Central Railroad & Bank- 716 THE ANTI-TRUST ACT OF 1890. [SECTION 1 ing Co. of Georgia, 50 Fed. 338, (1892), in the latter case the court said that the combination for a voting trust con- trolling the management of the railroad was within the spirit if not the letter of the anti-trust act. § 545. Agreements held not within the act. — Agree- ments of manufacturers or dealers with their customers for the prevention of dealing with competitors by such customers through the payment of rebates to them conditioned on their not so dealing are not within the act. Whitwell v. Conti- nental Tobacco Co., see »upia, § 97. Agreements with customers respecting sales in certain terri- tory, in Phillips v. lola Portland Cement Co., 125 Fed. 593 (1903), 61 C. C. A. 19, nor the incidental restraint of trade resulting in the purchase of competitors, In re Green, 52 Fed. 104 (1892), were held not within the act. See also In re Coming, 51 Fed. 205 (1892), and In re Tyrrell, 51 Fed. 213 (1892). An agreement is not in violation of the act where its effect upon interstate commerce is indirect and incidental only. See Ellis v. Inman, 124 Fed. 956 (D. C. of Oregon 1903). A contract between the stockholders of a corporation en- gaged in deahng in fish at different places whereunder, in the purchase of the business and good will, they were not to enter into competition in the business for a term of ten years, was held, in Booth v. Davis, 127 Fed. 875 (E. D. of Mich. 1904), to be unlawful and enforcible. In this class of cases where the restraint of trade is incidental and ancillary to a lawful contract and reasonable for the protection of rights under the contract, it has been uniformly held that they are not within the act. See the Addyston Pipe case, supra. It was held (C. C. A., second circuit), Delaware, etc. R. R. Co. V. Cutter, 147 Fed. 51 (1906), that a contract by a railroad company with a patron for the conduct of the busi- ness of transportation of milk, whereunder he was to receive a percentage of profit earned on the freight carrier and that the rate charged should not exceed those of competing roads, and plaintiff was to have the exclusive privilege of transport- ing milk over defendant's road so far as permitted by law, was not in violation of the act. §546] THE ANTI-TRUST ACT OF 1890. 717 In Dueber Watch Case Mfg. Co. v. Howard Watch Co., (C. C. A. second circuit), 66 Fed. 637, (1895) affirming 85 Fed. 851, it was held that petition was demurrable which failed to show a monopoly or restraint of trade in interstate commerce. It was held in the case of Northwestern Consolidated Milling Co. v. Callam & Son, 177 Fed. 786, (1910) where a purchase by three corporations of two corporations in the same business and for the conduct of the business thereafter in an effort to liquidate the indebtedness was not violative of the act. See Robinson v. Suburban Brick Co., 127 Fed. 804 (1904); American Brake Beam Co. v. Pungs, C. C. A. seventh circuit, 141 Fed. 923 (1905); Carter Crune Co. v. Purrung, C. C. A. sixth circuit, 86 Fed. 439, (1898) where contract with an independent manufacturing company for the entire product of the plant was held not violative of the act. See also Davis v. Booth 131 Fed. 31 (C. C. A. sixth circuit, 1904). For relations between a railroad company and contiguous coal mining lands which was held under the facts not to con- stitute a monopoly of interstate commerce, see United States V. Lehigh Valley R. Co., 225 Fed. 399, (1915) southern district of New York. It will be noted that in these cases the combinations held to be within the act were so adjudged because it ap- peared there was an unreasonable restraint of trade, that is, an effort to monopoUze, while in the combinations adjudged not to be within the act, it was because of the failure to show any such restraint of trade, or effort to monopolize. In other words, the rule appHed by the courts is the same as that declared in the act of 1914. § 646. The continuance of an association for social purposes after dissolution not violative of the act. — The Southern Wholesale Grocers Association was declared a combination in restraint of trade of many engaged in the same business to refrain from selling to an individual or class, whether the agreement was express or implied, was in violation of the act. It was held, however, in the district court of Alabama in United States v. The Association, 207 718 THE ANTI-TEUST ACTOF 1890. [SECTION 1 Fed. 434, (1913) that after the association had been so declared in restraint of trade, the mere continuance of the association for social purposes under the same constitution and by-laws, but without exercising the functions prohibited by the decree of dissolution, was not in violation of the act. § 547. The Standard Oil case. — ^In the case of the Standard Oil Company of New Jersey et al. v. United States, 221 U. S. 1, 55 L. Ed. 619 (1911), the Supreme Court affirmed with modifications the decree of the judges of the circuit court of the eighth circuit, 173 Fed. Rep. 177, and held that the unification of power and control over the oil industry, which resulted from combining in the hands of a holding company the capital stock of the various corporations trading in petroleum and its products, raised the presumption of the intent to exclude others from the trade and thus centralizing in the combinations the perpetual control of the movement of these commodities in the channels of interstate and foreign commerce. The Court said that the aggregation of so vast a capital under the circumstances in evidence, showed a purpose to maintain a dominion over the oil industry, not as the result of normal methods of industrial develop- ment, but by means of combination which were resorted to in order that the greater power that might be added than would otherwise have arisen, if normal methods had been fol- lowed. The presumption thus raised was made conclusive by considering the conduct of the persons and corporations who had been mainly instrumental in bringing about the power in the New Jersey holding corporation. In answer to the suggestion that a very small percentage of the crude oil thus produced was controlled by the combina- tion, the Court said it was no answer to the attempt to mon- opolize, as substantial power over the crude product was the inevitable result of the absolute control which existed over the refined product, so that the monopoly of the one carried with it the power to control the other. In thus finding that the combination was an unlawful restraint of trade and was an attempt to monopolize, there was no dissent in the Court. (As to the decree in this case, see infra, § 583). As to the construction of the Anti-Trust Act approved in this case, see supra, Part I, Chapter V. §549] THE ANTI-TRUST ACT OF 1890. 719 § 548. The American Tobacco Company case. — In United States v. American Tobacco Company, 221 U. S. 106, 55 L. Ed. 663, (1911), the Supreme Court, while concurring in the main with the decree of the circuit court of the second circuit, 164 Fed. Rep. 700, made certain modifications in the decree and therefore remanded the case. (As to the decree, see infra, § 584). The Supreme Court held that the acquisi- tion of dominion and control over the tobacco trade by the principal and accessory and subsidiary corporations as the result of purchasing numerous competitors, in many cases closing out the business when acquired, and of obtaining stock control of other competitors, as well as of concerns manufacturing the elements essential to the successful manufacture of tobacco products, brought about in many cases after a ruinous trade war, the parties in interest uni- formly covenanting not to engage in the tobacco business, and the former business often continuing ostensibly as an independent concern, violated the provisions of the Anti- Trust Act against combinations in restraint of commerce, by the monopolization or attempt to monopolize any part thereof, whether looked at from the point of view of stock ownership, or from the standpoint of the principal and accessory or subsidiary corporations viewed independently, including certain foreign corporations, in so far as, by con- tracts made by them, they became co-operators in the corporation. § 549. Railroad combinations held within the act. — For opinions condemning the Union Pacific and Southern Pacific merger and compelling the reconstruction of the St. Louis Terminal Railroad Association, see supra, § 95, 96. In United States v. Reading Company, 226 U. S. 324, 57 L. Ed. 243, (1912) partly affirming and partly reversing 123 Fed. 427, it was held that the carrier defendants possessed a substantial monopoly of the transportation facihties between the anthracite deposits and tide water distributing points, and also controlled by their subsidiary coal mining and selling companies nearly three-fourths of the annual supply of anthracite, and they must be deemed to have combined in restraint of interstate commerce contrary to the act of 720 THEANTI-TRDST ACTGF 1890. [SECTION 1 1890, where with the purpose and result of defeating the construction of a projected independent competing railway hne, and thus preserving their existing monopoly of trans- portation, they purchased through another corporation whose capital stock they first acquired, the coal properties controlled by certain independent coal operators of the different supporters of the projected railway enterprise. It was conceded that the acquisition of such property con- sidered alone might have been lawful under the local law. But the court held that it was its duty to dissolve such a combination, irrespective of how the legal title of the shares of the corporations were held. § 550. The Eastern Retail Dealers Association case. — The case of the Eastern States Retail Dealers Association V. United States, 234 U. S. 600, 58 L. Ed. 1490, (1914) affirming 201 Fed. 581, involved an interesting application of the prohibition of the act, in the concerted systematic and periodic circulation by an association of retail lumber dealers, among the members of a so-called official report, giving confidential information as to the wholesale dealers, who were regarded as soliciting from or dealing directly with con- sumers. Although each retailer was left free to act as he pleases, these reports were circulated, with the intent and effect of causing the retailers to withhold their patronage from the listed wholesalers, and thus practically and ap- preciatively impaired the interstate trade. The case in- volved a broad construction of the prohibition of the statute as directed against any interference with the natural flow of interstate commerce in its accustomed channels. The Court quoted the language of the so-called labor cases, Gompers v. Buck Stove & Range Company, 221 U. S. 418, (1911) 55 L. Ed. 797, and said that the principle an- nounced in that case was general, and that the Sherman Act covered any illegal means by which the interstate commerce is restrained, whether unlawful combination, whether of capital or labor. § 551. The Powder Trust case. — The circuit judges of the third circuit construed and applied the opinions of the Supreme Court in the Standard Oil and Tobacco cases in §552] THE ANTI-TRUST ACT OF 1890. 721 the case of the so-called powder trust, 188 Fed. 127 (1911). The court found that the combination was based upon an illegal association, and that this illegality was not cured by the formation of a new company for the purpose of acquiring the assets of the other corporations, and vesting the owner- ship of their plants and the control of their business in that company. The court said the formation of such a corpora- tion and its subsidiaries and the adoption of the new policy was merely a continuance in a different form of the illegal association, and that it constituted a combination in restraint of interstate commerce and to monopolize a part of the same which was unlawful under the Anti-Trust Act. The court discussed the decisions of the Supreme Court in the Standard Oil case and American Tobacco case, and said, "As we read those decisions restraint of interstate trade and restra,int of competition in interstate trade are not interchangeable expressions. There may be under the Anti-Trust Act restraint of competition, that does not amount to restraint of interstate trade, just as before the passage of the act there might have been restraint of competition that did not amount to a common law restraint of trade;" adding, "It matters not whether the combination be in the form of a trust or otherwise, whether it be in the form of a trade asso- ciation or a corporation, if it arbitrarily uses its power to force weaker competitors out of business, or to coerce them into a sale to or union with the combination, it puts a restraint upon interstate commerce, and monopolizes or attempts to mon- opolize a part of that commerce in a sense that violates the Anti-Trust Act." § 662. Application of the act to labor combination. — The prohibitions of the act have been construed to extend to any combination or conspiracy whether of capital or labor which interferes with the normal flow of interstate commerce. The application to the so-called labor combinations was first made in the Debs case, 64 Fed. 724, N. D. of 111. (1894) in an exhaustive opinion wherein it was held that while the original design of the act was to suppress the trusts and monopolies in the form of trusts which of course would be of a contractual character, yet it was equally clear that a further and more J-46. 722 THE ANTl-TEUST ACTOF 1890. [SECTION 1 comprehensive purpose came to be entertained and was embodied in the final form of the enactment. Combinations were condemned not only when they took a form of trust, but in whatever form found if they be in restraint of trade, and that was the effect of the words "or other- wise." In the Supreme Court the judgment of the circuit court was affirmed, 158 U. S. 564, 39 L. Ed. 1902 (1895) on the broader ground of the general power of the federal govern- ment in the protection of interstate commerce irrespective of the provisions of the act of 1890. The Court said however that it did not differ from the circuit court in its construction of the act of 1890. In a number of cases during the industrial disturbances of 1893 and 1894 the act was so construed and applied. Water- house V. Comer, 55 Fed. 149 (1893); U. S. v. Elliot, 64 Fed. 27 (1894); U. S. v. Agler, 62 Fed. 826 (1894); Thomas v. Railroad Co., 62 Fed. 830 (1894); Thomas v. Railroad Co., 62 Fed. 803; Toledo etc. Railroad Co. v. Pennsylvania Co., 54 Fed. 730, 746 (1893); charge to grand jury by Grosscup, J., 62 Fed. 828, and Ross, J., 62 Fed. 834 (1894). A contrary review was taken in U. S. v. Patterson, 55 Fed. 605 (1893), but otherwise the ruling in the Debs case was followed by the other circuit courts of the United States. In the case of Gompers v. Buck Stove & Range Co., supra, the Supreme Court held, 221 U. S. 418, 55 L. Ed. 797, that a court of equity may enjoin a continuance of a boycott although spoken or written words were used as one of the instrumentahties by which the boycott was made effective. This case however did not directly involve the construction of the Anti-Trust Act in its relation to interstate commerce, but -was based upon the general equity jurisdiction of the court as the case was appealed from the district court of Columbia in a review of a proceeding of alleged criminal contempt. In the so-called Danbury Hat cases, which was a proceed- ing to recover treble damages under the seventh section of the act for alleged treble damages suffered in consequence of a boycott in interstate commerce the declaration was held good on demurrer in 208 U. S. 274, 52 L. Ed. 488 and in 235 U. S. 522, §553] THE ANTI-TRUST ACT OF 1890. 723 59 L. Ed. 341 (1915), the Court affirming 209 Fed. 721, sustained a judgment for treble damages under the act. The Court said in the latter case that the grounds for dis- cussion as to the construction of the statute had been narrowed by the case of the Eastern States Retail Lumber -Dealers Association, supra. The decision in these Danbury cases were both based upon the broad construction of the act declared in the Retail Lumber Dealers case that any combination whatever to secure action which essentially obstructs the free flow of interstate commerce comes within the prohibition of the Anti-Trust Act. See supra, Chap. 6, § 101. It was held in Irving v. Neal, district court of N. Y., (1913), 209 Fed. 471, that a combination between a local Union or organization of carpenters by which their members were pledged to refuse to work on any job where trim and finish made in a non-union shop was used, was in restraint of trade and commerce, and if it effects interstate commerce, is in violation of the Anti-Trust Act, and that it was im- material that the combination was not directed against any particular concern, or dictated by any malicious motive. § 653. Labor Unions as such not unlawful under the act. — The cases cited in the preceding paragraph all relate to unlawful acts of labor organizations which interfere with and obstruct interstate and foreign commerce. Nowhere is it declared in these cases that labor unions as such are unlawful. Thus it was declared in Mitchell v. Hitchman Coal & Coke Co., by the C. C. A. of the fourth circuit, (1914) 214 Fed. 685, that the ancient rule that labor unions were unlawful, did not prevail in the United States. The court said that so long as the United States permits aliens to immigrate, a large majority of whom are uneducated laborers, it is the duty of the government to afford them equal protection under the constitution and the laws pursuant thereto, in- cluding the right to combine to improve their condition; and the trade union known as the United Mine Workers of America, organized to secure reasonable wages and better working conditions among the mine workers of the United States, and by concentrated effort to compel by peaceable 724 THE ANTI-TRUST ACT OF 1890. [SECTION 1 means and improvement in the mining conditions in the United States, was held not to be an unlawful organization or combination either under the statute or at common law. See also in this connection section 6 of the Clayton Act of 1914, infra, and Part I., Chapter VI., supra. It was said in Gill Engraving Co. v. Doerr, 214 Fed. Ill, Dis. Ct. So. Dis. of N. Y. (1914), in a case arising under the general business law of that state that the word "boycott" does not necessarily import illegality and the test is the legality of the object in view and of the means of attainment. § 554. Employment of common agency not neces- sarily within the act. — It was held by the C. C. A., eighth circuit, in Arkansas Brokerage v. Dunn, 173 Fed. 899 (1909), reversing the judgment of the circuit court, that the organization by a number of mercantile jobbers located in the same city, of a brokerage company of which they owned the stock, and the purchase of merchandise required by them from manufacturers and jobbers in other states through such company instead of through other brokers previously patronized, although there was no agree- ment binding them so to do, and the use of their influence to extend its business, did not constitute a combination or conspiracy in violation of the aet. The court said if this ex- pedient affected interstate commerce at all, it was not in a direct, immediate or necessary way which alone would make it obnoxious to the law, but only in an indirect, incidental, and unimportant way not within the denunciation of the law. § 556. Acts done outside of the United States not within the act. — In American Banana Co. v. United Fruit Co., 213 U. S. 347 (1909), the Supreme Court affirmed the C. C. A. of the second circuit, 166 Fed. 261 and the circuit court of New York in 160 Fed. 184, in dismissing a complaint which sought to recover damages upon an alleged conspiracy with soldiers and officials in Costa Rica, acting under governmental sanction, the Court saying that all legislation is prima facie territorial, and that what de- fendants did in a foreign country under the facts set forth in the complaint was not within the scope of the statute. § 556] The anti-trust act of 1890. 725 § 656. Combinations, wherever made, if affecting foreign commerce of this country, are within the act. — It is immaterial, however, that a combination is made in a foreign country, if it affects the foreign commerce of this country and is put into operation here. Thus, in Thomsen V. Union Castle Mail S. S. Co., 166 Fed. 251 (1908), the C. C. A. of the second circuit, reversing 149 Fed. 933, sustained a complaint which alleged a combination of ship owners to prevent competition between members by main- taining uniform freight rates in South African trade. This decision was followed by the judges of the same court in U. S. V. Hamburg Amerikanishe P- F. A. Gesellshaft, et al., 200 Fed. 806 (1911), where an agreement between certain steamship companies called the "Atlantic Con- ference" relating to the carriage of steerage passengers between the United States and Europe, was held illegal. The court said that citizens of foreign countries were not free to restrain or monopolize the foreign commerce of this country by entering into combinations abroad nor by employing foreign vessels to effect their purpose. See also U. S. v. Hamburg American S. S. Co., 216 Fed. 971 (1914), where it was held by the judges of the same court that a combination by steamship companies of so-called "fighting ships" in connection with the transporting of steerage passengers, constituted an undue and unreasonable restraint of trade, but that the exaction by the members of the combination of agreements by their agents to sell passage tickets for such members only, was not a violation of the act. The Supreme Court (January, 1916), reversed this judg- ment, and directed the dismissal of the bill because the con- troversy had become a "moot case" through the "actualities of the war" which had made the proceeding nugatory. The dismissal, however, was without prejudice to the right of the government to proceed anew against any combination of the parties in restraint of trade. It is also immaterial that one of the constituents in a com- bination of this country is a foreign corporation doing busi- ness in this country. In the American Tobacco case, the Supreme Court held that the circuit court erred in dismissing as to 1 he English companies, which were connected by inter- 726 THE ANTI-TRUST ACT OF 1890. [SECTION 1 corporate holdings with the combination in restraint of trade organized in this country. § 557. Patent monopoly not within the act. — In Bement v. New York Harrow Co., 186 U. S. 76, 46 L. Ed. 1058 (1902), the Supreme Court said that the object of the patent laws was a monopoly, and that the rule was, with few exceptions, that any conditions which were not in their nature illegal with regard to the kind of property imposed by the patentee and agreed to by the hcensee for the right to manufacture, or use, or sell the article, will be upheld by the courts ; and the fact that the conditions of the contract keep up a monopoly, does not render them illegal. This principle has been applied in several cases. Thus, in Rubber Tire Wheel Co. v. Milwaukee Rubber Works, in the seventh circuit, C. C. A., 154 Fed. 358 (1907), reversed the circuit court of Wisconsin in 142 Fed. 331, and held that licenses which were granted by the owner of the patent under an agreement that the licensee should sell the patented article only at prices fixed by the agreement, and restricting the production of the licensee, were valid, the court saying that patented articles unless and until they are released by the owner of the patent from his monopoly, are not articles of trade or commerce among the several states within the meaning of the act, and that provisions in the licenses for the accumulation of a fund for the suppression of competition did not render the licenses invalid. In the case of Indiana Mfg. Co. v. Case Threshing Machine Co., 154 Fed. p. 365 (1907), the same court, reversing the circuit court of Wisconsin, 148 Fed. 21, held that a contract by a patentee granting hcenses to manufacturers to pay complainants a royalty and giving them a right to use inven- tion thereafter acquired by complainant, was not in violation of the act. In Virtou v. Creamery Package Mfg. Co., it was held by the C. C. A. of the eighth circuit, 179 Fed. 115 (1910), that the fact that the owner of a patent was party to an illegal combination in restraint of trade did not deprive him of the right to sue for infringement of his patent, and that the owner of patent could lawfully notify infringers or persons believed § 558] THE ANTI-TRDST ACT OF 1890. 727 to be such of his claims and warn them that suit would be brought to protect his legal rights where he acted in good faith. It was held in this case that a contract which one company made with another, to be its sole agent for the sale of its products, was not in violation of the act, as the effect on interstate commerce was only incidental. This case was afHrmed by the Supreme Court 227 U. S. 857 L. Ed. 393. As a patentee still remains the owner of his patent after granting a license, a modification of the licenses between the owners and the various licensees regulating the manufacture and sale of the patented product, is not objectionable as a restraint of trade. Gosher Rubber Works v. Single Tube Tire Co., C. C. A., seventh circuit, 166 Fed. 431 (1908). 166 Fed. 431 (1908). In Henry v. A. B. Dick Co., 224 U. S. 1, 56 L. Ed. 645, (1912) the court decided that a patentee of a rotary muneo- graph could lawfully impose a license restriction that the merchant could only sell it with stencil paper, ink and other supplies from the patentee, and none but that of the patentee, and that the suit on such license was one arising under the patent laws of the United States. See also Winchester Repeating Arms Co. v. Bungar, 199 Fed. 786, (1912). § 658. Agreement of patentees and copyright holders violative of the act. — While stipulations that only tend to maintain a patent monopoly are not violative of the act, agreements of manufacturers and shippers for regulating prices through the instrumentality of price schedules and forbidding sales to shippers not in the combination and requiring the promise not to resell except at prices determined by the manufacturers, are none the less violative of the Anti- Trust Act, although the agreements take the form of a license from the owner of the patent for a device used in the enameling process. The agreement was distinguished from that of the Dick case, in Standard Sanitary Mfg. Co. v. United States, 226 U. S. 20, 57 L. Ed. 107 afhrming 191 Fed. 172. The same rule was applied in the case of copy- rights, the case of Strauss v. American Pubhshers Associa- tion, 231 U. S. 222, 58 L. Ed. 192 (1913) where the Court reversed 177 N. Y. 473, and held that the agreement between 728 THE ANTI-TRUST ACT OF 1890. [SECTION 1 associations embracing about seventy-five per cent of the book publishers and a number of book sellers of the United States which operated to restrict the sale of copyrighted books to those who had maintained only the fixed net retail prices and resulted in almost completely obstructing com- petition in such books at retail was violative of the Anti- Trust Act. The Court said that the monopolies in the copy- right was no more extensive than if secured under the patent laws. The Dick case and the Strauss case, supra, should be con- sidered in connection with the case of Bauer v. O'Donnell, 229 U. S. 1, 57 L. Ed. 1041, (1912) where it was held that the exclusive right "to make, use, and vend the invention or dis- covery" granted by revised statutes section 4884, U. S. compiled statutes, 1901, p. 3381, to a patentee, does not give such patentee the right to name a resale price on the patented article. The Court further held in the Bauer case that a notice attached to or pinned on a patented article that such article was purchased subject to the conditions of a resale price named therein cannot convert an unqualified sale into a mere license to use an invention. § 659. Secret formula contracts under the act. — In Dr. Miles Medical Co. v. John D. Park & Sons Company, 220 U. S. 373, 55 L. Ed. 502 (1911), the Supreme Court, Justice Holmes dissenting, held that a restraint of trade, which would be unlawful as to the other manufactured articles cannot be justified, because the article in question is a proprietary medicine made under a secret formula, and that contracts between a manufacturer and all dealers, whom he permitted to sell his products, comprising most of the dealers through- out the country, which fix the price for all sales, whether wholesale or retail, operated as a restraint of trade, unlawful both at common law, and as to interstate commerce under the Anti-Trust Act, — ^even though such products may be pro- prietary medicines made under secret formulae; affirming the judgment of the C. C. A. of the sixth circuit, 164 Fed. 803. The Court said there was no analogy to the right secured by letters patented, and that the value of the so- called proprietary medicines unpatented stood on no other §560] THE ANTI-TRUST ACT OF 1890. 729 footing than other manufacturers. The case was not anal- ogous to a sale of good will, or of an interest in a business or of the grant of a right to use a process of manufacture, and that the agreement was designed to maintain prices after the complainant had parted with the title to the article sold, and to prevent competition of those who trade in them. The Court said further that "where commodities have passed into the channels of trade and are owned by dealers, the validity of agreements to prevent competition, and to maintain prices is not to be determined by the cir- cumstancesi whether they were produced by several manu- facturers, or by one, or whether they were previously owned by one or by many; the complainant having sold its product at prices satisfactory to itself, the public is entitled to what- ever advantage may be derived from competition in the subsequent traffic." The decision in this case not only overruled the decisions in the circuit court in sustaining these proprietary medicine con- tracts, (see 149 Fed. 858), but the reasoning of the opinion condemned all contracts between vendor and vendee where- under the vendor undertakes to control the prices on goods sold after parting with the title thereto. All such restrictive contracts are condemned by the Anti- Trust Act of 1914, where the purpose or effect is t,o restrain trade or bring about a monopoly or substantially suppress competition. § 660. The combination of non-competitive patents not violative of the act. — In U. S. v. Winslow, 227 U. S. 202, 57 L. Ed. p. 481, (1913), affirming 195 Fed. 578, it was decided that the union in one corporation of three companies, each manufacturing a different non-competing group of patent machines collectively used for making shoes, is not forbidden by the prohibition of the Anti-Trust Act of 1890, although a large percentage of all the shoe machinery busi- ness may thus have been put into a single hand. The Court said as it was admitted that the patents did not compete with one another, it was hard to see why the collective business should be any worse than the component parts, and there was no greater objection to one corporation manufacturing 730 THE ANTI-TEUSTACTOF 1890. [SeCTION 1 seventy per cent of three competing groups of patent machines collectively used for making a single product than to three corpoi-ations making the same preparation of one group each. The disintegration aimed at by the statute did not extend to reducing all manufacture to isolated communi- ties of the lowest degree. The Court therefore held that the demurrers to the indictment were properly sustained. § 661. Tying contracts. The Shoe Machinery cases. — Section 3 of the Clayton Act specifically makes unlawful the leasing or sale of articles patented or unpatented where there is a condition or understanding that the lessee or purchaser shall not use or deal in the goods or machinery of a competitor of the lessor or seller where the effect of such lease, sale or agreement may be to substantially lessen competition or tend to create a monopoly in any line of commerce. This restriction applies to any articles whether patented or not. Under the Sherman Act such clauses would be unlawful if found by the court to tend to create a monopoly or unduly restrain trade. The Shoe Machinery Company contracts were before the court of Massachusetts, 222 Fed. 349, (1915) in a suit brought by the government to restrain the operation of their leasing contracts. This action was commenced before the passage of the Clayton Act. The court dismissed the bill but found that the contracts did not tend to create a monopoly or sub- stantially lessen competition within the meaning of the Sherman Act. It was said by Judge Putnam in his opinion: "They had come to no conclusion in regard to the effect on the pending case of the legislation of Congress enacted since the case was submitted." Subsequently suit was brought by the government in the E. D. of Missouri, enjoining the enforcement of certain specific clauses of the leases which it was claimed were violative of section 3 of the Clayton Act. The court granted an injunction, 227 Fed. 507, holding that the clauses in the leases did tend to create a monopoly and were specifically made unlawful by this section of the Clayton Act. This last named case against the United Shoe Machinery Company is pending on appeal (1916) in the circuit court of appeals for the eighth circuit. §562] THE ANTI-TRUST ACT OF 1890. 731 § 662. Restrictive sales under the Clayton Act and the Sherman Act. — Section 2 and 16 of the Clayton Act was before the courts for consideration in the case of The Great Atlantic & Pacific Tea Co. v. Cream of Wheat Co., 224 Fed. 566 (Dist. Ct. of N. Y.) (1915) and 227 Fed. 46 (1915) affirming the same case in the C. C. A. of the second circuit. In this case the Tea Company complained that the Cream of Wheat Company refused to continue to sell to it its product. The Cream of Wheat Company rephed that the Tea Company was engaged in the retail business and the Cream of Wheat Company conducted its business only with wholesalers of its product. It was urged that the defendant's professed and published scheme of sales, plus its practice thereunder created a monopoly and did lessen competition in cream of wheat, and that this result was in itself unlawful and was produced by means which are specifically prohibited by section 2 of the Clayton Act viz, price discrimination not justified by any of the excep- tions of that section, and further the plaintiff asserted itself to be threatened with loss or damage through such violation of section 2 of the act and sought an injunction under section 16. (See sections in full in Appendix). The court found that the defendant company had a lawful mon- opoly in the trade name of Cream of Wheat; that it was not a monopoly in restraint of trade, and that section 2 provided that nothing "herein contained shall prevent persons engaged in seUing goods, wares and merchandise in commerce from selecting their own customers in bona fide transactions and not in restraint of trade;" that the Cream of Wheat Company had a right to refuse to sell to the de- fendant in pursuance of its policy against selling to retailers. The lower court was sustained on appeal, and the appellate court used this language in regard to the second section of the Clayton Act. "Defendant, in the conduct of its business, decided and made announcement to the trade that for reasons sufficient to itself it would sell only to wholesalers. Why if it chose to do so it could not make such a rule and adhere to it, we are at a loss to understand. It named the price at which it would sell to wholesalers, so much in car load lots, so much in less than car load lots. That it certainly had a right to 732 THE ANTI-TRUST ACT OF 18 dOl [SeGTION 1 do ; the Clayton Act itself expressly recognizes the existence of this right." After finding that the defendant was not a monopoly or had a monopoly on the product it marketed, the court goes on to say: "We had supposed that it was elementary law that a trader could buy from whom he pleased and sell to whom he pleased and that his selection of seller and buyer was his own concern." With this case should be read also the decision of the federal judges in Michigan in United States v. Kellogg Toasted Corn Flakes Company, 222 Fed. 725 (1915) and also in the same case in Fed. — (1915) where the court granted an injunction against printing notices on boxes in which their product was marketed that selhng below ten per cent per package was an infringement of their patent right and from suggesting to retailers in writing or otherwise that if they failed to observe the fixed price they would be cut off from a further supply of the product. These cases seems to have been decided with reference to the act of 1890, although reference was made in the opinions to section 2 of the Clayton Act. § 563. The application of the Clayton Act and other acts to existing contracts. — How far the prohibitions of the Clayton Act affected contracts already in existence at the time of its passage was discussed in the case of ElMot Machinery Company v. Center, 227 Fed. 124, (1915) Dis. Ct. of Mich, where the court held that all persons entering into contracts involving interstate commerce must do so subject to the right of congress thereafter to control, regulate and prohibit the performance thereof. Any owner of prop- erty holds the same subject to such action as the sovereign power of the state may in the exercise of its legitimate sover- eignty adopt in relation to it. In support of this doctrine the court cited L. & N. R. Co. v. Mottley, supra, § 179. The principle thus invoked obviously is not limited to the Clayton Act, but applies to all legislation of congress which may render unenforceable any prior contracts, valid when made, in conflict therewith. § 564] THE ANTI-TRUST ACT OF 1890. 733 § 564. The case of the United States Steel Corpora- tion. — The case of U. S. v. U. S. Steel Corporation, 223 Fed., 55 (1915) was tried in the New Jersey district court before three judges in favor of defendants, and is now (1916) pending on appeal in the Supreme Court. The court adopted the construction of the statute of 1890 as it had been settled by the Supreme Court in the Standard Oil and To- bacco cases and applied in that circuit in the Keystone Watch case, in 218 Fed. 502, and the Powder Trust case, 188 Fed. 127, and after an exhaustive review of the facts found that they did not warrant the conclusion that the defendant corporation had violated the statute. The court held that the fact alone that a corporation after its organi- zation paid for property purchased with stock and then elected the seller a member of its board of directors, does not render him responsible for alleged illegality in its organi- zation or that the United States Steel Corporation was formed by combining several corporations, which were themselves all combinations, and which demonstrated their power to monopolize trade warrants a finding that the organizers of the steel corporation intended to perpetuate such monopolies, but if the corporation itself did not carry out this intention and did not attempt or possess the power to do the unlawful thing intended by its formation, a court of equity would not be warranted in dissolving the corpora- tion, but that the remedy would be an apphcation for the injunctive relief of a court of equity, — Judge Wooley with whom Judge Hunt concurred suggested that the bill be not dismissed but retained and if the government desired the court would entertain a motion to enjoin the defendants against engaging in fixing prices or from violating the Sher- man Anti-Trust Act along those lines which it may have intended to do at its inception, but which as a matter of fact it had never done or attempted to do. 734 THE ANTI-TRUST ACT OF 1890. [SECTION 2 Section 2. § 565. Section 2 of act. 566. Criminal procedure under the act — Sufficiency of indictments. 567. The act sufficiently definite for prosecution for criminal con- spiracy. 568. Overt act not necessary to criminal conspiracy under the act. 569. Limitations of prosecutions for conspiracy. 570. Indictments for conspiracy — sufficiency. 571. Corporations indictable for criminal conspiracy under the act. 572. Conspiracy to run a corner in cotton indictable. 573. Immunity of witnesses in criminal prosecutions under act. 574. The plea of nolo contendere. § 565. Persons engaging in monopolies guilty of misdemeanor. — Sec. 2. Every person who shall monopo- lize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign Nations, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court. (As to what constitutes a monopoly or attempt to monop- oHze under this section under the construction of the act by the Supreme Court in the Standard Oil and Tobacco Cases, see supra, § 91). § 566. Criminal procedure under the act — Suffi- ciency of indictment. — The first section of the act con- demned two distinct things, a contract in restraint of trade and a combination or conspiracy in restraint of trade, and it was held in Rice v. Standard Oil Co., 134 Fed. 464, Dist. N. J., (1905), that these distinct offenses should not be con- fused either in indictments or in civil suits, citing United States V. Cadwallader, 59 Fed. 677 (1893). The second section makes a distinct offense, that of monopoUzing or attempting to monopolize any part of trade or commei;ce among the states. The act does not define what is a monopoly any more than it does what is a conspiracy in restraint of trade, and resort §566] THE ANTI-TRUST ACT OF 1890. 735 must therefore be had to common law for a definition of these general terms. In re Green, 52 Fed. 104, 1892. It is in- sufficient in an indictment to simply follow the language of the act, for the reason that the words of the statute do not of themselves fully, directly and clearly set forth the elements necessary to constitute the offense intended to be punished. For the essentials of indictment for violation of the act, see In re Corning supra, and United States v. Greenhutt et al., 51 Fed. 205, northern district of Ohio, (1892) and In re Tyrrell, 51 Fed. 213, circuit court southern district of New York, (1892) ; In re Greene, circuit court southern district of Ohio, 52 Fed. 104, (1892) ; United States v. Nelson, 52 Fed. 646, district court of Minnesota, (1892); and charge to the grand jury by Grosscup, J., 62 Fed. 828 (1894), and by Ross, J., 62 Fed. 834, in southern district of California, 1894. It was held in these cases that it was not sufficient to simply follow the language of the statute, but that the indictment must contain a certain description of the offense and a state- ment of the facts constituting the same. See also charge to grand jury, E. D. of Ga., by Judge Speer, 151 Fed. 834 (1907), on the essentials of a combina- tion and restraint of interstate commerce. In U. S. V. American Naval Stores Co., C. C. S. D. of Ga., 186 Fed. 592 (1909), it was held that an indictment charging a conspiracy to violate the act that monopolizing or an attempt to monopolize were separate offenses and could not be included in one count of the indictment. The court said that it was important that the defendants should know whether the government would proceed to prove that the defendants monopolized or attempted to monopolize. These decisions, that an indictment under the act could not merely follow the language of the statute in charging a con- tract or combination in restraint of trade or a monopolizing, or attempt to monopolize interstate trade or commerce, but must contain a statement of the facts constituting the offense charged, were rendered prior to the definite construction of the act by the decisions of the Supreme Court in the Standard Oil and Tobacco Cases, and the correctness of this ruling is clear in the light of these decisions. It is not every restraint of trade which is illegal and criminal; but such restraint of 736 THEANTI-TBUST ACTOF 1890. [SECTION 2 trade, as would have been illegal and unenforcible at common law, is penalized by the statute. In a criminal prosecution therefore under this act, the indictment must set forth the facts constituting the offense, and the jury must determine under the instructions of the court, whether the facts shown in evidence, constitute an undue restraint of trade, or an attempt to monopolize. Prosecutions under this act are therefore sharply distin- guished from those under the Interstate Commerce Act, as amended. Under the latter facts constituting criminal viola- tions of the act are clearly and specifically stated. The rail- road is bound to publish its rates and any failure so to do, or any deviation therefrom is penahzed. We have a directly contrary condition in criminal prosecutions under the Anti- Trust Act. (As to criminal provisions of act see address of Hon. W. B. Hornblower before American Bar Association, 1911). The sufficiency of an indictment under the Anti-Trust Act was argued in U. S. v. Kissel, 218 U. S. 601, 54 L. Ed. p. 1168 (December, 1910), wherein the United States had taken out a writ of error from the judgment of the circuit court, S. D. of N. Y., sustaining a plea in bar of the statute of limi- tations to an indictment, charging a conspiracy to restrain trade and monopolize; but the court confined its opinion to the single question of the sufficiency of the plea. The sufficiency of allegations in indictments under the act is also considered in United States v. McAndrews & Forbes Co., et al., 149 Fed. 823, (1906) S. D. of N. Y., where the court held the allegations sufficient, and in U. S. v. Patton, 226 U. S. 525, 57 L. Ed. 333, reversing 187 Fed. 664, (the Cotton Corner case), also in U. S. v. Maurer, 188 Fed. 127, (Powder Trust case) and also in U. S. v. Swift, 188 Fed. 92, where the indictments in the so-called Meat Trust cases were held sufficient. See also U. S. v. New Departure Mfg. Co., 204 Fed. 107, (1913) where the court held that those who afterwards en- gaged in a conspiracy could be included in an indictment with those who initiated the same; and where the indictment alleged continuous acts to a period within the three years, it was sufficient allegation that the offense was committed § 567] THE ANTI-TRUST ACT OF 1890. 737 •within the three years, and that it was proper to incorporate in a subsequent count by reference facts alleged in the previous count. In United States v. Whiting, Dist. Court of Mass., (1914), 212 Fed. 466, the court said that to support a convic- tion of combining in restraint of trade it must appear, either that the normal volume of interstate trade has been interfered with by artificial agencies affecting to a substantial degree, and to the disadvantage of the pubUc, the prices or supply of the commodity which is the subject of the restraint, or that by means of the combination the prices or supply of the commodity is or may be affected to a substantial extent to the disadvantage of producers or purchasers and thereby operating to a material degree to the injury of the public, and that there has been a direct and intentional interference with the distribution of commodities in interstate commerce. § 567. The act sufficiently definite for prosecution for criminal conspiracy. — In Nash v. U. S., 229 U. S. 373, 57 L. Ed. 1233 (1912), the Court reversing 186 Fed. 489, held that a demurrer to an indictment for criminal con- spiracy under this act was properly over-ruled, and that the statute was not so vague as to be inoperative on its criminal side. The common law as to the restraint of trade was taken up by the statute which made criminal what prejudiced the public interest by unduly restricting competition or unduly obstructing the course of trade. The law was full of in- stances where a man's fate depended upon his estimating rightly, that is, as the jury subsequently estimates it, some matter of degree. The Court said that, construing the statute in the Ught of the Standard Oil and Tobacco cases, ther'. was sufficient definiteness for indictment for criminal conspiracy. In answer to the objection that the matters alleged to have been contemplated would not have constituted a defense if they had been done, it was enough to say that some of them conceivably might have been adequate to accomplish the result and that the attempt alleged would convert what on their face might be no more than ordinary acts of competi- tion or the small dishonesties of trade into a conspiracy of J-47. 738 THE ANTI-TBUST ACTOF 1890. [SeGTION 2 wider scope. The Court said this fact called for conscience and circumspection in prosecuting officers so as not to make unfounded charges. While holding the indictment sufficient, the Court reversed the judgment of conviction, because the trial court had failed to call the jury's attention to the fact that some of the charges had been abandoned, as that might have a material bearing on the charge of conspiracy on which the defendants were convicted. § 568. Overt act not necessary to criminal con- spiracy under the act. — Both the first and second sections of the act penalize a combination or conspiracy; and a con- spiracy to restrain or monopolize trade is, therefore, a criminal offense indictable under the act. A conspiracy in a legal sense is a misdemeanor at common law and has been defined as an agreement by two or more persons to do an unlawful act or to do a lawful act by un- lawful means. Under section 5440 R. S. the parties to a conspiracy to commit any offense against the United States or to defraud the United States are liable to punishment, provided one or more of the parties to the conspiracy do some overt act in furtherance of the conspiracy. An overt act in furtherance of the conspiracy is essential to an offense under this statute. But it was held by the Supreme Court in the Nash case, supra, that under the Anti- Trust Act, there is no requirement of an overt act to con- stitute an offense in conspiring to restrain or monopohze interstate commerce; and the statute therefore does not make the doing of any act other than the act of conspiring the con- tion of liability. It is not necessary therefore to aver an overt act in an indictment under this act. § 569. Limitations of prosecutions for conspiracy. — In the Kissel supra case it was held by the district court that a conspiracy in restraint of trade was nothing but a contract or agreement between two or more persons in restraint of trade, and that the three year statute of limitations began to run from the time when the agreement was complete, and the demurrer to the special plea involved was therefore § 570] THE ANTI-TRUST ACT OF 1890. 739 overruled. The Supreme Court on writ of error (1910), 218 U. S. 601, 54 L. Ed. 1168, reversed this ruUng and held that the indictment charged a continuing conspiracy, and although a contract was instantaneous, a conspiracy was a criminal partnership and might endure for years, and a conspiracy in restraint of trade was different from and more than a contract in restraint of trade. The Court said that while the special plea was bad, all defenses, including the defense -that the conspiracy was ended by success, abandon- ment or otherwise more than three years before the indict- ment, would remain open for consideration under the general issue. § 570. Indictments for conspiracy — Sufficiency — It was held in U. S. v. McAndrews & Forbes Co., S. D. of New York, 149 Fed. 823 (1906), that it was not necessary that the combination should involve a total suppression of trade or a complete monopoly, but that it was sufficient that the neces- sary operation of the combination tended to restrain inter- state commerce and to deprive the public of the benefit of free competition. It was not necessary to set out any precise time when the purpose was formed, or the plan of the con- spiracy was first devised. It was sufficient to allege the time when the several cases relied on to establish the offense were done. The court said that the term "conspiracy" in the Anti- Trust law was to be interpreted independently of the pre- ceding words, and must depend upon the concerted action of two or more persons to accomplish an unlawful result by any means, or a lawful result by unlawful means. The terms were wide enough to cover not only the suppression of the trade of competitors by wrongful means, but every restraint of interstate trade, if it can be accomplished by a predeter- mined and conceded action of two or more individuals. The indictment in this case was held sufficient. See also U. S. V. Va. & Car. Chem. Co., 163 Fed. 66, (D. Tenn. 1908) where the court held the indictment sufficient, but ordered it quashed because of the presence of unauthorized persons before the grand jury. In U. S. V. Patterson, 222 Fed. 599 (1915), the C. C. A. of the «ixth circuit, in the so-called National Cash Register 740 THE ANTI-TRUST ACT OF 1890, [SECTION 2 case, reversed the conviction of defendants, who were in- dicted for conspiracy to restrain trade contrary to the act. For decisions of the district court on demurrer to the in- dictment, see 201 Fed. 697; also 205 Fed. 292. The de- fendants were thirty in number and the indictment con- tained charges of many specific acts in carrying out the alleged conspiracy, such as inducing, hiring, and bribing employes of competitors to disclose the secrets of their business, making false statements, and the like. The court of appeals found that the indictment was void on the ground of uncertainty, and that the district court erred in over- ruling the demurrer thereto, the uncertainty consisting in the fact that the indictment charged a conspiracy against a specific number of competitors over a period of twenty years, and it could not be ascertained against which competitors during the last three years the acts complained of were committed. § 571. Corporations indictable for criminal con- spiracy under the act. — In U. S. v. McAndrews & Forbes Co., supra, the court held there was no improper joinder in an indictment of a corporation and the individual officers of a corporation as principal conspirators. The court said that there was nothing inherently impossible in the corporation's doing one thing and the individuals' another at or about the same time, which things were utterly different; yet all, when dovetailed together, go to make up the'joint product labeled by the act combination, conspiracy, and monopoly. It was conceivable that the evidence might show that the individual defendants were not pre-agents but acted under a species of corporate coercion; but this question could not be deter- mined on demurrer. The court said that the dogma that a corporation could not be indicted for an offense which derived its criminahty of evil intention was but the remnant of a theory always fanciful and in process of abandonment. It was as easy and logical to ascribe to a corporation an evil mind as it was to impute it with a sense of contractual appli- cation. The demurrers to the indictment were, therefore, overruled. §573] THE ANTI-TRUST ACT OF 1890. 741 § 672. Conspiracy to run a corner in cotton indict- able. — In the Cotton Corner case, U. S. v. Patten, defendants were indicted under a charge of conspiring in restraint of and to restrain trade and commerce among the several states in the supply of cotton available during the year ending September 1, 1910. The circuit court sustained demurrers to the several counts of the indictment and they were dis- missed, 187 Fed. 664, but this ruling was reversed by the Supreme Court, 226 U. S. 525, 57 L. Ed. 333, (1913) the Court holding that a conspiracy to run a corner in the available supply of a staple commodity such as cotton, normally a subject of interstate trade and commerce to be accomplished by purchases for future delivery, coupled with a withholding from sale for a limited time thereby enhancing artificially its price to all buyers throughout the country, is within the terms of the Anti-Trust Act of 1890, which makes it a criminal offense to engage in the conspiracy in restraint of interstate commerce, since by its necessary operation it will directly and materially impede and burden such commerce. The Court said that it was no answer to say that running a corner tended for a time to stimulate competition, as this did not prevent it from being a forbidden restraint, for it also operated to thwart the usual operation of the laws of supply and demand. Section 1 of the act was not confined to voluntary restraint but includes as well involuntary restraints and the creation of artificial conditions which necessarily impede or burden the due course of trade or restrict the common hberty to engage therein. (Justice Lurton and White dissented on the ground that, as they understood, the court below held the counts bad, as they did not sufficiently charge a corner. Holmes, J., also dissented). § 573. The immunity of witnesses in criminal pros- ecutions. — As to the general subject of immunity of wit- nesses and self incrimination in prosecution under this act and under the Interstate Commerce Act, see supia, § 424. It was held in U. S. v. Swift, N. D. of Illinois 186 Fed. 1002 (1911), that the Immunity Act Feb. 11, 1893, which was made applicable by the Act of Feb. 14, 1903 to the giving 742 THE ANTI-TRUST ACT OF 1890. [SECTION 2 of testimony before the Department of Commerce and Labor acted as a general amnesty for offense^ arising out of the transaction to which the testimony alleged, but it was not a shield against prosecution for offenses committed after the testimony is given of the testimony furnished. This ruling was applied to the case of a conspiracy, and it was held that the acquittal of the defendants in 1905 for the con- spiracy on the ground that they had been made immune from prosecution by reason of testimony given before the commissioner of corporations did not extend to subsequent prosecutions for continuing the same offense thereafter, nor did it obliterate the facts testified to, which if legally import- ant and relevant might be shown in a subsequent prosecu- tion. § 574. The plea of nolo contendere. — In certain of the district courts in criminal prosecutions under the act a plea of nolo contendere has been tendered by the defendants and ac- cepted by the court, and fines imposed as a punishment. This plea is recognized in some jurisdictions in misdemeanor cases (12 Cyc. 354) and when accepted by the court is an im- plied confession of the crime charged, and is therefore equivalent to a plea of guilty, except that it gives the accused an advantage of not being estopped to deny his guilt in a civil action based upon the same facts, as he would be on a plea of guilty. See 2 Hawkins P. C. c. 31, Sec. 3. In other words, it is an admission of guilt, but not of facts, alleged as a basis of the charge of guilt. In Hocking Valley R. Co. v. United States, C. C. A. sixth circuit, 210 Fed. 735, affirming 194 Fed. 234, (1913) the court said that the plea of nolo contendere, though in some respects in the nature of a compromise between the state and the defendant, and the latter may not have all the advantages of exception and review, but it can be saved to him by the plea of not guilty, or by standing mute, it did not follow at all that the defendant in such a case could not prosecute error at all. Where the broad question of whether the act charged constituted an offense against the criminal law was involved, it seems that the plea of nolo contendere, should not be con- sidered as a waiver of a right which a plea of guilty does not §574] THE ANTI-TRUST ACT OF 1890. 743 waive. The court therefore examined on the merits the questions presented. The same subject was considered by the C. C. A. of the seventh circuit, in Tucker v. United States, 196 Fed. 260, in (1912). The court said that the plea was not a plea in the strict sense of the term in criminal law. It required accept- ance by the court, and when accepted, it became an implied confession of guilt, but distinguishable from such a plea, in that it could not be used against the defendant as an admis- sion in any civil suit under the same act. In this case the trial court after such a plea was tendered, made a finding of guilty and sentenced the defendant to both fine and imprison- ment, although a fine alone might have been imposed under the law. The court held that no issue was presented for trial under the indictment and no adjudication of the ques- tion was authorized, and the judgment was reversed with directions to accept or to refuse acceptance of the plea, and then to proceed thereunder in conformity to law. 744 THE ANTI-TRUST ACT OF 1890. [SeCTION 3 Section 3. § 575. Section 3 of the act. 576. Territories and district of Columbia included. § 575. Section 3 of the Act. — Sec. 3. Every contract, combination in form of trust or otherwise, or conspiracy, in restraint of trade or commerce in any Territory of the United States or of the District of Columbia, or in restraint of trade or commerce between any such territory and an- other, or between any such territory or Territories and any State or States or the District of Columbia, or with foreign nations, or between the District of Columbia and any State or States or foreign nations, is hereby declared illegal. Every person who shall make any such contract or engage in any such combination or conpsiracy, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be pun- ished by fine not exceeding five thousand dollars, or by im- prisonment not exceeding one year, or by both said punish- ments in the discretion of the court. § 576. Territories and District of Columbia in- cluded. — ^This section, it will be seen, differs from section 1 only in the fact that it includes in the contracts in restraint of trade declared illegal and criminal not only those made in commerce among the several states and with foreign nations, but also those made in any territory of t he United States or of the District of Columbia, or between any such territory and another, or between any such territory or territories and any state or states, and also between the District of Columbia and any state or foreign states. This inclusion of contracts in a territory or in the District of Columbia is not under the authority of the commerce clause of the constitution, but under the general governmental power vested in congress over the territories of the United States and over the District of Columbia. Congress in the exercise of its power to organize and govern its territories combines the federal and state authority, Mormon Church v. United States, 136 U. S. 1. Congress is also vested by the constitution with the ex- clusive legislative authority over the District of Columbia. Constitution of U. S., art. IV, sec. 3, par. 2; art. I, sec. 8. §576] THE ANTI-TRUST ACT OF 1890. 745 It was held in Moore v. United States, C. C. A. eighth circuit, 85 Fed. 465, (1898) that the admission of Utah as a state did not operate to repeal the act of July 2nd, 1890, but when Utah was admitted into the Union, the territorial government was at an end and the circuit court of the United States for that district had no jurisdiction to try defendant on an indictment returned by the territorial grand jury; that section 13 of the Revised Statutes did not apply. 746 THE ANTI-TEUSTACTOF 1890. [SECTION 4 Section 4. § 577. Section 4 of the act. 578. Procedure in equity under the act. 579. Right of statutory injunction now not limited to the government. 580. The act under the general equity jurisdiction of the court. 581. A state cannot enjoin under the act. 582. Suits by the government of dissolution of unlawful combinations, procedure. 583. The decree in the Standard Oil case. 584. A decree in the American Tobacco Co. case. § 677. Courts may prevent and restrain violations. — Sec. 4. The several circuit courts of the United States are hereby invested with jurisdiction to prevent and restrain violations of this act; and it shall be the duty of the several district attorneys of the United States, in their respective districts, under the direction of the Attorney-General, to institute proceedings in equity to prevent and restrain such violations. Such proceedings may be by way of petition setting forth the case and praying that such violation shall be enjoined or otherwise prohibited. When the parties com- plained of shall have been duly notified of such petition the court shall proceed, as soon as may be, to the hearing and determination of the case; and pending such petition and before final decree the court may at any time make such temporary restraining order or prohibition as shall be deemed just in the premises. § 578, Procedure in equity under the act. — ^The right of the United States to proceed by injunction against illegal combinations under this act has been uniformly sustained. Thus in the Trans-Missouri Freight Association case the Court said that the government had the power to bring the suit to enjoin the association from proceeding, although the association had been dissolved pending the suit before the decree was entered. This ruling was followed in the other cases cited, the Joint Traffic Association case and the Northern Securities case. In the latter case the Court en- joined the corporation organized under state laws from exer- cising the powers acquired by virtue of the acquisition of the stock of the subsidiary companies. In such a suit filed by the United States a restraining order may be issued with notice, and where the unlawful combina- §579] THE ANTI-TRUST ACT OF 1890. 747 tion acts as an unincorporated association, it is sufficient that the association with a number of its officers and members are made parties; it is not necessary that all of its numerous membership should be made parties. United States v. Coal Dealers Association of Cal., 85 Fed. 252 (N. Dist. of Cal., 1898). § 679. The right of statutory injunction now not limited to the government. — Under this act, before the enactment of the statute of 1914, it had been uniformly held that a court of equity was not authorized to entertain a bill by a private party to enforce its provisions, although the general jurisdiction of the federal court as a court of equity to afford private relief in a proper case against threatened injury existed, the right of a statutory injunction being limited to the government of the United States. See Gulf, Colorado & Santa Fe Rarilroad v. Miami Lumber Co., 86 Fed. 407, (1898) Southern Indiana Express Co. v. United States Express Co., 88 Fed. 659, (1899) Pidcock v. Harring- ton, 64 Fed. 821, (1891); Block v. Standard Dist. Co., 95 Fed. 978, (1899). The Anti-Trust Act of 1914, however, provides, section 16, that any person, firm, corporation or association shall be entitled to. sue for and have injunctive relief in any court of the United States having jurisdiction over the parties, against threatened loss of damage by violation of the anti-trust laws, and when a proper showing of danger of irreparable loss or damages, that the danger is immediate, a preliminary in- junction may issue. No such suit however, can be brought by any party other than the United States against a common carrier in respect to any matter subject to the regulation and jurisdiction of the Interstate Commerce Commission. (See appendix, p. 863.) The effect of this act was considered in Union Pacific R. Co. V. Frank, 226 Fed. 906 (1915) by the C. C. A. of the eighth circuit where the court said that it was doubtful whether that act could apply to the case under consideration, as it was not passed until after the final decree was rendered in the case, but the court said : "Conceding, however, that it might be made applicable to this action, it does not change the rule already established 748 THE ANTI-TRUST ACT OF 1890. [SECTION 4 by the decisions of the courts, as the right to sue by a pri- vate party is only given to obtain injunctive rehef against threatened loss or damage. So that, if the law could be ap- plied in the present action it still remains true that loss or damage to the complainant must be shown." The court in this case held that a minority stockholder could not as such apply for injunctive relief for the purpose of enforcing the Sherman Act, but that it could apply for general equity relief. § 580. The act under the general equity jurisdiction of the court. — The equity jurisdiction of the circuit court, prior to the act of 1914, had been invoked by private parties where tliere is diverse citizenship, and on grounds for the exercise of the equity powers of the court. The equitable relief, however, must be a protection against irreparable injury to the complainant, and can not extend to the dis- solution of the combination on the ground of injury to the public, as that procedure would be open to the government only. See National Fire Proof Co. v. Mason Bldg. Assn., C. C. A. second circuit, 169 Fed. 259 (1909), affirming 145 Fed. 260. This doctrine has been r*epeatedly affirmed by the courts, see Boyd v. New York & H. Ry. Co. 220 Fed. 174, (1915). Mitchell V. Hitchman, 214 Fed. 685, (1914) and Paine Lum- ber Co. V. Neal, et al. 212 Fed. 259, (1913), affirmed by C. C. A. second circuit 214 Fed. 82, (1914). The jurisdiction of equity has also been sustained where a stockholder of a corporation has alleged the refusal of the cor- poration to maintain an action at law for damages and he is compelled to resort to equity on account of such refusal of the corporation to act. See concluding remarks of opinion in Ames V. American Telephone & Telegraph Company, circuit court Mass., 166 Fed. 820 (1909). See also Bigelow v. Calumet & Heckla Mining Co., 167 Fed. 721 western district of Michigan, where a stockholder was held entitled to sue to restrain another corporation which had obtained the control of a majority of its stock from voting the same and eliminating competition between the two com- panies to the irreparable injury of complainant. (This case §581] THE ANTI-TEUST ACT OF 1890. 749 was ultimately decided on the merits in favor of the de- fendant). In Shawnee Compress Co. v. Anderson, 209 U. S. 423, 52 L. Ed. 865 (1908), the Supreme Court affirmed the judgment of the Supreme Court of the territory of Oklahoma, 16 Okla. 231, in reversing the decree of the district court of the terri- tory in favor of the defendants in a suit by minority stock- holders, to cancel a lease of the corporate property with directions to enter judgment for plaintiff, relief being granted on the ground, wherein the Supreme Court concurred, that the lease was part of a scheme to permit a monopoly of the business in the territory. In Mannington v. Hocking Valley Ry. Co., 183 Fed. 133, (1910) Sou. Dis. of Ohio, which was a suit in equity filed in the state court alleging special injuries threatened to plaintiff on an alleged violation of the Sherman Anti-Trust Act, it was held that the United States court had jurisdiction and the case was removable from the state court on the filing of netition and bond. § 681. A state cannot enjoin under the act. — A state cannot proceed under the act by injunction. Thus in the state of Minnesota v. Northern Securities Co., 194 U. S. 48, 48 L. Ed. 870, (1904) the Supreme Court held that the state of Minnesota could not maintain a suit in its political char- acter to enforce the Anti-Trust Act of congress, .as the statute confines the action to suits by the several district attorneys of the United States in their several districts under the direction of the Attorney-General. The Court said that the purpose was to secure the uniformity of the enforcement of the act so far as direct procedure in equity was concerned, according to the uniform plan applicable throughout the entire country. This case had been brought in the state court and removed by the defendant to the circuit court of the United States, on the ground that it was one arising under the constitution and laws of the United States. The circuit court sustained the jurisdiction and dismissed the bill upon the merits. 123 Fed. 692. But the Supreme Court reversed the decree, with directions to remand the case to the state court on the ground that the circuit court of the United 750 THE ANTI-TEUST ACT OF 1890. [SECTION 4 States could not acquire jurisdiction of such proceeding, al- though both parties urged the Court to take jurisdiction, as the state of Minnesota was not a citizen within the meaning of the constitution, and there was no diverse citizenship to sustain the jurisdiction of the federal court. § 582. Suits by the government for dissolution of unlawful combinations. — Procedure: It was claimed in Standard Oil case, supra, § 547, that the circuit court erred in overruling exceptions on the ground of imipertinence to so much of the bill filed by the United States, as counted upon facts occurring prior to the Anti-Trust Act. But the Court held that this ruling could not be regarded as prejudicial error where the court gave no weight to the testimony adduced in the averments complained of, except as far as it tended to throw light upon the acts done after the passage of the statute, the results of which it was charged were being participated in and enjoyed by the alleged combination at the time of filing the bill. In Union Pacific Coal Company v. United States, 173 Fed. 737 (1909), it was held by the circuit judges of the eighth cir- cuit that a combination between a corporation and its officers or agents could not be formed by the efforts of the officers or agents alone without the conscious participation in it by any other officer or agent of the corporation, and that conscious participation of two or more minds is indispensable to an unlawful combination. Neither were non-participating stockholders criminally liable for a violation of law by the corporation wherein they did not participate. In Alexander v. U. S., 201 U. S. 117, 50 L. Ed. 686 (1906), it was held that orders of a federal circuit court, directing witnesses to answer the questions put to them and produce written evidence in their possession, on their examination before a special examiner appointed in a suit brought by the United States to enjoin an alleged violation of the Anti-Trust Act, lacked the finality requisite to sustain an appeal to the Supreme Court. The powers of a court of equity in a proceeding under this section in enforcing the production of books and papers, were discussed in the St. Louis Terminal Railroad cases, 146 Fed. 486, 154 Fed. 268. It was held that a court had the inherent §583] THE ANTI-TEUST ACT OF 1890. 751 power to compel the production of books and papers and not only from parties to the suit but from third parties. The fourth constitutional amendment prohibiting reasonable searches and seizures affords no protection to a witness for his refusal to produce books and papers admittedly in his possession. A petition for a subpoena duces tecum is sufficiently definite when the description is sufficient enough to enable the witness to produce them without uncertainty. § 583. The decree in the Standard Oil case. — In the Standard Oil case, the decree entered by the circuit court ordered the dissolution of the New Jersey holding corpora- tion, and enjoined the subsidiary corporations and their stockholders from making any agreement tending to bring about further violations of the statute. This was criticised as too broad and of itself preventing legitimate business transactions. The Supreme Court said that it was not capable of any such construction and therefore could not produce any harmful results. The decree should be con- strued, not as depriving the stockholders of the corporations of the power to make lawful and normal contracts and agree- ments after the dissolution of the corporation, but as restrain- ing them from by any device whatever creating directly or indirectly the illegal combination which the decree dissolved. In this case the Court said that in view of the magnitude of the interests involved and their complexity, the thirty days for executing the decree was too short, and it was extended so to embrace a period of at least six months ; and that in view of the possible injury to result to the public from the decree prohibiting interstate commerce in petroleum and its prod- ucts, the injunction against the carrying on of interstate commerce by the New Jersey corporation and the sub- sidiary companies until the dissolution of the company should not have been awarded. The case was therefore remanded with the affirmance of the decree with these instructions, and the circuit court was authorized to retain jurisdiction to the extent necessary to compel compliance in .every respect with its decrees. (With respect to the modifi- cations and also as to the decree in the Tobacco case. Justice Harlan dissented, though concurring in the findings of the Court). 752 THE ANTI-TRUST ACT OF 1 890. [SECTION 4 § 584. The decree in the American Tobacco Com- pany case. — In the American Tobacco case, supra, § 447, where the Supreme Court without dissent found that there was an unlawful combination in restraint of trade and an attempted monopolization of the business, the Court said that with respect to the remedy the situation involved difTiculties greater than were presented in any Anti-Trust case which had been considered by the Court. The mere decree forbidding stock ownership by one party to the com- bination of another part would afford no adequate measure of relief since the different ingredients of the company would re- main unaffected, and that the settled device which had been resorted to made it difficult to formulate al-emedy; and because the tobacco business had been so separated under various subordinate companies and so unified by the control acquired by the scheme condemned, that any specific form of relief might operate really to injure the public, and may be to perpetuate the wrong. The Court therefore found it in- expedient to allow a permanent injunction against all parts of the combination, dr to direct the appointment of a receiver of all the property in all its ramifications. Coiisideriiig the complexity of the situation, therefore, the Court decreed that the combination was in restraint of trade and an attempt to monopolize, and that the circuit court shotild be ordered to hear the parties by evidence or otherwise for the purpose of ascertaining and determining upon some plan or method of dissolving the corporation and of recreating out of the ele- ments now composing it a new company which should be honestly in harmony with the law, and not repugnant to the law. Six months was allowed from the receipt of the man- date to accomplish these purposes, with leave, however, in the event the necessities required it in the judgment of the court below, to extend such period for a further time, not exceeding sixty days, and that if, in the event that this con- dition of disintegration was not brought about in this time it should be the duty of the court, either by way of injunction, or by the appointment of a receiver, to give effect to the requirements of the statute ; and the Court concluded : "Pending the bringing about of the result stated, each and all of the parties, individuals as well as corporations, §584] THE ANTI-TRUST ACT OF 1890. 753 should be restrained from doing any act which might there- after extend or enlarge the power of the combination by any means or device whatsoever." The circuit judges under this decree approved (1911), the plan or reorganization whereunder the assets of the "trust" were distributed pro rata to the stockholders organ- ized in four new companies; and the Attorney-General announced that no appeal would be taken by the United States therefrom. Such pro rata distribution of the assets of a combination adjudged illegal was approved by the Supreme Court in the case of the Northern Securities Company v. Harriman, 197 U. S. 244, 49 L. Ed. 739, (1905). As to decree in the Union Pac. and Southern Pac. case, see supra, § 95. J-48. 754 THE ANTI-TRUST ACT OF 1890. [SECTION 5 Section 5. § 585. Section 5 of the act. 586. The scope of decrees under the anti-trust act. 587. Judicial application of section. § 685. Additional parties may be summoned. — Sec. 5. Whenever it shall appear to the court before which any proceeding under section four of this act may be pending, that the ends of justice require that other parties should be brought before the court, the court may cause them to be summoned, whether they reside in the district in which the court is held or not ; and subpoenas to that end may be served in any district by the marshal thereof. § 586. The Scope of Decrees under the Anti-Trust Act. — The newly organized Federal Trade Commission is authorized, on reference made by the court to the commis- sion, as a master in chancery, to ascertain and report an appropriate form of decree, when the court has found that the government is entitled to relief. The commission pro- ceeds upon notice to the parties, as the Master in Chancery, and makes report to the court. It is also empowered in section 6 to make an investigation upon its own initiative as to the manner in which the decree has been, or is being, carried out, and upon apphcation of the Attorney-General it is directed to make such investigation and report, and such report is made public in the discretion of the commission. The scope of decrees in these government suits was illus- trated in the St. Louis Terminal Railroad case, wherein the Court found that there would be nothing unlawful in the association on its being reorganized, and the Court therefore did not order dissolution, but directed such reorganization, so as to include all the companies interested in the terminals. Supra § 96. On the second appeal of this case, when the terms of the decree were in question, the Court (1915), 236 U. S. 194, 59 L. Ed. 535, refused to insert in the decree the abolition of any special terminal charge within a so-called 100-mile radius, and said that such a requirement would make the decree repugnant to the Interstate Commerce Act, and to the exercise by the state authorities of their power §586] THE ANTI-TRUST ACT OF 1890. 755 over charges, in so far as that jurisdiction may extend. The Court also directed that the decree should be modified so as to recognize the right of the terminal company as an acces- sory to a strictly terminal business, to carry on transporta- tion as to business exclusively originating on its line, ex- clusively moving thereon, and exclusively intended for delivery on same. In a suit in the Louisiana district. Steel v. United Fruit Company, 190 Fed. 631, affirmed in 194 Fed. 1023, (1912) where the circuit found from the evidence the defendant company had acquired a controlling interest in a competing steamship corporation to prevent competition, and that a subsequent sale of the stock was formal only, and an in- junction was therefore issued restraining the company from voting the stock, but the court held that that did not in- validate the stock so as to preclude the company from transferring to another in good faith and conveying the right to convey stock so transferred in case the transfer was made without suspicion of retained control. The wide scope of decrees under this act is further illus- trated in the case of U. S. v. Keystone Watch Case Co., Eas. Dis. of Pa. 218 Fed. 502 where the judges refused to dissolve the defendant company though it had acquired a large percentage of the business, but concluded that the im- proper practices of which it was found that the defendant had been guilty should be reached by a governmental injunction and not by a governmental dissolution and so a decree of injunction without dissolution was entered. From this appeals were taken by both parties to the Supreme Court. In the so-called United States Steel Corporation case, 223 Fed. 1. c. 178, the court (Wooley J.) said: "that the corporation violated one of the provisions of the statute by combining with others to unduly restrain trade and in possessing the power to again unlawfully combine with others to do the same unlawful acts. * * * xhe ordinary relief is the injunction process of the court which in an ordinary situation would follow such a finding as of course. I am satisfied, however, that the same end will be attained a manner consistent with recent legislation by re- taining jurisdiction of the bill if desired by the government 756 THE ANTI-TRUST ACT OF 1890. [SECTION 5 for the purposes of restraining the defendants against engag- ing in the price fixing practices found illegal." The government in this case refused to consent to have the court retain jurisdiction of the bill and appealed from the decree entered. In U. S. V. American Can Co., Dis't of Md. Feb. 1916, (See Federal Trade Reporter March 1, 1916) the Court Rose J. found that the purpose of the organization of the defendant was illegal, but that it had ceased to engage in unlawful practices and that the public interest would not be subserved by its dissolution. It was therefore concluded to retain the bill reserving the right to decree a dissolution thereafter if future conditions call for such a remedy. The court said that if either of the parties insisted on the entering of a final decree for the purpose of seeking at once a review by appeal, the court would then determine as to what de- cree should be entered. For forms of decrees in such cases showing the details and the specific acts included in the prohibitions, see Appendix, p. 879. It should be noted, however, that these decrees are not always entered in litigated cases, but have been not infrequently entered by the court as agreed by the parties on the abandonment of the prosecution. Thus, in the settlement of the so-called National Cash Register htigation (see Supra § 570 as to the criminal prose- cution in this case) the decree entered by consent in settle- ment, which is set out in full in the appendix p. 882, provides for the retention of the case in court for the modification of the decree, if changed conditions require. § 587. Judicial application of section. — ^The com- prehensive jurisdiction vested in the court under this section is enforced by the provisions of the act of February 11, 1903, known as the Expedition Act, infra, § 610, whereunder suits in equity brought by the United States may be given pre- cedence over others on the certificate of the Attorney- General as to the general pubhc importance of the suit. The provision of this section however, whereunder the court can order parties to be summoned residing in other districts and can direct subpoena to be served in any district § 587] THE ANTI-TRUST ACT OF 1890. 757 by the marshal thereof, only applies to suits in equity, that is, to statutory injunctions brought by the government under section 4 of the Anti-Trust Act. It does not apply to private actions for damages under section 7 of the act, which can only be brought in the district where the defendant resides or is found. Under the Elkins Act, § 519, supra, criminal prosecutions brought under the Interstate Commerce Act, must be brought in the district where the violation is com- mitted, or through which the transportation may have been conducted. The jurisdiction vested in the courts in this class of pro- ceedings, enabling the government to select a forum in any state, where anyone of the defendants is a resident, was illustrated in the Standard Oil case, wherein there was some seventy-one corporate and partnership defendants and several individual defendants, and only one of the numerous defendants, the Waters-Pierce Oil Co., was a resident in the district in which the suit was commenced, and the only defendant served with process therein. Contemporaneously with the fihng of the bill, the court made an order under this section to serve process upon all the other defendants, where- ever they could be found. This jurisdiction was sustained by the circuit judges, see 152 Fed. 290, and also on appeal by the Supreme Court, supra, which held that under this section the court took rightful jurisdiction over the case, and properly ordered notice to be served upon the non-resident defendants. As to parties in suit in equity by United States, see also Powder Trust case, 188 Fed. 127, supra. There is no provision in the Anti-Trust Act as to the court wherein criminal offenses shall be prosecuted. Such prose- cutions must therefore be had in the district where the offense is committed. See cases cited, § 566. In Wogan v. American Sugar Refining Co., 1914, (District of La.), 215 Fed. 273, (1914) that where plaintiff was a citizen of the state and the defendant a New Jersey cor- poration doing business in Louisiana and found within the district, was properly sued. That the only radical change made by the judicial act of 1911 was to abolish the circuit courts, the purpose in other respects being to codify the existing law. It was therefore held that the provision 758 THEANTI-TEUSTACTOF 1890. [SECTION 5 of section 51 of the code requiring certain actions to be brought within the district of the defendant's residence would not apply to suits for violations of the Sherman Act. In Greer v. Stoller, western district of Missouri, 77 Fed. 1, it was held that the authority to bring in non-residents of the district was limited to suits instituted by the govern- ment and could not be availed of in private suits. The Anti-Trust Act of 1914 provides, section 12, that "any suit, action or proceeding under the anti-trust laws against a corporation may be brought, not only in a judicial district whereof it is an inhabitant, but also in any district where it may be found and transacts business, and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found." 589] THE ANTI-TRUST ACT OF 1890. 759 Section 6. § 588. Section 6 of the act. 589. Enforcement of seizure of goods under section 6. § 688. Seizure and condemnation of property. — Sec. 6. Any property owned under any contract or by any com- bination, or pursuant to any conspiracy (and being the sub- ject thereof) mentioned in section one of this act, and being in the course of transportation from one State to another, or to a foreign country, shall be forfeited to the United States, and may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure, and con- demnation of property imported into the United States con- trary to law. § 689. Enforcement of seizure of goods under sec- tion 6. — ^The seizure of goods authorized under section 6 can be enforced only by the procedure like to that provided by sections 3309-3391 R. S. U. S. for the forfeiture of goods under the customs laws, and with trial by jury. There is no reported case of such proceeding under this section. The seizure cannot be enforced in an equity suit by the United States under section 4. Addyston Pipe & Steel Co. v. United States, 29 C. C. A. 141, 85 Fed. 271 (1890). It was said in this case by Taft, J., that the only remedy which can be afforded under section 4 is a decree of in- junction. 760 THE ANTI-TRUST ACT OF 1890. [SECTION 7 Section 7. § 590 Section 7 of the act. 591. The re-enactment of the section in the act of 1914. 592. The section construed by the Supreme Court. 593. Threefold damages recoverable under acts of 1890 and 1914 only in actions at law. 594. Plaintiff must show injury. 595. A state is not a "person or corporation" under section 7. 596. Only the parties to an unlawful conspiracy liable as defendants. 597. Pleadings under Section 7. 598. Evidence under Section 7. 599. The Danbury Hat case. 600. Measure of damages under Section 7. 601. The act as a defense in suits by alleged illegal combinations. 602. The illegality of a corporation plaintiff and the illegality of the contract of sale distinguished. 603. No recovery under act for violation of interstate commerce act. 604. Limitations. 605. Self-incriminating testimony. 606. Service upon Foreign Executor under New York Statute quashed. 607. Service upon Foreign Corporation doing business in the district. § 590. Persons injured may recover threefold dam- ages and attorney's fee. Sec. 7. Any person who shall be injured in his business or property by any other person or corporation by reason of anything forbidden or declared to be unlawful by this act, may sue therefor in any circuit court of the United States in the district in which the defendant resides or is found, without respect to the amount in contro- versy, and shall recover threefold the damages by him sus- tained, and the costs of suit, including a reasonable attor- ney's fee. § 691. The reenactment of this section in the act of 1914. — This section is reenacted as section 4, of the Clayton Act of 1914, where it appears as follows: "Sec. 4. That any person who shall be injured in his busi- ness or property by reason of anything forbidden in the anti- trust laws, may sue therefor in any District in the United States in the District in which the defendant resides or is found, or his agent, without respect to the amount in con- troversy and shall recover three-fold of the damages by him sustained, and the costs of suit, including a reasonable at- torney's fee. §592] THE ANTI-TRUST ACT OF 1890. 761 § 692. The section construed by the Supreme Court. — This section was construed by the Supreme Court in Montague v. Lowry, 193 U; S. 38, 48 L. Ed. 608, affirming the judgment of the circuit court of appeals for the ninth circuit, 115 Fed. 27, and of the circuit court (N. Dist. of Cal.) 106 Fed. 38, for treble damages and attorney's fees in favor of a firm which had endeavored to procure tiles for the pur- poses of their business from the tile manufacturers, members of the association, who refused to deal with them because they, the plaintiffs were not members of the association. Plaintiffs were not eligible to membership in the association, because they did not always carry stock worth $3,000, which was made a condition of eligibility to membership. It was claimed that this provision had not been enforced. But the Court said there was nothing to prevent its enforcement at any time, if an apphcation was made by any one who did not fill the condition. The proof showed that by reason of the formation of the association plaintiffs had been injured in their business, because they were unable to procure tiles from the manufacturers at any price or from the dealers at San Francisco at less than the hst price which was more than fifty per cent above the price at which members of the association could purchase the same. In this case the jury found a verdict for |500 and judgment vvas rendered for treble this amount, and in addition thereto the court allowed $750 for attorney's fees. The trial lasted live days. The Court said that the amount of the attorney's fees was within the discretion of the trial court reasonably exercised, and that the discretion was not abused. The section was also construed by the Supreme Court in the case of Chattanooga Foundry Works v. Atlanta, 203 U. S. 390, 51 L. Ed. 241 (1906), affirming the circuit court of appeals, sixth circuit, 127 Fed. 25. In this case three-fold damages were recovered by the city of Atlanta, Ga., in the circuit court of Tennessee against two Tennessee corporations which were members of the combination held unlawful in the Addyston Pipe & Steel Co. case. See supra, § 92. The plaintiff was engaged in conducting a system of waterworks, and it was held entitled to recover the difference between the price paid and the fair price the city would have had to pay 762 THE ANTI-TEUST ACTOF 1890. [SECTION 7 under natural conditions for water pipe, together with attorney's fee; and the judgment trebled the damages allowed by the jury. The Court said there was no doubt that congress had power to authorize a recovery for the damage, although the latter was suffered wholly within the boundaries of one state, and that it was immaterial that there was no direct contract between plaintiff and the defendants. § 693. — Threefold Damages Recoverable Under Acts of 1890 and 1914 only in Actions at Law. — In Fleitmann v. Wellsbach Street Lighting Co., 240 U. S. 27, 60 L. Ed. , it was held by the Supreme Court, affirming the circuit court of appeals of the 2nd circuit, that the penalty of triple damages provided in this section could not be enforced otherwise than through the verdict of a jury in a court of common law. The statute plainly provides this remedy and no other. The Court said in its opinion that the Act of October 15, 1914, passed since this suit was begun, did not go further in terms than to give an injunction to private persons against threatened loss. In this case the suit was in equity brought by a stockholder to recover for the corporation the penalty of threefold damages from persons and corporations who were charged with the ruin of that corporation through a monopolistic combination, but the Court held that the procedure was not authorized under the section of either Act. The same ruling as to the Act of 1890 had been made by the circuit court of appeals of the 8th circuit in Post v. Buck Stove & Range Co., 200 Fed. 918, (1912). See also Corey v. Independent Ice Co., D. Ct. of Mass. (1913), 207 Fed. 459. § 694. Plaintiff must show injury. — ^The fact of an il- legal combination in an industry does not establish a right of private action for damages, unless plaintiff shows injury di- rectly accruing to himself by reason of the illegal combina- tion ; but an allegation that plaintiff is in the business affected by the combination, and by reason thereof is unable to make purchases and suffers loss thereby, is sufficient. Gibbs v. McNeeley, 102 Fed. 594, reversed in 55 C. C. A. 70, 118 Fed. 120, 60 L. R. A. 152 (1902). §594] THE ANTI-TRUST ACT OF 1890. 763 It is not necessary that plaintiff should be engaged himself in the business of interstate commerce, if he has suffered injury in his business or property by reason of anything for- bidden by the act. See City of Atlanta case, supra. The stockholder or creditor of a corporation, which has been made bankrupt by reason of an unlawful combination violative of this act, has no right of action therefore for dam- ages under this section, as the right of action in such case belongs to the corporation or its trustee in bankruptcy. See Loeb v. Eastman Kodak Company (C. C. A., third circuit 1910), 183 Fed. 704; Ames v. American Telephone & Telegraph Co. (infra), 166 Fed. 820 (1909). See also section 4, supra. In Claybaugh v. Southern Wholesale Groc. Ass'n, 181 Fed. 706, (1910) sou. dis. of Alabama, where plaintiff had first brought suit in the state court for the injury and settled the same such settlement was a bar to his suit under this section and not being entitled to recover actual damages he was not entitled to recover threefold damages or attorney's fees, and a verdict for defendant was therefore directed. In Union Castle Mail S. S. Co. v. Thomsen, 190 Fed. 536, C. C. A. second circuit, (1912) the court reversed 106 Fed. 251, where the court had said that it was immaterial whether restraint of trade was reasonable or unreasonable; but the court, on this second hearing, held that since their former decision the Supreme Court had, in the Standard Oil and Tobacco cases laid down a different rule, and it was unjust to the plaintiff to dismiss the complaint because he had submitted his case under their former ruling, and the case was therefore remanded for another trial. See also Corey v. Independent Ice Co., 207 Fed. 459, supra, where the allegations were held insuflTicient. In Strout V. United Shoe Machinery Co., 195 Fed. 313, Dis. Ct. of Mass. (1912) the court ruled that while a mere chancery receiver having no title to the assets or to the claim sued on could not maintain an action in the federal court in a jurisdiction other than that in which he was appointed. A receiver of a corporation who is a successor in title of the corporation could sue in a foreign jurisdiction. 764 THE ANTI-TEUST ACTOF 1890. [SeCTION 7 § 595. A state is not a "person or corporation" un- der section 7. — In Lowenstein v. Evans, 69 Fed. 908 (1895), a demurrer was sustained to a suit filed by a liquor dealer in South Carolina under the seventh section of the act against the members of the State Board of Control of the liquor traffic, under the State Dispensary law, alleging that the state monopoly of the liquor business was in violation of the act. The court said that a state is not a "person" or "corporation" within the meaning of the section. § 696. Only the parties to an unlawful conspiracy liable as defendants. — In Jayne v. Loder, 149 Fed. 21, C. C. A. third ciicuit, (1907) where manufacturers of proprietary medicines have entered into a tri-partite agree- ment for the purpose of maintaining prices, which was held to be an unlawful conspiracy, and subsequently a retailers' association proposed further plana and more drastic methods which were not adopted by the other associations, but were assented to by some of their members, the court held that the two combinations were separate and distinct and that a party to the first who did not become a party to the second, was not bound thereby and could not be joined as a defendant in an action for damages under the statute with other de- fendants who were parties only to the second agreement, nor was the letter admissible in evidence against it. In MarioneUi v. United Booking Officers of America, 227 Fed. 165 (1914), in a suit for damages by the agent of vaudeville performers against an alleged combination of a number of vaudeville theaters and their booking agents for alleged blacklisting, the court held the complaint good on demurrer, and that in such an action all of the parties privy to the general plan were properly joined, though the execu- tion of different parts of the plan was confined to individuals. See also Wear-Kramer Tobacco Company v. American Tobacco Company, 180 Fed. 160 (1910), where the court overruled a declaration under this section and held that the facts alleged showed an unlawful conspiracy to damage the plaintiff in interstate business. See the same case in 178 Fed. 117. §597] THE ANTI-TRUST ACT OF 1890. 765 § 597. Pleadings under section 7. — It is not sufficient to frame a complaint in the language of the statute, but the nature and substance of the contracts alleged to be illegal and the substantive facts constituting a monopoly, must be set out. Cilley V. U. S. Machinery Co., 152 Fed. 726, C. C. Mass. (1907). See also Strout v. United Shoe Machinery Co., same court, (1912) 195 Fed. 313, where it was held that the action was a civil remedy for a private injury, compensatory in its nature and effect, and the threefold damages recoverable are ex- emplary damages; that the averments of the pleadings pur- porting to give jurisdiction must be positive and argumenta- tive inferences were insufTicient. In a later suit of Cill v. United Shoe Machinery Co., same court, 202 Fed. 598, and Strout v. United Shoe Machinery Co., same court, 202 Fed. 602, (1913) the declarations were held suflTicient, the court saying that the thing forbidden by the Anti-Trust Act may consist of a scheme as a whole or an unlawful combination as a whole and it was not necessary to set out the separate offenses under sections 1 and 2 in separate counts. See also Corey v. Independent Ice Co., where it was held that allegations in a petition that an ice company was engaged in cutting and harvesting ice in New Hampshire and transporting the same to Boston and selling it in Boston was not sufficient to show that the corporation was engaged in interstate commerce, and that defendants entered into a combination and conspiracy in restraint of interstate com- merce in violation of the act was insufficient as pleading a conclusion. A complaint was also held bad on demurrer in Rice v. Standard Oil Co., 134 Fed. 464 (Dist. N. J., 1905), where the court said that the plaintiff must not only show facts showing the combination to be unlawful, but also facts showing that by reason of such unlawful action he had been injured in his business or property; and that the act made a distinction between a contract and a combination or conspiracy, and the two should not be confused in a pleading in a civil case any more than in indictment in a criminal proceeding. As to 766 THE ANTI-TRUST ACT OF 1-890. [SECTION 7 complaint held sufficient for submission to a jury, see Gibbs V. McNeeley, supra. In Buckeye Powder Co. v. Dupont de Nemures, 196 Fed. 514, Dist. Court, N. J. (1912), the court held a declaration against twenty-eight defendants good on motion to strike out, saying that the complaint was sufficient if it set out with reasonable certainty and defmiteness the causes which resulted from plaintiff's injury and connecting the defendant therewith, any defendant deeming himself prejudiced by such generahty of statement having the right to move for a bill of particulars. The court said that under the conformity statute, R. S. 914, the federal court would follow the practice prescribed by the state statute as near as may be, but not where it would defeat or encumber the administration of the law under the federal statutes. The complaint in Loewe v. Lawlor, supra, (the Danbury Hat case), was held by the Supreme Court sufficient on demurrer to show a cause of action under this section charg- ing interference with the manufacturer's business by an un- lawful combination in violation of the act. For declaration held insufficient under this section not showing injury to the plaintiff from the wrongful acts com- plained of, see Bishop v. American Preservers Co., 51 Fed. 272, Sou. Dis. of 111. (1892.) § 598. Evidence under section 7. — In Buckeye Powder Co. V. Hazzard Powder Co., 205 Fed. 827, Dist. of Conn. (1913), the court granted a motion to compel a witness whose testimony was taken by deposition de bene esse under section 863 R. S., U. S., to answer questions concerning the conduct of the business of defendants after the date when it was alleged plaintiff's business was destroyed as bearing on the question whether a combination or conspiracy existed before that date; and the court said a witness whose testimony was being taken de bene esse was not entitled to refuse to answer questions because he or his counsel believed them to be irrelevant. Where the witness admitted that he had written an article reflecting on plaintiff he thereby waived his privilege not to testify concerning the article on the ground that to do so might subject him to criminal prosecution .for libel. It was also held that it was no objection to the §600] THE ANTI-TRUST ACT OF 1890. 767 taking of a witness deposition de bene esse that it was claimed that the proceedings amounted to no more than a fishing excursion to obtain the testimony in aid of another proceeding; as the court would presume the action was honestly brought and intended to be tried. In Dancel v. Goodyear Shoe Machinery Co., 128 Fed. 753, (1904) it was held that the issue of a subpoena duces tecum to compel the production of books and papers was not a matter of right, but could be issued only under an order of court, and that a Notary Public without such order, had no power to issue a subpoena duces tecum. § 599. The Danbury Hat case. — In the Danbury Hat case referred to in §552, supra, wherein the Court sustained the complaint on demurrer and sent the case back for trial resulting in the damages which were trebled under the act, and this judgment was affirmed in 209 Fed. 721, and was sustained by the Supreme Court 235 U. S. 522, (1915) the Court held that if the members of a labor organization paid their dues and continued to delegate authority to their officers unlawfully to interfere with the plaintiff's interstate commerce, they should have known that the officers were acting within their delegated authority, and such members were jointly personally liable. The Court also held in this case that the damages accruing since the action began, if the consequences of acts done before and constituting part of the cause of action declared on, were properly allowed, and that reasons given by customers for refusing to deal with the sellers of plaintiff's hats including letters from dealers to plaintiffs were admissible in evidence to show the damages, and that the introduction of news- papers was proper to show publicity in places and directions where the facts were likely to be brought home to defendants, and also to prove intended and detrimental consequences of the principal acts. § 600. Measure of damages under section 7. — The measure of damages which a party is entitled to recover in such an action is the difference between the price paid and the reasonable price under natural and competitive conditions. See also supra, § 592. 768 THE ANTI-TRUST ACT OF 1890. [SECTION 7 The Court said in the City of Atlanta case that the plain intent was to compensate the person injured and that the en- largement of compensation by the provision for trebling the amount of damages did not constitute the action a penal action within the meaning of section 1047 R. S., U. S. The other sections of the act were penal, but the seventh section was distinctly compensatory. See also for full discussion of measure of damages Central Coal & Coke Co. v. Hartmann, 111 Fed. 96, C. C. A. eighth circuit, (1901) where the court said that while the general rule was that the anticipated profits of a commercial business were too remote, speculative and dependent upon changing cir- cumstances to warrant a judgment for their loss, there was an exception to this rule, when the loss of profits from the interruption of an established business may be recovered, where the plaintiff makes it reasonably certain by competent proof what the amount of his actual loss was. § 601. The act as a defense in suits by alleged illegal combinations. — There is no provision in the Anti-Trust Act, such as is contained in some state anti-trust statutes, making the fact of membership of a vendor in an illegal combination a defense by a vendee in a suit for goods pur- chased; and where a contract of purchase is wholly collateral to and independent of the agreement under which the com- bination is, made, the fact of the combination constitutes no defense in a suit for the purchase price by the vendor. Connolly v. Sewer Pipe Co., 184 U. S. 540, 46 L. Ed. 679 (1902). In this case it was held that the illegality at common law of a combination formed in restraint of trade did not prevent it from recovering the purchase price of goods sold in the course of business, and that a violation of the Anti-Trust Act by the formation of an illegal combination in restraint of trade did not preclude such a company from recovering on collateral contracts for the purchase price of goods, and also that a recovery of the treble damages under section 7 could only be had by direct action and not by way of set-off. In Continental Wall Paper Co. v. Voight, 212 U. S. 227, 53 L. Ed. 486 (1909),the Court, affirming 148 Fed. 939, sustained §601] THE ANTI-TRUST ACT OF 1890. 769 the defense set up by the answer in an action for goods sold and deUvered that plaintiff was a selling agent of a combina- tion of wall paper manufacturers offending against the act, and that in carrying out the combination defendants were compelled to sign a shipper's agreement which in effect bound them to buy from the plaintiff all wall paper needed in their business at certain fixed prices, and that these prices were unreasonable. (Justices Holmes, Brewer, White and Peck- ham dissenting.) The prevaihng opinion distinguished the case from the Connolly case, as there the contract of purchase was wholly collateral to and independent of the agreement under which the combination was made, while in this case, as admitted by the demurrer, the count sued on was made up in execution of the agreement and thus constituted a part of it. The principle was also laid down in Bement v. New York Harrow Co., 186 U. S. p. 70, 46 L. Ed. 1058 (1902), that the defense that a contract is in violation of an act of congress against unlawful restraints and monopolies, making illegal every contract violative of its provisions, may be set up by private individuals when sued thereon, and if proved consti- tutes a good defense to the action. In this case it was also held that conditions imposed by the patentee in a license which keep up the monopoly of fixed prices did not violate the act of congress. See supra, § 557. See also: American Soda Fountain v. Green, 69 Fed. 333 (C. C. E. D. of Pa., 1895) ; Columbia Wire Co. v. Freeman Wire Co., 71 Fed. 302 (1895). It is no objection to the enforcement of a contract, in the consideration of which nothing illegal inheres, that it may incidentally aid one of the parties in exacting and violating the Anti-Trust statute. This was held in Ingraham v. Nat'I Salt Co., 130 Fed. 676 (1904, C. C. A. second circuit), reversing, 122 Fed. 40, where the action was to recover the amount of certificates created by defendant, in payment of stock of another company, the certificates in payment of the stock purchasing being held to have been lawfully issued in exercise of the defendant's implied power to incur in- debtedness. It was held in Searchlight Gas Co. v. Presto-Lite Co., 215 Fed. 692, (1914) by the C. C. A. of the seventh circuit, J-49. 770 THE ANTI-TEUST ACT OF 1890. [SECTION 7 in 1914, that it was no defense to a suit for infringement of a trade mark that the complainant may conduct its business in violation of the anti-trust law. See also Motion Picture Co. v. Eclaire Film Co., district court of New Jersey, (1913) 208 Fed. 416. See also Reynolds Tobacco Co. v. Allen Bros. Tobacco Co. Cir. Ct. West. Dis. of Va., 155 Fed. 819, National Fold- ing Box Co. V. Robertson, Cir. Ct. D. of Conn. 99 Fed. 985, (1900), Chicago Wall Paper Mills v. General Paper Co., C. C. A. seventh circuit 147 Fed. 491, (1906), Motion Picture Patents Co. v. Ullman, 186 Fed. 174, Cir. Ct. Sou. Dist. of N. Y. (1910), Motion Picture Patents Co. v. Laemmle, 178 Fed. 104, Cir. Ct. So. Dist. of N. Y. (1910), General Elec. Co. v. Wise, Cir. Ct. Nor. Dist. of N. Y. 119 Fed. 922, (1903). § 602. The illegality of a corporation plaintiff and the illegality of the contract of sale distinguished. — The Connolly case, supra, and the Continental Wall Paper case, supra, were distinguished and these cases reconciled by the Supreme Court (without dissent) in the case of D. R. Wilder Manufacturing Company v. Corn Products Refining Company, 236 U. S. 165, 59 L. Ed. 520 (1915) affirming 75 S. E. (Ga.) 918, where it was claimed that the plaintiff, the Refining Company, had no legal existence as it was a combi- nation illegally organized with the object of monopolizing all dealings in glucose and corn syrup. The defendant claimed that under the ruling in the Continental Wall Paper case the plaintiff could not recover, but the Court said that the ruling in the Continental case was rested exclusively upon elements of illegality in hearing in the particular con- tract of sale in that case, and that case was therefore on that ground distinguished from the Connolly case, where it was not the contract but the organization of the plaintiff which was attacked. The Court said therefore that the Anti-Trust Act did not authorize the direct or indirect suggestion of the illegal existence of a corporation as a means of defense to a suit brought by such corporation on an otherwise inherent legal and enforcible contract. Plaintiff was therefore entitled to recover for the goods admittedly purchased, but defendant was not entitled to his §605] THE ANTI-TRUST ACT OF 1890. 771 percentage in the proposed profit sharing scheme devised by the plaintiff corporation, where he did not comply with the condition upon which the offer of a right to a participation in the profits was rested, — that he would for the following year deal exclusively with the corporation plaintiff. § 603. No recovery under act for violation of Inter- state Commerce Act. — The anti-trust law does not give any right of action for damages sustained by the payment of excessive, unjust, or unreasonable rates to interstate carriers alleged to have been induced by a conspiracy between inter- state railroads, as relief therefor as provided by the Interstate Commerce Act. See Meeker v. Lehigh Valley R. R. Co., 162 Fed. 354, cir- cuit court, southern district New York (1908). The Anti-Trust Act and the Interstate Commerce Act are separate and independent acts, not germane in character and purpose. See United States v. A., T. & S. F. R. R. Co., 142 Fed. 176 (1905). § 604. Limitations. — There was no limitation fixed under the statute of 1890 for the bringing of private actions, and it was held by the Supreme Court in the Atlanta case, supra, that the matter of the limitation was left to the local law of the state where the action was brought. It is pro- vided, however, in the act of 1914, section 5, that whenever any suit or proceeding in equity or criminal prosecution is instituted by the United States to prevent, restrain or punish violations of any of the anti-trust laws, the running of the statute of limitations in respect of each and every private right of action arising under such laws, and based in whole or in part on any matter complained of in said suit or pro- ceeding, shall be suspended during the pendency thereof. § 605. Self incriminating testimony. — The subject of immunity of witnesses who give self-incriminating testimony, particularly in relation to governmental prosecutions, civil or criminal, under the other sections of this act, has been the subject of extensive discussion. Prior to the act of February 25, 1903, it had been held, in Foote v. Buchanan, 113 Fed. 156 (1902), that the act of congress of February 11, 1893, 772 THE ANTI-TRUST ACT OF 1890. [SECTION 7 supra, § 424, did not apply to the Anti-Trust Act, and that the fifth amendment of th,e constitution did apply thereto, so that self-incriminating testimony could not be enforced until this act of February 25, 1903, which was a provision of the legislative, executive and judicial appropriation act of that year {supra, § 424), providing that no person should be prosecuted and subjected to any penalty or forfeiture for or on account of any transaction matter or thing, concerning which he may testify or produce evidence, documentary or otherwise, in any preceding suit or prosecution under said acts, (the Interstate Commerce Act or the Anti-Trust Act). Provided further that no person so testifying shall be ex- empted from prosecution or punishment for perjury com- mitted in so testifjdng. A witness cannot claim the privilege to refuse to answer when called to testify, as his answer when given is a complete bar to the pending prosecution, or to any further prosecution, if it be pertinent to the subject-matter. In re Kittle, So. Dist. of New York), 180 Fed. 946 (1910), it was held in this case that this section was not retroactive, the consti- tutional guaranty being specified by the construction that the witness is not subject to further prosecution after giving his testimony. By the act of June 30, 1906, it was provided that this im- munity should extend only to a natural person who, in obed- ience to a subpoena, gives testimony on oath or gives testi- mony, documentary or otherwise, under oath. As to the construction of this Immunity Act in relation to corporations and natural persons, see supra, section 12 of Interstate Com- merce Act. § 606. Service upon foreign executor under New York statute quashed. — In Thornborn v. Gates, 225 Fed. 613, (1915) it was held that the provision of this section, that any person injured may sue therefor in any circuit court in the United States in the district in which the defendant resides or may be found, merely removes the existing limita- tions on the venue of actions between those of diverse citizen- ship, and permits the plaintiff to sue the defendant, where- ever he can serve the defendant with process. In this case the defendant was an executrix of two deceased persons, §607] THE ANTI-TEUST ACT OF 1890. 773 and was a resident, as was also her decedent, of the state of Texas. She was served with process in the state of New York while she was sojourning there. Section 1836-a of the code of New York authorized service upon a foreign executor, requiring however a copy of the letters testa- mentary to be filed in the court. This statute, however, the court held, must be construed as opening the courts of New York to suits against foreign executors in cases where the law of the domicihary state allows it. The court therefore held that the New York statute did not warrant the service in a suit brought in the federal court under this section, and the service was quashed. § 607. Service upon foreign corporation doing busi- ness in the district. — In Dodson v. Farbenfabriken of Elberfeld Co., 206 Fed. 125, Dist. Ct. of Pa. (1913), where the suit was brought against a corporation organized under the laws of Germany and service was made upon a New York corporation alleged to have been organized to transact the business of the foreign company in the United States, and it being alleged that the New York company v^as the foreign company's agent and authorized to do the very acts complained of, the court held the service of processa sufficient. It was conceded that it must appear that the corporation was doing business in the district, but the court held that the statute of Pennsylvania did not necessarily contemplate service on an individual representing the cor- poration as an agent, but authorized service on a foreign corporation by service on another corporation representing it in the district. 774 THE ANTI-TEUST ACT OF 1890. [SeCTION 8 Section 8. § 608. Section 8 of the act. § 608. "Person" or "persons" defined.— Sec. 8. That the word "person," or "persons" wherever used in this act shall be deemed to include corporations and associations existing under or authorized by the laws of either the United States, or the laws of any of the Territories, the laws of any State, or the laws of any foreign country. This statutory inclusion of the corporations and associa- tions in the term "person" is not contained in the Interstate Commerce Act. The general rule however, is well estab- lished that the term "person" as well as the term "citizen" is to be construed as including corporations unless there be something beyond the mere use of the word to indicate the intent on the part of congress to include them. United States V. Amedy, 11 Wheat, 329, 6 L. Ed. 502; Ramsey v. Tacoma Land Co., 196 U. S. 360, 49 L. Ed. 513, (1905). A municipal corporation is entitled to sue for damages under the seventh section see supra, § 592. In the Clayton Anti-Trust Act of 1914 the definition of "person" is as follows: "The word "person,' or 'persons' wherever used in this act shall be deemed to include corporations and associations existing under or authorized by the laws of either the United States, the laws of any of the Territories, the laws of any state or the laws of any foreign country." For definition of "corporation" in the Federal Trade Commission Act, see section 4 of that act. § 609. Definition of words and phrases used in the Anti-Trust Act. — The following words and phrases used in the Sherman Anti-Trust Act, and relative thereto, have been defined by the courts and their meaning as used in this legislation interpreted : For the definition of the word "Boycott", see Thomas v. Cincinnati & C. R. Co., 62 Fed. 803 (1894); "Combination" §609] THE ANTI-TRUST ACT OF 1890. 775 or "Conspiracy", Tribolet v. United States, 95 Penn. Rep. 87; "Combination" and "Monopoly", United States v. McAndrews et al., 149 Fed. 824 (1906), "Commerce" United States v. Debs, 64 Fed. 724 (1894), United States V. Cassidy, 67 Fed. 698 (1895), United States v. Swift & Co., 222 Fed. 529, Standard Oil Co. v. United States, 221 U. S. 1 ; 55 L. Ed. 619 (1911) "Conspiracy", United States v. Debs, supra, Pettibone v. United States, 148 U. S. 203, 37 L. Ed. 419 (1901) United States v. Cassidy, supra. United States v. McAndrews, et al., supra. United States v. Kissel, 173 Fed. 827 (1909); "Corner", United States v. Patten, 187 Fed. 668 (1911); "Due Process of Law", United States v. N. Y. N. H. & H. R. Co., 165 Fed. 746 (1908); "Immunity", United States V. Swift, 186 Fed. 1017 (1911); "Interstate Com- merce", In re charge to grand jury, 151 Fed. 838 (1907); "Mail Trains", United States v. Cassidy, supra; "Monopo- lize", American Biscuit & Mfg. Co. v. Klotz, 44 Fed. 724 (1891); "Monopolizing", or "Attempting to monopolize". In re Green, 52 Fed. 104 (1892); "Monopoly of Trade", United States v. Trans-Missouri Freight Association, 58 Fed. 58 (1893); "Monopohzed", United States v. Patten, supra. Standard Oil Co. v. United States, supra, "Municipal Corporation", "A Business Corporation", City of Atlanta v. Chattanooga Foundry & Pipe Works, 127 Fed. 23 (1903); "More or Less", Hadley-Dean Glass Co. v. Highland Glass Co., 143 Fed. 242 (1906); "Pardon", United States v. Swift, supra; "Patent", United States v. Standard Sanitary Manufacturing Co., supra; "Person", Standard Oil Co. v. United States, supra; "Restraint of Trade", United States v. Debs, supra. Standard Oil Co. v. United States, 221 U. S. 50, United States v. American Tobacco Co., 221 U. S. 179 55 L. Ed. 694 (1910); "Restraint of Competition", United States V. DuPont, etc. Co., 188 Fed. 151 (1911); "Trust", United States v. Northern Securities Co., 120 Fed. 721 (1903). THE EXPEDITION ACT. § 610. The Expedition Act. 611. The judicial application of the act. 612. The amendment of 1910. 613. The construction of the statute. 614. The Act not violative of due process of law. § 610. The Expedition Act. AN ACT To expedite the hearing and determination of suits in equity pending or hereafter brought under the act of July second, eighteen hundred and ninety, entitled "An Act to protect trade and commerce against unlawful restraints and monopolies," "An Act to regulate, commerce," approved February fourth, eighteen hundred and eighty- seven or any other Acts having a like purpose that may be hereafter enacted. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. Sec. 1. (As amended June 25, 1910.) That in any suit in equity [Expedition of cases.] pending or hereafter brought in any circuit court of the United States under the Act entitled "An Act to protect trade and commerce against unlawful restraints and monopolies," approved July second, eighteen hundred and ninety, "An Act to regulate commerce," approved February fourth, eighteen hundred and eighty-seven, or any other Acts having a like purpose that hereafter may be enacted, wherein the United States is complainant, the Attorney-General may file with the clerk of such court a certificate that, in his opinion, the case is of general public importance, a copy of which shall be immediately furnished by such clerk to each of the circuit judges of the circuit in which the case is pend- ing. Thereupon such case shall be given precedence over others and in every way expedited, and be assigned for hear- [Hearing before three judges.] ing at the earliest practicable day, before not less than three of the circuit judges of said court, if there be three or more; and if there be not more than two circuit judges, then before them and such district judge as they may selfect; or, in case the full court shall not at any time be made up by reason of the necessary absence or disqualification of one or more of the said circuit judges, the justice of the Supreme Court as- signed to that circuit or the other circuit judge or judges may designate a district judge or judges within the circuit (7761 §610] THE EXPEDITIO>f ACT. 777 who shall be competent to sit in said court at the hearing of said suit. In the event the judges sitting in such case shall be equally divided in opinion as to the decision or disposi- [Chief justice to designate circuit judge in case of equal division.] tion of said cause, or in the event that a majority of said judges shall be unable to agree upon the judgment, order, or decree finally disposing of said case in said court which should be entered in said cause, then they shall immediately certify that fact to the Chief Justice of the United States, who shall at once designate and appoint some circuit judge to sit with said'judges and to assist in determining said cause. Such order of the Chief Justice shall be immediately trans- mitted to the clerk of the circuit court in which said cause is pending, and shall be entered upon the minutes of said court. Thereupon said cause shall at once be set down for reargument and the parties thereto notified in writing by the clerk of said court of the action of the court and the date fixed for the reargument thereof. The provisions of this sec- tion shall apply to all causes and proceedings in all courts now pending, or which may hereafter be brought. [Appeal to supreme court.] Sec. 2. That in every suit in equity pending or hereafter brought in any circuit court of the United States under any of said Acts, wherein the United States is complainant, in- cluding pases submitted but not yet decided, an appeal from the final decree of the circuit court will lie only to the Su- preme Court and must be taken within sixty days from the entry thereof: Provided, That in any case where an appeal may have been taken from the final decree of a circuit court to the circuit court of appeals before this Act takes effect, the case shall proceed to a final decree therein, and an appeal may be taken from such decree to the Supreme Court in the manner now provided by law. Public, No. 82, approved February 11, 1903; Public, No. 310, approved June 25, 1910. This act, known as the "Expedition Act," was approved February 11, 1903, prior to the act amendatory of the Inter- state Commerce Act, which was approved February 19, 1903,, supra, § 519, and is therefore referred to in the third section of that act, where it is provided that the provisions of this act shall be applicable to any suit prosecuted under the direction of the Attorney-General in the name of the Interstate Com- merce Commission. 778 THE EXPEDITION ACT. [§611 § 611. Judicial applicatioii of act. — The expeditious procedure provided by this act was illustrated and enforced in the Northern Securities case, which was argued in the circuit court at St. Louis before the four judges of the court in April, 1903, decided in May, 1903, appealed to the Supreme Court, advanced on the docket and finally decided on the fourth day of April, 1904. In Interstate Com. v. Baird, 194 U. S. 25, 48 L. Ed. 860, (1904), which was appealed directly to the Supreme Court from the circuit court in a proceeding instituted by Mr. Hearst before the commission, the Supreme Court held that the appeal was properly made to the Supreme Court from the circuit court, and the right of direct appeal was also applicable to proceedings to enforce the production of books and papers or the giving of testimony before the commission. The Court said it was a purpose of this act of 1903 to elimi- nate the necessity of any appeal to the circuit court of appeals and permit the litigation to be shortened by direct appeal to the Supreme Court. In Missouri Pacific Railroad Co. v. United States, 189 U. S. 274, 47 L. Ed. 811, (1903) the Supreme Court while holding that the circuit court had erred in refusing to sustain a demurrer of a railroad company to a bill filed by the dis- trict attorney of the United States under the direction of the Attorney-General, at the instance of the Interstate Com- merce Commission, also said that the act of February, 1903, expressly conferred this power to invoke the remedy of injunction, which had not heretofore existed, and as that act specifically provided that the new remedies which created should be applicable to all cases then pending, the Court therefore decided that the case would not be finally disposed of, but would be remanded for further proceedings in ac- cordance with the provisions of this act of Feb. 19, 1903. § 612. Amendment of 1910. — As originally enacted in 1903, section 1 of this act did not contain the provision for calling in a circuit judge from another circuit in case of an equal division of the court, but did provide that in case of a division in opinion the case should be certified to the Supreme Court for review in like manner as if taken there by appeal. §613] THE EXPEDITION ACT. 779 In Baltimore & Ohio Railroad Co. v. Interstate Commerce Com., 215 U. S. 216, 54 L. Ed. 164 (1909), the Court held that this provision did not authorize the sending up of the whole case, as that under the settled ruling of the court would con- vert the Supreme Court into one of original rather than appellate jurisdiction. The only construction the Court, therefore, could give to the statute under the constitution, would be to authorize the certification of questions when there was a division of opinion upon a definite point of law. The same ruling was made in the case of U. S. v. Terminal R. R. Association of St. Louis, wherein the entire case was certified to the Supreme Court on account of the equal division of the four judges sitting in the case. In conse- quence of this ruling the statute was amended in 1910 (act of June 25, 1910), by providing that when the judges were equally divided in opinion or a majority were unable to agree upon a judgment, they should certify that fact to the chief justice, who should designate some circuit judge to assist in determining the case. § 613. Construction of the statute. — This statute was construed by the judges of the fifth judicial circuit in Southern Pacific T. Co. et al. v. Interstate Commerce Com- mission, 166 Fed. 134 (1908), where it was sought to enjoin the enforcement of an order of the Interstate Commerce Commission and the court overruled a motion for an injunc- tion pendente lite, one of the judges dissenting, the complain- ant moved the court at this stage to certify the case to the Supreme Cotirt under section 2 of the act. The court said that section 16 of the Interstate Commerce Act as amended in 1906, made this expediting act apply to suits to suspend orders. of the Interstate Commerce Commission, and re- quired both the final hearing and the hearing for preliminary injunction to be held before three circuit judges; but'tTiere was no provision in the act requiring three circuit judges to sit in any other phases of the case than the hearing on apph- cation for preliminary injunction and on the final hearing: and the only provision for certification was in the case of a di- vision of opinion, and there was no other provision for certi- fication of the case in the statute, so that the motion was denied. 780 THE EXPEDITION ACT. [§614 § 614. The act not violative of due process of law. — In U. S. V. New York, N. H. & H. R. Co., 165 Fed. 742, (1908) where an emergency certificate was filed by the At- torney-General, it was contended that there was a discrimina- tion in this statute, as it was applicable only to a certain class of cases, and was operative only at the request of the United States, and therefore it was class lesiglation and a denial of due process of law. This was in 1908, prior to the amendment of 1910. It was held by the court, the three circuit judges sitting, that due process of law did not pro- hibit the establishment of a special commission or the assign- ment of special judges for the trial of a specific offender as long as there was a compliance otherwise with the rules of common law. There was a substantial distinction be- tween the fifth amendment of the federal constitution, which is obligatory only on the United States, and the fourteenth amendment, which is obligatory on the states and prohibits the denial of the equal protection of the laws, which might in some cases be a denial of due process of law; but mere discrimination, though in one sense class legislation, did not have that effect. As to the importance of this section the court cited a decision of the third circuit in U. S. v. Delaware & H. Co., 164 Fed. 215 (1908). EMPLOYERS LIABILITY ACT § 615. The Employers Liability Act of 1906. 616. The Act of 1906 invalid as to interstate carriers. 617. The act of 1906 valid as to District of Columbia and territories. 618. The employers liability act of 1908. 619. The Amendatory act of April 5, 1910. 620. The act of 1908 as amended in 1910 sustained by the Supreme Court. 621. The amendment of 1910. 622. The abolition of contributory negligence in connection with Safety Applicance Act. 622a. Contributory negligence and assumption of risk distinguished. 623. What is employment in interstate commerce? 624. Concurrent jurisdiction of the State courts. 625. Jurisdiction of the Supreme Court in suits brought in State courts. 626. Prohibition of contracting out of the act. 627. The superseding of State statutes. 627a. The Employers Liability Act and state compensation laws. 628. Parties entitled to right of action under the act. 629. Right of removal under the act. 630. Procedure in trials under the act. 631. Measure of damages under the act. 632. Set-ofI under the act. 633. Aliens as beneficiaries within the terms of the act. § 616. The Employers' Liability Act of 1906. AN ACT Relating to liability of common carriers in the District of Columbia and Territories and common carriers engaged in commerce between the states and between the states and foreign nations to their employees. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That every common carrier engaged in trade or commerce in the District of Columbia, or in any Territory of the United States, or between the several States, or between any Territory and another State, or between any Territory or Territories and any State or States, or the District of Columbia, or with foreign nations, or between the District of Columbia and any State or States or foreign nations, shall be liable to any of its employees, or, in the case of his death, to his personal representative for the benefit of his widow and children, if any, if none, then for his parents, if none, then for his next of kin dependent upon him, for all damages which may result [7811 782 THE EMPLOYER'S LIABILITY ACT. [§616 from the negligence of any of its oflficers, agents, or em- ployees, or by reason of any defect or insufficiency due to its negligence in its cars, engines, appliances, machinery, track, roadbed, ways or works. Sec. 2. That in all actions hereafter brought against any common carriers to recover damages for personal injuries to an employee, or where such injuries have resulted in his death, the fact that the employee may have been guilty of contributory negligence shall hot bar a recovery where his contributory negligence was slight and that of the employer was gross in comparison, but the damages shall be diminished by the jury in proportion to the amount of negligence at- tributable to such employee. All questions of negligence and contributory neghgence shall be for the jury. Sec. 3. That no contract of employment, insurance, relief benefit, or indemnity for injury or death entered into by or on behalf of any employee, nor the acceptance of any such insurance, relief benefit, or indemnity by the person entitled thereto, shall constitute any bar or defense to any action brought to recover damages for personal injuries to or death of such employee : Provided, however, That upon the trial of such action against any common carrier the defendant may set off therein any sum it has contributed toward any such insurance, relief, benefit, or^ndemnity that may have been paid to the injured employee, or, in case of his death, to his personal representative. Sec. 4. That no action shall be maintained under this Act, unless commenced within one year from the time the cause of action accrued. Sec. 5. That nothing in this Act shall be held to limit the duty of common carriers by railroads or impair the rights of their employees under the safety-appliance Act of March sec- ond, eighteen hundred and ninety-three, as amended April first, eighteen hundred and ninety-six, and March second, nineteen hundred and three. Approved June 11, 1906. § 616. The act of 1906 invalid as to interstate carriers. — In what is known as the Employers' Liability Case, Howard v. Illinois Central R. R. Co., 207 U. S. 463, 52 L. Ed. 297 (1907), the Supreme Court held this act of 1906 invalid as to interstate carriers, in that it went beyond the power of congress under the commerce clause, by including all the employes of said carriers and in not limiting the act to the employes engaged in said commerce. Five justices concurred in the opinion holding that this part of the act, §618] THE EMPLOYER'S LIABILITY ACT. 783 thus held invahd, could not be separated from the provisions of the act as to interstate employes, so the entire act as to interstate carriers was held void. Four justices (Moody, Harlan, McKenna and Holmes) dis- sented, holding not only that the act in its main features was valid, but that the attempted regulation of intrastate em- ployes could and should be separated from the other pro- visions of the act. Three of the justices concurring in -the conclusion that the act was invalid did not concur in the assumption of the opinion that congress could regulate the relation of master and servant in interstate commerce. It seems therefore that six of the justices concurred in maintaining the power of congress to regulate the liability of interstate carriers to their employes engaged in interstate commerce. § 617. The act of 1906 valid as to District of Colum- bia and the territories. — So much of the act as related to the District of Columbia and the territories, was not based upon the power of congress to regulate commerce among the states but upon its power as a single sovereign with full legislative authority, and in El Paso & N. R. Co. v. Gutierrez, 215 U. S. 87, 54 L. Ed. 106 (1909), the Court without dissent declared that the invalidity of the act as to interstate com- merce as declared in the Howard Case, supra, did not invali- date such of its provisions as regulate commerce within the District of Columbia and the territories, afTirming the su- preme court of Texas in 117 S. W. 426. In this opinion the Court approved the opinion of the court of appeals of the District of Columbia holding the act valid as to the District of Columbia in Hyde v. Southern R. R. Co., 31 App. D. C. 466. § 618. The Employers' Liability Act of 1908. AN ACT Relating to the liability of common carriers by railroad to their employees in certain cases. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That every common carrier by railroad while engaging in commerce be- tween any of the several States or Territories, or between any of the States and Territories, or between the District of 784 THE EMPLOYERS LIABILITY ACT. [§618 Columbia and any of the States or Territories, or between the District of Columbia or any of the States or Territories, and any foreign nation or nations, shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce, or, in case of the death of such employee, to his or her personal representative, for the benefit of the surviving widow or husband and children of such employee; and, if none, then of such employee's parents ; and, if none, then of the next of kin dependent upon such employee, for such injury or death resulting in whole or in part from the negligence of any of the ofTicers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars, engines, appli- ances, machinery, track, roadbed, works, boats, wharves, or other equipment. Sec. 2. That every common carrier by railroad in the Territories, the District of Columbia, the Panama Canal Zone, or other possessions of the United States shall be liable in damages to any person suffering injury while he is em- ployed by such carrier in any of said jurisdictions, or, in case of the death of such employee, to his or her personal repre- sentative, for the benefit of the surviving widow or husband and children of such employee; and, if none, then of such employee's parents; and, if none, then of the next of kin dependent upon such employee, for such injury or death resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars, engines, appliances, machinery, track, roadbed, works, boats, wharves, or other equipment. Sec. 3. That in all actions hereafter brought against any such common carrier by railroad under or by virtue of any of the provisions of this act to recover damages for personal injuries to an employee, or where said injuries have resulted in his death, the fact that the employee may have been guilty of contributory negligence shall not bar a recovery, but the damages shall be diminished by the jury in proportion to the amount of negligence attributable to such employee: Pro- vided, That no such employee who may be injured or killed shall be held to have been guilty of contributory negligence in any case where the violation by such common carrier of any statute enacted for the safety of employees contributed to the injury or death of such employee. Sec. 4. That in any action brought against any common carrier under or by virtue of any of the provisions of this act lo recover damages for injuries to, or the death of, any of its employees, such employee shall not be held to have assumed the risks of his employment in any case where the §619] THE EMPLOYER'S LIABILITY ACT. 785 violation by such common carrier of any statute enacted for the safety of employees contributed to the injury or death of such employee. Sec. 5. That any contract, rule, regulation, or device whatsoever, the purpose or intent of which shall be to enable any common carrier to exempt itself from any liability created by this Act, shall to that extent be void: Provided, That in any action brought against any such common carrier under or by virtue of any of the provisions of this Act, such common carrier may set off therein any sum it has con- tributed or paid to any insurance, relief benefit, or indemnity that may have been paid to the injured employee or the person entitled thereto on account of the injury or death for which said action was brought. Sec. 6. That no action shall be maintained under this Act unless commenced within two years from the day the cause of action accrued. Sec. 7. That the term "Common carrier" as used in this act shall include the receiver or receivers or other persons or corporations charged with the duty of the management and operation of the business of a common carrier. Sec. 8. That nothing in this Act shall be held to limit the duty or liability of common carriers or to impair the rights of their employees under any other A<;t or Acts of Congress, or to affect the prosecution of any pending proceeding or right of action under the Act of Congress entitled, "An Act relating to liability of common carriers in the District of Columbia and Territories, and to common carriers engaged in com- merce between the States and between the States and foreign nations to their employees," approved June eleventh, nineteen hundred and six. Approved, April 22, 1908. § 619. The amendatory act of April 6, 1910. AN ACT To amend an Act entitled "An Act relating to the liability of common carriers by railroad to their employees in certain cases," approved April 22, 1908. Be it enacted by the Senate and House of Repiesentatives of the United States of America in Congress assembled. That an Act entitled "An Act relating to the liability of common carriers by railroad to their employees in certain cases," approved April twenty-second, nineteen hundred and eight, be amended in section six so that said section shall read: "Sec. 6. That no action shall be maintained under this Act unless commenced within two years from the day the cause of action accrued. 786 THE EMPLOYER'S LIABILITY ACT. [§ 620 "Under this Act an action may be brought in a circuit court of the United States, in the district of the residence of the de- fendant, or in which the cause of action arose, or in which the defendant shall be doing business at the time of commencing such action. The jurisdiction of the courts of the United States under this Act shall be concurrent with that of the courts of the several States, and no case aiising under this Act and brought in any state court of competent jurisdiction shall be removed to any court of the United States." "Sec. 2. That said Act be further amended by adding the following section as section nine of said Act: "Sec. 9. That any right of action given by this Act to a person suffering injury shall survive to his or her personal representative, for the berefit of the surviving widow or husband and children of such employee, and, if none, then of such employee's parents; and, if none, then of the next of kin dependent upon such employee, but in such cases there shall be only one recovery for the same injury." Approved April 5, 1910. § 620. The Act of 1908 as amended in 1910 sustained by the Supreme Court. — In Mondou v. New York, New Haven & Hartford Ry. Co., 223 U. S. 59, 56 L. Ed. 327, (1912) known with other cases decided at the same time as the Second Employers Liiability c,ases, the Supreme Court over-ruled the Supreme Court of Connecticut, 82 Conn. 373, which had held under the authority of the Hoxey case, 82 Conn. 353, that the act was repugnant to the constitution and even if valid a right of action thereunder could not be enforced in the courts of the state. The Supreme Court held that congress in the exercise of its power over interstate commerce could lawfully regulate the relations of carriers and their employees, that congress did not exceed its power in abrogating the federal servant rule, and restricting the defenses of contributory negligence and assumption of risk, since no one had any vested right in that rule of the common law, and the natural tendency of such changes was to promote the safety of the employees and to advance the commerce in which they were engaged. The Court also held that the fifth section of the act pro- hibiting any contracting out of the act was also within the power of congress; and that the laws of the several states in so far as they cover the same field were superseded by enact- ment by congress of this act, and that the distribution of §621] THE EMPLOYER'S LIABILITY ACT. 787 damages in the act necessarily superseded any applicable state legislation. The Court in this case also sustained the concurrent jurisdiction of the state courts under the amendment of 1910, and held that a state court could not decline to exercise the jurisdiction of such an action, and even if there was any inconvenience or confusion resulting from this concurrent jurisdiction, it afforded no reason to a state court for declining a jurisdiction conferred by law. Since this decision the act has been applied and enforced by the Supreme Court in several cases as a lawful exercise of the powers of congress, and free from the infirmities of the Act of 1906. § 621. The Amendment of 1910. — Prior to the amend- ment of 1910 the act made no provision for the survival of the action so given for an injury sustained in the event of the death of the injured party. Fulgham v. Midland Valley R. R. Co. (1909) 167 Fed. 660. The amendment provides for the bringing of the action by certain heirs or representatives of the deceased. The Fulgham case has been referred to with approval and as an authority by the U. S. Supreme Court in the case of Michigan Central R. R. Co. v. Vreeland, 227 U. S. 59, 57 L. Ed. 417 (1913), where the Court held that the act of 1908 did not provide for any survival of right of action created in behalf of an injured employe, and that the right was extngiuished by his death, saying: "The obvious purpose of Congress (i.e., the amendment of 1910) was to save a right of action to certain lelatives de- pendent upon an employe wrongfully injured for the loss and damage resulting to them financially by reason of the wrongful death." A further material change was made by this amendment of 1910 by providing for the current jurisdiction of the state courts, see § 624 infra, and also prohibiting removal from a state court to a court of the United States, § 629 infra. The amendment also provides that iSuit may be brought in the district courts of the United States in the district 788 THE EMPLOYER'S LIABILITY ACT. [§ 622a of the residence of the defendant and in which the cause of action arose, or in which the defendant should be doing business at the time of commencing the action. As to the purpose of this amdnment, see Newell v. B. & 0. R. Co., 181 Fed. 698 (1910), which was decided after this amend- ment had been adopted, but the court held that the ainend- ment did not confer jurisdiction upon pending suits, and when the suit was brought, the court was deprived of juris- diction, as the jurisdiction was not founded only upon diverse citizenship, but upon a federal right, and could be brought only in the district of the defendant's residence. The act of 1910 removes this difTiculty as to actions there- after brought. § 622. The abolition of contributory negligence in connection with the Safety Appliance Act, — Under the proviso of Section 3 of the act of 1908, no employee who may have been injured or killed shall be held to have been guilty of contributory negligence in any case where the violation by such common carrier of any statute enacted for the safety of employees contributed to the injury or death of such em- ployee. This provision was applied and enforced by the C. C. A. of the eighth circuit in Johnson v. Great Northern R. Co., 178 Fed. 643 (1909), as amending the Safety AppUance Act and making the question of assumption of risks and contribu- tory negligence by the plaintiff immaterial in an action under that act. The sanie view was taken by the Supreme Court in Schlemmer v. Buffalo Ry. Co., 205 U. S. 1, 51 L. Ed. 681 (1907). In Southern Pacific R. Co. v. Crockett, 234 U. S. 725, 58 L. Ed. 1564, (1914) the Court said that the assumption of risk in a case under the employers' liability act remained as at common law, saving in cases where a violation by the common carrier of any statute enacted for the safety of employees contributed to the injury of the employee. § 622a. Contributory negligence and assumption of risk distinguished. — In Seaboard Air Line Co. v. Horton, 233 U. S. 492, 58 L. Ed. 1062, (1914) the Supreme Court, reversing the Supreme Court of North Carolina, 162 § 623] THE EMPLOYER'S LIABILITY ACT. 789 N. C. 424, said that the distinction between contributory negligence and assumption of risk though simple was some- times overlooked. Contributory negligence involves the notion of some fault or breach of duty on the part of the employee; and since it is ordinarily his duty to take some precaution for his own safety when engaged in a hazardous occupation, contributory negligence is sometimes defined as a failure to use such care for his safety as ordinarily prudent employees in similar circumstances would use. On the other hand, the assumption of risk, even though the risk be obvious, may be free from any suggestion of fault or negli- gence on the part of the employee. The risks may be present, notwithstanding the exercise of all reasonable care on his part. Some employments are necessarily fraught with danger to the workmen — danger that must be and is contained in the line of his duty. Such dangers as are normally and necessarily incident to the occupation are presumably taken into consideration in fixing the rate of wages. Such risks, said the Court, are assumed by the employee, but there are risks of another sort arising out of the failure of the em- ployer to exercise such care with respect to providing a safe place of work and suitable and safe apphances for work. The Court said the elimination of the defense of assumption of risk by section 4 in any case, where the violation by the carrier of any statute enacted for the safety of the employees contributed to the injury or death of the employee plainly evidenced the legislative intent that in all other cases such assumption of risk shall have its former effect as a complete bar to the action. For failure to observe this distinction the judgment of the Carolina court was reversed. See also Yazoo & M. V. R. Co. v. Wright, 235 U. S. 336, 59 L. Ed. 277, (1914), affirming C. C. A., sixth circuit, 207 Fed. 281. See same subject discussed in relation to safety act, § 661 infra. § 623. What is employment in inte,rstate com- merce. — The most difficult question in the apphcation and enforcement of the act is the determination of what is em- ployment in interstate commerce within the meaning of the 790 THE EMPLOYER'S LIABILITY ACT. [§ 623 act. The act of 1906 was declared invalid for the reason that it applied to employees of interstate carriers, whether those employees were employed in interstate or intrastate com- merce ; so it must be proven that the employer and employee were engaged in interstate commerce at the time of the injury in order to sustain a recovery under the act. Thus a common carrier is engaged at the same time in interstate and intrastate service', on the same tracks and bridges; and the same employees are employed in both kinds of service, with the same equipment, and the same stations are used at the same time for both classes of traffic. The question thus presented must necessarily be determined by the special facts of each case and is an illustration of the intricacies into which our dual system of government often leads. But the diffi- culty is but an incident which can neither defeat or impair the power of congress over interstate commerce. The carrier must be engaged in interstate commerce at the time of the injury. In North Carolina R. Co. v. Zachary, 232 U. S. 248, 58 L. Ed. 591, (1913) the Supreme Court, reversing 156 N. C. 491, held that the lessor in a lease of an intrastate railway to an interstate railway was through the lessee a common carrier within the meaning of the act, where under the local law the lessor was responsible for all acts of negligence of the lessee, and a railway fireman killed while employed in interstate commerce by the lessee carrier was regarded as employed also by the lessor. It was held in the same case that the hauling of empty cars from one State to another was interstate commerce within the meaning of the act. In N. Y. C. & H. R. R. Co. v. Carr, 238 U. S. 261, 59 L. Ed. 1298, (1915) the court affirmed 142 N. Y. Supp. 11, and held that a brakeman on a pickup freight train running between points in the same state, but containing cars loaded with interstate freight, who was injured while attempting in the course of his employment to set a brake on an intrastate car, was eriiployed in interstate commerce where the setting of the brake was necessary in order that the train might proceed on its journey. This case was distingusihed from the case of the Illinois Central R. Co. v. Behrens 233 U. S. 473, 58 L. Ed. 1051, (1914) for there the cars were running between two points in the same state. § 623 J THE EMPLOYER'S LIABILITY ACT. 791 It has been uniformly held that where a carrier is perform- ing both interstate and intrastate service on the same train, an employee injured in the operation of such train is regarded as having been engaged in interstate commerce. The same ruling has been extended to the construction and repair of tracks and bridges used by the carrier in both interstate and intrastate commerce. See Columbia P. S. R. Co. v. Sauter, 223 Fed. 604, C. C. A. ninth circuit, (1915) where the employee was killed while constructing a bridge. Lom- bardo v. Boston & M. R. Co., 223 Fed. 427, N. D. of N. Y. (1915), where the employee was engaged in repairing a track used in both kinds of commerce. Thompson v. Columbia, etc. Co. 205 Fed. 203, Dist. of Washington, (1913), where the employee was killed while engaged in repairing a bridge. Eng. V. Southern Pacific Co., 210 Fed. 92, Dist. Ct. of Ore. (1913), where the injured party was engaged in framing a new office for both kinds of business. Law v. Illinois Central R. Co., 208 Fed. 869, C. C. A. of the sixth cir- cuit (1912) held that a boiler maker's helper employed in repairing a locomotive for use in interstate commerce was so engaged in interstate commerce. In San Pedro etc. Co. v. David, 210 Fed. 870, the C. C. A. of the sixth circuit (1914) held that a railroad section hand engaged in ballasting the main track of the railroad was engaged in interstate com- merce. And in Copper River R. Co. v. Heney, 211 Fed. 459 (1913), the C. C. A. of the ninth circuit held that the party injured in retimbering a railroad tunnel for a sub- sidiary company of the railroad company, it was held that both companies should be regarded as common carriers. See the same court in Northern Pacific R. Co. v. Merkl, 198 Fed. 1 (1912), which made the same ruling as to an employee working in repair shops used in repairing cars used cus- tomarily in both interstate and intrastate commerce. TralHch v. Chicago, M. & St. P- R. Co., 217 Fed. 675, West. Dist. of Wash. (1914), that the plaintiff operating a steam shovel in the removal of earth from the roadbed was held employed in interstate commerce. Employees engaged in service incidental to the operation of trains in interstate commerce have been held engaged in that commerce. Thus in the C. C. A. of the sixth circuit, Pitts- 792 THE EMPLOYEE'S LIABILITY ACT. [§623 burgh, C. C. & St. L. R. Co. v. Glinn, 219 Fed. 148 (1914), held that where a switchman was killed aligning switches where the cars were handled by the carrier both for inter- state and intrastate freight, the jury were authorized to find that he was engaged in interstate commerce at the time of his death, affirming 208 Fed. 989. In the eighth C. C. A., the court said in the case of lUinois Central R. Co. v. Nelson, 203 Fed. 957 (1913), that where a brakeman was injured while crossing the track with ice intended for use on the train, he was engaged in interstate commerce. So in Erie R. Co. v. Jacobus, in the C. C. A. of the third circuit, 221 Fed. 335, (1915), where a deck hand was employed on a tug boat employed in propelling freight boats in and about New York harbor, and between New Jersey and New York, the court held there was suffici- ent evidence for the jury, and a judgment in his favor was affirmed. It was also held in Illinois Central R. Co. v. Porter, C. C. A. of the sixth circuit, 207 Fed. 211 (1913), that a truckman employed by a railroad company to wheel inter- state freight was engaged in interstate commerce. In Laphere v. Oregon R. & N. Co., 196 Fed, 336 (1913), the C. C. A. of the ninth circuit, reversing 193 Fed. 248, held that a locomotive fireman ordered to report to a sta- tion to be transported with others to another station to relieve a crew of an interstate train and was killed through the negligence of other servants of the company operating an interstate train, was held within the act. In Deale v. Coal and Coke Ry. Co., 215 Fed. 285, (1914) it was held that an employee of an interstate railway who was engaged in repairing a telegraph line owned and main- tained by it and used in directing the operation of interstate trains, was entitled to the benefit of the act. See also Zikos V. Ore. R. & N. Co., 129 Fed. 893, E. Dist. of Washington, (1910) where a section hand working on a track of a railroad over which both interstate and intrastate trains moved was held employed in interstate commerce within the meaning of the act. In this case the court said that where the employment necessarily and directly contributes to the whole extended use, and without which intrastate traffic could not § 623[ THE EMPLOYER'S LIABILITY ACT. 793 be carried out at all, no reason appears for denying the power over the one, although that may indirectly contribute to the other. To same effect see Cola-Surdo v. Central R. of N. J., 180 Fed. 832 (1910), where a track walker injured while assisting in repairing a switch in a railroad yard, was held engaged in interstate commerce, the court saying that the act did not say that the injury could not arise from an act done in interstate commerce and that it was immaterial whether the train by which he was injured was engaged in interstate commerce. On the other hand the mere act of mining coal is not inter- state commerce. Delaware, L. & W. R. Co. v. Yurkonis, 220 Fed. 429, (1915). C. C- A. 2nd Cir. The owner of timber land operating a logging railroad to a port within the state where the timber was sold to purchasers was not engaged in interstate commerce. Bay v. Merrell & Ring Logging Co., 220 Fed. 295, C. C. A. ninth cir. (1915) following Nordgard v. Merrysville & Northern R. Co., 218 Fed. 737, in the same court. So in Pederson v. D. L. & W. R. Co., 197 Fed. 537, (1912) it was said by the C. C. A. 3d Cir. that an iron worker em- ployed on a railroad bridge on which an additional track was being placed for use in both intrastate and interstate business, who was struck and injured by a local intrastate train on the old track where he had gone for some rivets, was held not to be engaged in interstate commerce. For cases in this circuit following this ruling where the employees were held not to be engaged in interstate com- merce, see Bennett v. Lehigh Valley R. Co., 197 Fed. 578, (1912) Heimbach v. Lehigh VaUey R. Co., 197 Fed. 579 and Feaster v. Philadelphia & R. Co. 197 Fed. 580. In Illinois Central R. Co. v. Rogers, 221. Fed. 52,(1915) it was held by the C. C. A. 5th circuit that an employee while cleaning stencils used by the company to mark cars owned and used in interstate commerce, was not engaged in interstate commerce. In Bravis v. Chicago, M. & St. P. R. Co., 217 Fed. 234, (1914), it was held by the C. C. A. of the eighth circuit, that an employee engaged in the construction of a bridge on a cut-off which had never been provided with rail or used as a railroad, was not engaged 794 THE EMPLOYER'S LIABILITY ACT. [§624 in interstate commerce, although the company was so en- gaged and intended to use the cut-off when completed. In Penn. R. Co. v. Knox, 218 Fed. 748, the C. C. A. of the third circuit, (1915), held that where an interstate move- ment of empty railroad cars had ceased at their first destina- tion point in Pennsylvania, the employment in the state thereafter did not constitute interstate commerce. In Thomas v. Boston & M. R. Co., 218 Fed. 143, Dist. of N. H., the plaintiff who was injured by the faUing of timber while he was engaged in tearing down part of a railroad roundhouse which was rendered useless by fire, was held not to be engaged in interstate commerce. In Schanley v. Philadelphia & R. R. Co., E. D. of Penn., 221 Fed. 1012, (1915), a member of a shifting crew in a freight yard who at the time of his death was aiding in the shunting of empty cars upon a siding of a manufacturing company and who had been sent out as a flagman to protect the switch to stop an on-coming train on the track with which the switch was connected, was not shown to be en- gaged in interstate commerce. In Taylor v. Southern R. Co., 178 Fed. 380, (1910) a member of a railroad bridge gang who was injured while engaged within the scope of his employment in repairing a bridge by an alleged defective scaffold, though his duty required work in the repair of bridges in different states, was held not engaged in interstate commerce. § 624. Concurrent jurisdiction of the state courts. — There is no exclusive jurisdiction in the federal courts declared in this act ; but, on the contrary, in the amendment of 1910 it is specifically provided in section 6, as amended, that the jurisdiction of the courts of the tJnited States under this act shall be concurrent with the courts of the several states, and no case arising under this act and brought in any court. of competent jurisdictions shall be removed to any court of the United States. This amendment was enacted after the opinion in Hoxie v. N. Y., N. H. & H. R. R., 82 Conn. 352, wherein the court declined jurisdiction of a suit asserting rights under this act, upon the ground among other things that congress did not intend that jurisdiction arising §625] THE EMPLOYER'S LIABILITY ACT. 795 under this act should be exercised by the state courts, and this act of 1910 was sustained by Supreme Court. See Mon- dou case, supra. It has also been held (see Whittaker v. I. C. Ry., supra) that where the petition states facts which bring the case within the Employers Liability Act, it is covered by the act, whether specifically declared so or not. In the Colasurdo Case, supra, also prior to the amendment of 1910, the court held in an action removed from the state court, that it was not subject to remand, though it appeared in the trial that the parties were citizens of the same state, if it appeared from the complaint that plaintiff sought to recover under the Employers Liability Act, and where such an averment was made, the federal jurisdiction existed, even though the complaint was dismissed because the plaintiff was not a person so employed. It has also been held prior to the amendment of 1910 in Miller v. I. C. R. R., 168 Fed. 982, that, where it did not appear from plaintiff's declaration that the construction of this act was involved, the cause was not removable as arising under the laws of the United States. Under this amendment declaring concurrent jurisdiction in the state and federal courts plaintiff in suing in the latter must show in his petition either diverse citizenship, or an assertion of his right of recovery under this statute, and in either case, he must also show the jurisdictional amount of ($3,000.00) in controversy. § 626. The Jurisdiction of the Supreme Court in Suits Brought in the State Courts. — In suits brought by writ of error from the Supreme Court to the highest court of a state, the jurisdiction of the Supreme Court is limited to the federal rights under the statute claimed to have been denied in the state courts. Thus if the state court holds that the case does not come under the federal law and it seems that the plaintiff in error may have been prejudiced thereby, the case will be reversed, see North Carolina R. Co. v. Zachary, 232 U. S. 248, 58 L. Ed. 591, (1914) reversing 156 N. C. 496. The measure of damages under the act is definitely fixed, and can not be helped out by state legislation. Where the state court sets up a different standard of recovery from that 796 THE EMPLOrER'S LIABILITY ACT, [§ 626 prescribed by the act, the judgment is reversed, see Gulf, Col. & S. F. R. Co. V. McGinis, 228 U. S. 173, 57 L. Ed. 785 (1913), reversing the Texas court in 147 S. W. 1178; and also Kansas City S. R. Co. v. Leslie, infra § 629. In C. R. I. & P. Co. V. Devine, 239 U. S., 52, 60 L. Ed., (1915), the court affirmed, on motion, 266 111. 248, saying that the want of merit in the proposition that the state statute as to amount of recovery controlled, had been too conclusively established to permit of further argument. The questions of pleading, such as that the defect in the original declaration is cured by the admission in the reply, and in general matters of pleading and admissibility of evidence, which involved no construction of the federal statute, can not be considered on a writ of error. This, however, does not apply to the question of the burden of proof respecting contributory negligence. This must be determined according to the rules in the federal courts which places the burden of proof on the defendant, and not accord- ing to any local rule or procedure which imposes that burden on the plaintiff. Central Vermont Ry. Co. v. White, 238 U. S. 507, 59 L. Ed. 1433, (1915) affirming 87 Vt. 330. In a case brought to the Supreme Court by writ of error to the state court, the Court will analyze the evidence to the extent necessary to give the plaintiff in error the benefit of the asserted federal right, North Carolina R. Co. v. Zachary, supra. § 626. Prohibition of contracting out of the Act. — The prohibition of any contract, the purpose or intent of which is to enable a carrier to exempt itself from the liability created by the act, was sustained by the Supreme Court in the Mondou case, supra, where it was claimed that such a provision was an unwarranted interference with the liberty of contract, but the Court said that as congress possessed the power to impose the liability, it also possessed the power to insure its efficacy by prohibiting any contract, rule, regula- tion or device in evasion of it. The same clause was in the act of 1906. See remarks of Moody, J., concerning the same in the Howard case, supra. The prohibition of contracting out of a remedical statute would seem distinguishable from a contract of exemption § 627] THE EMPLOYER'S LIABIUTY ACT. 797 made by an express agreement of a railroad company entered into as a condition of his employment, such as was held valid in B. & 0. Ry. Co. v. Voight, 176 U. S. 497, 44 L. Ed. 560 (1900). This prohibition of contracting out was again sus- tained in Philadelphia B. & W. R. Co. v. Schubert, 224 U. S. 601, 56 L. Ed. 911, (1911) affirming 36 App. D. C. 565. In this case it was held that under this provision a stipulation making the acceptance of benefits under the contract of membership in a relief department of a railroad a bar to an action under the statute was void, and this, whether the contract was entered into before or after the enactment of the act. In Robertson v. B. & 0. R. Co., 237 U. S. 84, 59 L. Ed. 849 (1914), the Court affirmed the Court of appeals of the Dis- trict of Columbia, holding that a porter on a Pullman Com- pany car could lawfully stipulate in his contract of employ- ment to exempt the railroad company hauling the cars from liability for injury sustained by him, and this was not included in the prohibition of this section, since he was not an employee of the railway company within the meaning of the act, and he was not made such by assisting in collecting fares for the conductor in the early morning hours. § 627. The superseding of state statutes. — It was held by the Supreme Court in the Second Employer's Lia- bility cases, supra, that the laws of the several states in so far as they covered the same field were superseded by the enactment by congress of the Employer's Liability Act of 1908. The Court said that it undoubtedly rested with congress to determine whether a national law operated uni- formly in all the states upon all carriers by railroads engaged in interstate commerce would subserve the needs of that commerce. This was also the ruling of the Supreme Courts of Wisconsin and Missouri in relation to the nine hour law of congress, infra. In Chicago I. L. Co. v. Hackett, 228 U. S. 559, 57 L. Ed. 966, (1913) where the injury sued for occurred in February 1907, the Court held that the state law was not invahdated by the enactment of the Employer's Liability Act of 1906, as that having been held invalid by congress was not a law 798 THE EMPLOYER'S LIABILITY ACT. [§627 for any purpose, and therefore the state law remained in force. In Seaboard A. L. R. Co. vs. Horton, 233 U. S. 492, 58 L. Ed. 1062, (1914) the Court reversed 162 N. C. 424, and held that the elimination of the defense of the assumption of risk in Section 4 referred to the federal courts the conten- tion that state laws upon the subject were superseded. A writ of error would therefore lie from the Supreme Court to review the decision of the state court, which sustained the action of the trial court overruling the contention made by the plaintiff in error, which set forth the application of the federal statute, which if acceded to would have produced a verdict in favor of the plaintiff in erroi;. In Taylor v. Taylor, 232 U. S. 363, 58 L. Ed. 638, (1914) the Supreme Court held that the provisions of this Act governed the distribution of damages to the exclusion of any applicable state legislation, and nothing in the state statute for the distribution of personal property could affect the right of a childless widow of an interstate railway com- pany employee, theretofore injured in interstate commerce, to the entire proceeds of the judgment, whether under section 1 or section 9 of the Act. While the Employers' Liabihty act displaces state laws on the same subject, yet if the local practice permits, the com- plaint may show the right of recovery under the federal and state law, or under the common law as supplemented by the state mining laws. Thus in Delaware L. & W. R. Co. vs. Yuokis, supra, the claim under the federal law was denied, but the judgment in favor of plaintiff for personal injuries from a gas explosion in a mine was affirmed. In Wabash R. Co. v. Hayes, 234 U. S. 86, 58 L. Ed. 1226, (1913) the Supreme Court held that declarations stating a cause of action under the Employers' Liability act could be treated as affording a basis for recovery in a state by ehmi- nating the allegation that the injury occurred in interstate commerce, which the proof demonstrated was unwarranted, and the writ of error from the affirmance of the judgment in 180 111. 511 was dismissed. It was held also in Bravis v. Chicago, M. & St. p. R. Co., supra, that in an action which in a single complaint sets § 627a] THE EMPLOYER'S LIABILITY ACT. 799 forth a case under the state law, and the plaintiff amends so as to set out in one count a case under the federal statute and thereby makes an election and abandoned his cause of action under the state law and relies on the federal act, he is estopped from revoking or repudiating this after a direct verdict against him on his pleading and evidence. As to the superseding of state laws, see Oliver v. Nor. Pac. R. Co., 196 Fed. 432 (1912). § 627a. The Employers Liability Act and State Compensation Laws.— The Employers Liability Act is based upon negligence, that is, applies only to cases where the injury is found to be due to negligence. The broader field of compensation for all injuries incurred with or without fault on the basis of compensation, as one of the hazards of business paid for by the public, as such sought to be covered by state workmens compensation acts, is not included in this act of congress. The question therefore is presented whether the act of congress supersedes these state compensation acts, so as to preclude an employee in interstate commerce from seeking relief thereunder. In Seaboard Air Line Co. v. Horton, supra, the Supreme Court said: "It is settled, that since Congress, by the Act of 1908, took possession of the field of the employers' liability in in- terstate transportation by rail, all state laws upon the sub- ject are superseded." , In this case the decision was based upon the failure of the state court to apply the federal law as to assumption of risk. In certain of the state courts it has been held that their state compensation laws did not apply to railroad employees injured in interstate commerce. See Staley v. Illinois Cen. R. Co., (Sup. Gt. of 111.) 109 N. E. 342, and also in California, Smith V. Industrial Accident Association, (State District Ct. of Appeals) 147 Pac. Rep. 600. On the other hand it was held by the New York court of appeals, in Winfield v. New York Cen. & H. R. Co., 110 N. E. 614, (Nov. 1915) that in view of the fact that the federal employers' liability act and the workmen's compensation act law of New York were radically different in principle. 800 THE EMPLOYERS LIABILITY ACT. [§628 scope and method, and that the one was based on negligence while the other was riot, the federal act did not prevent a recovery of compensation under the state law by one acci- dentally injured while tamping ties in the employment of a railroad engaged in interstate commerce, and that the mere fact that congress had not yet exercised its legislative power on the particular subject did not render inoperative a state statute relative to the same subject matter. The New York statute provided that it should apply in interstate com- merce only to the extent not forbidden by any act of congress. The New York court suggested a case where an employer might contend in order to defeat a claim for compensation, that the injury was caused by his negligence, and the court said that such a case was not presented, but in that event there could be no double recovery. See a discussion of these cases in the Harvard Law Review of February 1916, page 439. In Northern Pacific Co. v. Meese, 239 U. S. 614, 60 L. Ed. (1916) the Supreme Court reversed the C. C. A., 9th circuit, 211 Fed. 254, which had reversed the District Court of Washington, 206 Fed. 222, and held that the latter court correctly construed the Washington Workmen's Com- pensation Act as taking away the right of an employe of a brewing company to recover from a railroad company for damages resulting in death, caused by the negligence of the railroad company, while he was performing his ordinary duties at the brewery company. The Court held that the District Court followed the construction of the statute by the Supreme Court of the State in Peet v. Mills, 76 Wash- ington 437, which had held that the Legislature had in effect aboUshed all causes of action, whether based on negligence or not, and that the compensation provided by the act was intenned to be exclusive of every other remedy. § 628. Parties Entitled to Right of Action Under the Act.— In Garrett v. L. & N. R. Co., 235 U. S. 308, 59 L. Ed. 242 (1915) the Supreme Court afHrmed 197 Fed. 705 and held that the right of action under the act of an injured employee was extinguished by the death of the employee as the result of such injury, and the petition was fatally de- fective as to the parents of such employee, where it contained §628] THE EMPLOYER'S LIABILITY ACT. 801 no averment of pecuniary loss to such parents. In this case the Court said it was not justified under the facts in remand- ing the case for the purpose of allowing amendments to be made. In St. Louis I. M. & S. R. Co. v. Craft, 237 U. S. 648, 59 L. Ed. 1160, (1915) the Court affirmed the supreme court of Arkansas, which modified and affirmed the judgment of the circuit court of that state, reducing the verdict of one thousand dollars for pecuniary loss to the father, and eleven thousand dollars for pain and suffering of the decedent to five thousand dollars. The Court held that the circum- stances of this award were questions of fact, which were open to revision in the federal Supreme Court on a writ of error to the state court; that under the act there was no basis for a separate estimate of the pain and suffering before death, when the action was brought by personal repre- sentatives, and there could be only one recovery for the same injury; but damages for conscious pain and suffering could be included in that recovery. In this case the action was brought by the father, there being surviving no child or mother. The action was brought under Section 9 of the Act of 1910. It would seem that if a deceased employee leaves no widow, children, parents, or next of kin dependent upon him, no recovery can be had by a mere representative of his estate. The legal representative of the decedent acts only as trustee for the beneficiaries; and if there are no benefi- ciaries such as are described in the Employer's Liability Act, the trust fails upon well recognized principles of law. This was the view taken by the court in Thomas v. Chicago & Northwestern Railroad Co., 202 Fed. 766, (1913) where it was held that the right of action conferred by the statute upon relatives is independent of that given to the employe, and does not include any damages that he might have recovered had he lived, but is given for the pecuniary loss which such relatives may have sustained because of the decedent's untimely death while engaged in interstate commerce. This view of the law was adopted by Hon. Jacob Trieber, United States district judge, in an article on the National Employers Liability Act in the American Law Review of August, 1915. J-51. 802 THE EMPLOYEE'S LIABILITY ACT. [§ 629 In Cam v. Southern Ry. Co., E. Dist. of Tenn., 199 Fed. 211 (1911), in a case brought under the act prior to the amendment of 1910, it was held that the right of action for injury to an employe did not survive the death of the em- ploye, and recovery was therefore limited to the pecuniary injury or loss sustained by the beneficiaries. The court said that the survival of the injured employe's right of action was expressly provided by the amendment of 1910. In this case the court held the verdict of $10,000 excessive, and required a remittitur of $2500. § 629. Right of Removal Under the Act.— This amendment of 1910 was incorporated in Section 28 of the Judicial Code effective January 1, 1912, whiclt specifies the causes which are removable from state courts by non- resident defendants, and concludes: "Provided, that no case arising under the Act entitled (giving the title of this Act), or any amendment thereto, brought in any state court of competent jurisdiction shall be removed to any Court of the United States." The Supreme Court in Kansas CityS. R. Co. v. Leslie, 238 U. S. 599, 59 L. Ed. 1478, (1915) in a case where there was a diverse citizenship which would otherwise have justified removal, held that the language of both the amendment and Judicial Code clearly prohibited the removal of a case arising under the act in a state court upon the sole ground of diverse citizenship. The same conclusion had been announced frequently by the lower federal courts cited in the opinion. A different view was expressed in Van Bremer v. Texas & P. R. Co., 190 Fed. 394, which the Court disapproved. In Arizona & R. Co. v. Clark, 235 U. S. 669, 59 L. Ed. 415 (1915), the Court affirmed the United States Circuit Court of Appeals, 201 Fed. 817, in a suit that was brought in the Arizona District Court when a territory under the Act of 1908 as amended in 1910, the territory becoming a state after the action was commenced. The Court held that the party had proved the right to have the case tried in the state court, and the federal court had jurisdiction as the action was under the law of the United States. § 630] THE EMPLOYEE'S LIABILITY ACT. 803 But a removal may be had if the complaint fails to show that the injury was caused while the plaintiff or his repre- sentative was employed in interstate traffic, as it is the record at the time of the removal which controls. In the case of Strother vs. Union Pacific Railroad Co., 220 Fed. 731, (W. D. of Mo.) (1915) the court said that where a petition contained two counts, stating causes of action under the act and under the state law, and the necessary diversity of citizenship existed, the railroad company could remove such cause of action without waiting until plaintiff elected to rely on the cause of action under the state law, and that such removal carried the whole case with it. The court said if the right of removal was doubtful, the federal court would retain jurisdiction. In De Atley v. C. & 0. R. Co., Dts. Ct. of Kentucky, 201 Fed. 591 (1912), the employers' liability act was held to supersede all other common law and statutory liabilities of carriers to their employees, and where plaintiff claimed a liability under the act, the suit would be regarded for purposes of removal as one under the act, whether the facts show negligence covered by the act or not, and the case was therefore held not removable and remanded, although there was a diversity of citizenship. In Kelley's Admx. v. C. & 0. R. Co., 201 Fed. 602, Dist. Ct. of Kentucky (1912), it seems that the master mechanic employed by an interstate railroad was joined as a defendant, but the court held that under the act the liability for the death of an engineer was limited to the common carrier, and it could not at the same time be made liable under the state statute. The case was therefore held improperly removed and was remanded. See also Burnett v. Spokane P. & S. R. Co. 210 Fed. 94. § 630. Procedure in Trials Under the Act. — In Toledo, St. Louis & Western R. Co. v. Slavin, 236 U. S. 454, 59 L. Ed. 671, (1915) the Court reversed 88 Ohio state 536, where a judgment had been rendered in favor of plain- tiff, and the evidence showed that the train was engaged in interstate commerce, although the pleadings contained no reference to the federal act, and as the Ohio statute had aboUshed the common law assumption of risks, it was applied -804 THE EMPLOYER'S LIABILITY ACT. [§ 630 in the federal courts, and that the carrier was prejudiced thereby. The habiUty to certain relatives dependent upon the decedent is not hmited to cases where death was instan- taneous, the right thus created being independent of any cause of action which the decedent had, and including no damages which he might have recovered for his injury if he had survived. The measure of damages to which the widow is entitled is the financial benefit which she might reasonably have expected from her husband in a pecuniary way and do not include the loss of society and companionship, or care and advice, as such considerations are not capable of esti- mate by a definite pecuniary standard. See also American R. Co. V. Diverickson, 227 U. S. 145, 57 L. Ed. 456, reversing 5 Porto Rico Fed. Reps. 401, where the Court applied the same rule to parents where the action was brought for their benefit, and said there could be no recovery for the loss of the society and companionship of the same. In Colorado, Gulf, C. & S. F. R. Co. V. Maginis, 228 U. S. 173, (1912) the Court held that the recovery must be limited to the com- pensating the relatives for whose benefit the administrator sues and who shows they have sustained some pecuniary loss ; and the surviving child with no reasonable expectation of any pecuniary benefit from the continuation of the life can have no share. In Norfolk & W. R. Co. v. Holbrook, 235 U. S. 625, 59 L. Ed. 392, (1915) the Court reversing 215 Fed. 687, (C. C. A. 4th circuit), held that it was reversible error for the court to tell the jury in an action for the benefit of the widow and infant children of a deceased railway employee that the pecuniary damages suffered were much greater than when the beneficiaries were all adults, or dependents who were next of kin. (Judges McKenna, Day and Hughes dis- senting). In Arizona & L. R. Co. v. Clark, supra, it was held by the Supreme Court that neither the testimony of other wit- nesses nor the voluntary testimony by plaintiff of his physical condition amounted to a waiving of the privilege against distclosures by a physician of communications by the plain- tiff under the Arizona statute against such disclosures by §631] THE EMPLOYER'S LIABILITY ACT. 805 physicians, and the Court held that the exclusion of suclj disclosure was not error. (Judges Hughes and Day dis sen ting). Rejection of evidence as to the interstate character of the employment does not require the reversal of a judgment in favor of the employee, where the railway company's position was made no worse by the trial of the case on the theory that the state law governed. C. & N. W. Ry. Co. v. Gray, 237 U. S. 399, 59 L. Ed. 1018, aflfirming 153 Wis. 637. Neither can a party sit still until after a verdict and then insist that it should be set aside because of failure on the part of the trial court to charge on some matter to which its atten- tion had not been called, and this principle is not altered by the statutes of the state regarding motions for new trial. lUinois Cen. R. Co. v. Skaggs, 240 U. S. 66, 60 L. Ed. (1916) affirming 125 Minn. 532. A dispute that plaintiff, was injured in an interstate trip is sufficiently presented in an amendment of the petition. Kansas City Wes. R. Co. v. McAdow, 240 U. S. 51, 60 L. Ed. , (1916) affirming K. C. Ct. of Appeals, 164 S. W. 188, but a substantive right of action or defense arising under the act cannot be lessened or destroyed by a local rule of practice. N. & S. R. Co. v. Fer- rebee, 238 U. S. 269, 59 L. Ed. 1303, affirming 167 N. C. 290 (1915). § 631. The Measure of Damages Under the Act. — It was said by the Supreme Court in Michigan C. R. Co. v. Vreeland, 227 U. S. 59, 57 L. Ed. 417, reversing 189 Fed. 495, (1913) that the act declares two distinct and independent liabilities, resting, of course, upon the common foundation for the recoverable injury, but based upon altogether different principles. It plainly declares the liability of the carrier to its injured servant, but does not provide for any survival of the right of action created in behalf of the injured employee. The act also gives an action for the benefit of certain members of the family of the decedent. The act does not provide for any survival of the right of action of the employee extinguished by his death, and could not be helped out by state legislation, but does give a right of action for the benefit of certain relatives which is independent of any cause of action which the decedent had. 806 THE EMPLOYER'S LIABILITY ACT. [| 632 It was held in the case of Gulf, Colorado Railroad Co. v. McGinnis, 228 U. S. 173, 57 L. Ed. 785, (1913) that when an action is commenced by the representatives of the deceased for the benefit of several beneficiaries that as the action of the administrator is not for the equal benefit of each relative surviving, the interest,of each beneficiary must be separately measured by his individual pecuniary loss and that this apportionment must be made^by the jury, and that a judg- ment for a gross sum cannot be sustained. § 632. Setoff under the act. — Section 5 of the act provides "that in any action brought against any such common carrier * * * such common carrier may set off therein any sum it has contributed or paid to any insur- ance, relief benefit or indemnity that may have been paid to the injured employee or the person entitled thereto on account of the injury or death for which said action was brought." Although the act has been in force for over seven years we have been unable to find any adjudications in regard to this section. While the language of the statute is not free from ambiguity it seems the best construction would be to hold that only the amount contributed or paid by a carrier toward insurance of the injured employee would be a proper set off to the claim of such injured employee or his personal repre- sentative. § 633. Aliens as Beneficiaries within the terms of the Act.— In McGovern v. Philadelphia & R. Ry. Co., 235 U. S. 389, 59 L. Ed., 283 (1914), the Supreme Court reversed the E. D. of Pennsylvania, 209 Fed. 975, and held that the fact that the beneficiaries were non-resident agents, would not prevent their maintenance of an action for damages under the act. The Court in this case declined to follow the Supreme Court of Pennsylvania in Deni v. Pa. R. Co., 181 Pa. 525, construing the statute of that state. THE SAFETY ACT OF 1893, AMENDED 1896. Section 1. § 634. Section 1 of the act. 635. Railroads subject to the act. 636. The common law duty of the carrier in relation to safety appli- ances. 637. Petition and procedure under the act. 638. Federal question in suits under the act. 639. The act in the state courts. 640. The effect of the act upon state legislation. AN ACT To promote the safety of employees and travelers upon rail- roads by compelling common carriers engaged in interstate commerce to equip their cars with automatic couplers and continuous brakes and their locomotives with driving-wheel brakes, and for other purposes. § 634. Driving-wheel and train brakes. — Be it enacted by the Senate and House of Respresentatives of the United Stales of America in Congress assembled. Sec. 1. That from and after the first day of January, e'ghteen hundred and ninety-eight, it sha'l be unlawful for any common carrier engaged in interstate commerce by railroad to use on its Une any locomotive engine in moving interstate traffic not equipped with a power driving-wheel brake and apphances for operating the train-brake system, or to run any train in such traffic after said date that has not a sufficient number of cars in it so equipped with power or train brakes that the engineer on the locomotive drawing such train can control its speed without requiring brakemen to use the common hand brake for that purpose. § 636. Railroads subject to the act. — ^This act, as also the accident law, is made applicable to any common carrier engaged in interstate commerce by railroad, while the Inter- state Commerce Act applies only to the interstate traffic of railroad carriers, except in the requirement of annual reports under section 20 of that act. In United States v. Geddes, 131 Fed. 452 (1904), C. C. A., sixth circuit, which was a suit on behalf of the United States for the recovery of penalties under this act, the court held that a narrow gauge railroad wholly in Ohio which connected at one of its termini with an 807 808 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 1 interstate road but neither shipped nor received any traffic under a through bill of lading, or any other arrangement, and charged local freight tariffs on its own line, assuming pay- ment of the Baltimore & Ohio advance charges with weekly settlements was not engaged in interstate commerce within the meaning of this act, and was therefore not subject to penalties for non-compliance. The court said that under the rulings of the Supreme Court, express and sleeping car and railroad companies were limited to the nature of their busi- ness, making it local or interstate or both as they pleased, and that assuming the payment of the charges of the de- livering road did not constitute a continuous carriage neces- sary to make the business of interstate commerce. See also 180 Fed. 480. But a stock yards company owning and maintaining a live stock depot of all railroad companies doing business at that point, and owning and maintaining several miles of track con- necting with several railroad companies, and which by its own locomotives and servants transports for hire over its tracks shipments accepted by other railroad companies, is a common carrier within the meaning of the safety appliance law, although the carb in which it transports such shipments are in every instance the cars of the other companies, and although the stockyards company receives its compensation from the railroads and not the shippers. Union Stockyards Co. V. U. S., 169 Fed. 404 (1909), C. C. A., eighth circuit, affirming 161 Fed. 919. The same decision was made in the C. C. A., seventh circuit as to the belt railroad in Cook county, Illinois, forming connections with trunk lines and acting only as an agent for the trunk line, see 168 Fed. 542 (1909), to move a train of freight cars containing one from a point on one rail- road in Illinois to a point on another railroad in Wisconsin. Such a transfer constituted in effect a continuous carriage over both the roads, and defendant was therefore engaged in interstate commerce and within the Safety Appliance Act. In U. S. V. Southern Railway, 164 Fed. 347, district court of Alabama (1908), the act was broadly held to apply to all vehicles running on interstate highway, and that it was im- material that the cars were loaded with commodities from §636] THE SAFETY ACT OF 1893, AMENDED 1896. 809 one point to another in the same state, and that it was sufficient that the cars were hauled oyer a portion of the interstate highway. This case has since been affirmed by the Supreme Court 222 U. S. 20, 56 L. Ed. 72, (1911). It was also held in the C. C. A. of the ninth circuit. Pacific Coast Ry. Co. v. U. S., 173 Fed. 448 (1909), that the act applies to a railroad which takes part in the trans- portation of interstate commerce on any point of its way to the point of final destination, though operated wholly within a single state, independently of connecting lines and without any traffic arrangement. See also U. S. v. Colorado, etc., Co., 157 Fed. 321, C. C, eighth circuit (1907), where the same ruling is made as to the transportation for an inde- pendent express company by railroad operating entirely within the state, if the articles carried are for continuous passage to or from places out of the state; and it is im- material that the property is carried free or from a common control of management or arrangement with another carrier. See also U. S. v. International, etc., Co., 174 Fed. 638 (1909), C. C. A. of the fifth circuit. § 636. The common law duty of the carrier in rela- tion to safety appliances. — It was held by the Supreme Court of North Carolina that the action of the Interstate Commerce Commission in extending the date at which the act should go into force could not set aside the principle of law that failure to provide the appliances was negligence per se, and that such postponement could not have any other effect than to postpone the date at which the use would im- pose the penalty for failure to do so. In other words, that the Court would take notice of the act as establishing by legislative recognition a measure of legal duty of the railroad company in providing safe apphances, that is, modern self- coupling devices, for its employes. Troxler v. Southern Ry. Co., 122 N. C. 902, 44 L. R. A. 313 (1899). See also Greenlee v. Southern Railway Co., 122 N. C. 982, 41 L. R. A., 99 (1899). In Schlemmer v. R. R. Co., 207 Pa. 198 (1907), the court intimated that it was doubtful whether the act had any applicability to actions for negligence in Pennsylvania, but 810 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 1 did not decide this point as the p aintiff was non-suited for contributory negligence. This judgment, however, was reversed by the Supreme Court of the United States, 205 U. S. 1, 51 L. Ed. 681, on the ground that this ruling of the state court was inconsistent with the provision of section 8 of the act as to non-assumption of risk. In New England Railroad Co. v. Conroy, 175 U. S. 323, 44 L. Ed. 181 (1899), a case not arising under the act, but in- volving the question of the responsibility of the engineer, the court said that as railroads are now operated, the engineer is a much more important functionary in the actual movements of the train than the conductor, and particularly has this become the case since the introduction of the air brake train system, and the court referred to the first section of this act of March 2, 1893, providing for air brakes under the control of the engineer, saying: "We do not refer to this statute as directly applicable to the case in hand, but as a legislative recognition of the dominant position of the engineer." See also Northern Pacific R. R. Co. v. Tynan, 56 C. C. A. 192, 119 Fed. 288 (1902), where the court says that prior to the passage of this act there had been numerous decisions rendered by the courts of this country, where it was held that the railroad companies were guilty of negligence in using the Miller coupler in connection with the ordinary Unk draw bars. See also Texas & Pacific R. Co. v. Archibald, 170 U. S. 665, 42 L. Ed. 1188 (1898). § 637. Petition and procedure under the act. — Held in Voelker v. R. R. Co., 116 Fed. 867 (1902), and affirmed on this point by the court of appeals, that it is not necessary for the petition for personal injuries suffered under violation of the act to refer to the act, although the burden is on the plaintiff to show that the car on which he was injured was engaged in interstate commerce, Winkler v. Pennsylvania R. Co. (Del.), 53 Atl. 90; and it is a question for the jury whether railroad companies comply with the act. Crawford V. Railroad Co., 10 Am. Neghgence Reps. 166. § 638. Federal question in suits under the act. — ^The instruction by a court to a jury that railroads are required to keep their appUances in good and suitable order, raised no § 640] THE SAFETY ACT OF 1893, AMENDED 1896. 811 question under the act so as to make a claim of a federal right under section 709, R. S., which can be the basis of a writ of error from the Supreme Court to the highest court of the state. Southern Ry. Co. v. Carson, 194 U. S. 136, 48 L. Ed. 907 (1904). It was objected in this case that the instructions in the state court assumed that if the automatic coupling was out of order the company failed to comply with the act of congress, and the supreme court of the state held that there was no error in this, as congress must have intended that the couplers should have been kept in proper repair for use, and moreover as such was the law of the state, even if the act of congress had not specifica lly imposed this duty. The Court said that in this ruling no right was specifically set up or claimed under the act of congress, and the writ of error was dismissed. § 639. The act in the state courts. — Aa there is no exclusive jurisdiction vested by the act in the federal courts its effect is to create a new standard of duty and liability in interstate commerce, which is the law of the land both as to the federal and state courts. This was illustrated in the Schlemmer case, supra, wherein the supreme court of Pennsylvania held that the plaintiff was barred from re- covering by reason of his own contributory negligence, which was reversed by the Supreme Court of the United States on the ground that this ruling, which was in conformity with that enforced in the courts of the state in actions for personal injuries, was inconsistent with the rule of non-assumption of risk which was declared by the Saftey Act and was applicable to the interstate employment wherein plaintiff was engaged. As this federal right was duly asserted in the case and denied a federal question was presented and the judgment of the state court was reviewable by the Supreme Court. See same case, second appeal, infra, § 661. § 640. The effect of the act upon state legislation. — The same principle has been appHed to this act as to other legislation of congress concerning interstate commerce. In so far as congress has occupied the field of legislation relating to the equipment with safety appliances of cars in interstate railways, these acts of congress invahdate provisions of the 812 THESAFETY ACT OP 1893, AMENDED 1896. [SeCTION 1 state in relation to freight cars moving between points within the state on railways engaged in interstate commerce. See Southern R. Co. v. Railroad Commission of Indiana, 236 U. S. 439, 59 L. Ed. 661 (1915), reversing 197 Fed. 23. This principle, however, does not extend beyond the legis- lation enacted by congress. Thus the Supreme Court in Atlantic C. R. Co. v. Georgia, 234 U. S. 280, 58 L. Ed. 1312, (1914) affirmed 135 Ga. 545 in holding vaUd a statute of that state requiring locomotives to be equipped with electric headlights, and this decision was based upon the fact that congress had not included that matter in the Safety Act so as to supersede the exercise of the power of the state in making provision therefor. See also L. & N. R. Co. v. Hughes, Dis. Ct. Ohio, (1912) 201 Fed. 727. § 642] THE SAFETY ACT OF 1893, AMENDED 1896. 813 Section 2. § 641. Section 2 of the act. 642. Coupler equipment under section 2. 643. Automatic couplers of different makes. 644. The meaning of "car" in section 2. 645. An absolute duty imposed upon carriers by the act to provide and maintain automatic equipment. 646. When cars are in interstate commerce. § 641. Automatic couplers. — Sec. 2. That on and after the first day of January, eighteen hundred and ninety-eight, it shall be unlawful for any such common carrier to haul or permit to be hauled or used on its Une any car used in moving interstate traffic not equipped with couplers coupling auto- matically by impact, and which can be uncoupled without the necessity of men going between the ends of cars. § 642. Coupler equipment under section 2. — ^The re- quirement of automatic couplers in section 2 was construed by the C. C. A. for the eighth circuit in Chicago, Mil- waukee & St. Paul R. Co. V. Voelker, 129 Fed. 522, re- versing 116 Fed. 867, decided (1904). The court said that the act of congress forbade the use of a coupler which required the operator to go between the ends of the cars to prepare the coupler for the impact. The preparation of the coupler for the impact is not distinct from the act of coupling. Both are connected with the indispensable parts of the larger ' act, which is regulated by the statute and the performance of which is intended to be released from unnecessary risk and danger. The court ruled that when an automatic car coupler had been permitted to become worn and defective so the lever would not lift the pin from the socket, and the knuckle could not be drawn open by leaning toward the coupler and using one hand, but required the presence of the operator's entire body between the ends of the cars and the draw bars and the use of both his hands, it failed to meet ths requirements of the act and constituted actionable negligence. It was hdd in Briggs v. C, N. & W. R. Co., 125 Fed. 745 (1903), that when a railroad company in order to comply with section 2 of the act removed the long pilot from in front 814 THE S^ETY ACT OF 1893. AMENDED 1896. [Se CTION 2 of the engine and substituted a shorter one in order to put the automatic coupler in front of the engine, an accident which could have been prevented by a long pilot does not make the company liable. In the case of U. S. v. Pere Marquette Ry. Co., Dis. Ct. Mich. (1913), 211 Fed. 220, it was held that the use of a car, the coupling apparatus of which is inoperative, on the tracks of a railroad company engaged in interstate commerce, in a switch yard or in actual road service on the main line, is a violation of the Safety' Apphance Act. § 643. Automatic couplers of different makes. — The amendment of 1903 provides that the act shall apply in all cases whether or not the couplers brought together are the same kind, make or title, and the provisions and requirements relating to train brakes, automatic couplers, grab irons and the height of draw bars apply to all trains, locomotive tenders and cars, and similar vehicles used on any railroad in interstate commerce and saving thos'e excepted by the act. In a suit brought prior to the amendment of 1903 it was held by the Supreme Court in Johnson v. Southern Pacific R. Co., 196 U. S. 1, 49 L. Ed. 363 (1904), reversing the C. C. A. of the eighth circuit in 117 Fed. 462, that the couplers required must be of such a nature and character that they must couple automatically and save the employes from going between the cars, and that the use of automatic couplers which did not couple automatically on the same train whether of the same make or not violated the act. As stated above however this requirement is now enforced by the amended statute of 1903. § 644. The meaning of "car" in section 2.^n the same case the term "car" as used in section 2, which was held by a majority of the court of appeals, Thayer, J., dissenting, not to include locomotives, and that there was no language in the act which would make it unlawful to use in interstate commerce locomotive engines which were not equipped with automatic couplers. This ruling was reversed by the Su- preme Court which held that the law must be construed with reference to the danger to employes which it sought to remedy, and that for the purposes of safety appliances, loco- §645] THESAPETY ACT OF 1893, AMENDED 1896. 815 motives were cars within the meaning of the act and are required to be equipped with automatic couplers, and that it was even more necessary that locomotives should be so equipped than it was that freight, dining and passenger cars should be, since locomotives had occasion to make couplings more frequently. The word car was therefore used in a generic sense as including both the locomotive and its tender. In the Schlemmer case, supra, the Court reaffirmed the ruling of the Johnson case and said that a shovel car attached to an interstate train was within the meaning of the statute as well as the locomotive, and that the words, "used in moving interstate traffic," should not be taken in a narrow sense; and the Supreme Court of Pennsylvania was held to have erred in holding that such a car was not within the meaning of the section. The Court said the amendatory act of March 2, 1903, indicated the intent of the original act. A switch engine, however, was held not a car within the meaning of the act if the brakeman was injured by a collision between a car and a switch engine on which the employee was riding, when there was no intention to couple the car to the engine. See St. Louis & S. F. R. Co. v. Conarty, 238 U. S. 243, 59 L. Ed. 1290 (1915), reversing 106 Ark. 421. § 646. An absolute duty imposed upon carriers by the act to provide and maintain automatic equip- ment. — An absolute duty to provide a car used in moving interstate traffic with automatic couplers and to maintain them in proper condition at all times and in all conditions is imposed upon interstate carriers by this act, which is not discharged by properly equipping the car with automatic couplers and using due diligence to keep them in good work- ing order. This rule of absolute duty was definitely declared by the Supreme Court in a prosecution by the government for penalty for non-compliance with the act under section 6 of the act, C. B. & Q. R. Co. v. U. S., 220 U. S. 559, 55 L. Ed. 582 (1911), and also in private actions by employes for personal injuries sustained through the absence of defective condi- tions of the automatic couplers required by the act. St. L., I. & M. R. Co. V. Taylor, 210 U. S. 281, 52 L. Ed. 1061 (1909), 816 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 2 and also in Delk v. St. L. & St. F, R. Co., 220 U. S. 580, 55 L. Ed. 590 (1911). In the latter case the Court reversed the judgment of the C. C. A. of the sixth circuit, 158 Fed. 931. The Court said in the latter case that this absolute duty not only required the carrier to provide the auto- matic couplers, the kind prescribed by congress, but also an absolute duty to keep the cars in good order at all times. In this case the car had a defective coupler and the com- pany had sent for the required appliances and would repair the car when it was received, but the Court said the company could only use the car in this defective condition under the penalty of the law, and as the injury was suffered by the em- ploye in attempting to force a coupling in this defective condition the company was liable. In this Delk case the trial court had submitted the issue of contributory negligence to the jury which rendered a verdict for plaintiff. This was reversed by the circuit court of appeals and the case taken to the Supreme Court by writ of certiorari. The Supreme Court reversed the judgment of the circuit court of appeals and affirmed the judgment of the circuit court. § 646. When cars are in interstate commerce. — An- other important ruling was made in the Johnson case. The injury in this case was caused in coupling a freight engine with a dining car which had been detached from a through train, turned on the turn-table and was to be drawn by a freight engine to the turn-table, turned, and then moved to a side track to wait another through train moving in the oppo- site direction. As the car was standing empty on the side track when the plaintiff was injured, the majority of the court held that it was not engaged in interstate commerce, and therefore at the time of the accident the locomotive and dining car were not being used in moving interstate traffic within the meaning of the act. The Supreme Court in the case cited, and in the same opinion, reversed this decision, and held that the dining car, though empty and on a side track, was engaged in interstate commerce within the meaning of the act. In the Delk case, supra, it was held by the Supreme Court that a freight car, loaded with interstate freight and placed § 646] THE SAFETY ACT OF 1893, AMENDED 1896. 817 on a side track in the railway yard at destination to await repairs to the automatic coupler, was used in moving inter- state commerce within the meaning of the act when a coupling with another car is thereafter attempted by the carrier's order during the course of switching operations. Thus, it is immaterial whether the car is full or empty. See Johnston v. Great Northern Railway Co., 178 Fed. 646, C. C. A., eighth circuit (1910). In this case the cars were awaiting delivery on the switch track, and the company was held liable. See U. S. v. L. & N. R. R. Co., 186 Fed. 280, C. C. A., sixth circuit. In Southern Railway Co. v. Snyder, 187 Fed. 492, sixth cir- cuit (1911), the court held that cars being hauled to a place of repair in an intrastate train composed only of such cars, or while on a repair track out of all connection with cars in com- mercial use, were not subject to the act, and that while a rail- road could move empty cars by themselves to repair shops, yet in so moving them the cars must be wholly excluded from commercial use and from connection with other vehicles which were commercially used. The court, however, em- phasized the duty of the carrier to exercise a high degree of diligence in discovering and repairing the defect in the coupler and withdrawing the car from commercial use while the defect existed. The court held that it was a question for the jury whether the cars had been in fact withdrawn from commercial interstate use at the time of the injury to plaintiff. In U. S. V. C. & N. W. R. Co., 157 Fed. 616, district court of Nebraska, it was held that under this act as amended in March, 1903, there was no room for distinction in a car actually engaged in interstate commerce and the hauling of one that is generally used therein, and that the hauling of an empty car from one state to another for purposes of repair was engaging in interstate commerce, and that an engine was a car within the meaning of the act. See also Wabash v. U. S., 168 Fed. 1, C. C. A., seventh circuit (1909), where the same ruling was made. In this case the court construed the word "used" as applying to all cars and trains operated over an interstate highway, whether they were operated between points in the same states or whether they were empty, or J— 62. 818 THE SAFETY ACT OF 1893, AMENDED 1896. [SeCTION 2 whether the traffic carried is interstate traffic or not. See also U. S. V. St. Louis, etc., Co., district court of Tennessee, 154 Fed. 516 (1906). In Erie R. Co. v. Russell, 183 Fed. 722, the C. C. A. second circuit (1910), held that a car with a defective coupler billed for the repair shop which was not sent there but was left on the track in ordinary use on the switching track to be repaired by the switchmen, and that car coupled to other cars were being "used" within the meaning of the statute; and where such a car, though empty, was brought into the station in an interstate train it was being used in interstate commerce, not only while being moved in the train but also while being repaired in the yards. In an action to recover for death of a switchman killed in repairing the defective coupler, the question of whether the defective coupler was the proximate cause of his death was held properly submitted to the jury, as was also the question of contributory negligence, and the judgment for plaintiff was affirmed. In Southern Ry. Go. v. U. S., 222 U. S. 20, 56 L. Ed. 72, (1911), it was held by the Supreme Court that the law applies to all equipment on a highway of interstate commerce, whether at the time the car is carrying state or interstate commerce, and that the act so construed was within the constitutional power of congress. See also U. S. v. Western & A. R. R. Co., 184 Fed. 336 (1910), Dist. Ct. N. D. of Georgia. The yards of an interstate carrier at Jersey City, Wee- hawken and Bergen lying from two to three and a half miles apart were governed by the prohibition of the act, and the transfer of trains operating in such yards and making up trains were held to be trains within the meaning of the act. See United States v. Erie Railroad, 237 U. S. 402, 59 L. Ed. 1019, reversing the G. C. A. of the third circuit, 212 Fed. 853. This case was followed in U. S. v. C. B. & Q. R. Co., 237 U. S. 410, 59 L. Ed. 1023 (1915) reversing the C. C. A., eighth circuit, 211 Fed. 12. Where three railroad yards, though at some distance from each other because of natural barriers and the tracks of another railroad, were interdependent and supplementary § 646] THE SAFETY ACT OF 1893, AMENDED 1896. 819 to each other to complete switching operations, and all forming a combined switching system indispensable to the handhng of incoming and outgoing trains, the movement of trains from one yard to another was a switching operation and not an interstate commerce operation and not subject to the act of March 2nd, 1893, relative to running trains without a sufficient number of cars equipped with power or train brake. U. S. v. Erie Railroad Co., 212 Fed. 852, C. C. A., third circuit (1914). In U. S. v. N. Y. Cent. R. Co. Dis. Gt. (1913) 205, Fed. 428, the court said that where defendant used different yards extending over six miles all under the control of one yardmaster and moved cars from one yard to another to switch on branch tracks running into industrial yards, while engaged in hauling a train of thirty-nine empty freight cars, twenty-five of which were equipped with air brakes, the transfer being made by a switch engine, that the train thus engaged was not employed in interstate commerce. See also Wheehng Terminal R. Co. v. Russell, 209 Fed. 795, C. C. A. fourth circuit (1914). In this case the de- fendant railroad company had transported certain cars in interstate commerce which had been delivered and un- loaded, and was thereafter hauling the empty cars to scales for the purpose of re-weighing them to ascertain the net weight of the contents, and while this service was in process plaintiff, a member of the crew, was injured, it was decided that the train was engaged in interstate commerce and that plaintiff was entitled to the protection of the Safety Appli- ance Act. 820 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 3 Section 3. § 647. Section 3 of the act. 648. The use of defective cars forbidden. § 647. When carriers may refuse to receive cars. — Sec. 3. That when any person, firm, company, or corpora- tion engaged in interstate commerce by railroad shall have equipped a sufficient number of its cars so as to comply with the provisions of section one of this act, it may lawfully refuse to receive from connecting lines of road or shippers any cars not equipped sufficiently, in accordance with the first section of this act, with such power or train brakes as will work and readily interchange with the brakes in use on its own cars, as required by this act. § 648. The use of defective cars forbidden. — The pro- hibition of the statute is against the use, and not against the ownership of a car, defective in its required equipment. There is no right of recovery by a terminal railroad, which has been mulcted in damages in a suit by an employe for injuries sustained in handling a car, wanting in equipment, from the carrier company owning the car; as it was its duty to refuse to receive the defective car; and therefore it was so far a wrong doer that it could not recover over from the owning company. Union Stockyards of Omaha v. C. B. & Q. R. R. Co., 196 U. S. 217, 49 L. Ed. 453 (1905). This case did not arise under the Safety Act, but was decided under the common law principles, with reference to the duty of the carrier and the right of contribution in case of damages for neglect of duty. 650] THE SAFETY ACT OF 1893. AMENDED 1896. 821 Section 4. § 649. Section 4 of the act. 650. Construction of section. § 649. Grab irons and handholds. — Sec. 4. That from and after the first day of July, eighteen hundred and ninety-five, until otherwise ordered by the Interstate Com- merce Commisjion, it shall be unlawful for any railroad com- pany to use any car in interstate commerce that is not pro- vided with secure grab irons or handholds in the ends and sides of each car for greater security to men in coupling and uncoupUng cars. § 650. Construction of section. — In U. S. v. B. & 0. R. R. Co., district court, W. D. of Virginia, (1910) 184 Fed. 94, the court held that this section was indefinite as to the num- ber of handholds and as to the intended location thereof on the ends and sides of cars. It was not indefinite so far as it required handholds to be provided both on the ends and sides of cars, and that a yard engine used in interstate commerce was not equipped as required where no handholds were provided in the sides near the rear end of the tender, though the tender was equipped with a running board and an un- coupling level bar which ran nearly across the entire back of the tender and was so located and of such a character that it might serve as a handhold; it not appearing that the presence of the handhold as required would not Lend to greater security. 822 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 5 Section 5. § 651. Section 5 of the act. 652. The delegation of power sustained. § 651. Standard height of drawbars for freight cars. Sec. 5. That within ninety days from the passage of this act -the American Railway Association is authorized hereby to designate to the Interstate Commerce Commission the standard height of drawbars, for freight cars, measured per- pendicular from the level of the tops of the rails to the cen- ters of the drawbars, for each of the several gauges of rail- roads in use in the United States, and shall fix a maximum variation from such standard height to be allowed between the drawbars of empty and loaded cars. Upon their deter- mination being certified to the Interstate Commerce Commis- sion, said Commission shall at once give notice of the stand- ard fixed upon to all common carriers, owners, or lessees en- gaged in interstate commerce in the United States by such means as the Commission may deem proper. But should said association fail to determine a standard as above provided, it shall be the duty of the Interstate Commerce Commission to do so, before July first, eighteen hundred and ninety-four and immediately to give notice thereof as aforesaid. And after July first, eighteen hundred and ninety-five, no cars, either loaded or unloaded, shall be in use in interstate traffic which do not comply with the standard above provided for. * § 662. The delegation of power sustained. — Legisla- tive power is not unconstitutionally delegated to the Ameri- can Railway Association and the Interstate Commerce Association by this section. St. Louis, I. M. & S. R. Co. v. Taylor, 210 U. S. 281, 52 L. Ed. 1061 (1907). The Court said that whether or not legislative power was unconstitu- tionally delegated was a federal question which allowed a writ of error from the Supreme Court to the Supreme Court of Arkansas; but the Court found that the legislative power was not unconstitutionally delegated, and that the state court erred in holding that under the section the draw bars of unloaded freight cars are required to be of uniform and *Note. — ^Prescribed standard height of drawbars: Standard-gauge roads, 34i inches; narrow-gauge roads, 26 inches; maximum variation between loaded and empty cars, 3 inches, § 652] THE SAFETY ACT OF 1893, AMENDED 1896. 823 standard height, but those of loaded cars need not be of a uni- form height, provided that they did not vary from the three inches prescribed as the maximum permitting variation from the standard. The Court also held that the statutory duty imposed upon the carriers in absolute terms by this section of using in interstate commerce only such freight cars as com- ply with the standard fixed as the height for draw bars, is not discharged by furnishing cars constructed with draw bars of the standard height and by furnishing to competent in- spectors and trainmenasufficientnumber of metallic wedges or "shins" to use as occasion demands to raise to the legal standard draw bars lowered by the natural effect of proper use, reversing 83 Ark. 591. 824 THE SAFETY ACT OF 1893, AMENDED 1896. [SeCTION 6 Section 6. § 653. Section 6 of the act. 654. Enforcement of act by prosecution. 655. The supreme court en prosecution for penalty under the act. 656. The burden of proof under the proviso. § 663. Penalty for the violation of the provisions of this act. — Sec. 6. {As amended April 1, 1896.) That any such common carrier using any locomotive engine, running any train, or hauling or permitting to be hauled or used on its line any car in violation of any of the provisions of this act, shall be liable to a penalty of one hundred dollars for each and every such violation, to be recovered in a suit or suits to be brought by the United States district attorney in the District Court of the United States having jurisdiction in the locality where such violation shall have been committed; and it shall be the duty of such district attorney to bring such suits upon duly verified information being lodged with him of such violation having occurred; and it shall also be the duty of the Interstate Commerce Commission to lodge with the proper district attorneys information of any such violations as may come to its knowledge: Provided, That nothing in this act contained shall apply to trains. composed of four-wheel cars or to trains composed of eight-wheel standard logging cars where the height of such car from top of rail to center of coupling does not exceed twenty-five inches, or to locomotives used in hauling such trains when such cars or locomotives are exclusively used for the trans- portation of logs. § 654. Enforcement of the act by prosecution. — This act has been applied and enforced not only in suits for dam- ages against the railroad companies for alleged non-com- pliance with the act, but also in suits by the government under this section. An action by the government under this statute to recover this penalty has been held not to be a criminal prosecution, but a civil action. See U. S. v. Oregon Short Line R. R. Co., 180 Fed. 483, Dist. of Idaho (1908). In this case it was held that it was not necessary to allege that the company acted knowingly or negligently, as the penalty was enforced for the non-compliance with the statutory duty. See also U. S. v. P. & Reading R. R., 160 Fed. 696 (1908). §655] THESAPETY ACT OF 1893, AMENDED 1896. 825 It was held by th* C. C. A., fifth circuit, in U. S. v. St. Louis etc., Ry Co., 184 Fed. 28 (1910), that where several cars, each without the requisite appliances required by this act, are hauled by a carrier in interstate commerce at one and the same time, there are as many distinct violations of the act as there are cars not properly equipped, for every one of which the statutory penalty is recoverable. It was also held that actions to recover these statutory penalties are so far civil in their nature that the United States may recover upon the preponderance of evidence, and the trial judge may in proper cases direct a verdict. See also U. S. v. Western & A. R. Co., 184 Fed. 336, district court, northern district of Georgia, where the court passed upon the sufficiency of a declaration to recover penalties for violation of the act. It was held that it was sufficient that a car not properly equipped is moved in a train containing cars carrying interstate commerce, though the defective car was not immediately connected to that carrying the interstate shipment; and the declaration was held sufficient which showed that the car had not arrived at its point of final destination. § 656. The Supreme Court on prosecution for pen- alty under the act. — In C. B. & Q. R. Co. v. U. S., supra, the Supreme Court affirmed the judgment of the C. C. A., eighth circuit, 170 Fed. 556, wherein judgment had been affirmed in favor of the United States in a suit to recover penalties for violation of the Safety Appliance Act. It was claimed that the ruling in the Taylor case, supra, was not apphcable .as that was an action by an individual to recover damages for a personal injury, whereas the present action was to recover a penalty; but the Court said the contention was unsound as the action for recovery of penalty was a civil one. It was therefore competent for the trial court to withdraw the case from a jury and direct a verdict if the evi- dence was uncontradicted and raised only a question of law. The penalty could not be escaped by showing that the carrier had exercised reasonable care in equipping its cars with required safety appliances and had used due diligence to keep them in repair by usual inspection ; but the statute im- 826 the'safety act of 1893, amended 1896. [Section 6 posed an absolute duty upon the carrier which was not discharged by the exercise of reasonable care or diligence. § 656. The burden of proof under the proviso. — ^The burden of proof is upon a railroad to bring itself within this exception in favor of four wheel cars. The effect of the pro- viso is to create an exception; and whoever claims under such an exdeption must set it up and prove it through this case. Schlemmer v. R. R., supra. § 658] THE SAFETY ACT OF 1893, AMENDED 1896. 827 Section 7. § 657. Section 7 of the act. 658. Discretion of the commission in delaying enforcement of the act. § 657. Power to extend time. — Sec. 7. That the Inter- state Commerce Commission may from time to time upon full hearing and for good cause extend the period within which any common carrier shall comply with the provisions of this act. § 668. Discretion of the commission in delaying the enforcement of the act. — This statute, which as amended is the only enactment for the safety of railroad employes in the federal regulation of railroad transportation, has been construed by the commission from time to time in connection with the discretionary power lodged with the commission under section 7 of the act for the extension of the period of time in which the railroads are required to comply with the act. The commission has ruled that this discretionary power was designed to afford relief in cases which would otherwise inflict special hardships upon the pubhc and the carriers and should only be exercised under such circumstances and for such short lengths of time as are contemplated by the framers of the statute and are plainly inferable from its terms. 9 I. C. C. R. 522; 8 I. C. C. R. 643, 662; 6 I. C. C. R. 332. 828 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 8 Section 8. § 659. Section 8 of the act. 660. Contributory negligence under the act. 661. Contributory negligence distinguished from assumption of risk. 662. Responsibility of carrier for cars out of condition. § 669. Employees not deemed to assume risk of em- ployment. — Sec. 8. That any employee of any such com- mon carrier who may be injured by any locomotive, car, or train in use contrary to the provisions of this act shall not be deem&d thereby to have assumed the risk thereby occa- sioned, although, continuing in the employment of such car- rier after the unlawful use of such locomotive, car, or train had been brought to his knowledge. § 660. Contributory negligence under the act. — It is provided in section 8 of the original act that the continuance in the employment of the carrier by an employe after knowing of the violation of the act shall not be deemed an assumption of the risk. It has been held in some of the state courts that this provision clearly indicates the modification of the terms and limiting the applications theretofore announced by the courts with reference to the assumption of the risk by ths em- ploye. See Texas, etc., R. Co. v. Swearingen, 122 Fed. 193 (1903). See also Narramore v. Railroad Co., 96 Fed. 298, C. C. A., sixth circuit (1899), construing the Ohio statute to the same effect. But it was held by the United States C. C. A. for the eighth circuit in Gilbert v. Burlington C. R. & N. R. Co., 128 Fed. 529 (1904), afg. 123 Fed. 832, that the devolu- tion of the duty upon the common carriers to so equip their cars, that they could be uncoupled without requiring their servants to go between the ends of the cars, necessarily imposed upon their servants the railroad's duty of using the equipment thus used upon them, and refraining from going between the ends of the cars to couple or uncouple them un- less compelled to do so by necessity. Under this legislation the breach of either of these duties constituted a want of ordinary care and constituted actionable negligence. The court also said the principle was applicable, that where there § 660] THE SAFETY ACT OF 1893, AMENDED 1896. 829 is a comparatively safe and a more dangerous way of dis- charging the duty known to the servants, it was negligence for him to select the more dangerous method, and if his negli- gence contributed to his injury, his negligence is fatal to re- covery therefore. See also Northern Pacific Ry. Co. v. Tynan, 119 Fed. 288, and 56 C. C. A. 192, ninth circuit, 1902, where the court left the issue of contributory neghgence to the jury. See also Railway Co. v. Baker, 33 C. C. A. 468, 91 Fed. 224, in the seventh circuit, where plaintiff was held guilty of contributory negligence for failing to exercise reasonable care for his own safety in the absence of grab irons or hand holds; and Denver & Rio Grande R. Co. v. Arrighi, 129 Fed. 347 (C. C. A., eighth circuit). In this case the court said that the defense of contributory negligence was as available to the railroad company after as before the passage of the act of congress, although it had not complied with its requirements. In this case the plaintiff rested his case entirely on the failure of the defendant to comply with the act. The court said that the rationale of the doctrine of as- sumption of risk was not that which supported the rule of contributory negligence. It was held in the Voelker case, supra, that a switchman does not assume the risk where the car requiring couplers is not so equipped, and is not marked or isolated as one in bad repair, and its movement at the time is not with the view to its isolation or repair, though he continues in the employment with knowledge of the unlawful use of the car. It was ruled by the Supreme Court in the Taylor case, supra, that the Safety Appliance Act imposed upon the rail- road companies an unqualified and absolute duty, and that they move cars in a defective condition at their peril. This sam« ruling has been followed in suits for damages by or on behalf of employes in Atlantic Coast Line v. U. S., 168 Fed. 175, by the C. C. A. of the fourth circuit; this rule was an- nounced and this case was cited with approval by the Supreme Court in the case of C. B. & Q. Ry. Co. v. U. S. 220 U. S. 559, 55 L. Ed. 582, (1910); in Wabash R. R. v. U. S. C. C. A., seventh circuit, supra; by the C. C. A., eighth circuit, in U. S. v. Southern Pacific, 169 Fed. 407 (1909); in C, B. & Q. R. R. v. U. S., 170 Fed. 556, and by 830 THE SAFETY ACT OF 1893, AMENDED 1896. [SECTION 8 the sixth circuit in U. S. v. Illinois Central R. R., 177 Fed. 801. It therefore follows that the employe cannot be charged with assuming the risk when the company fails in the performance of this statutory duty. See also Employer's Liability Act of 1908, p. 514, infra. See also U. S. v. Ander- son Tobacco, etc., Co., 163 Fed. 517, C. C. A., eighth cir- cuit (1908>, reversing 150 Fed. 442. § 661. Contributory negligence distinguished from assumption of risk. — The Schlemmer case, supra, came again before the Supreme Court, 220 U. S. 590, 55 L. Ed. 596 (1911), on a writ of error from a second trial where judgment was rendered for the defendant, affirmed by the Supreme Court of Pennsylvania, 220 Pa. 470. The Supreme Court affirmed the judgment of the Pennsylvania court, which in turn had affirmed the judgment of the trial court, which had entered a judgment for the defendant, notwithstanding a verdict of the jury for the plaintiff on the issue of con- tributory negligence. This was on the ground that a clear cause of contributory negligence was presented in that the decedent not only attempted to make the coupling in a dangerous way when his attention was directly called to a safe way, but also did it with reckless disregard of his personal safety by raising his head, though twice expressly cautioned at the time as to the danger of so doing. This Supreme Court said that the statute at the time of the injury complained of took away the defense of assumption of risk but did not deal with the defense of contributory negli- gence, and that while assumption of risk sometimes shades into negligence as commonly understood there is, neverthe- less, the practical and clear distinction between the two. Assumption of risk means that an employe is held to assume the risk of the ordinary dangers of the occupation into which he is about to enter, and those risks and dangers which are known or are so plainly observable that the employe may be presumed to know of them ; and if he continues in the master's employ without objection he takes upon himself the risk of injury from his defects. Contributory negligence, on the other hand, is the omission of the employe to take those precautions for his own safety which ordinary prudence re- §662] THESAFETY ACT OF 1893, AMENDED 1896. 831 quires. Under the statute, therefore, when Schlemmer saw that the car was not equipped with an automatic coupler he would not from that knowledge alone take upon himself the risk of injury without liability from his employer; but he was not for that reason absolved from the duty of using ordinary care for his own protection under the circumstances as they existed. No federal right, therefore, was denied in the ruling of the state court, directing a judgment for the defendant. In this case the Court called attention to the third section of the Employer's Liability Act of 1908, which was enacted after the injury in this case, which provided that no employe was guilty of contributory negUgence in any case where violation by a common carrier of any statute enacted for the safety of employes, contributed to the injury or death of such em- ployes. See this subject discussed in relation to Employer's Liabihty Act. supra § 622a. § 662. Responsibility of carrier for cars out of con- dition. — Prior to the decision of the Supreme Court in the Delk case there was a difference of judicial opinion as ex- pressed in the circuit courts as to the responsibility of the carrier when a car equipped with automatic apparatus is out of order, and is being used for switching purposes on a side track where it is placed for repairs. See Sigel v. N. Y. C. & H. R. Co., N. D. of Pa., 178 Fed. 873 (1910), and also the opinion of the majority of the court of appeals of the sixth circuit in the Delk case, 158 Fed. 931 (1908); but it is definitely determined by the judgment of the Supreme Court that the absolute duty of the carrier extends to the main- tenance in good condition at all times of the coupling ap- paratus required by the statute. AMENDMENT OF 1903 TO SAFETY ACT. § 663. Amendment of 1903. 664. Relation of the Act to the Employers Liability Act. AN ACT To amend an Act entitled "An act to promote the safety of employees and travelers upon railroads by compelling common car- riers engaged in interstate commerce to equip their cars with auto- matic couplers and continuous brakes and their locomotives with driving-wheel brakes, and for other purposes," approved March second, eighteen hundred and ninety-three, and amended April first, eighteen hundred and ninety-six. § 663. Amendment of 1903.— Be it enacted by the Sen- ate and House of Representatives of the United States of Amer- ica in Congress assembled. That the provisions and require- ments of the Act entitled "An Act to promote the safety of employees and travelers upon railroads by compelling com- mon carriers engaged in interstate commerce to equip their cars with automatic couplers and continuous brakes, and their locomotives with driving-wheel brakes, and for other purposes," approved March second, eighteen hundred and ninety-three, and amended April first, eighteen hundred and ninety-six, shall be held to apply to common carriers by railroads in the Territories and the District of Columbia and shall apply in all cases, whether or not the couplers brought together are of the same kind, make, or type; and the pro- visions and requirements hereof and of said acts relating to train brakes, automatic couplers, grab irons, and the height of drawbars shall be held to apply to all trains, locomotives, tenders, cars, and similar vehicles used on any railroad en- gaged in interstate commerce, and in the Territories and the District of Columbia, and to all other locomotives, tenders, cars, and similar vehicles used in connection therewith, ex- cepting those trains, cars, and locomotives exempted by the provisions of section six of said act of March second, eighteen hundred and ninety-three, as amended by the act of April first, eighteen hundred and ninety-six, or which are used upon street railways. Sec. 2. That whenever, as provided in said act, any train is operated with power or train brakes, not less than fifty per centum of the cars in such train shall have their brakes used and operated by the engineer of the locomotive drawing such train; and all power-brake cars in such train which are associated together with said fifty per centum shall have their brakes so used and operated; and, to more fully carry into effect the objects of said act, the Interstate Commerce Commission may, from time to time, after full hearing, in- [ 832] § 664] AMENDMENT OP 1903 TO SAFETY ACT. 833 crease the minimum percentage of cars in any train re- quired to be operated with power or train brakes which must have their brakes used and operated as aforesaid; and failure to comply with any such requirement of the said Interstate Commerce Commission shall be subject to the like penalty as failure to comply with any requirement of this section. Sec. 3. That the provisions of this act shall not take effect until September first, nineteen hundred and three. Nothing in this act shall be held or construed to reheve any common carrier, the Interstate Commerce Commission, or any United States district attorney from any of the provisions, powers, duties, liabilities, or requirements of said act of March sec- ond, eighteen hundred and ninety-three, as amended by the act of April first, eighteen hundred and ninety-six; and all of the provisions, powers, duties, requirements and liabilities of said act of March second, eighteen hundred and ninety- three, as amended by the act of April first, eighteen hundred and ninety-six, shall, except as specifically amended by this act, apply to this act. As to the effect of this amendment under the construction of section 2, see decision of the Supreme Court in the Schlem- mer case, where it was held that this act indicated the intent of the original act in the construction of section 2. § 664. Relation of the act to the Employers Liability Act. — In Southern Pacific Railroad Co. v. Crockett, 234 U. S. 725 58 L. Ed. 1564, (1914) the Supreme Court affiimed the Supreme Court of Tenn. in giving judgment for plaintiff employed as a switchman in the moving of interstate com- merce, who was injured by being thrown from a car which had become detached from an engine which was not equipped with a standard draw bar. The action arose on October 15, 1910, after the enactment of the amendment of that year but before the taking effect of the commission's order respecting draw bars, which became effective December 31, 1910. The Court said the effect of the amendment of 1903 had the effect of regulating the height of draw bars upon locomotive engines and that the assumption of risks in cases under the Em- ployers' Liability Act remained as at common law, saving in cases where the violation by the common carrier of any statute enacted for the safety of employees contributed to the injury of the employee. SAFETY ACT OF 1910. § 665. Safety Act of 1910. § 666. Safety Act of 1910. AN ACT To supplement "An Act to promote the safety of employees and travelers upon railroads by compelling common carriers engaged in interstate commerce to equip their c^rs with automatic couplers and continuous brakes and their locomotives with driving wheel brakes and for other purposes," and other safety appliance Acts, and for other purposes. Be it enacted by the Senate and House of Representatives of [To what carriers applicable.} the United States of Ameiica in Congress assembled. That the provisions of this Act shall apply to every common carrier and every vehicle subject to the Act of March second, eighteen hundred and ninety-three, as amended Apiil first, eighteen hundred and ninety-six, and March second, nine- teen hundred and three, commonly known as the "Safety Appliance Acts." [When act effective.] Sec. 2. That on and after July first, nineteen hundred and eleven, it shall be unlawful for any common carrier subject to the provisions of this Act to haul, or permit to be hauled or used on its line any car subject to the provisions of this Act not equipped with appliances provided for in this Act; [Cars to be equipped ^rith sill steps, hand brakes, ladders, running boards, and grab irons.] to-wit: All cars must be equipped with secure sill steps and efficient hand brakes; all cars requiring secure ladders and secure running boards shall be equipped with such ladders and running boards, and all cais having ladders shall also be equipped with secure hand holds or grab irons on their roofs at the tops of such ladders: Provided, That in the load- ing and hauling of long commodities, requiring more than one car, the hand brakes may be omitted on all save one of the cars while they are thus combined for such purpose. [Commission ta designate number, dimensions, location, and manner of application of appliances.] Sec. 3. That within six months from the passage of this Act the Interstate Commerce Commission, after hearing, shall designate the number, dimensions, location, and man- ner of application of the appliances provided for by section two of this Act and section four of the act of March second, [834] § 665] SAFETY ACT OF 1910. 835 eighteen hundred and ninety-three, and shall give notice of such designation to all common carriers subject to the pro- visions of this Act by such means as the Commission may deem proper, and thereafter said number, location, dimen- sions, and manner of application as designated by said Com- mission shall remain as the standards of equipment to be used on all cars subject to the provisions of this Act, unless changed by an order of said Interstate Commerce Commis- sion, to be made after full hearing and for good cause shown ; and failure to comply with any such requirement of the Inter- state Commerce Commission shall be subject to a Uke pen- alty as failure to comply with any requiremet of this Act: [Period of compliance may be extended.] Provided, That the Interstate Commerce Commission may, upon full hearing and for good cause, extend the period within which any common carrier shall comply with the provisions of this section with respect to the equipment of cars actually in service upon the date of the passage of this Act. Said [ComtnisBion may modify^height^of drawbars.] Commission is hereby given authority, after hearing, to modify or change, and to prescribe the standard height of drawbars and to fix the time within which such modifica- tion or change shall become effective and obligatory, and [Present standard height of drawbars legal.] prior to the time so fixed it shall be unlawful to use any car or vehicle in interstate or foreign traffic which does not com- ply with the standard now fixed or the standard so prescribed, and after the time so fixed it shall be unlawful to use any car or vehicle in interstate or foreign traffic which does not comply with the standard so prescribed by the Commission. [Penalty for violation of provisions of this act.] Sec. 4. That any common carrier subject to this Act using, hauhng, or permitting to be used or hauled on its line any car subject to the requirements of this Act not equipped as provided in this Act shall be liable to a penalty of one hun- dred dollars for each and every such violation, to be recov- ered as provided in section six of the Act of March second, eighteen hundred and ninety-three, as amended April first, eighteen hundred and ninety-six: Provided, That where any car shall have been properly equipped, as provided in this Act and the other Acts mentioned herein, and such equip- ment shall have become defective or insecure while such [Defective cars may be hauled to nearest available repair point.] car was being used by such carrier upon its line of railroad, such car may be hauled from the place where such equipment was first discovered to be defective or insecure to the nearest available point where such car can be repaired, without lia- 836 - SAFETY ACT OF 1910. [§ 665 bility for the penalties imposed by section four of this Act or section six of the Act of March second, eighteen hundred and ninety-three, as amended by the Act of April first, eighteen hundred and ninety-six, if such movement is neces- sary to make such repairs and such repairs can not be made except at such repair point; and such movement or hauling of such car shall be at the sole risk of the carrier, and nothing [Carriers not relieved from liability for death or injury.] in this section shall be construed to relieve such carrier from liability in any remedial action for the death or injury of any railroad employee caused to such employee by reason of or in connection with the movement or hauling of such car with equipment which is defective or insecure or which is not maintained in accordance with the requirements of this Act and the other Acts herein referred to; and nothing in this proviso shall be construed to permit the hauling of [Hauling by chains.] defective cars by means of chains instead of drawbars, in revenue trains or in association with other cars that are com- mercially used, unless such defective cars contain live stock or "perishable" freight. [Enforcement.] Sec. 5. That it shall be the duty of the Interstate Com- merce Commission to enforce the provisions of this Act, and all powers heretofore granted to said Commission are hereby extended to it for the purpose of the enforcement of this Act. Public, No. 133, approved, April 14, 1910. [Employment of inspectors.] Sundry civil act (appropriations) of June 28, 1902, au- thorizes Commission to employ "inspectors to execute and enforce the requirements of the Safety-Appliance Act." THE HOURS OF SERVICE ACT OF 1907. § 666. The act of 1907. 667. The constitutionality of the act sustained. 668. The act invalidates State acts on the subject. 669. The statute not void for uncertainty. 670. The Interstate Commerce Commission had authority to require reports. 671. No privilege to a corporation or corporation officers against self- incrimination. 672. Construction of liability of carriers under the act. 673. What trains employed in interstate commerce within the mean- ing of the act. § 666. The act of 1907. AN ACT To promote the safety of employees and travelers upon railroads by limiting the hours of service of employees thereon. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the provisions of this Act shall apply to any common carrier or [Conamon carrier and employees subject to act.] carriers, their officers, agents, and employees, engaged in the transportation of passengers or property by railroad in the District of Columbia or any Territory of the United States, or from one State or Territory of the United States or the District of Columbia to any other State or Territory of the United States or the District of Columbia, or from any place in the United States to an adjacent foreign country, or from any place in the United States through a foreign country to any other place in the United States. The term [Meaning of term "railroad.*^] "railroad" as used in this Act shall include all bridges and ferries used or operated in connection with any railroad, and also all the road in use by any common carrier operating a railroad, whether owned or operated under a contract, [Meaning of term ''employees."] agreement, or lease; and the term "employees" as used in this Act shall be held to mean persons actually engaged in or connected with the movement of any train. [Sixteen hours the maximum continuous service of train- men.] Sec. 2. That it shall be unlawful for any common carrier, its officers or agents, subject to this Act to require or permit any employee subject to this Act to be or remain on duty for (837) 838 THE HOURS'OF SERVICE ACT OF 1907. [§666 a longer period than sixteen consecutive hours, and when- ever any such employee of such common carrier shall have been continuously on duty for sixteen hours he shall be re- [Ten consecutive hours oiF duty.] lieved and not required or permitted again to go on duty until he has had at least ten consecutive hours off duty; and no such employee who has been on duty sixteen hours in the aggregate in any twenty-four-hour period shall be re- quired or permitted to continue or again go on duty without having had at least eight consecutive hours off duty: Pro- [Service hours of telegraph and telephone operators.] vided, That no operator, train dispatcher, or other employee who by the use of the telegraph or telephone dispatches, re- ports, transmits, receives, or delivers orders pertaining to or affecting train movements shall be required or permitted to be or remain on duty for a longer period than nine hours in any twenty-four-hour period in all towers, offices, places, and stations continuously operated night and day, nor for a longer period than thirteen hours in all towers, offices, places, and stations operated only during the daytime, except in case of emergency, when the employees named in this pro- viso may be permitted to be and remain on duty for four additional hours in a twenty-four-hour period or not ex- ceeding three days in any week: Provided further. The In- [Cotnmission may extend period.] terstate Commerce Commission may after full hearing in a particular case and for a good cause shown extend the period within which a common carrier shall comply with the pro- visions of this proviso as to such case. [Penalty for violation.] Sec. 3. That any such common carrier, or any officer or agent thereof, requiring or permitting any employee to go, be, or remain on duty in violation of the second section thereof, shall be liable to a penalty of not to exceed five hun- dred dollars for each and every violation, to be recovered in a suit or suits to be brought by the United States distric at- [Prosecutions.] lorney in the district court of the United States having jurisdic- tion in the locality where such violation shall have been com- mitted; and it shall be the duty of such district attorney to bring such suits upon satisfactory information being lodged with him ; but no such suit shall be brought after the expira- tion of one year from the date of such violation ; and it shall also be the duty of the Interstate Commerce Commission to lodge with the proper district attorneys information of any such violations as may come to its knowledge. In all prosecutions under this Act the common carrier shall be § 667] THE HOURS OF SERVICE ACT OF 1907. 839 deemed to have had knowledge of all acts of all its ofTicers and agents: Provided, That the provisions of this Act shall [Unavoidable, accidents, etc.] not apply in any case of casualty or unavoidable accident or the act of God; nor where the delay was the result of a cause not known to the carrier or its officer or agent in charge of such employee at the time said employee left a terminal, and which could not have been foreseen: Pro- [Wrecking, etc., crews.] vided further. That the provisions of this Act shall not apply to the crews of wrecking or relief trains. [Enforcement.] Sec. 4. It shall be the duty of the Interstate Commerce Commission to execute and enforce the provisions of this Act, and all powers granted to the Interstate Commerce Commission are hereby extended to it in the execution of this Act. [Effective.] Sec. 5. That this Act shall take effect and be in force one year after its passage. Approved March 4. 1907. § 667. The constitutionality of the act sustained. — In B. & 0. R. Co. V. Interstate Commerce Commission, 221 U. S. 612, 55 L. Ed. 878, the Supreme Court in (1911), affirmed the circuit court of Maryland in sustaining a de- murrer to a bill of the B. & 0. Railroad seeking to enjoin the enforcement of an order of the Interstate Commerce Commission requiring monthly reports from railroads sub- ject to this act. It was claimed that penalties were not limited to interstate commerce, but applied to intrastate railroads and to employes engaged in local business. The Court said that the statute in its scope was matsriaily different from the Employers Liability Act of 1906, as theie the act applied to any employes of the carrier, while in this statute the limiting words governed employes as well as the carriers. The Court said, even if it were true that the inter- state and the intrastate operations of its carriers were so interwoven, that it was impracticable for them to divide their employes in such manner that the duties of those who are engaged in connection with interstate commerce could not be confined to that commerce exclusively; the constitu- tional authority of congress could not be thus denied its 840 THE HOURS OF SERVICE ACT OF 1907. [§ 668 effective exercise in its powers to provide for the safety of employes and travelers. Congress was not limited to laws relating to mechanical appliances, but could recognize that the length of hours of service had a direct relation to the efficiency of human agencies upon which protection to life and property necessarily depends. The power of congress therefore to limit the hours of labor of those employes en- gaged in interstate transportation could not be defeated either by prolonging the period of service through other requirements of the carriers, or by the commanding of duties relating to interstate and intrastate operations. § 668. The act invalidates state acts on the subject. —In Erie R. Co. v. New York, 233 U. S. 671, 58 L. Ed. 1149, (1914), the Supreme Court held that this act invalidated the New York statute laws of 1907 (p. 415), prescribing a still shorter days' work, and this exercise by congress of its authority in interstate commerce precluded the state during the period of the date of the act and the time when by its terms it should go into effect from making or enforcing a local regulation limiting the hours of labor of such em- ployees. See also U. S. v. Grand Rapids & I. R. Co. 224 Fed. 667, C. C. A., sixth circuit, (1915). § 669. The statute not void for uncertainty. — The Court said that the words "except in case of emergency" in section two did not make the application of the act so un- certain as to destroy its validity. Congress had the power to use the general description, and in the legal sense there was no uncertainty. Congress by an appropriate description of an exceptional class had established a standard with respect to which cases that arise must be adjudged. The Court said the broad scope of the proviso in section three even if it was construed to include everything that could be included in the emergency clause in section two would not be merely a duplication which would not invalidate the act. § 670. The Interstate Commerce Commission had authority to require reports. — In the same case the Court said that the authority to require the secretary or other § 672] THE HOtmS OF SERVICE ACT OP 1907. 841 officers of the cariers subject to this act to make monthly reports under oath showing the instances where employes subject to the act had rendered excess services, and giving the cause and explanatory facts, if any, or where there had been no excess service to make the separate oath to that effect, was conferred upon the Interstate Commerce Com- mission by the provision of section four of the act; in con- nection with the amendments of the Interstate Commerce Act of June 18, 1910, authorizing the commission to require the carriers to file periodical or special reports under oath concerning any matter upon which it is by law authoiized or required to keep itself informed or which it is required to enforce. The Court decided in Northern Pacific R. Co. v. U. S. 213 Fed. 162, C. C. A., eighth circuit, (1914), that the omission by a carrier from a report filed with, the Interstate Commerce Commission of one or more instances of excessive service that they should have included in such report does not sub- ject the common carrier to liability for the penalty or for- feiture denounced by act for failure to file a'periodical report, when the omission of such instances in the report were caused by mistake of law or fact and made in good faith. See also U. S. V. B. & 0. Ry. Co. Dis. Ct. N. D. of W. Va., 226 Fed. 220. § 671. No privilege to a corporation or corporation officers against self-incrimination. — In the same case it was held that there was no violation of the constitutional provision against unreasonable searches and seizures in the requirements of the reports under this act, and neither the corporation subject to the act nor the officers of the cor- poration could claim a privilege against self-incrimination to judtify refusal to make such reports. The transactions to which the required reports related were corporate trans- actions subject to the regulating power of congress and the officers of the corporation are bound by the corporate obliga- tion, and could not claim a personal privilege in hostility to the requirement. § 672. Construction of liability of carriers under the act.— In St. Louis I. M. & S. R. Co. v. McWhirter, 229 U. S. 842 THE HOURS OF SERVICE ACT OF 1907. [§ 672 265, 57 L. Ed. 1179, (1913) it was held that in a suit based upon this act in a state court, where plaintiffs requested the court to instruct the jury to find in its favor, the federal question is necessarily involved, which, when denied, sup- ports a writ of error from the Supreme Court to the state Vourt. In this case it was also held that the act did not create an unconditional liability over all cases that happened during the period of service beyond the statutory limitation, irrespective of proof showing connection between the accident and the working over time. In United States v. Northern Pacific R. Co., (C. C. A., ninth circuit), 215 Fed. 64, it was decided that the fail- ure of a train dispatcher to appreciate the fact that the transfer of a crew in consequence of a wreck to another train would prevent their return on a regular train without keeping them on duty more than sixteen hours without eight hours consecutive rest, was a casualty within the meaning of the Hours of Service Act, and that the railroad was within the exception to the proviso of section 3 of the act, and that the railroad company was therefore not subject to the penalty. For the construction of the word "casualty" and "un- avoidable accident" as used in the act, see U. S. v. N. Y. & 0. W. R. Co. 216 Fed. 702, (1914) Dis. Ct. N. Y. The proviso of Sec. 3 of the act, which exempts a com- mon carrier from liability for the penalty specified in the case of casualty, unavoidable accident or the act of God necessarily requires a telegraph operator, train despatcher or other employe of such carrier to serve longer than the time limited for his service by section 2 of the act. U. S. v. Missouri Pacific R. Co., 213 Fed. 169, (C. C. A., eighth cir. 1914). In the case of San Pedro etc. R. Co. v. U. S. 213 Fed. 326, C. C. A., eighth cir. (1914), the act was held to be violated when a fireman was required to remain on duty for the pur- pose of watching his engine and keeping his fires alive until the coming of a relief crew after sixteen hours of duty in the movement of a train, and this was true whether the extra duty was in connection with the movement of the train or not, as the statute is highly remedial and should be liberally construed to effect its purpose which is to protect the safety § 673] THE HOURS OF SERVICE ACT OF 1907. 843 of employees and travellers. It has been held that the terms of this act impose an absolute duty on the carrier, the non-performance of which is not excused by the exercise of reasonable diligence or due care on its part, and it is no defense to the penalty imposed by the act that a telegraph operator violated the instructions of his superior officers, or that they did not know that he worked excessive hours, since if he was "permitted" by his superior officers to work in excess of the hours named in the act, the penalty would attach. U. S. v. Oregon-Washington N. Co. 213 Fed. 688, Dis. Ct. Washington, (1914). The C. C. A. of the seventh circuit in Chicago, R. I. & P. R. Co. V. U. S. 226 Fed. 27, (1915) construing section 2 of this act said that it was not confined to orders whose violations might result in some accident, but extended to orders looking to greater regularity in passenger service, as the statute aimed at general efficiency and promptness of service as well as safety, and the words "operator, etc." are extended to those who ordinarily and habitually trans- mit orders, and the same court in C. & N. W. Ry. Co. V. U. S., 226 Fed. 30, (1915) held that towermen whose principal duty was to operate switch levers but who habit- ually telephone orders were included in the terms of the section. See also C. C. A., fifth circuit, in U. S. v. Houston B. & T. Ry. Co. 205 Fed. 344. § 673. What trains employed in interstate com- merce within the meaning of the act. — Employees of a railroad company engaged in hauling freight from one point in a state on a railway line to another point in the same state where it is taken up by the same company and attached to its regular trains for interstate shipment are employed in interstate commerce within the meaning of the Hours of Service Act. U. S. v. Chicago, M. P. & S. R. Co. Dis. Ct. Wash., (1912) 197 Fed. 625. THE TWENTY-EIGHT HOUR LIVE STOCK TRANS- PORTATION LAW. § 674. The twenty-eight hour act. 675. Delivery to connecting carrier. 676. Accidental or unavoidable causes defined. 677. Violation of rules and regulations of company no defense. 678. Press of business. 679. Substitution for accommodation of animals. 680. Requested confinement — Question for jury. 681. Burden of proof. 682. The government is entitled to writ of error. 683. Pleadings. 684. "Wilfully" and "knowingly" construed. 685. Who subject to the act. 686. Place of bringing suits. 687. Procedure — Unit of offense AN ACT To prevent cruelty to animals while in transit by railroad or other means of transportation from one state or territory or the District of Columbia into or through another state or territory or the District of Columbia, and repealing sections forty-three hundred and eighty-six, forty-three hundred and eighty-seven, forty-three hundred and eighty-eight, forty-three hundred and eighty-nine, and forty- three hundred and ninety of the United States revised statutes. § 674. The twenty-eight hour live stock transporta- tion law. — Be it enacted by the Senate and House of Repre- sentatives of the United States of America in Congress assem- bled. That no railroad, express company, car company, com- mon carrier other than by water, or the receiver, trustee, or lessee of any of them, whose road forms any part of a line of road over which cattle, sheep, swine, or other animals shall be conveyed from one State or Territory or the District of Columbia into or through another State or Territory or the District of Columbia, or the owners or masters of steam, saihng, or other vessels carrying or transporting cattle, sheep, swine, or other animals from one State or, Territory or the District of Columbia into or through another State or Territory or the District of Columbia, shall confine the same in cars, boats, or vessels of any description for a period longer than twenty-eight consecutive hours without unload- ing the same in a humane manner, into properly equipped pens for rest, water and feeding, for a period of at least five consecutive hours, unless prevented by storm or by other accidental or unavoidable causes which cannot be antici- I 844] § 674] THE TWENTY-EIGHT HOUR LAW. 845 pated or avoided by the exercise of due diligence and fore- sight: Provided, That upon the written request of the owner or person in custody of that particular shipment, which written request shall be separate and apart from any printed bill of lading, or other railroad form, the time of confinement may be extended to thirty-six hours. In estimating such confinement, the time consumed in loading and unloading shall not be considered, but the time during which the ani- mals have been confined without such rest or food or water on connecting roads shall be included, it being the intent of this Act to prohibit their continuous confinement beyond the period of twenty-eight hours, except upon the contin- gencies hereinbefore stated: Provided, That it shall not be required that sheep be unloaded in the nighttime, but where the time expires in the nighttime in case of sheep the same may continue in transit to a suitable place for unloading, subject to the aforesaid limitation of thiity-six hours. Sec. 2. That animals so unloaded shall be properly fed and watered during such rest either by the owner or person having the custody thereof, or in case of his default in so doing, then by the railroad, express company, car company, common carrier other than by water, or the receiver, trustee, or lessee or any of them, or by the owners or masters of boats or vessels transporting the same, at the reasonable expense of the owner or person in custody thereof, and such railroad, express company, car company, common carrier other than by water, receiver, trustee, or lessee of any of them, owners or masters, shall in such case have a lien upon such animals for food, care and custody furnished, collectible at their destination in the same manner as the transportation charges are collected, and shall not be liable for any detention of such animals, when such detention is of reasonable duration, to enable compliance with section one of this Act; but noth- ing in this section shall be construed to prevent the owner or shipper of animals from furnishing food therefor, if he so desires. Sec. 3. That any railroad, express company, car company, common carrier other than by water, or the receiver, trustee, or lessee, of any of them, or the master or owner of any steam, sailing, or other vessel who knowingly and willfully fails to comply with the provisions of the two preceding sections shall for every such failure be liable for and forfeit and pay a penalty of not less than one hundred nor more than five hun- dred dollars: Provided, That when animals are carried in cars, boats, or other vessels in which they can and do have proper food, water, space, and opportunity to rest the pro- visions in regard to their being unloaded shall not aipply. Sec. 4. That the penalty created by the preceding section shall be recovered by civil action in the name of the United 846 THE TWENTY-EIGHT HOUE LAW. [§675 States in the circuit or district court holden within the dis- trict where the violation may have been committed or the person or corporation resides or carries on business; and it shall be the duty of the United States attorneys to prose- cute all violations of this Act reported by the Secretary of Agriculture, or which come to their notice or knowledge by other means. Sec. 5. That sections forty-three hundred and eighty-six, forty-three hundred and eighty-seven, forty-three hundred and eighty-eight, forty-three hundred and eighty-nine and forty- three hundred and ninety of the Revised Statutes of the United States be, and the same are hereby, repealed. Approved, June 29, 1906. § 675. Delivery to connecting carrier. — It was held in the case of U. S. v. Union Pacific R. Co., 213 Fed. 332, C. C. A. eighth cir. (1914), that the duty of a common carrier of livestock in regard to the acts regulating the hours of confinement thereof is not discharged until it has been im- posed upon the carrier next in order; and while the initial carrier might employ a terminal company to do the work of transferring the car to the connecting carrier, it was liable both to the shipper and the government for the penalty im- posed by this law on account of the action of the terminal company until the car was delivered to the connecting car- rier. See also in this connection U. S. v. Southern Pac. R. Co., 157 Fed. 459, (1907) and in M. K. & T. R. Co. v. U. S. 178 Fed. 15, C. C. A. (1910) the decision was that a raikoad company delivering its cars containing stock to a connecting carrier without keeping same confined longer than a period ' of twenty-eight hours is relieved from responsibility, but in these last two cases there was no question as to the confine- ment by an intermediate terminal or transferring company. But it has been held in U. S. v. Chicago etc. R. Co., 211 Fed. 770, Dis. Ct. of 111. (1913), that a connecting carrier may refuse to accept livestock because the shipment has already been confined a large proportion of the twenty-eight hours before being offered to such connecting carrier, and where it would be impossible to take such shipment to" another feeding place before the expiration of the time, the connecting carrier was not guilty of violation of the act. And in the case of U. S. v. Chicago Junction Railroad Co., 211 Fed. 724, Dis. Ct. 111. (1913) where the defendant's sole § 676] THE TWENTY-EIGHT HOUR LAW. 847 duty was to transport cattle a short distance from a certain junction to the Chicago stockyards and it accepted a carload of horses which had been confined in excess of the statutory period before they were delivered to the defendant and the defendant made the delivery to the stockyards immediately, it was decided that the junction railroad, which was the delivering carrier, was not guilty of "knowingly" and "wilfully" confining the animals in violation of the twenty- eight hour law. When a carrier receives stock from a connecting carrier, knowledge as to how long the livestock has been confined by the delivering carrier is imputed to the receiving carrier unless it shows positively that it made reasonable inquiry and could not accertain the fact. N. Y. Cen. R. Co. v. U. S. C. C. A. 2nd Cir. (1913,) 203 Fed. 953. § 676. Accidental or unavoidable causes defined. — "An accidental or unavoidable cause which cannot be antici- pated or avoided by the exercise of due dihgence and fore- sight" is one which cannot be avoided by that degree of prudence, foresight, care and caution which the law requires of every one under the circumstances of the particular case, and which would have been exercised by a man of ordinary prudence under such circumstances. United States v. Southern Pacific R. Co., 178 Fed. 15. On the other hand in Montana Cent. R. Co. v. U. S., 164 Fed. 400 (1908), it was held that the twenty-eight hour law is not a criminal statute and the violation was not excused by oversight or uninten- tional neglect. As to the accidental and unavoidable that come within the section of the statute, see U. S. v. A., T. & S. F. R. Co., 166 Fed. 160 (1908), that a company must know how long a con- necting carrier had kept the animals without food or water and must learn such fact at its peril. U. S. v. St. Joe Stock Yds. Co., 181 Fed. 625 (1911). In the case of St. Joseph Stock Yards Co. v. United States, 187 Fed. 104, the C. C. A. for the eighth circuit, (1911) held that in the absence of proof of knowledge brought home to a connecting carrier that a shipment of livestock had been confined by the delivering carrier for more than 848 THE TWENTY-EIGHT HOUR LAW. [ §677 twenty-eight hours the connecting or receiving carrier has a right to indulge the presumption that the delivering carrier has complied with the statute in regard to watering and feeding the livestock delivered. See also Sir Louis Merchants Bridge Terminal Railroad Co. V. United States, 209 Fed. 600 (1913), where the same construction was given to the act. § 677. Violation of rules and regulation of company no defense.— In U. S. v. Atlantic Coast Line, 173 Fed. 764, (C. C. A. fourth cir. 1909) the fact that the company had made rules and regulations requiring the employes to comply with the act and that its violation was the act of the employe in disobeying the rules was no defense. § 678. Press of business. — Nor does preds of business excuse a violation of the act. U. S. v. Union Pacific R. Co., 169 Fed. 65, (1909). § 679. Substitution for accommodation of animals. — Where animals were transported in cars specially arranged so as to secure to them proper food and water and of suflTicient size to allow some of the cattle to he down and rest a part of the time of their confinement, but not of suflTicient size to allow all the cattle confined in such cars to he down at the same time, that such arrangement did notavoid the necessity of unloading and feeding required by the act. Erie R. Co. v. U. S., C. C. A. (1912), 200 Fed. 406. § 680. Requested confinement: — Question for jury. —In U. S. v. Terminal Stock Yards Co., 172 Fed. 452 (1909), it was held that the first thirty-six hour confinement could not be counted against the carrier if requested by the owner. And the period beyond the twenty-eight hours (or thirty-six hours if requested). See U. S. v. Sioux City, etc., Co., 162 Fed. 556. In M. K. & T. R. Co. v. U. S., 178 Fed. 15, C. C. A., eighth cir. (1910), it was held that the question of conformity to the request of extension was for the court and not for the jury because a written instrument was involved. And it was also held that an agreement between the shipper and the carrier to confine stock longer than the thirty-six § 684] THE TWENTY-EIGHT HOUE LAW. 849 hour extension period named in the statute was void. Webster v. Union Pacific R. Co. 200 Fed. 597, (Dis. Ct. Colo., 1912). § 681. Burden of proof . — The government is required to estabUsh its case only by a preponderance of evidence and each independent shipment is a basis for a separate charge. U. S. V. Southern Pacific, 157 Fed. 459; M. K. & T. R. Co. v. U. S., 178 Fed. 15, eighth circuit; U. S. v. N. Y. & C. R. Co., 168 Fed. 699, C. C. A. second circuit; U. S. v. B. & 0. S. W. R. Co., 159 Fed. 33, C. C. A. sixth circuit; U. S. v. Oregon & R. N. Co., 163 Fed. 642. The Supreme Court in U. S. v. Regan, 232 U. S. 37, 58 L. Ed. 494 (1914), held that in this character of penalties a "reasonable preponderance of evidence" should be sufficient to secure judgment. § 682. The government is entitled to writ of error. — And the government is entitled to a writ of error. U. S. v. N. Y. C, etc., Co., 168 Fed. 699, C. C. A., second circuit; U. S. v. B. & 0. S. W. R. Co., 159 Fed. 33, C. C. A., sixth circuit. § 683. Pleadings. — As to the necessity of pleading the exceptions of the statute see N. Y. & C. H. R. Co. v. U. S., 165 Fed. 833. And it has been held that it is not essential to the recovery of a penalty under this statute that the government should negative the excuses embodied in the proviso of the statute. The excuse is a separate topic and the burden is on the de- fendant to establish it. C. R. & I. R. Co. v. U. S. 195 Fed. 241, C. C. A. eighth circuit, 1912. § 684, "Wilfully" and "knowingly" construed.— For case construing the word "wilfully" as used in the statute, see U. S. v. A., T. & S. F. R. Co., 166 Fed. 160; N. Y. Cent. & H. R. Co. v. U. S., 165 Fed. 833 C. C. A., first circuit; Houston, etc., Co. v. U. S., 168 Fed. 895; U. S. v. Sioux City, etc., Co., 162 Fed. 556; U. S. v. Union Pacific R. Co., 169 Fed. 65; M. K. & T. R. Co. v. U. S., 178 Fed. 15. l—H. 850 THE TWENTY-EIGHT HOUR LAW. [§685 Oregon-Wash. Nav. Co., v. U. S. 205 Fed. 337 (C. C. A., ninth circuit 1913) and it is also held that the question whether the stock has been "wilfully" or "knowingly" con- fined is one for the jury. See also U. S. v. Lehigh Valley R. Co. 204 Fed. 705, C. C. A. third circuit, (1913). § 685. Who subject to the act. — In U. S. v. St. Joseph Stock Yards Co., 181 Fed. 625, it is held that a stock yard company doing what is known as the terminal business was held subject to the provisions of the act; to the same effect is U. S. V. Sioux City Stock Yards Co., 162 Fed. 556, (1908). § 686, Place of bringing suits. — As to the place of bringing suit, see Southern Pacific R. Co. v. U. S., 171 Fed. 364; St. L. & St. F. R. Co. v. U. S., 169 Fed. 69, eighth circuit, (1909). § 687. Procedure— Unit of offense.— In B. & 0. S. W. R. Co. V. U. S., 220 U. S. 94, 55 L. Ed. 384 (1911), the act was construed by the Supreme Court modifying the decision of the United States circuit court of appeals of the sixth circuit, 159 Fed. 33, and it was held that but one penalty could be recovered against a carrier for the loading, and that other separate and distinct penalties accrued, as the time for the lawful confinement of the cattle loaded at later periods successively expired. The Court said that the statute was not primarily intended for the benefit of the owners but to prevent cruelty to animals in transit. The Court also held that the aggregate sum of the possible penalties is the amount in dispute for the purpose of sustaining the appellate juris- diction of the Supreme Court; and that the circuit court may properly consolidate under U. S. R. S. 921 several actions by the United States against a carrier to recover the penalties prescribed by this act; APPENDIX. 1. Anti-Trust Sections of Tariff Act 851 2. Anti-Trust Act of 1914 (ClaytonAct) 853 3. Federal Trade Commission Act 869 4. Code Provision for Designation of Carrier's Agent at Washington 878 5. Decrees Entered in Anti-Trust Cases 879 6. Rules of Practice Trade Commission 887 7. Rules of Practice Interstate Commerce Commission 892 8. Forms of Procedure, Interstate Commerce Commission 902 9. Act of 1913 — Abolishing Commerce Court 905 10. Arbitration Act of 1913 909 11. Interlocking and Automatic Signals Act 917 12. The Ash-Pan Act 918 13. The Report of Accidents Act 920 14. Locomotive Boiler Inspection Act 922 Sections 73 to 77, both inclusive of "AN ACT to Reduce Taxation, to Provide Revenue for the Government, and for Other Purposes" of August 27, 1894, as amended by "An Act to Amend Section 73 and 76 of the Act of August 27, 1894, entitled " 'An Act to Reduce Taxation, to Provide Revenue for the Government and for Other Purposes,' " approved February 12, 1913. Combinations in Restraint of Import Trade are Ille- gal. — Penalty. Sec. 73. That every combination, conspiracy, trust, agreement, or contract is hereby declared to be contrary to pubUc poUcy, illegal, and void when the same is made by or between two or more persons or corporations either of whom, as agent or principal, is engaged in importing any article from any foreign country into the United States, and when such combination, conspiracy, trust, agreement, or contract is intended to operate in restraint of lawful trade, or free competition in lawful trade or commerce, or to increase the market price in any part of the United States of any article or articles imported or intended to be imported into the United States, or of any manufacture into which such im- ported^article enters or is intended to enter. Every person who is_,or shall hereafter be engaged in the importation of goods or any commodity from any foreign country in viola- tion of this section of this Act, or who shall combine or con- spire with another to violate the same, is guilty of a misde- meanor, and on conviction thereof in any court of the United States such person shall be fined in a sum not less than one hundred dollars and not exceeding five thousand dollars, and shall be further punished by imprisonment, in the discre- tion of the court, for a term not less than three months nor exceeding twelve months. . [ 851 ] 852 APPENDIX. Jurisdiction of Courts. — Duty of District Attorneys. Sec' 74. That the several circuit courts of the United States are hereby' invested with jurisdiction to prevent and restrain violations of section seventy-three of this Act; and it shall be the duty of the several district attorneys of the United States, in their respective districts, under the direc- tion of the Attorney-General, to institute proceedings in equity to prevent and restrain such violations. Such pro- ceedings may be by way of petitions setting forth the case and praying that such violations shall be enjoined or other- wise prohibited. When the parties complained of shall have been duly notified of such petition the court shall proceed, as soon as may be, to the hearing and determination of the case; and pending such petition and before final decree, the court may at any time make such temporary restraining order or prohibition as shall be deemed just in the premises. Bringing in Additional Parties. Sec. 75. That whenever it shall appear to the court before which any proceeding under the seventy-fourth section of this Act may be pending, that the ends of justice require that other parties should be brought before the court, the court may cause them to be summoned, whether they reside in the district in which the court is held or not; and subpoenas to that end may be served in any district by the marshal thereof. Forfeiture of Property of Trusts, etc., in Transit. Sec. 76. That any property owned under any contract or by any combination, or pursuant to any conspiracy, and being the subject thereof, mentioned in section seventy-three of this Act, imported into and being within the United States or being in the course of transportation from one State to another, or to or from a Territory or the District of Golum- liia, shall be foifeited to the United States, and may be seized and condemned by like proceedings as those provided by law for the forfeiture, seizure, and condemnation of property imported into the United States contrary to law. Suits by Persons Injured. — Amount of Recovery. Sec. 77. That any person who shall be'injured in his busi- ness or property by any other person or corporation by reason of anything forbidden or declared to be unlawful by this Act may sue therefor in any circuit court of the United States in the district in which the defendant resides or is found, without respect to the amount in controversy, and shall re- cover threefold the damages by him sustained, and the costs of suit, including[a reasonable attorney's fee. FEDERAL ANTI-TRUST ACT. (CLAYTON ACT) (In effect October 15, 1914.) AN ACT to Supplement Existing Laws against Unlawful Restraints and Monopolies, and for Other Purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That "antitrust laws," as used herein, includes the Act entitled "An Act to protect trade and commerce against unlawful restraints and monopolies," approved July second, eighteen hundred and ninety; sections seventy-three to seventy- seven, inclusive, of an Act entitled "An Act to reduce taxa- tion, to provide revenue for the Government, and for other purposes," of August twenty-seventh, eighteen hundred and ninety-four; an Act entitled "An Act to amend sections seventy-three and seventy-six of the Act of August twenty- seventh, eighteen hundred and ninety-four, entitled " 'An Act to reduce taxation, to provide revenue for the Govern- ment and for other purposes,'" approved February twelfth, nineteen hundred and thirteen; and also this Act. "Commerce," as used herein, means trade or commerce among the several States and with foreign nations, or be- tween the District of Columbia or any Territory of the United States and any State, Territory, or foreign nation, or between any insular possessions or ther places under the jurisdiction of the United States, or between any such pos- session or place and any State or Territory of the United States or the District of Columbia or any foreign nation, or within the District of Columbia or any Territory or any insular possession or other place under the jurisdiction of the United States: Provided, That nothing in this Act con- tained shall apply to the Philippine Islands. The word "person" or "persons" wherever used in this Act shall be deemed to include corporations and associations existing under or authorized by the laws of either the United States, the laws of any of the Territories, the laws of any State, or the laws of any foreign country. Sec. 2. That it shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly, to discriminate in price between different pur- chasers of commodities, which commodities are sold for use, consumption, or resale within the United States or any Ter- ritory thereof or the District of Columbia or any insular [853] 854 APPENDIX. possession or other place under the jurisdiction of the United States, where the effect of such discrimination may be to substantially lessen competition or tend to create a monopoly in any hne of commerce: Provided, That nothing herein' contained shall prevent discrimination in price be- tween purchasers of commodities on account of differences in the grade, quality, or quantity of the commodity sold, or that makes only due allowance for difference in the cost of seUing or transportation, or discrimination in price in the same or different communities made in good faith to meet competition: And provided further. That nothing herein con- tained shall prevent persons engaged in selhng goods, wares, or merchandise in commerce from selecting their o#n- cus- tomers in bona fide transactions and not in restraint of trade. Sec. 3. That it shall be unlawful for any person engaged in commerce, in the course of such commerce, to lease or make a sale on contract for sale of goods, wares, merchan- dise, machinery, supplies or other commodities, whether patented or unpatented, for use, consumption or resale within the United States or any Territory thereof or the District of Columbia or any insular possession or other place under the jurisdiction of the United States, or fix a price charged there- for, or discount from, or rebate upon, such price, on the con- dition, agreement or understanding that the lessee or pur- chaser thereof shall not use or deal in the goods, wares, mer- chandise, machinery, supplies or other commodities of a competitor or competitors of the lessor or seller, where the effect of such lease, sale, or contract for sale or such condi- tion, agreement or understanding may be to substantially lessen competition or tend to create a monopoly in any line of commerce. Sec. 4. That any person who shall be injured in hi;i busi- ness by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee. Sec. 5. That a final judgment or decree hereafter rendered in any criminal prosecution or in any suit or proceeding in equity brought by or on behalf of the United States under the antitrust laws to the effect that a defendant has violated said laws shall be prima facie evidence against such defend- ant in any suit or proceeding brought by any other party against such defendant under said laws as to all matters re- specting which said judgment or decree would be an estoppel as between the parties thereto: Provided, That this section FEDERAL ANTI-TBUST ACT. 855 shall not apply to consent judgments or decrees entered be- fore any testimony has been taken: Provided further. That this section shall not apply to consent judgments or decrees rendered in criminal proceedings or suits in equity now pending in which the taking of testimony has been com- menced but has not been concluded, provided such judg- ments or decrees are rendered before any further testimony is taken. Whenever any suit or proceeding in equity or criminal prosecution is instituted by the United States to prevent, restrain, or punish violations of any of the antitrust laws the running of the statute of limitations in respect of each and every private right of action arising under said laws and based in whole or in part on any matter complained of in said suit or proceeding shall be suspended during the pen- dency thereof. Sec. 6. That the labor of a human being is not a com- modity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor, agricultural, or horticultural organiza- tions, instituted for the purposes of mutual help, and not having capital stock or conducted for profit, or to forbid or restrain individual membeis of such organizations, from lawfully carrying out the legitimate objects thereof; nor shall such organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in re- straint of trade, under the antitrust laws. Sec. 7. That no corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital of another corporation engaged also in commerce where the effect of such acquisition may be to substantially lessen competition between the corpo- ration whose stock is so acquired and the corporation making the acquisition, or to restrain such commerce in any section or community, or tend to create a monopoly of any line of commerce. No corporation shall acquire, directly or indirectly, the whole or any part of the stock or other share capital of two or more corporations engaged in commerce where the effect of such acquisition, or the use of such stock by the voting or granting of proxies or otherwise, may be to substantially lessen competition between such corporations, or any of them, whose stock or other share capital is so acquired, or to restrain such commerce in any section or community, or tend to create a monopoly of any line of commerce. 856 APPENDIX. This section shall not apply to corporations purchasing such stock solely for investment and not using the same by voting or otherwise to bring about, or in attempting to bring about, the substantial lessening of competition. Nor shall anything contained in this section prevent a corpora- tion engaged in commerce from causing the formation of subsidiary corporations for the actual carrying on of their immediate lawful business, or the natural and legitimate branches or extensions thereof, or from owning and holding all or a part of the stock of such subsidiary corporations, when the effect of such formation is not to substantially lessen competition. Nor shall anything herein contained be construed to pro- hibit any common carrier subject to the laws to regulate commerce from aiding in the construction of branches or short lines so located as to become feeders to the main line of the company so aiding in such construction or from ac- quiring or owning all or any part of the stock of such branch lines, nor to prevent any such common carrier from acquir- ing and owning all or any part of the stock of a branch or short line constructed by an independent company where there is no substantial competition between the company owning the branch line so constructed and the company owning the main line acquiring the property or an interest therein, nor to prevent such common carrier from extending any of its lines through the medium of the acquisition of stock or otherwise of any other such common carrier -where there is no substantial competition between the company extending its lines and the company whose stock, property, or an interest therein is so acquired. Nothing contained in this section shall be held to affect or impair any right heretofore legally acquired: Provided, That nothing in this section shall be held or construed to authorize or make lawful anything heretofore prohibited or made illegal by the antitrust laws, nor to exempt any person from the penal provisions thereof or the civil remedies therein provided. Sec. 8. That from and after two years from the date of the approval of this Act no person shall at the same time be a director or other officer or employee of more than one bank, banking association or trust company, organized or oper- ating under the laws of the United States, either of which has deposits, capital, surplus, and undivided profits aggre- gating more than $5,000,000; and no private banker or per- son who is a director in any bank or trust company, organ- ized and operating under the laws of a State, having depos- its, capital, surplus, and undivided profits aggregating more 857 than $5,000,000, shall be eligible to be a director in any bank or banking association organized or operating under the laws of the United States. The eligibility of a director, offi- cer, or employee under the foregoing provisions shall be determined by the average amount of deposits, capital, surplus, and undivided profits as shown in the official state- ments of such bank, banking association, or trust company filed as provided by law during the fiscal year next preced- ing the date set for the annual election of directors, and when a director, officer, or employee has been elected or se- lected in accordance with the provisions of this Act it shall be lawful for him to continue as such for one year thereafter under said election or employment. No bank, banking association or trust company, organ- ized or operating under the laws of the United States, in any city or incorporated town or village of more than two hun- dred thousand inhabitants, as shown by the last preceding decennial census of the United States, shall have as a di- rector or other officer or employee any private banker or any director or other officer or employee of any other bank, banking association or trust company located in the same place: Provided, That nothing in this section shall apply to mutual savings banks not having a capital stock represented by shares: Provided further. That a director or other officer or employee of such bank, banking association, or trust com- pany may be a director or other officer or employee of not more than one other bank or trust company organized under the laws of the United States or any State where the entire capital stock of one is owned by stockholders in the other: And provided further. That nothing contained in this section shall forbid a director of class A of a Federal reserve bank, as defined in the Federal Reserve Act, from being an officer or director or both an officer and director in one member bank. That from and after two years from the date of the ap- proval of this Act no person at the same time shall be a di- rector in any two or more corporations, any one of which has capital, surplus, and undivided profits aggregating more than $1,000,000, engaged in whole or in part in commerce, oth,er than banks, banking associations, trust companies, and common carriers subject to the Act to regulate com- merce, approved February fourth, eighteen hundred and eighty-seven, if such corporations are or shall have been theretofore, by virtue of their business and location of opera- tion, competitors, so that the elimination of competition by agreement between them would constitute a violation of any of the provisions of any of the antitrust laws. The 858 APPENDIX. eligibility of a director under the foregoing provisions shall be determined by the aggregate amount of the capital, sur- plus, and undivided profits, exclusive of dividends declared but not paid to stockholders, at the end of the fiscal year of said corporation next preceding the election of directors, and when a director has been elected in accordance with the provisions of this Act it shall be lawful for him to continue as such for one year thereafter. When any person elected or chosen as a director or officer or sele&ted as an employee of any bank or other corporation subject to the provisions of this Act is eligible at the time of his election or selection to act for such bank or other cor- poration in such capacity, his eUgibility to act in such capa- city shall not be affected and he shall not become or be deemed amenable to any of the provisions hereof by reason of any change in the affairs of such bank or other corpora- tion from whatsoever cause, whether specifically excepted by any of the provisions hereof or not, until the expiration of one year from the date of his election or employment. Sec. 9. Every president, director, officer or manager of any firm, association or corporation engaged in commerce as a common carrier, who embezzles, steals, abstracts or willfully misapplies, or willfully permits to be misapplied, any of the moneys, funds, credits, securities, property or assets of such firm, association or corporation, arising or accruing from, or used in, such commerce, in whole or in part, or willfully or knowingly converts the same to his own use or to the use of another, shall be deemed guilty of a felony and upon conviction shall be fined not less than $500 or confined in the penitentiary not less than one year nor more than ten years, or both, in the discretion of the court. Prosecutions hereunder may be in the district court of the United States for the district wherein the offense may have been committed. That nothing in this section shall be held to take away or impair the jurisdiction of the courts of the several States under the laws thereof; and a judgment of conviction or acquittal on the merits under the laws of any State shall be a bar to any prosecution hereunder for the same act or acts. Sec. 10. That after two years from the approval of this Act no common carrier engaged in commerce shall have any dealings in securities, supplies or other articles of commerce, or shall make or have any contracts for construction or maintenance of any kind, to the amount of more than $50,000, in the aggregate, in any one year, with another cor- poration, firm, partnership, or association when the said FEDERAL ANTI-TRUST ACT. 859 common carrier shall have upon its board of directors or as its president, manager or as its purchasing or selling officer, or agent in the particular transaction, any person who is at the same time a director, manager, or purchasing or selling ofTicer of, or who has any substantial interest in, such other corporation, firm, partnership or association unless and ex- cept such purchases shall be made from, or such dealings shall be with, the bidder whose bid is the most favorable to such common carrier, to be ascertained by competitive bid- ding under regulations to be prescribed by rule or otherwise by the Interstate Commerce Commission. No bid shall be received unless the name and address of the bidder or the names and addresses of the officers, directors, and general managers thereof, if the bidder be a corporation, or of the members, if it be a partnership or firm, be given with the bid. Any person who shall, directly or indirectly, do or attempt to do anything to prevent anyone from bidding or shall do any act to prevent free and fair competition among the bidders or those desiring to bid shall be punished as pre- scribed in this section in the case of an officer or director. Every such common carrier having any such transactions or making any such purchases shall within thirty days after making the same file with the Interstate Commerce Com- mission a full and detailed statement of the transaction showing the manner of the competitive bidding, who were the bidders, and the names and addresses of the directors and officers of the corporations and the members of the firm or partnership bidding; and whenever the said commission shall, after investigation or hearing, have reason to believe that the law has been violated in and about the said pur- chases or transactions it shall transmit all papers and docu- ments and its own views or findings regarding the transac- tion to the Attorney General. If any common carrier shall violate this section, it shall be fined not exceeding $25,000; and every such director, agent, manager or officer thereof who shall have knowingly voted for or directed the act constituting such violation or who shall have aided or abetted in such violation shall be deemed guilty of a misdemeanor and shall be fined not ex- ceeding $5,000, or confined in jail not exceeding one year, or both, in the discretion of the court. Sec. 11. That authority to enforce compliance with sec- tions two, three, seven, and eight of this Act by the persons respectively subject theteto is hereby vested in the Inter- state Commerce Commission where applicable to common 860 Appendix. carriers, in the Federal Reserve Board whej-e applicable to banks, banking associations, and trust companies and in the Federal Trade Commission where applicable to all other character- of commerce, to be exercised as follows : Whenever the commission or board vested with jurisdic- tion thereof shall have reason to believe that any person is violating or has violated any of the provisions of sections two, three, seven, and eight of this Act it shall issue and serve upon such person a complaint stating its charges in that respect and containing a notice of a hearing upon a day and at a place therein fixed at least thirty days after the service of said complaint. The person so complained of shall have the right to appear at the place and time so fixed and show cause why an order should not be entered by the commission or board requiring such person to cease and de- sist from the violation of the law so charged in said com- plaint. Any person may make application, and upon good cause shown may be allowed by the commission or board, to in- tervene and appear in said proceeding by counsel or in per- son. The tCiStimony in any such proceeding shall be reduced to writing and filed in the office of the commission or board. If upon such hearing the commission or board, as the case may be, shall be of the opinion that any of the provisions of said sections have been or are being violated, it shall make a report in writing in which it shall state its findings as to the facts, and shall issue and cause to be served on such per- son an order requiring such person to cease and desist from such violations, and divest itself of the stock held or rid itseilf of the directors chosen contrary to the provisions of sections seven and eight of this Act, if any there be, in the manner and within the time fixed by said order. Until a transcript of the record in such hearing shall have been filed in a circuit court of appeals of the United States, as herein- after provided, the commission or board may at any time, upon such notice and in such manner as it shall deem proper, modify or set aside, in whole or in part, any report or any order made or issued by it under this section. If such person fails or neglects to obey such order of the commission or board while the same is in effect, the commis- sion or board may apply to the circuit court of appeals of the United States, within any circuit where the violation complained of was or is being committed, or where such person resides or carries on business, for the enforcement of its order, and shall certify and file with its spphcation a transcript of the entire record in the proceeding, including FEDERAL ANTI-TRUST ACT. 861 all the testimony taken and the report and order of the com- mission or board. Upon such filing of the application and transcript the court shall cause notice thereof to be served upon such person and thereupon shall have jurisdiction of the proceeding and of the question determined therein, and shall have power to make and enter upon the pleadings, testimony, and proceedings set forth in such transcript a decree affirming, modifying, or setting aside the order of the commission or board. The findings of the commission or board as to the facts, if supported by testimony, shall be conclusive. If either party shall apply to the court for leave to adduce additional evidence, and shall show to the satis- faction of the court that such additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the proceeding before the commis- sion or board, the court may order such additional evidence to be taken before the commission or board and to be ad- duced upon the hearing in such manner and upon such terms and conditions as to the court may seem proper. The com- mission or board may modify its findings as to the facts, or make new findings, by reason of the additional evidence so taken, and it shall file such modififed or new findings, which, if supported by testimony, shall be conclusive, and its rec- ommendation, if any, for the modification or setting aside of its original order, with the return of such additional evi- dence. The judgment and decree of the court shall be final, except that the same shall be subject to review by the Su- preme Court upon certiorari, as provided in section two hundred and forty of the Judicial Code. Any party required by such order of the commission or board to cease and desist from a violation charged may obtain a review of such order in said circuit court of appeals by filing in the court a written petition praying that the order of the commission or board be set aside. A copy of such petition shall be forthwith served upon the commis- sion or board, and thereupon the commission or board forth- with shall certify and file in the court a transcript of the rec- ord as hereinbefore provided. Upon the filing of the trans- script the court shall have the same jurisdiction to affirm, set aside, or modify the order of the commission or board as in the case of an application by the commission or board for the enforcement of its order, and the findings of the com- mission or board as to the facts, if supported by testimony, shall in like manner be conclusive. The jurisdiction of the circuit court of appeals of the United States to enforce, set aside, or modify orders of the commissian or board shall be exclusive. 862 APPENDIX. Such proceedings in the circuit court of appeals shall be given precedence over other cases pending therein, and shall be in every way expedited. No order of the commission or board or the judgment of the court to enforce the same shall in any wise relieve or absolve any person from any liability under the antitrust Acts. Complaints, orders, and other processes of the commission or board under this section may be served by anyone duly authorized by the commission or board, either (a) by deliv- ering a copy thereof to the person to be served, or to a mem- ber of the partnership to be served, or to the president, sec- retary, or other executive ofTicer or a director of the corpo- ration to be served; or (b) by leaving a copy thereof at the principal office or place of business of such person; or (c) by registering and maiUng a copy thereof addressed to such person at his principal office or place of business. The veri- fied return by the person so serving said complaint, order, or other process setting forth the manner of said service shall be proof of the same, and the return post-office receipt for said complaint, order, or other process registered and mailed as aforesaid shall be proof of the service of the same. Sec. 12. That any suit, action, or proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found. Sec. 13. That in any suit, action, or proceeding brought by or on behalf of the United States subpoenas for witnesses who are required to attend a court of the United States in any judicial district in any case, civil or criminal, arising under the antitrust laws may run into any other district: Provided, That in civil cases no writ of subpoena shall issue for witnesses living out of the district in which the court is held at a greater distance than one hundred miles from the place of holding the same without the permission of the trial court being first had upon proper application and cause shown. Sec. 14. That whenever a corporation shall violate any of the penal provisions of the antitrust laws, such violation shall be deemed to be also that of the individual directors, officers, or agents of such corporation who shall have authorized, or- dered, or done any of the acts constituting in whole or in part such violation, and such violation shall be deemed a misdemeanor, and upon conviction therefor of any such FEDERAL ANTI-TRUST ACT. 863 director, officer, or agent he shall be punished by a fine of not exceeding $5,000 or by imprisonment for not exceeding one year, or by both, in the discretion of the court. Sec. 15. That the several district courts of the United States are hereby invested with jurisdiction to prevent and restrain violations of this Act, and it shall be the duty of the several district attorneys of the United States, in their re- spective districts, under the direction of the Attorney Gen- eral, to institute proceedings in equity to prevent and re- strain juch violations. Such proceedings may be by way of petition setting forth the case and praying that such viola- tion shall be enjoined or otherwise prohibited. When the parties complained of shall have been duly notified of such petition, the court shall proceed, as soon as may be, to the hearing and determination of the case; and pending such petition, and before final decree, the court may at any time make such temporary restraining order or prohibition as shall be deemed just in the premises. Whenever it shall ap- pear to the court before which any such proceedings may be pending that the ends of justice require that other parties should be broughj; before the court, the court may cause them to be summoned, whether they reside in the district in which the court is held or not, and subpoenas to that end may be served in any district by the marshal thereof. Sec. 16. That any person, firm, corporation, or associa- tion shall be entitled to sue for and have injunctive relief, in any court of the United States having jurisdiction over the parties, against threatened loss or damage by a viola- tion of the antitrust laws, including sections two, three, seven and eight of this Act, when and under the same conditions and principles as injunctive relief against threatened conduct that will cause loss or damage is granted by courts of equity, under the rules governing such proceedings, and upon the execution of proper bond against damages for an injunction improvidently granted and a showing that the danger of irreparable loss or damage is immediate, a preliminary in- junction may issue: Provided, That nothing herein contained shall be construed to entitle any person, firm, corporation, or association, except the United States, to bring suit in equity for injunctive relief against any common carrier sub- ject to the provisions of the Act to regulate commerce, ap- proved February fourth, eighteen hundred and eighty-seven, in respect of any matter subject to the regulation, super- vision, or other jurisdiction of the Interstate Commerce Commission. Sec. 17. That no preliminary injunction shall be issued without notice to the opposite party. 864 APPENDIX. No temporary restraining order shall be granted without notice to the opposite party unless it shall clearly appear from specific facts shown by affidavit or by the verified bill that immediate and irreparable injury, loss, or damage will result to the applicant before notice can be served and a hearing had thereon. Every such temporary restraining order shall be endorsed with the date and hour of issuance, shall be forthwith filed in the clerk's office and entered of record, shall define the injury and state why it is irreparable and why the order was granted without notice, and shall by its terms expire within such time after entry, not to exceed ten days, as the court or judge may fix, unless within the time so fixed the order is extended for a like period for good cause shown, and the reasons for such extension shall be entered of record. In case a temporary restraining order shall be granted without notice in the contingency specified, the matter of the issuance of a preliminary injunction shall be set down for a hearing at the earhest possible time and shall take precedence of all matters except older matters of the same character; and when the same comes up for hearing the party obtaining the temporary restraining order shall proceed with the application for a preliminary injunction, and if he does not do so the court shall dissolve the tempo- rary restraining order. Upon two days' notice to the party obtaining such temporary restraining order the opposite party may appear and move the dissolution or modification of the order, and in that event the court or judge shall pro- ceed to hear and determine the motion as expeditiously as the ends of justice may require. Section two hundred and sixty-three of an Act entitled "An Act to codify, revise, and amend the laws relating to the judiciary," approved March third, nineteen hundred and eleven, is hereby repealed. Nothing in this section contained shall be deemed to alter, repeal, or amend section two hundred and sixty-six of an Act entitled "An Act to codify, revise, and amend the laws re- lating to the judiciary," approved March third, nineteen hundred and eleven. Sec. 18. That, except as otherwise provided in section six- teen of this Act, no restraining order or interlocutory order of injunction shall issue, except upon the giving of security by the applicant in such sum as the court or judge may deem proper, conditioned upon the payment- of such costs and damages as may be incurred or suffered by any party who may be found to have been wrongfully enjoined or restrained thereby. FEDERAL ANTI-TBUST ACT. 865 Sec. 19. That every order of injunction or restraining order shall set forth the reasons for the issuance of the same, shall be specific in terms, and shall describe in reasonable detail, and not by reference to the bill of complaint or other document, the act or acts sought to be restrained, and shall be binding only upon the parties to the suit, their ofTicers, agents, servants, employees and attorneys, or those in active concert or participating with them, and who shall, by per- sonal service, or otherwise, have received actual notice of the same. Sec. 20. That no restraining order or injunction shall be granted by any court of the United States, or a judge or the judges thereof, in any case between an employer and em- ployees, or between employers and employees, or between em- ployees, or between persons employed and persons seeking employment, involving, or growing out of, a dispute con- cerning terms or conditions of employment, unless neces- sary to prevent irreparable injury to property, or to a prop- erty right, of the party making the application, for which injury there is no adequate remedy at law, and such prop- erty or property right must be described with particularity in the application, which must be in writing and sworn to by the applicant or by his agent or attorney. And no such restraining order or injunction shall prohibit any person or persons, whether singly or in concert, from terminating any relation of employment, or from ceasing to perform any work or labor, or from recommending, advising, or persuading others by peaceful means so to do; or from attending at any place where any such person or persons may lawfully be, for the purpose of peacefully obtaining or com- municating information, or from peacefully persuading any person to work or to abstain from working; or fom ceasing to patronize or to employ any party to such dispute, or from recommending, advising or persuading others by peaceful and lawful means so to do; or from paying or giving to, or withholding from, any person engaged in such dispute, any strike benefits or other moneys or things of value; or from peaceably assembling in a lawful manner, and for law- ful purposes; or from doing any act or thing which might lawfully be done in the absence of such dispute by any party thereto; nor shall any of the acts specified in this paragraph be considered or held to be violations of any law of the United States. Sec. 21. That any person who shall willfully disobey any lawful writ, process, order, rule, decree or command of any dis- trict court of the United States or any court of the District of Columbia by doing any act or thing therein, or thereby for- J— 56. 866 APPENDIX. bidden to be done by him if the act or thing so done by him be of such character as to constitute also a criminal offense under any statute of the United States, or under the laws of any State in which the act was committed, shall be pro- ceeded against for his said contempt as hereinafter provided. Sec. 22. That whenever it shall be made to appear to any district court or judge thereof, or to any judge therein sit- ting, by the return of a proper officer on lawful process, or upon the affidavit of some credible person, or by informa- tion filed by any district attorney, that there is reasonable ground to believe that any person has been guilty of such contempt, the court or judge thereof, or any judge therein sitting, may issue a rule requiring the said person so charged to show cause upon a day certain why he should not be punished therefor, which rule, together with a copy of the affidavit or information, shall be served upon the person charged with sufficient promptness to enable him to prepare for and make return to the order at the time fixed therein. If upon or by such return, in the judgment of the court, the alleged contempt be not sufficiently purged, a trial shall be directed at a time and place fixed by the court: Provided, however. That if the accused, being a natural person, fail or refuse to make return to the rule to show cause, an attach- ment may ifesue against his person to compel an answer, and in case of his continued failure or refusal, or if for any reason it be impracticable to dispose of the matter on the return day, he may be required to give a reasonable bail for his attendance at the trial and his submission to the final judgment of the court. Where the accused is a body cor- porate, an attachment for the sequestration of its property may be issued upon like refusal or failure to answer. In all cases within the purview of this Act such trial may be by the court, or, upon demand of the accused, by a jury; in which latter event the court may impanel a jury from the jurors then in attendance, or the court or the judge thereof in chambers may cause a sufficient number of jurors to be selected and summoned, as provided by law, to attend at the time and place of trial, at which time a jury shall be se- lected and impaneled as upon a trial for misdemeanor; and such trial shall conform as near as may be to the practice in criminal cases prosecuted by indictment or upon infor- rnation. If the accused be found guilty, judgment shall be entered accordingly, prescribing the punishment, either by fine or imprisonment, or both, in the discretion of the court. Such fine shall be paid to the United States or to the complainant or other party injured by the act constitutine the con- FEDERAL ANTI-TRUST ACT. 867 tempt, or may, where more than one is so damaged, be di- vided or apportioned among them as the court may direct, but in no case shall the fine to be paid to the United States exceed, in case the accused is a natural person, the sum of $1,0D0, nor shall such imprisonment exceed the term of six months: Provided, That m any case the court or a judge thereof may, for good cause shown, by affidavit or proof taken in open court or before such judge and filed with the papers in the case, dispense with the rule to show cause, and may issue an attachment for the arrest of the person charged with contempt; in which event such person, when arrested, shall be brought before such court or a judge thereof with- out unnecessary delay and shall be admitted to bail in a reasonable penalty for his appearance to answer to the charge or for trial for the contempt; and thereafter the pro- ceedings shall be the same as provided herein in case the rule had issued in the first instance. Sec. 23. That the evidence taken upon the trial of any person so accused may be preserved by bill of exceptions, and any judgment of conviction may be reviewed upon writ of error in all respects as now provided by law in criminal cases, and may be affirmed, reversed, or modified as justice may require. Upon the granting of such writ of error, exe- cution of judgment shall be stayed, and the accused, if thereby sentenced to imprisonment, shall be admitted to bail in such reasonable sum as may be required by the court, or by any justice, or any judge of any district court of the United States or any court of the District of Columbia. Sec. 24. That nothing herein contained shall be construed to relate to contempts committed in the presence of the court, or so near thereto as to obstruct the administration of justice, nor to contempts committed in disobedience of any lawful writ, process, order, rule, decree, or command entered in any suit or action brought or prosecuted in the name of, or on behalf of, the United States, but the same, and all other cases of contempt not specifically embraced within section twenty-one of this Act, may be punished in con- formity to the usages at law and in equity now prevailing. Sec. 25. That no proceeding for contempt shall be insti- tuted against any person unless begun within one year from the date of the act complained of; nor shall any such pro- ceeding be a bar to any criminal prosecution for the same act or acts; but nothing herein contained shall affect any proceedings in contempt pending at the time of the passage of this Act. 868 APPENDIX. ' ■ Sec. 26. That if any clause, sentence, paragraph, or part of this Act shall, for any reason, be adjudged by any court of competent jurisdiction to be invaUd, such judgment shall not affect, impair, or invalidate the remainder thereof, but shall be confined in its operation to the clause, sentence, paragraph, or part thereof directly involved in the contro- versy in which such judgment shall have been rendered. Approved October 15, 1914. FEDERAL TRADE COMMISSION ACT. (In effect September 26, 1914.) AN ACT to create a Federal Trade Commission, to define its powers and duties, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That a commission is hereby created and established, to be known as the Federal Trade Commission (hereinafter referred to as the commission), which shall be composed of five commis- sioners, who shall be appointed by the President, by and with the advice and consent of the Senate. Not more than three of the commissioners shall be members of the same political party. The first commissioners appointed shall con- tinue in office for terms of three, four, five, six, and seven years, respectively, from the date of the taking effect of this act, the term of each to be designated by the President, but their successors shall be appointed for terms of seven years, except that any person chosen to fill a vacancy shall be ap- pointed only for the unexpired term of the commissioner whom he shall succeed. The commission shall choose a chair- man from its own membership. No commissioner shall en- gage in any other business, vocation, or employment. Any commissioner may be removed by the President for ineffi- ciency, neglect of duty, or malfeasance in office. A vacancy in the commission shall not impair the right of the remaining commissioners to exercise all the powers of the commission. The commission shall have an official seal, which shall be judicially noticed. Sec. 2. That each commissioner shall receive a salary of $10,000 a year, payable in the same manner as the salaries of the judges of the courts of the United States. The com- mission shall appoint a secretary, who shall receive a salary of $5,000 a year, payable in like manner, and it shall have authority to employ and fix the compensation of such attor- neys, special experts, examiners, clerks, and other employees as it may from time to time find necessary for the proper per- formance of its duties and as may be from time to time ap- propriated for by Congress. With the exception of the secretary, a clerk to each com- missioner, the attorneys, and such special experts and ex- aminers as the commission may from time to time find [ 869] 870 APPENDIX. necessary for the conduct of its work, all employees of the commission shall be a part of the classified civil service, and shall enter the service under such rules and regulations as may be prescribed by the commission and by the Civil • Service Commission. All of the expenses of the commission, including all neces- sary expenses for transportation incurred by the commis- sioners or by their employes under their orders, in making any investigation, or upon ofTicial business in any other places than in the city of Washington, shall be allowed and paid on the presentation of itemized vouchers therefor ap- proved by the commission. Until otherwise provided by law, the commission may rent suitable offices for its use. The Auditor for the State and Other Departments shall receive and examine all accounts of expenditures of the com- mission. Sec. 3. That upon the organization of the commission and election of its chairman, the Bureau of Corporations and the offices of the Commissioner and Deputy Commissioner of Corporations shall cease to exist; and all pending investiga- tions and proceedings of the Bureau of Corporations shall be continued by the commission. All clerks and employees of the said bureau shall be trans- ferred to and become clerks and employees of the commis- sion at their present grades and salaries. All records, papers, and property of the said bureau shall become records, papers, and property of the commission, and all unexpended funds and appropriations for the use and maintenance of the said bureau, including any allotment already made to it by the Secretary of Commerce from the contingent appropriation for the Department of Commerce for the fiscal year nineteen hundred and fifteen, or from the departmental printing fund for the fiscal year nineteen hundred and fifteen, shall become funds and appropriations available to be expended by the commission in the exercise of the powers, authority, and duties conferred on it by this Act. The principal office of the commission shall be in the city of Washington, but it may meet and exercise all its powers at any other place. The commission may, by one or more of its members, or by such examiners as it may designate, prosecute any inquiry necessary to its duties in any part of the United States. FEDERAL TEADE COMMISSION ACT. 871 Sec. 4. That the words defined in this section shall have the following meaning when found in this Act, to-wit: "Commerce" means commerce among the several States or with foreign nations, or in any Territory of the United States or in the District of Columbia, or between any such Territory and another, or between any such Territory and any State or foreign nation, or between the District of Colum- bia and any State or Territory or foreign nation. "Corporation" means any company or association incor- porated or unincorporated, which is organized to carry on business for profit and has shares of capital or capital stock, and any company or association, incorporated or unincor- porated, without shares of capital or capital stock, except partnerships, which is organized to carry on business for its own profit or that of its members. "Documentary evidence" means all documents, papers, and correspondence in existence at and after the passage of this Act. "Acts to regulate commerce" means the Act entitled "An Act to regulate commerce," approved February fourteenth [fourth?], eighteen hundred and eighty-seven, and all Acts amendatory thereof and supplementary thereto. "Antitrust Acts" means an Act entitled "An Act to pro- tect trade and commerce against unlawful restraints and monopolies," approved July second, eighteen hundred and ninety; also the sections seventy-three to seventy-seven, in- clusive, of an Act entitled "An Act to reduce taxation, to provide revenue for the Government, and for other pur- poses," approved [of?] August twenty-seventh, eighteen hun- dred and ninety-four; and also an Act entitled "An Act to amend sections seventy-three and seventy-six of the Act of August twenty-seventh, eighteen hundred and ninety-four, entitled 'An Act to reduce taxation, to provide revenue for the Government, and for other purposes,' " approved Feb- ruary twelfth, nineteen hundred and thirteen. Sec. 5. That unfair methods of competition in commerce are hereby declared unlawful. The commission is hereby empowered and directed to pre- vent persons, partnerships, or corporations, except banks, and common carriers subject to the Acts to regulate com- merce, from using unfair methods of competition in com- merce. Whenever the commission shall have reason to believe that any such person, partnership, or corporation has been or is 872 APPENDIX. using any unfair method of competition in commerce, and if it shall appear to the commission that a proceeding by it in respect thereof would be to the interest of the pubhc, it shall issue and serve upon such person, partnership, or cor- poration a complaint stating its charges in that respect, and containing a notice of a hearing upon a day and at a place therein fixed at least thirty days after the service of said complaint. The person, partnership, or corporation so com- plained of shall have the right to appear at the place and time so fixed and show cause why an order should not be entered by the commission requiring such person, partner- ship, or corporation to cease and desist from the violation of the law so charged in said complaint. Any person, partner- ship, or corporation may make application, and upon good cause shown may be allowed by the commission, to inter- vene and appear in said proceeding by counsel or in person. The testimony in any such proceeding shall be reduced to writing and filed in the office of the commission. If upon such hearing the commission shall be of the opinion that the method of competition in question is prohibited by this Act, it shall make a report in writing in which it shall state its findings as to the facts, and shall issue and cause to be served on such person, partnership, or corporation an order requir- ing such person, partnership, or corporation to cease and desist from using such method of competition. Until a transcript of the record in such hearing shall have been filed in a circuit court of appeals of the United States, as herein- after provided, the commission may at any time, upon such notice and in such manner as it shall deem proper, modify or set aside, in whole or in part, any report or any order made or issued by it under this section. If such pel son, partnership, or corporation fails or neg- lects to obey such order of the commission while the same is in effect, the commission may apply to the circuit court of appeals of the United States, within any circuit where the method of competition, in question was used or where such person, partnership, or corporation resides or carries on business, for the enforcement of its order, and shall certify and file with its application a transcript of the entire record in the proceeding, including all the testimony taken and the report and order of the commission. Upon such fiHng of the application and transcript the court shall cause notice thereof to be served upon such person, partnership, or corporation and thereupon shall have jurisdiction of the proceeding and of the question determined therein, and shall have power to make and enter upon the pleadings, testimony, and proceed- ings set forth in such transcript a decree affirming, modify- ing, or setting aside the order of the commission. The find- FEDERAL TRADE COMMISSION ACT. 873 ings of the commission, as to the facts, if supported by testi- mony, shall be conclusive. If either party shall apply to the court for leave to adduce additional evidence, and shall show to thg satisfaction of the court that such additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the proceeding before the commission, the court may order such additional evidence to be taken before the commission and to be adduced upon the hearing in such mannef and upon such terms and condi- tions as to the court may seem proper. The commission may modify its findings as to the facts, or make new findings, by reason of the additional evidence so taken, and it shall file such modified or new findings, which, if supported by testimony, shall be conclusive, and its recommendation, if any, for the modification or setting aside of its original order, with the return of such additional evidence. The judgment and decree of the court shall be final, except that the same shall be subject to review by the Supreme Court upon cer- tiorari, as provided in section two hundred and forty of the Judicial Code. Any party required by such order of the commission to cease and desist from using such method of competition may obtain a review of such order in said circuit court of appeals by filing in the court a written petition praying that the order of the commission be set aside. A copy of such petition shall be forthwith served upon the commission, and there- upon the commission forthwith shall certify and file in the court a transcript of the record as hereinbefore provided. Upon the filing of the transcript the court shall have the same jurisdiction to affirm, set aside, or modify the order of the commission as in the case of an application by the com- mission for the enforcement of its order, and the findings of the commission as to the facts, if supported by testimony, shall in like manner be conclusive. The jurisdiction of the circuit court of appeals of the United States to enforce, set aside, or modify orders of the commission shall be exclusive. Such proceedings in the circuit court of appeals shall be given precedence over other cases pending therein, and shall be in every way expedited. No order of the commission or judgment of the court to enforce the same shall in any wise relieve or absolve any person, partnership, or corporation from any liability under the anti-trust Acts. Complaints, orders, and other processes of the commission under this section may be served by anyone duly authorized by the commission, either (a) by delivering a copy thereof 874 APPENDIX to the person to be served, or to a member of the partner- ship to be served, or to the president, secretary, or other executive officer or a director of the corporation to be served ; or (b) by leaving a copy thereof at the principal office or place of business of such person, partnership, or corpora- tion; or (c) by registering and mailing a copy thereof ad- dressed to such person, partnership, or corporation at his or its principal office or place of business. The verified re- turn by the person so serving said complaint, order, or other process setting forth the manner of said service shall be proof of the same, and the return post-office receipt for said complaint, order, or other process registered and mailed as aforesaid shall be proof of the service of the same. Sec. 6. That the commission shall also have power — (a) To gather and compile information concerning, and to investigate from time to time the organization, business, conduct, practices, and management of any corporation en- gaged in commerce, excepting banks and common carriers subject to the Act to regulate commerce, and its relation to other corporations and to individuals, associations, and partnerships. (b) To require, by general or special orders, corporations engaged, in commerce, excepting banks, and common carriers subject to the Act to regulate commerce, or any class of them, or any of them, respectively, to file with the commis- sion in such form as the commission may prescribe annual or special, or both annual and special, reports or answers in writing to specific questions, furnishing to the commission such information as it may require as to the organization business, conduct, practices, management, and relation tc other corporations, partnerships, and individuals of the re- spective corporations filing such reports or answers in writing. Such reports and answers shall be made under oath, or otherwise, as the commission may prescribe, and shall be filed with the commission within such reasonable period as the commission may prescribe, unless additional time be granted in any case by the commission. (c) Whenever a final decree has been entered against any defendant corporation in any suit brought by the United States to prevent and restrain any violation of the antitrust Acts, to make investigation, upon its own initiative, of the manner in which the decree has been or is being carried out, and upon the application of the Attorney General it shall be its duty to make such investigation. It shall transmit to the Attorney General a report embodying its findings and recommendations as a result of any such investigation, and FEDERAL TRADE COMMISSION ACT. 875 the report shall be made public in the discretion of the com- mission. (rf) Upon the direction of the President or either House of Congress to investigate and report the facts relating to any alleged violations of the antitrust Acts by any corporation. (e) Upon the appUcation of the Attorney General to in- vestigate and make recommendations for the readjustment of the business of any corporation alleged to be violating the antitrust Acts in order that the corporation may thereafter maintain its organization, management, and conduct of business in accordance with law. (/) To make public from time to time such portions of the information obtained by it hereunder, except trade secrets and names of customers, as it shall deem expedient in the public interest; and to make annual and special reports to the Congress and to submit therewith recommendations for additional legislation; and to provide for the publication of its reports and decisions in such form and manner as may be best adapted for public information and use. (g) From time to time to classify corporations and to make rules and regulations for the purpose of carrying out the provisions of this Act. (h) To investigate, from time to time, trade conditions in and with foreign countries where associations, combinations, or practices, of manufacturers, merchants, or traders, or other conditions, may affect the foreign trade of the United States, and to report to Congress thereon* with such recom- mendations as it deems advisable. Sec. 7. That in any suit in equity brought by or under the direction of the Attorney General as provided in the antitrust Acts, the court may, upon the conclusion of the testimony therein, if it shall be then of opinion that the complainant is entitled to relief, refer said suit to the com- mission, as a master in chancery, to ascertain and report an appropriate form of decree therein. The commission shall proceed upon such notice to the parties and under such rules of procedure as the court may prescribe, and upon the coming in of such report such exceptions may be filed and such pro- ceedings had in relation thereto as upon the report of a mas- ter in other equity causes, but the court may adopt or reject such report, in whole or in part, and enter such a decree as the nature of the case may in its judgment require. Sec. 8. That the several departments and bureaus of the Government when directed by the President shall fur- 876 APPENDIX. nish the commission, upon its request, all records, papers, and information in their possession relating to any corpora- tion subject to any of the provisions of this Act, and shall de- tail from time to time such officials and employees to the commission as he may direct. Sec. 9. That for the purposes of this Act the commission, or its duly authorized agent or agents, shall at all reasonable times have access to, for the purpose of examination, and the right to copy any documentary evidence of any corpo- ration being investigated or proceeded against; and the commission shall have power to require by subpoena the attendance and testimony of witnesses and the production of all such documentary evidence relating to any matter under investigation. Any member of the commission ma> sign subpoenas, and members and examiners of the com- mission may administer oaths and affirmations, examine witnesses, and receive evidence. Such attendance of witnesses, and the production of such documentary evidence, may be required from any place in the United States, at any designated place of hearing. And in case of disobedience to a subpoena the commission may invoke the aid of any court of the United States in requiring the attendance and testimony of witnesses and the pro- duction of documentary evidence. Any of the district courts of the United States within the jurisdiction of which such inquiry is carried on may, in case of contumacy or refusal to obey a subpoena issued to any corporation or other person, issue an order requiring such corporation or other person to appear before the commis- sion, or to produce documentary evidence if so ordered, or to give evidence touching the matter in question; and any failure to obey such order of the court may be punished by such court as a contempt thereof. Upon the apphcation of the Attorney General of the United States, at the request of the commission, the district courts of the United States shall have jurisdiction to issue writs of mandamus commanding any person or corporation to comply with the provisions of this Act or any order of the commission made in pursuance thereof. The commission may order testimony to be taken 'by dep- osition in any proceeding or investigation pending under this Act at any stage of such proceeding or investigation. Such depositions may be taken before any person designated by the commission and having power to administer oaths. Such testimony shall be reduced to writing by the person FEDERAL TRADE COMMISSION ACT. 877 taking the deposition, or under his direction, and shall then be subscribed by the deponent. Any person may be com- pelled to appear and depose and to produce documentary evidence in the same manner as witnesses may be compelled to appear and testify and produce documentary evidence before the commission as hereinbefore provided. Witnesses summoned before the commission shall be paid the same fees and mileage that are paid witnesses in the courts of the United States, and witnesses whose depositions are taken and the persons taking the same shall severally be entitled to the same fees as are paid for like services in the courts of the United States. No person shall be excused from attending and testifying or from producing documentary evidence before the com- mission or in obedience to the subpoena of the commission on the ground or for the reason that the testimony or evi- dence, documentary or otherwise, required of him may tend to criminate him or subject him to a penalty or forfeiture. But no natural person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transac- tion, matter, or thing concerning which he may testify, or produce evidence, documentary or otherwise, before the commission in obedience to a subpoena issued by it: Pro- vided, That no natural person so testifying shall be exempt from prosecution and punishment for perjury committed in so testifying. Sec. 10. That any person who shall neglect or refuse to attend and testify, or to answer any lawful inquiry, or to produce documentary evidence, if in his power to do so, in obedience to the subpoena or lawful requirement of the com- mission, shall be guilty of an offense and upon conviction thereof by a court of competent jurisdiction shall be pun- ished by a fine of not less than $1,000 nor more than $5,000 or by imprisonment for not more than one year, or by both such fine and imprisonment. Any person who shall willfully make, or cause to be made, any false entry or statement of fact in any report required to be made under this Act, or who shall willfully make, or cause to be made, any false entry in any account, record, or mem- orandum kept by any corporation subject to this Act, or who shall willfully neglect or fail to make, or to cause to be made, full, true, and correct entries in such accounts, rec- ords, or memoranda of all facts and transactions appertain- ing to the business of such corporation, or who shall willfully remove out of the jurisdiction of the United States, or will- fully mutilate, alter, or by any other means falsify any docu- 878 APPENDIX. mentary evidence of such corporation, or who shall willfully refuse to submit to the conamission or to any of its author- ized agents, for the purpose of inspection and taking copies, any documentary evidence of such corporation in his pos- session or within his control, shall be deemed guilty of an offense against the United States, and shall be subject, upon conviction in any court of the United States of competent jurisdiction, to a fine of not less than $1,000 nor more than $5,000, or to imprisonment for a term of not more than three years, or to both such fine and imprisonment. If any corporation required by this Act to file any annual or special report shall fail so to do within the time fixed by the commission for filing the same, and such failure shall continue for thirty days after notice of such default, the corporation shall forfeit to the United States the sum of $100 for each and every day of the continuance of such failure, which forfeiture shall be payable into the Treasury of the United States, and shall be recoverable in a civil suit in the name of the- United States brought in the district where the corporation has its principal office or in any dis- trict in which it shall do business. It shall be the duty of the various district attorneys, under the direction of the Attor- ney General of the United States, to prosecute for the re- covery of forfeitures. The costs and expenses of such prose- cution shall be paid out of the appropriation for the expenses of the courts of the United States. Any officer or employee of the commission who shall make public any information obtained by the commission without its authority, unless directed by a court, shall be deemed guilty of a misdemeanor, and, upon conviction thereof, shall be punished by a fine not exceeding $5,000, or by imprison- ment not exceeding one year, or by fine and imprisonment, in the discretion of the court. Sec. U. Nothing contained in this Act shall be construed to prevent or interfere with the enforcement of the provision of the anti-trust Acts or the Acts to regulate commerce, nor shall anything contained in the Act be construed to alter, modify, or repeal the said antitrust Acts or the Acts to regulate commerce or any part or parts thereof. Approved September 26, 1914. DESIGNATION BY CARRIERS OF AGENT AT WASHINGTON FOR SERVICE OF PROCESS. The following provision of the act creating the Commerce Court was not repealed by the Act abolishing the court as it relates to service in proceedings before the Interstate Com- merce Commission as well as the Commerce Court. See Federal Statutes, Annotated, Supp. 1912, page 111. Sec. 6. (Agent in Washington to be designated by carriers for service of process, etc. — service in default of designation.) * * * it shall be the duty of every common carrier subject to the provisions of this Act, within sixty days after the taking effect of this Act, to desig- nate in writing an agent in the city of Washington, District of Columbia, upon whom service of all notices and processes may be made for and on behalf of said common carrier in any proceeding or suit pending before the Interstate Com- merce Commission or before said Commerce Court, and to file such designation in the office of the secretary of the Interstate Commerce Commission, which designation may from time to time be changed by like writing similarly filed ; and thereupon service of all notices and processes may be made upon such common carrier by leaving a copy thereof with such designated agent at his office or usual place of residence in the city of Washington, with like effect as if made personally upon such common carrier, and in default of such designation of such agent, service of any notice or other process in any proceeding before said Interstate Commerce Commission or commerce court may be made by posting such notice or process in the office of the secretary of the Interstate Commerce Commission. (36 Stat. L. 544.) [879] FORMS OF DECREES IN ANTITRUST CASES. As illustrative of the kind and character of decrees which are entered by courts in cases under the antitrust acts, the following decrees which have heretofore been entered in litigated cases are given: 1. Decree in U. S. v. American Thread Company (S. Dist. of N. Y.) "From having by an agreement or understanding any list of wholesalers or retailers with whom trade in sewing thread shall not be carried on. "From purchasing competing plants or brands or from acquiring any interest, by stock ownership or otherwise, in the business of competitors. "From fixing by agreement with competitors trade dis- counts, rebates, terms or conditions of sale or credits, in con- nection with the sale or shipment of sewing thread. "From exacting of any purchaser any agreement to main- tain a fixed or minimum price, or refusing to trade with, or discriminating against any purchaser because of the prices at which he sells thread, unless he is selling or offering to sell at less than cost. "From giving any bonus or rebate contingent upon the aggregate of future purchases. "From co-operating with or assisting dealers to pool their orders for the purpose of securing discounts or concessions. "From using 'fighting brands,' defined to be brands re- vived or used for the purpose of being offered to customers of competitors at cut prices. "From employing 'flying squadrons' whose principal busi- ness it was to handle 'fighting brands' and solicit business from customers of competitors. "From soliciting agreements or discriminating against those dealers who handle goods of competitors. "From attacking the credit or business reputation of or the quality of thread dealt in by any competitor by false reports or insufficient warrant in fact. "From harrassing or threatening to sue without sufficient legal provocation for infringements of trade-marks or brands. "From offering or giving secret rebates to any customer of competitor. [880 J FORMS OF DECREES IN ANTI-TRDST CASES. 881 "From selling or offering to sell thread below the cost of production, or at lower prices in gne section of the United States than in another, after allowing for transportation and differences in the quality, grade or quantity sold with the intent thereby to obtain a monopoly, but with the exception that they may meet bona fide competitors' pricej, and may make different prices, etc., to different classes of customers. (The phraseology of this is almost the exact language of sec- tion two of the Clayton law.) "From offering free goods to customers in excess of five per cent of such purchases at any one time." This decree was entered by consent of parties. 2. The Decree in the Tar Product Company Case: "From entering into any contract or agreement with a competitor, a producer of coal tar, whereby such producer was restricted to whom he should sell, or the territory in which or the price at which such product shall be sold. "From making any agreement or enforcing any contract" whereby the purchaser of one line of material should be re- quired to buy from defendants or allied interests any other product. "From keeping secret their interest in other companies. "From, with the intent to injure the business of a com- petitor, selling its products at a less price to customers of competitors than to its own customers." 3. The Decree in U. S. v. Bowser (Indiana.) "From making or causing to be made to customers, pres- ent or prospective, false representations concerning the standing or business methods of competitors with the intent to injure such competitors in business; and from like rep- sentations concerning the product of competitors. "From threatening to bring suits for alleged infringements of patents, not founded in good faith, against competitors or their customers. "From hiring or bribing individuals or public officers to use their influence in promoting sales of defendants' prod- uct or in preventing sales of competitors' product. "From procuring parties to take employment with com- petitors for the purpose of securing information. "From inducing or hiring any person to secure names and addresses of competitors' customers. Defendant's own trav- eling men or employees may supply such information, if the purpose is not to injure the business of a competitor. J-58. 882 APPENDIX. "From securing or attempting to secure cancellation of orders secured by competitors. "From promising or agreeing to indemnify customers or prospective customers from losses from litigation, on condi- tion that they cancel contracts with competitors. "From reducing the price of their product below cost of production, or giving it away, in order to prevent sales by competitors or discriminating in price between different persons or localities with the purpose or intent to injure the business of competitors. "From hiring away the employees of competitors. "From committing or causing to be committed any other similar acts of unfair competition, the purpose or intent of which shall be to injure or destroy the business of any com- petitor, to substantially lessen competition in the product or otherwise restrain interstate trade or commerce, or tend to create a monopoly therein in favor of defendants." 4. Final Decree (Entered by Consent) in U. S. v. National Cash Register Co. et al in So. Dist. of Ohio (1916) This day came the parties, by their counsel, and thereupon the defendants hereinafter named, consenting not to oppose the entry of the following decree, as more fully appears by their written consent on file herein, and the plaintiff, through its counsel, having moved for an injunction, on consideration thereof the court finds for the plaintiff and against said defendants, and that the plaintiff is entitled to the rehef prayed for in the following particulars: It is therefore ordered, adjudged and decreed: First. That the defendants. The National Cash Register Company, and indictments served * * * have com- bined to restrain and have attempted to monopolize inter- state and foreign trade and commerce in cash registers in violation of sections 1 and 2 of the Anti-Trust Act of July 2, 1890, by one or another of the means hereinafter enjoined. Second. That the defendant, The National Cash Register Company, its directors, officers, agents and employees, and the individual defendants, their employees, agents, and serv- ants, and any other persons authorized to act or acting for or in behalf of any of them, be and they are hereby jointly and severally enjoined and restrained as follows: (a) From persuading or inducing, or attempting to per- suade or induce, a pui chaser of a cash register or other registering device manufactured or sold by any competitor, or a person who has agreed or contracted to become such purchaser, to break or repudiate his contract of purchase. FORMS OF DECREES IN ANTI-TRUST CASES. '883 or to return or refuse to receive the cash register or other registering device so bought or agreed to be bought, or to refuse to pay for the same in accordance with his agreement with said competitor. (b) From espionage upon a competitor or his agent, or a solicitor of a competitor, or upon a retail dealer in the cash registers or other registering devices of a competitor, for the purpose ^f obtaining the names or addresses of purchasers or prospective purchasers from any such competitor or retail dealer, or for the purpose of obtaining any other information as to his private affairs or business; and from using any infor- mation so obtained in Drder to dissuade or endeavor to dis- suade any person or persons from purchasing any cash register or other registering device manufactured or sold by a competitor. (c) From inducing, or attempting to induce, either directly or through another, any employee or ex-employee of any competitor, or of his agent, or dealer, to disclose to said defendants, or to either of them or to any person for them oi for either of them, the business secrets of his employer or former employer. (d) From inducing, or attempting to induce, any employee or agent of a competitor, or any dealer in the cash registers or registering devices of a competitor, to leave the service of such competitor or to cease to deal in such competitor's cash registers or other registering devices, and from employ- ing or attempting to employ any such agent or employee so induced to leave the service of a competitor, or any such dealer so induced to cease dealing in the cash registers or other registering devices of a competitor, as an agent or employee of the defendant corporation or any company organized as a successor to its business in whole or in part. (e) From using any information as to the trade secrets or business confidences of any competitor which shall have been derived from any person who shall have been in the employ of any such competitor and which shall have been obtained by him in the course or by means of such employment. (f) From manufacturing, selling or offering for sale any cash register or other registering device made to resemble in appearance a competing register or registering device, or producing, or designed to produce, the same or similar results, or performing, or designed to perform, the same or similar functions, when sold or offered for sale, not in good faith for the purpose of earning profits therefrom, but for the dominant purpose of preventing sales of such competing cash registers or registering devices, or of inducing the pur- chaser or owner of the competing cash register or registering device to substitute therefor one of such similar machines; or from seUing any cash register or registering device at a 884 APPENDIX. price fixed with reference not to the cost of manufacture but solely with reference to the price of the said competing cash register or registering device, for the purpose of driving from business in interstate or foreign commerce the manufacturer of or dealer in such competing cash registers or other register- ing devices. (g) From selling or otherwise disposing of any cash register or other registering device manufactured by a competitor, whether acquired by purchase, exchange or otherwise, not for the purpose of realizing therefrom as much as practicable but for the dominant purpose or intent of preventing sales by a competitor or retail dealer in the cash registers or registering devices of a competitor; and from acquiring any such cash register or other registering device, manufactured by any competitor, for any of the purposes specified in this sub-paragraph of this decree. (h) From selling or otherwise disposing of any second-hand cash register or other registering device of the defendant's own make for the purpose not of realizing therefrom as much as practicable but for the dominant purpose of underselling a competitor and driving him from business; Provided, that nothing herein contained shall prevent any sale or offer at a price made in good faith to meet competition. (i) From employing any person, whether known as a "special man," or "competition man," hereby defined to be an employee, to have as his principal business not the pro- motion of the sale of the cash registers or other registering devices of the make of the defendants, or the solicitation of orders therefor, but the prevention of sales of cash registers or other registering devices by a competitor, or his agent, or dealer. (j) From following from one city or village to another, or from one place in the same city or village to another place therein, any competitor, or his salesman, or agent, or any dealer in a competitive cash register or other registering device, for the purpose of interfering with or hindering such competitor, salesman, agent, employee, or dealer, while attempting to sell any cash register or other registering device, or for the purpose of ascertaining the names of the persons upon whom, or the places of business at which, such competitor, salesman, agent, employee, or dealer, may call. (k) From making, or circulating, or causing to be made or circulated, any statement, report, representation, or insinua- tion reflecting upon the solvency or responsibility, financially or otherwise, of any competitor, or upon the efficiency of any competing cash register or other registering device, when such statement, report, representation, or insinuation is either a misrepresentation or is made for the mere purpose, not of directly promoting the sale of registers or other registering FORMS OF DECREES IN ANTI-TRUST CASES. 885 devices manufactured by defendants, but of preventing the sale of competing cash registers or other registering devices or of driving such competitor from business. (1) From using or publishing, or causing to be used or published, any document, circular, or letter, the purpose or intent of which is to recommend or suggeot to agents or employees of the defendants the doing of any act herein forbidden; and from in any manner communicating to >uch agents or employees any means of accomphshing or bringing about any such act. (m) From intimidating, or attempting or threatening to intimidate any competitor or any person contemplating becoming a competitor in the manufacture or sale of cash registers or ocher registering devices in interstate or foreign commerce by maintaining or making a display of models of machines of the defendants' make, together with various rival machines which they were built to resemble or to displace, or by maintaining or making a display of quantities of second-hand registers or other registeiing devices of a compotitor, or by displaying placards or statements pur- porting to show the amounts lost by vaious competitors in an effort to compete with the defendant corporation, or its piedecessors, and f'-om intimidating, or attempting or threatening to intimidate, by any such means, investors or persons contemplating becoming investors in the stocks or other securities of competing companies formed or to be formed. (n) From maintaining as an ostensible competitor any corporation or organization owned, directed or controlled, by stock ownership or otherwise, by said defendants or any of them, or affiliated with them, or any of them, without dis- closing the connection with the said defendants. (o) From intimidating, or attempting or threatening to intimidate purchasers or prospective purchasers of compet'ng cash reg'sters or other registering devices, with suit or liabil- ity for patent inlringement unless and until such claim of infringement has been sustained by a court of competent jurisdiction. But nothing herein contained shall prevent defendant corporation or its proper representative from serv- ing in good faith upon any such purchaser a formal notice of its claim of infringement. (p) From acquiring ownership or control directly or in- directly, by means of stock ownership or otherwise, of the whole or an essential part of the business, patents, or plant of any competitor engaged in the manufacture or sale of cash registers or other registering devices in interstate or foreign commerce; Provided, that in case any such acquisi- tion is desired, a petition may be presented to this court stating the reasons therefor, and if the court upon investiga- 886 APPENDIX. tion into all the circumstances of the case and after notice of not less than sixty days to the Attorney General shall determine that such business or patents or plant so desired to be acquired will supplement the plant, patents, machines, Of facilities of the defendant corporation and that the acquisition thereof is desired for that purpose and will not substantially lessen competition, then jurisdiction is reserved to pass an order permitting the same upon such terms and conditions as may be right. Third. That jurisdiction of this cause be and is hereby retained for the purpose of enforcing this decree, and for the purpose of enabling the parties to apply to the court for modi- fication hereof if it be hereafter shown to the satisfaction of the court that by reason of changed conditions or changes in the statute law of the United States the provisions heieof have become inappropriate or inadequate to maintain com- petitive conditions in interstate or foreign trade in cash registers or other registering devices in the United States, or have become unduly oppressive to the defendants and are no longer necessary to secure or maintain competitive conditions in such interstate and foreign trade. Fourth. That defendants pay the costs of this suit to be taxed. FEDERAL TRADE COMMISSION. Rules of Practice before the Commission. [Adopted June 17, 1915.]* I. Sessions Page 42 II. Complaints., III. Answers IV. Service : V. Intervention VI. Continuance and extensions of time. ... VII. Witnesses and subpoenas VIII. Depositions in contested proceedings. IX. Documentary evidence X. Briefs XI. Address of the Commission 42 43 43 43 43 44 44 45 45 45 I. Sessions. The principal office of the Commission at Washington, D. C, is open each business day from 9 a. m. to 4:30 p. m. The Commission may meet and exercise all its powers at any other place, and may, by one or more of its members, or by such examiners as it may designate, prosecute any in- quiry necessary to its duties in any part of the United States. Sessions of the Commission for hearing contested proceed- ings will be held as ordered by the Commission. Sessions of the Commission for the purpose of making orders and for the transaction of other business, unless other- wise ordered, will be held at the office of the Commission at Washington, D. C, on each business day at 10:30 a. m. Three members of the Commission shall constitute a quorum for the transaction of business. All orders of the Commission shall be signed by the secre- tary. II. Complaints. Any person, partnership, corporation, or association may apply to the Commission to institute a proceeding in respect to any violation of law over which the Commission has jurisdiction. 'Released for publication, June 26, 1915. ( 887 ] 888 APPENDIX. Such application shall be in writing, signed by or in be- half of the applicant, and shall contain a short and simple statement of the facts constituting the alleged violation of law and the name and address of the appUcant and of the party complained of. The Commission shall investigate the matters complained of in such application, and if upon investigation it shall ap- pear to the Commission that there is a violation of law over which the Commission has jurisdiction, the Commission shall issue and serve upon the party complained of a complaint stating its charges and containing a notice of a hearing upon a day and at a place therein fixed at least 40 days after the service of said complaint. III. Answers. Within 30 days from the service of the complaint, unless such time be extended by order of the Commission, the de- fendant shall file with the Commission an answer to the complaint. Such answer shall contain a short and simple statement of the facts which constitute the ground of de- fense. It shall specifically admit or deny or explain each of the facts alleged in the complaint, unless the defendant is without knowledge, in which case he shall so state, such statement operating as a denial. Answers in typewriting must be on one side of the paper only, on paper not more than 8| inches wide and not more than 11 inches long, and weighing not less than 16 pounds to the ream, folio base, 17 by 22 inches, with left-hand margin not less than 1^ inches wide, or they may be printed in 10 or 12 point type on good unglazed paper 8 inches wide by 10| inches long, with inside margins not less than 1 inch wide. IV. Service. Complaints, orders, and other processes of the Commis- sion may be served by anyone duly authorized by the Com- mission, either (a) by delivering a copy thereof to the person to be served, or to a member of the partnership to be served, or to the president, secretary, or other executive officer, or a director, of the corporation or association to be served; or (b) by leaving a copy thereof at the principal office or place of business of such person, partnership, corporation, or asso- ciation; or (c) by registering and mailing a copy thereof ad- dressed to such person, partnership, corporation, or associa- tion at his or its principal office or place of business. The verified return by the person so serving said complaint, order, or other process, setting forth the manner of said FEDERAL TRADE COMMISSION. 889 service, shall be proof of the same, and the return post-ofFice receipt for said complaint, order, or other process, regis- tered and mailed as aforesaid, shall be proof of the service of the same. V. Intervention. Any person, partnership, corporation, or association de- siring to intervene in a contested proceeding shall make ap- plication in writing, setting out the grounds on which he or it claims to be interested. The Commission may, by order, permit intervention by counsel or in person to such extent and upon such terms as it shall deem just. Apphcations to intervene must be on one side of the paper only, on paper not more than 8| inches wide and not more than 11 inches long, and weighing not less than 16 pounds to the ream, folio base, 17 by 22 inches, with left- hand margin not less than 1| inches wide, or they may be printed in 10 or 12 point type on good unglazed paper 8 inches wide by lOJ inches long, with inside margins not less than 1 inch wide. VI. Continuances and Extensions of Time. Continuances and extensions of time will be granted at the discretion of the Commission. VII. Witnesses and Subpoenas. Witnesses shall be examined orally, except that for good and exceptional cause for departing from the general rule the Commission may permit their testimony to be taken by deposition. Subpoenas requiring the attendance of witnesses from any place in the United States at any designated place of hearing may be issued by any member of the Commission. Subpoenas for the production of documentary evidence (unless directed to issue by a Commissioner upon his own motion) will issue only upon application in writing, which must be verified and must specify, as near as may be, the documents desired and the facts to be proved by them. Witnesses summoned before the Commission shall be paid the same fees and mileage that are paid witnesses in the courts of the United States, and witnesses whose depositions are taken, and the persons taking the same, shall severally be entitled to the same fees as are paid for like services in the courts of the United States. 890 APPENDIX. VIII. Depositions in Contested Proceedings. The Commission may order testimony to be taken by deposition in a contested proceeding. Depositions may be taken before any person designated by the Commission and having power to administer oaths. Any party desiring to take the deposition of a witness shall make application in writing, setting out the reasons why such deposition should be taken, and stating the time when, the place where, and the name and post-office address of the person before whom it is desired the deposition be taken, the name and post-office address of the witness, and the subject matter or matters concerning which the witness is expected to testify. If good cause be shown, the Commis- sion will make and serve upon the parties, or their attorneys, an order wherein the Commission shall name the witness whose deposition is to be taken and specify the time when, the place where, and the person before whom the witness is to testify, but such time and place, and the person before whom the deposition is to be taken, so specified in the Com- mission's order, may or may not be the same as those named in said application to the Commission. The testimony of the witness shall be reduced to writing by the officer before whom the deposition is taken, or under his direction, after which the deposition shall be subscribed by the witness and certified in usual form by the officer. After the deposition has been so certified it shall, together with a copy thereof made by such officer or under his direc- tion, be forwarded by such officer under seal in an envelope addressed to the Commission at its office in Washington, D. C. Upon receipt of the deposition and copy the Commis- sion shall file in the record in said proceeding such deposition and forward the copy to the defendant or the defendant's attorney. Such depositions shall be typewritten on one side only of the paper, which shall be not more than 8i inches wide and not more than 11 inches long and weighing not less than 16 pounds to the ream, folio base, 17 by 22 inches, with left- hand margin not less than 1^ inches wide. No deposition shall be taken except after at least 6 days' notice to the parties, and where the deposition is taken in a foreign country such notice shall be at least 15 days. No deposition shall be taken either before the proceeding is at issue, or, unless under special circumstances and for good cause shown, within 10 days prior to the date of the hearing thereof assigned by the Commission, and where the deposition is taken in a foreign country it shall not be taken after 30 days prior to such date of hearing. FEDERAL TRADE COMMISSION. IX. Documentary Evidence. 891 Where relevant and material matter offered in evidence is embraced in a document containing other matter not mate- rial or relevant and not intended to be put in evidence, such document will not be filed, but a copy only of such relevant and material matter shall be filed. X. Briefs. Unless otherwise ordered, briefs may be filed at the close of the testimony in each contested proceeding. The presid- ing Commissioner or examiner shall fix the time within which briefs shall be filed and service thereof shall be made upon the adverse parties. All briefs must be filed with the Secretary and be accom- panied by proof of service upon the adverse parties. Fifteen copies of each brief shall be furnished for the use of the Com- mission, unless otherwise ordered. Application for extension of time in which to file any brief shall be by petition in writing, stating the facts upon which the application rests, which must be filed with the Commis- sion at least five days before the time for filing the brief. Every brief shall contain, in the order here stated — (1) A concise abstract, or statement of the case. (2) A brief of the argument, exhibiting a clear statement of the points of fact or law to be discussed, with the reference to the pages of the record and the authorities relied upon in support of each point. Every brief of more than ten pages shall contain on its top fly leaves a subject index with page references, the subject index to be supplemented by a list of all cases referred to, alphabetically arranged, together with references to pages where the cases are cited. Briefs must be printed in 10 or 12 point type on good un- glazed paper 8 inches by 10| inches, with inside margins not less than 1 inch wide, and with double-leaded text and single- leaded citations. Oral arguments will be had only as ordered by the Com- mission. XI. Address of the Commission. All communications to the Commission must be addressed to Federal Trade Commission, Washington, D. C, unless otherwise specifically directed. 892 APPENDIX. RULES OF PRACTICE BEFORE THE COMMISSION IN CASES AND PROCEEDINGS UNDER THE ACT TO REGULATE COMMERCE. I. PUBLIC SESSIONS. Sessions of the Commission for hearing contested cases, including oral arguments, will be held as ordered by the Commission. The office of the Commission at Washington, D. C, is open each business day from 9 a. m. to 4:30 p. m. II. PARTIES TO CASES. Any person, firm, company, corporation, or association, mercantile, agricultural, or manufacturing society, body poli- tic or municipal organization, or any common carrier, or the railroad commissioner or commission of any State or Terri- tory, may complain to the Commission of anything done, or omitted to be done, in violation of the provisions of the act to regulate commerce by any common carrier subject to the provisions of said act. If a complaint relates to matters in which two or more carriers, engaged in transportation by continuous carriage or shipment, are interested, the several carriers participating in such carriage or shipment are neces- sary parties defendant. If a complaint relates to rates, regulations, or practices of carriers operating different lines, and the object of the pro- ceeding is to secure correction of such rates, regulations, or practices on each of said lines, all the carriers operating such lines should be made defendants. If a complaint relates to provisions of a classification it will ordinarily be sufficient to name as defendants the princi- pal carriers named as parties to the classification. If the line of a carrier is operated by a receiver or trustee, both the carrier and its receiver or trustee must be made de- fendants in cases involving transportation over such line. Any person may petition in any proceeding for leave to intervene prior to or at the time of the hearing and not after. Such petition shall set forth the petitioner's interest in the proceedings, but intervention will not be permitted, except upon allegations that are reasonably pertinent to the issues of the original complaint. Leave granted on such petition will entitle such intervenors to have notice of hearings, to RULES OF PRACTICE. 893 produce and cross-examine witnesses, and to be heard in per- son or by counsel upon brief and at the oral argument. III. COMPLAINTS. Complaints must be in typewriting on one side of the paper only, on paper not more than 8^ inches wide and not more than 12 inches long, and weighing not less than. 16 pounds to the ream, folio base, 17 by 22 inches, with left- hand margin not less than 1| inches wide, setting forth briefly the facts claimed to constitute a violation of the law. Com- plaints may also be printed in the size designated in Rule XIV regarding briefs. The corporate name of the carrier or car- riers complained against must be stated in full without abbreviations, and the address of the complainant, with the name and address of his attorney or counsel, if any, must appear upon each copy of the complaint. The complaint need not be verified, but must be signed in ink by the com- plainant or his duly authorized attorney. The complainant must furnish as many complete copies of the complaint as there may be parties complained against to be served, in- cluding receiver or receivers, and three additional copies for the use of the Commission. The Commission will serve the complaint upon each de- fendant by leaving a copy with its agent in the District of Columbia, or, if no such agent has been designated, by post- ing a copy in the office of the Secretary of the Commission. Two or more complaints involving the same principle, subject, or state of facts may be included in one complaint. The several rates, regulations, discriminations, and ship- ments involved should be separately set out and in case dis- crimination in rates or charges is alleged, appropriate alle- gation should also be made to present for decision the issue as to whether or not such rates or charges are just and rea- sonable. One or more persons may join in one complaint against one or more carriers if the subject matter of the com- plaint 'nvolves substantially the same principle, subject, or state of facts. Except under unusual circumstances and for good cause shown, reparation will not be awarded unless specifically prayed for in the complaint or in an amendment thereto filed before the submission of the case. After a final order has been entered upon a complaint in which reparation is not sought or, if prayed, has been denied, the Commission will not ordinarily award reparation upon a complaint subsequently filed and based upon any finding upon the first complaint. 894 APPENDIX. Where reparation is demanded under a general rate ad- justment challenged in the complaint, or upon many ship- ments under a particular rate, or where many points of ori- gin or destination are involved, it is the practice of the Com- mission first to determine and make a formal announcement respecting the reasonableness of the rate or rates in issue, and whether the facts justify an award of reparation, giving to the parties thereafter an opportunity to make proof re- specting the shipments upon which reparation is claimed. Freight bills and other exhibits must therefore be reserved until such further hearing and must not be filed with the complaint. In such cases the complaint, without unneces- sary details, should disclose in general terms the basis and extent of the damages demanded in such manner as reason- ably to advise the defendants thereof. When a claim for reparation has been before the Com- mission informally and the parties have been notified by the Commission that the claim is of such a nature that it can not be determined informally, formal complaint must be filed within six months after such notification, or the parties will be deemed to have abandoned their claim: Provided, how- ever. That this rule does not apply to formal complaints for reparation filed within two years from the date of the de- livery of the shipments. IV. ANSWERS. One copy of each answer must, unless the Commission orders otherwise, be filed with the secretary of the Commis- sion at his office in Washington, D. C, within 30 days after the day of service of the complaint by defendants whose general offices are at or west of El Paso, Tex., Salt Lake City, Utah, or Spokane, Wash., and within 20 days by all other defendants, and a copy of each such answer must be at the same time served personally or by mail upon the com- plainant or his attorney. The Commission will, when advis- able, shorten or extend the time for answer. If a defendant satisfies a complaint before answering, a written acknowl- edgment thereof, showing the character and extent of the satisfaction given, must be filed by the complainant. In such case a statement of the fact and manner of satisfaction with- out other matter may be filed as answer. If the complaint is satisfied after the fihng and service of answer, a written acknowledgment thereof must be filed by the complainant and a supplemental answer setting forth the fact and manner of satisfaction must be filed by the defendant. Answers in typewriting must be on one side of the paper only, on paper RULES OF PEACTICE. 895 not more than 8| inches wide and not more than 12 inches long and weighing not less than 16 pounds to the ream, folio base, 17 by 22 inches, with left-hand margin not less than 1 J inches wide, or may be printed in the size designated in Rule XIV regarding briefs. V. MOTION TO DISMISS. A defendant who deems the complaint insufTicient to show a breach of legal duty may, instead of answering or formally demurring, serve on the complainant notice of hearing on the complaint; and in such case the facts stated in the complaint will be deemed admitted. A copy of the notice must at the same time be filed with the secretary of the Commission. The filing of an answer, however, will not be deemed an admission of the sufficiency of the complaint, but a motion to dismiss for insuflficiency may be made at the hearing. VI. SERVICE OF PAPERS. Copies of notices or papers, other than complaints, pre- sented by a party must be served upon the adverse party or parties personally or by mail. When any party has ap- peared by attorney, service upon such attorney will be deemed proper service upon the party. VII. AMENDMENTS. Amendments to any complaint or answer in any proceed- ing or investigation will be allowed by the Commission at its discretion. VIII. CONTINUANCES AND EXTENSIONS OF TIME. Continuances and extensions of time will be granted at the discretion of the Commission. IX. STIPULATIONS. Parties to any proceeding may, by stipulation in writing filed with the secretary, agree upon the facts, or any por- tion thereof, involved therein. It is desired that the facts be thus agreed upon whenever practicable. 896 APPENDIX. X. HEARINGS. Upon issue being joined by service of answer or by notice of hearing on the complaint, or by failure of defendant to answer, the Commission will assign a time and place for hearing. Witnesses will be examined orally before the Com- mission or one of its examiners, unless their testimony be taken by deposition or the facts be agreed upon as provided for in these rules. XI. DEPOSITIONS. The deposition of a witness for use in a case pending be- fore the Commission may, after such case is at issue, be taken upon compliance with the following rules of procedure, which are prescribed by the Commission under authority con- ferred upon it by section 17 of the act, but not otherwise. Such depositions may be taken before a special agent or examiner of the Commission, or any judge or commissioner of any court of the United States, or any clerk of a district court, or any chancellor, justice, or judge of a supreme or superior court, mayor or chief magistrate of a city, judge of a county court or court of common pleas of any of the United States, or any notary public, not being of counsel or attor- ney to either of the parties, nor interested in the event of the proceeding or investigation, according to such designation as the Commission may make in any order made by it in the premises, except that where such deposition is taken in a foreign country it may be taken before an officer or person designated by the Commission or agreed upon by the parties by stipulation in writing to be filed with the Commission. Any party desiring to take the deposition of a witness in such a case shall notify the Commission to that effect, and in such notice shall state the time when, the place where, and the name and post-office address of the party before whom it is desired the deposition be taken, the name and post-office address of the witness, and the subject matter or matters concerning which the witness is expected to testify, whereupon the Commission will make and serve upon the parties or their attorneys an order wherein the Commission shall name the witness whose deposition is to be taken and specify the time when, the place where, and the party be- fore whom the witness is to testify, but such time and place, and the party before whom the deposition is to be taken, so specified in the Commission's order, may or may not be the same as those named in said notice to the Commission. RULES OF PRACTICE. 897 Every person whose deposition is so taken shall be cau- tioned and take oath (or affirm) to testify the whole truth and nothing but the truth concerning the matter about which he shall testify, and shall be carefully examined. His testi- mony shall be reduced to typewriting by the officer before whom the deposition is taken, or under his direction, after which the deposition shall be subscribed by the witness and certified in usual form by the officer. After the deposition has been so subscribed and certified it shall, together with two copies thereof made by such officer or under his direc- tion, be forwarded by such officer under seal in an envelope addressed to the Commission at its office in Washington, D. C. Upon receipt of the deposition and copies the Com- mission will file in the record in said case such deposition and forward one copy to the complainant or his attorney, and the other copy to the defendant or its attorney, except that where there is more than one complainant or defendant the copies will be forwarded by the Commission to the par- ties designated by such complainants or defendants as the case may be. Such depositions shall be typewritten on one side only of the paper, which shall be not more than 8| inches wide and not more than 12 inches long and weighing not less than 16 pounds to the ream, foho base, 17 by 22 inches, with left- hand margin not less than 1| inches wide. No deposition shall be taken except after 6 days' notice to the parties, and where the deposition is taken in a foreign country such notice shall be at least 15 days. No such deposition shall be taken either before the case is at issue or, unless under special circumstance and for good cause shown, within 10 days prior to the date of the hearing thereof assigned by the Commission, and where the deposi- tion is taken in a foreign country it shall not be taken after 30 days prior to such date of hearing. Witnesses whose depositions are taken pursuant to these rules and the magistrate or the officer taking the same, unless he be an examiner of the Commission, shall severally be en- titled to the same fees as are paid for like service in the courts of the United States, which fees shall be paid by the party or parties at whose instance the depositions are taken. XII. WITNESSES AND SUBPOENAS. Subpoenas requiring the attendance of witnesses from any place in the United States to any designated place of hearing may be issued by any member of the Commission. J-57. 898 APPENDIX. Subpoenas for the production of books, papers, or docu- ments (unless directed to issue by the Commission upon its own motion) will issue only upon application in writing. Applications to compel witnesses not parties to the proceed- ing to produce documentary evidence must be verified and must specify, as near as may be, the books, papers, or docu- ments desired, and the facts to be proven by them. Appli- cations to compel a party to the proceeding to produce books, papers, or documents need only set forth in a general way the books, papers, or documents sought, with a statement that the applicant believes they will be of service in the de- termination of the case. Witnesses whose testimony is taken orally are severally entitled to the same fees as are paid for like services in the courts of the United States, such fees to be paid by the party at whose instance the testimony is taken. XIII. DOCUMENTARY EVIDENCE. Where relevant and material matter offered in evidence is embraced in a document containing other matter not ma- terial or relevant and not intended to be put in evidence, such document will not be filed, but the party offering the same shall also present to opposing counsel and to the Com- mission in proper form for fihng copies of such material and relevant matter, and that only shall be filed. In case any portion of a tariff, report, circular, or other document on file with the Commission is offered in evidence, the party offering the same must give specific reference to the items or pages and lines thereof to be considered. In case any testimony in other proceedings than the one on hearing is introduced in evidence, a copy of such testimony must be presented as an exhibit. When exhibits of a docu- mentary character are offered in evidence, two copies should be furnished at the hearing for the use of the Commission and a copy for each of the principal parties represented. XIV. BRIEFS. Unless otherwise specifically ordered, briefs may be filed upon application made at hearings or upon order of the Com- mission. Briefs shall be printed and contain an abstract of the evidence relied upon by the parties filing the ^ame; and in such abstract reference shall be made to the pages of the record wherein the evidence appears. The abstract of evi- dence should follow the statement of the case and precede RULES OF PRACTICE. 899 the argument. Every brief of more than 10 pages shall con- tain on its front fly leaves a subject index with page refer- ences, the subject index to be supplemented by a list of all cases referred to alphabetically arranged, together with ref- erences to pages where the cases are cited. Briefs must be printed in 10 or 12 point type, on good unglazed paper, 5| inches wide by 9 inches long, with inside margins not less than 1 inch wide, and with double-leaded text and single- leaded citations. At the close of the testimony in each case the presiding commissioner or examiner will fix the time for filing and service of the respective briefs, as follows, unless good cause for variation therefrom is shown: To the complainant, 30 days from date of conclusion of the testimony; to the defend- ants and interveners, 15 days after the date fixed for the com- plainant; and to complainant for reply brief, 10 days after the date fixed for defendants or interveners. Briefs not filed and served on or before the dates fixed therefor will not be received unless a special order therefor is made by the Com- mission. All briefs must be filed with the secretary and be accompanied by notice, showing service upon the adverse parties, and 15 copies of each brief shall be furnished for the use of the Commission, unless otherwise ordered. Applica- tions for extension of time in which to file briefs shall be by petition, in writing, stating the facts on which the applica- tion rests, which must be filed with the Commission at least five days before the time for filing such brief. Oral argument will be had only as ordered by the Com- mission. Applications therefor must be made at the hearing or in writing within 10 days after the completion of proof. XV. REHEARINGS. Applications for reopening a case after final submission, or for rehearing after decision, must be by petition stating specifically the grounds relied upon; such petition must be served by the party filing same upon the opposing counsel who appeared at the hearing or on brief. If such application be to reopen the case for further evi- dence, the nature and purpose of such evidence must be briefly stated, and the same must not be merely cumulative. If the appUcation be for a rehearing, the petition must specify the matters claimed to be erroneously decided, with a brief statement of the alleged errors. If any order of the Commission is sought to be reversed, changed, or modified on account of facts and circumstances arising subsequent to the hearing, or of consequences resulting from compliance 900 APPENDIX. therewith, the matters relied upon by the applicant must be fully set forth. At least 10 copies of all such applications must be filed. XVI. TRANSCRIPTS OF TESTIMONY. One copy of the testimony will be furnished by the Com- mission for the use of the complainant and one copy for the use of the defendant, without charge. If two or more com- plainants or defendants have appeared at the hearing, such complainants or defendants must designate to whom the copy for their use shall be delivered. In proceedings instituted by the Commission on its own motion, including proceedings involving the suspension of tariffs, no free copies of testimony will be furnished. XVII. COMPLIANCE WITH ORDERS. An order having been issued, the defendant or defendants named therein must promptly notify the secretary of the Commission on or before the date upon which such order becomes effective, whether or not compliance has been made therewith. If a change in rates is required, the notification to the secretary must be given in addition to the filing of proper tariffs. XVIII. APPLICATIONS UNDER FOURTH SECTION. Any common carrier may apply to the Commission, under the proviso clause of the fourth section, for authority to charge for the transportation of like kind of property less for a longer than for a shorter distance over the same line, in the same direction, the shorter being included within the longer distance, or for authority; to charge more as a through rate than the aggregate of the intermediate rates subject to the act. Such application shall be by petition, which shall specify the places and traffic involved, the rates charged on such traffic for the shorter and longer distances, the carriers other than the petitioner which may be interested in the traffic, the character of the hardship claimed to exist, and the extent of the relief sought by the petitioner. Upon the filing of such a petition, the Commission will take such ac- tion as the circumstances of the case require. EULES OF PRACTICE. 901 XIX. SUSPENSIONS. Suspensions of rates under section 15 of the act to regu- late commerce will not ordinarily be made unless request in writing therefor is made at least 10 days before the time fixed in the tariff for such rates to take effect. Requests for suspension must indicate the schedule affected by the I. C. C. number and give specific reference to the parts thereof com- plained against, together with a statement of the grounds thereof. XX. INFORMATION TO PARTIES. The secretary of the Commission will, upon request, ad- vise any party as to the form of complaint, answer, or other paper necessary to be filed in the case. XXI. ADDRESS OF THE COMMISSION. All communications to the Commission must be addressed to Washington, D. C, unless otherwise specifically directed. 902 APPENDIX. FORMS. These forms may be used in cases to which they are applicable, with such alterations as the circumstances may render necessary. No. 1. Complaint. BEFORE THE INTERSTATE COMMERCE COMMISSION. Insert corporate title, without abbreviation, of carrier {or carriers) necessary defendants. vs. The Railroad Company, — — Railway Company. The complaint of the above-named complainant respect- fully shows: I. That {complainant should here state occupation and place of business, also whether it is a corporation, firm, or partner- ship, and if a firm or partnership, the individual names of the parties composing the same should be given). II. That the defendant (defendants) above named is a common carrier (common carriers) engaged in the trans- portation of passengers and property, wholly by railroad (partly by railroad and partly by water), between points in the State of and points in the State of , and as such common carrier (carriers) is (are) subject to the provisions of the act to regulate commerce approved Feb- ruary 4, 1887, and acts amendatory thereof or supplementary thereto. III. That {state in this and in subsequent paragraphs, to be numbered numerically, the matter or matters iritended to be complained of, naming every rate, rule, regulation, or prac- tice whose lawfulness is challenged, and also each point of origin and point of destination between which the rates com- plained of are applied). {Following this a paragraph or paragraphs should be in- serted alleging thai by reason of the facts stated in the fore- going paragraphs complainant {complainants) has {have) been subjected to the payment of rates of transportation which were when exacted, and still are, unjust and unreasonable in viola- tion of section 1 of the act to regulate commerce, or unduly dis- criminatory in violation of sections 2, 3, or 4 thereof.) FORMS. 903 Wherefore complainant prays that defendants may be severally required to answer the charges herein; that after due hearing and investigation an order be made commanding said defendants and each of them to cease and desist from the aforesaid violation of said act to regulate commerce, and establish and put in force and apply as maxima in future to the transportation of between the shipping and destination points named in paragraph hereof, in lieu of the rates named in said paragraph, such other rates as the Commission may deem reasonable and just (and also pay to complainants by way of reparation for the unlawful charges hereinbefore described the sum of , or such other sum as, in view of the evidence to be adduced herein, the Commission may consider complainant entitled to), and that such other and further order or orders be made as the Commission may consider proper in the premises and com- plainant's cause may appear to require. Dated at , 19—. [Complainant's signature.] No. 2. Answer. BEFORE THE INTERSTATE COMMERCE COMMISSION. VS. > The Railroad Company, j The above-named defendant, for answer to the complaint in this proceeding, respectfully states: 1. {Here follow the usual admissions, denials, and aver- ments, answering the complaint paragraph by paragraph.) Wherefore the defendant prays that the complaint in this proceeding be dismissed. The Railroad Company, By , [Title of officer.] 904 APPENDIX No. 3. Notice by Carrier under Rule V. INTERSTATE COMMERCE COMMISSION. VS. > The Railroad Company. J Notice is hereby given under Rule V of the Rules of Prac- tice in proceedings before the Commission that a hearing is desired in this proceeding upon the facts as stated in the complaint. The — — — Railroad Company, By , [Title of officer.] THE ACT OF 1913 ABOLISHING THE COMMERCE COUBT. 905 THE ACT OF 1913 ABOLISHING THE COMMERCE COURT. (Commerce Court abolished — jurisdiction to vest in district courts.) * * * The Commerce Court, cre- ated and established by the Act entitled "An Act to create a Commerce Court and to amend the Act entitled 'An act to regulate commerce,' approved February fourth, eighteen hundred and eighty-seven, as heretofore amended, and for other purposes," approved June eighteenth, nineteen hundred and ten, is abolished from and after December thirty-first, nineteen hundred and thirteen, and the juridiction vested in said Commerce Court by said Act is transferred to and vested in the several district courts of the United States, and all Acts or parts of Acts in so far as they relate to the establishment of the Commerce Court are repealed. Nothing herein contained shall be deemed to affect the tenure of any of the judges now acting as circuit judges by appointment under the terms of said Act, but such judges shall continue to act under assignment, as in the said Act provided, as judges of the district courts and circuit courts of appeals; and in the event of and on the death, resignation, or removal from office of any of such judges, his office is hereby abolished and no successor to him shall be appointed. The venue of any suit hereafter brought to enforce, sus- pend, or set aside, in whole or in part, any order of the Inter- state Commerce Commission shall be in the judicial district wherein is the residence of the party or any of the parties upon whose petition the order was made, except that where the order does not relate to transportation or is not made upon the petition of any party the venue shall be in the district where the matter complained of in the petition before the commission arises, and except that where the order does not relate either to transportation or to a matter so com- plained of before the commission the matter covered by the order shall be deemed to arise in the district where one of the petitioners in court has either its principal office or its principal operating office. In case such transportation re- lates to a through shipment the term "destination" shall be construed as meaning final destination of such shipment. The procedure in the district courts in respect to cases of which jurisdiction is conferred upon them by this Act shall be the same as that heretofore prevailing in the Commerce Court. The orders, writs, and processes of the district courts may in these cases run, be served, and be returnable any- where in the United States; and the right of appeal from the 906 APPENDIX. district courts in such cases shall be the same as the right of appeal heretofore prevailing under existing law from the Commerce Court. No interlocutory injunction suspending or restraining the enforcement, operation, or execution of, or setting aside, in whole or in part, any order made or en- tered by the Interstate Commerce Commission shall be issued or granted by any district court of the United States, or by any judge thereof, or by any circuit judge acting as district judge, unless the application for the same shall be presented to a circuit or district judge, and shall be heard and determined by three judges, of whom at least one shall be a circuit judge, and unless a majority of said three judges shall concur in granting such application. When such appli- cation as aforesaid is presented to a judge, he shall imme- diately call to his assistance to hear and determine the ap- plication two other judges. Said application shall not be heard or determined before at least five days' notice of the hearing has been given to the Interstate Commerce Com- mission, to the Attorney General of the United States, and to such other persons as may be defendants in the suit: Provided, That in cases where irreparable damage would otherwise ensue to the petitioner, a majority of said three judges concurring, may, on hearing, after not less than three days' notice to the Interstate Commerce Commission and the Attorney General, allow a temporary stay or suspen- sion, in whole or in part, of the operation of the order of the Interstate Commerce Commission for not more than sixty days from the date of the order of said judges pending the application for the order or injunction, in which case the said order shall contain a specific finding, based upon evi- dence submitted to the judges making the order and identi- fied by reference thereto, that such irreparable damage would result to the petitioner and specifying the nature of the damage. The said judges may, at the time of hearing such application, upon a hke finding, continue the temporary stay or suspension in whole or in part until decision upon the appUcation. The hearing upon such application for an in- terlocutory injunction shall be given precedence and shall be in every way expedited and be assigned for a hearing at the earliest practicable day after the expiration of the notice hereinbefore provided for. An appeal may be taken direct to the Supreme Court of the United States from the order granting or denying, after notice and hearing, an interlocu- tory injunction, in such case if such appeal be taken within thirty days after the order, in respect to which complaint is made, is granted or refused; and upon the final hearing of any suit brought to suspend or set aside, in whole or in part, any order of said commission the same requirement as THE ACT OF 1913 ABOLISHING THE COMMERCE COURT. 907 to judges and the same procedure as to expedition and appeal shall apply. A final judgment or decree of the district court may be reviewed by the Supreme Court of the United States if appeal to the Supreme Court be taken by an aggrieved party within sixty days after the entry of such final judg- ment or decree, and such appeals may be taken in like man- ner as appeals are taken under existing law in equity cases. And in such case the notice required shall be served upon the defendants in the case and upon the attorney general of the State. All cases pending in the Commerce Court at the date of the passage of this Act shall be deemed pending in and be transferred forthwith to said district courts except cases which may previously have been submitted to that court for final decree and the latter to be transferred to the district courts if not decided by the Commerce Court before December first, nineteen hundred and thirteen, and all cases wherein injunctions or other orders or decrees, mandatory or otherwise, have been directed or entered prior to the abolition of the said court shall be transferred forthwith to said district courts, which shall have jurisdiction to pro- ceed therewith and to enforce said injunctions, orders, or de- crees. Each of said cases and all the records, papers, and proceedings shall be transferred to the district court wherein it might have been filed at the time it was filed in the Com- merce Court if this Act had then been in effect; and if it might have been filed in any one of two or more district courts it shall be transferred to that one of said district courts which may be designated by the petitioner or peti- tioners in said case, or, upon failure of said petitioners to act in the premises within thirty days after the passage of this Act, to such one of said district courts as may be designated by the judges of the Commerce Court. The judges of the Commerce Court shall have authority, and are hereby di- rected, to make any and all orders and to take any other action necessary to transfer as aforesaid the cases and all the records, papers, and proceedings then pending in the Commerce Court to said district courts. All administrative books, dockets, files, and all papers of the Commerce Court not transferred as part of the record of any particular case shall be lodged in the Department of Justice. All furni- ture, carpets, and other property of the Commerce Court is turned over to the Department of Justice and the Attorney General is authorized to supply such portion thereof as in his judgment may be proper and necessary to the United States Board of Mediation and Conciliation. Any case hereafter remanded from the Supreme Court which, but for the passage of this Act, would have been re- manded to the Commerce Court, shall be remanded to a 908 APPENDIX. district court, designated by the Supreme Court, wherein it might have been instituted at the time it was instituted in the Commerce Court if this Act had then been in effect, and thereafter such district court shall take all neces- sary and proper proceedings in such case in accordance with law and such mandate, order, or decree therein as may be made by said Supreme Court. All laws or parts of laws inconsistent with the foregoing provisions relating to the Commerce Court, are repealed. (38 Stat. L. 219.) Approved October 22, 1913. FKOM ACT OF 1913. ORGANIZING LABOR DEPARTMENT. 909 FROM ACT OF 1913— ORGANIZING LABOR DEPARTMENT. Chapter 6. — Arbitration of labor disputes. [Scope of Law.) Section 1. The provisions of this act shall apply to any common carrier or carriers and their officers, agents, and employees, except masters of vessels and seamen, as defined in section forty-six hundred and twelve. Revised Statutes of the United States, engaged in the transportation of passen- gers or property wholly by railroad, or partly by railroad and partly by water, for a continuous carriage or shipment from one State or Territory of the United States or the Dis- trict of Columbia to any other State or Territory of the United States or the District of Columbia, or from any place in the United States to an adjacent foreign country, or from any place in the United States through a foreign country to any other place in the United States. [Definitions.] The term "railroad" as used in this act shall include all bridges and ferries used or operated in connection with any railroad, and also all the road in use by any corporation operating a railroad, whether owned or operated under a contract, agreement, or lease; and the term "transporta- tion" shall include all instrumentalities of shipment or car- riage. The term "employees" as used in this act shall include all persons actually engaged in any capacity in train operation or train service of any description, and notwithstanding that the cars upon or in which they are employed may be held and operated by the carrier under lease or other contract: Provided, however. That this act shall not be held to apply to employees of street railroads and shall apply only to em- ployees engaged in railroad train service. In every such case the carrier shall be responsible for the acts and defaults of such employees in the same manner and to the sam?, extent as if said cars were owned by it and said employees directly employed by it, and any provisions to the contrary of any such lease or other contract shall be binding only as between the parties thereto and shall not affect the obligations of said carrier either to the public or to the private parties con- cerned. A common carrier subject to the provisions of this act is hereinafter referred to as an "employer," and the employees of one or more of such carriers are hereinafter referred to as "employees." 910 APPENDIX. [Applications to Board.] Sec. 2. Whenever a controversy concerning wages, hours of labor, or conditions of employment shall arise between an employer or employers and employees subject to this act interrupting or threatening to interrupt the business of said employer or employers to the serious detriment of the public interest, either party to such controversy may apply to the Board of Mediation and Concihation created by this act and invoke its services for the purpose of bringing about an amicable adjustment of the controversy; and upon the re- quest of either party the said board shall with all practicable expedition put itself in communication with the parties to such controversy and shall use its best efforts, by mediation [Mediation.] and conciliation, to bring them to an agreement; and if such efforts to bring about an amicable adjustment through me- diation and conciliation shall be unsuccessful, the said board shall at once endeavor to induce the parties to submit their [Arbitration.] controversy to arbitration in accordance with the provisions of this act. [Proffer of services.] In any case in which an interruption of traffic is imminent and fraught with serious detriment to the public interest, the Board of Mediation and Concihation may, if in its judg- ment such action seems desirable, proffer its services to the respective parties to the controversy. In any case in which a controversy arises over the mean- ing or the apphcation of any agreement reached through mediation under the provisions of this act either party to the said agreement may apply to the Board of Mediation and Conciliation for an expression of opinion from such board as to the meaning or application of such agreement and the said board shall upon receipt of such request give its opinion as soon as may be practicable. [Boards of arbitration.] Sec. 3. Whenever a controversy shall arise between an employer or employers and employees subject to this act, which can not be settled through mediation and conciliation in the manner provided in the preceding section, such con- troversy may be submitted to the arbitration of a board of six, or, if the parties to the controversy prefer so to stipulate, to a board of three persons, which board shall be chosen in the following manner: In the case of a board of three, the employer or employers and the employees, parties respec- tively to the agreement to arbitrate, shall each name one arbitrator; and the two arbitrators thus chosen shall select FROM ACT OF 1913. ORGANIZING LABOR DEPARTMENT. 911 the third arbitrator; but in the event of their failure to name the third arbitrator within five days after their first meeting, such third arbitrator shall be named by the Board on Media- tion and Conciliation. In the case of a board of six, the em- ployer or employers and the employees, parties respectively to the agreement to arbitrate, shall each name two arbi- trators, and the four arbitrators thus chosen shall, by a ma- jority vote, select the remaining two arbitrators; but in the event of their failure to name the two arbitrators within fifteen days after their first meeting the said two arbitrators, or as many of them as have not been named, shall be named by the Board of Mediation and Conciliation. In the event that the employees engaged in any given controversy are not members of a labor organization, such employees may select a committee which shall have the right to name the arbitrator, or the arbitrators, who are to be named by the employees as provided above in this section. [Agreements to arbitrate.] Sec. 4. The agreement to arbitrate — First. Shall be in writing. Second. Shall stipulate that the arbitration is had under the provisions of this act; Third. Shall state whether the board of arbitration is to consist of three or six members ; Fourth. Shall be signed by duly accredited representa- tives of the employer or employers and of the employees; Fifth. Shall state specifically the questions to be sub- mitted to the said board for decision; Sixth. Shall stipulate that a majority of said board shall be competent to make a valid and binding award ; Seventh. Shall fix a period from the date of the appoint- ment of the arbitrator or arbitrators necessary to complete the board, as provided for in the agreement, within which said board shall commence its hearings; Eighth. Shall fix a period from the beginning of the hear- ings within which the said board shall make and file its award : Provided, That this period shall be thirty days unless a different period be agreed to; Ninth. Shall provide for the date from which the award shall become effective and shall fix the period during which the said award shall continue in force; Tenth. Shall provide that the respective parties to the award will each faithfully execute the same; Eleventh. Shall provide that the award and the papers and proceedings, including the testimony relating thereto, certified under the hands of the arbitrators, and which shall have the force and effect of a bill of exceptions, shall be filed in the clerk's office of the district court of the United States 912 APPENDIX. for the district wherein the controversy arises or the arbitra- tion is entered into, and shall be final and conclusive upon the parties to the agreerhent unless set aside for error of law apparent on the record; Twelfth. May also provide that any difference arising as to the meaning of the application of the provisions of an award made by a board of arbitration shall be referred back to the same board or to a subcommittee of such board for a ruling, which ruling shall have the same force and effect as the original award ; and if any member of the original board is unable or unwilling to serve another arbitrator shall be named in the same manner as such original member was named. [Fo^vers of arbitrators.] Sec. 5. For the purposes of this act the arbitrators herein provided for, or either of them, shall have power to admin- ister oaths and affirmations, sign subpoenas, require the attendance and testimony of witnesses, and the production of such books, papers, contracts, agreements, and docu- ments material to a just determination of the matters under investigation as may be ordered by the court; and may in- voke the aid of the United States courts to compel witnesses to attend and testify and to produce such books, papers, con- tracts, agreements, and documents to the same extent and under the same conditions and penalties as is provided for in the act to regulate commerce, approved February fourth, eighteen hundred and eighty-seven, and the amendments thereto. [Agreements to be acknowledged.] Sec. 6. Every agreement of arbitration under this act shall be acknowledged by the parties thereto before a notary public or a clerk of the district or the circuit court of appeals of the United States, or before a member of the Board of Mediation and ConciUation, the members of which are hereby authorized to take such acknowledgments ; and when so acknowledged shall be delivered to a member of said board or transmitted to said board to be filed in its office. [Notice to arbitrators.] When such agreement of arbitration has been filed with the said board, or one of its members, and when the said board, or a member thereof, has been furnished the names of the arbitrators chosen by the respective parties to the controversy, the board, or a member thereof, shall cause a notice in writing to be served upon the said arbitrators, notifying them of their appointment, requesting them to meet promptly to name the remaining arbitrator or arbitra- tors necessary to complete the board, and advising them of the period within which, as provided in the agreement of FROM ACT OF 1913. OHGANIZING LABOR DEPARTMENT. 913 arbitration, they are empowered to name such arbitrator or arbitrators. [Notice to board of mediation and conciliation.] When the arbitrators selected by the respective parties have agreed upon the remaining arbitrator or arbitrators, they shall notify the Board of Mediation and Conciliation; and in the event of their failure to agree upon any or upon all of the necessary arbitrators within the period fixed by this act they shall, at the expiration of such period, notify the Board of Mediation and Concihation of the arbitrators selected, if any, or of their failure to make or to complete such selection. [Reconvening boards of arbitration.] If the parties to an arbitration desire the reconvening of a board to pass upon any controversy arising over the mean- ing or application of an award, they shall jointly so notify the Board of Mediation and Conciliation, and shall state in such written notice the question or questions to be sub- mitted to such reconvened board. The Board of Mediation and Concihation shall thereupon promptly communicate with the members of the board of arbitration or a subcom- mittee of such board appointed for such purpose pursuant to the provisions of the agreement of arbitration, and ar- range for the reconvening of said board or subcommittee, and shall notify the respective parties to the controversy of the time and place at which the board will meet for hearings upon the matters in controversy to be submitted to it. [Organization.] Sec. 7. The board of arbitration shall organize and select its own chairman and make all necessary rules for conduct- ing its hearings; but in its award or awards the said board shall confine itself to findings or recommendations as to the questions specifically submitted to it or matters directly bear- ing thereon. All testimony before said board shall be given under oath or affirmation, and any member of the board of arbitration shall have the power to administer oaths or affirmations. It may employ such assistants as may be necessary in carrying on its work. It shall, whenever prac- ticable, be supplied with suitable quarters in any Federal building located at its place of meeting or at any place where the board may adjourn for its dehberations. The board of arbitration shall furnish a certified copy of its awards to the [Awards to be filed.] respective parties to the controversy, and shall transmit the original, together with the papers and proceedings and a transcript of the testimony taken at the hearings, certified under the hands of the arbitrators, to the clerk of the district court of the United States for the district wherein the con- J— 58. 914 APPENDIX. troversy arose or the arbitration is entered into, to be filed in said clerk's ofFiGe as provided in paragraph eleven of sec- tion four of this act. And said board shall also furnish a cer- tified copy of its award, and the papers and proceedings, in- cluding the testimony relating thereto, to the Board of Mediation and Conciliation, to be filed in its office. The United States Commerce Court, the Interstate Com- merce Commission, and the Bureau of Labor Statistics are hereby authorized to turn over to the Board of Mediation and Conciliation upon its request any papers and documents heretofore filed with them and bearing upon mediation or arbitration proceedings held under the provisions of the act approved June first, eighteen hundred and ninety-eight, providing for mediation and arbitration. [Award in effect.] Sec. 8. The award, being filed in the clerk's office of a district court of the United States as hereinbefore provided, shall go into practical operation, and judgment shall be en- tered thereon accordingly at the expiration of ten days from such filing, unless within such ten days either party shall [Exceptions.] file exceptions thereto for matter of law apparent upon the record, in which case said award shall go into practical operation, and judgment be entered accordingly^, when such exceptions shall have been finally disposed of either by said district court or on appeal therefrom. [Appeals.) At the expiration of ten days from the decision of the dis- trict court upon exceptions taken to said award as aforesaid judgment shall be entered in accordance with said decision, unless during said ten days either party shall appeal there- from to the circuit court of appeals. In such case only such portion of the record shall be transmitted to the appellate court as is necessary to the proper understanding and con- sideration of the questions of law presented by said exceptions and to be decided. [Final judgment.] The determination of said circuit court of appeals upon said questions shall be final, and, being certified by the clerk thereof to said district court, judgment pursuant thereto shall thereupon be entered by said district court. If exceptions to an award are finally sustained, judgment shall be entered setting aside the award in whole or in part; but in such case the parties may agree upon a judgment to be entered disposing of the subject matter of the contro- versy, which judgment when entered shall have the same force and effect as judgment entered upon an award. FROM ACT OF 1913. ORGANIZING LABOR DEPARTMENT. 915 [No compulsory employment.] Nothing in this act contained shall be construed to re- quire an employe to render personal service without his con- sent, and no injunction or other legal process shall be issued which shall compel the performance by any employee against his will of a contract for personal labor or service. [Receivers hips.] Sec. 9. Whenever receivers appointed by a Federal court are in the possession and control of the business of employ- ers covered by this act the employees of such employers shall have the right to be heard through their representatives in such court upon all questions affecting the terms and conditions of their employment; and no reduction of wages shall be made by such receivers without, the authority of the court therefor, after notice to such employees, said notice to be given not less than twenty days before the hearing upon the receivers' petition or application, and to be posted upon all customary bulletin boards along or upon the rail- way or in the customary places on the premises of other em- ployers covered by this act. [Compensation.] Sec. 10. Each member of the board of arbitration created under the provisions of this act shall receive such compen- sation as may be fixed by the Board of Mediation and Con- ciliation, together with his traveling and other necessary expenses. The sum of $25,000, or so much thereof as may [Appropriation.] be necessary, is hereby appropriated, to be immediately available and to continue available until the close of the fiscal year ending June thirtieth, nineteen hundred and four- teen, for the necessary and proper expenses incurred in con- nection with any arbitration or with the carrying on of the work of mediation and conciliation, including per diem, traveling, and other necessary expenses of members or em- ployees of boards of arbitration and rent in the District of Columbia, furniture, office fixtures and supplies, books, salaries, traveling expenses, and other necessary expenses of members or employees of the Board of Mediation and Con- ciliation, to be approved by the chairman of said board and audited by the proper accounting officers of the Treasury. [Commissioner of mediation and conciliation.] Sec. 11. There shall be a Commissioner of Mediation and Concihation, who shall be appointed by the President, by and with the advice and consent of the Senate, and whose salary shall be $7,500 per annum, who shall hold his office for a term of seven years and until a successor qualifies, and who shall be removable by the President only for miscon- 916 APPENDIX. [Added members of board.] duct in office. The President shall also designate not more than two other officials of the Government who have been appointed by and with the advice and consent of the Senate, and the officials thus designated, together with the Com- missioner of Mediation and Conciliation, shall constitute a board to be known as the United States Board of Mediation and Conciliation. [AasiBtajtit commiseioner.] There shall also be an Assistant Commissioner of Media- tion and Conciliation, who shall be appointed by the Presi- dent, by and with the advice and consent of the Senate, and whose salary shall be $5,000 per annum. In the absence of the Commissioner of Mediation and Conciliation, or when that office shall become vacant, the assistant commissioner shall exercise the functions and perform the duties of that office. Under the direction of the Commissioner of Mediation and Conciliation, the assistant commissioner shall assist in the work of mediation and conciliation and when acting alone in any case he shall have the right to take acknowl- edgments, receive agreements of arbitration, and cause the notices in writing to be served upon the arbitrators chosen by the respective parties to the controversy, as provided for in section five of this act. The Act of June first, eighteen hundred and ninety-eight, relating to the mediation and arbitration of controversies between railway companies and certain classes of their em- ployees is hereby repealed: Provided, That any agreement of arbitration which, at the time of the passage of this Act, shall have been executed in accordance with the pro- visions of said Act of June first, eighteen hundred and ninety- eight, shall be governed by the provisions of said Act of June first, eighteen hundred and ninety-eight, and the pro- ceedings thereunder shall be conducted in accordance with the provisions of said Act. Approved July 15, 1913. INTERLOCKING ACT. 917 INTERLOCKING ACT. AN ACT To grant the right of way through the Oklahoma Territory and the Indian Territory to the Enid and Anadarko Railway Com- pany, and for other purposes. Sec. 18. That when in any case two or more railroads crossing each other at a common grade shall, by a system of interlocking or automatic signals, or by any works or fixtures to be erected by them, render it safe for engines and trains to pass over such crossing without stopping, and such inter- locking or automatic signals or works or fixtures shall be ap- [Approval by conxmission of interlocking or automatic signals at crossings.] proved by the Interstate Commerce Commissioners, then, in that case, it is hereby made lawful for the engines and trains of such railroad or railroads to pass over such crossing without stopping, any law or the provisions of any law to the contrary notwithstanding; and when two or more rail- roads cross each other at a common grade, either of such roads may apply to the Interstate Commerce Commission- ers for permission to introduce upon both of said railroads some system of interlocking or automatic signals or works or fixtures rendering it safe for engines and trains to pass [Common grade crossing.] over such crossings without stopping, and it shall be the duty of said Interstate Commerce Commissioners, if the system of works and fixtures which it is proposed to erect by said company, are, in the opinion of the Commission, suffi- cient and proper, to grant such permission. [Notice of intent to use signals at crossings.] Sec. 19. That any railroad company which has obtained permission to introduce a system of interlocking or auto- matic signals at its crossing at a common grade with any [Division of cost.] other railroad, as provided in the last section, may, after thirty days' notice, in writing, to such other railroad company, introduce and erect such interlocking or automatic signal or fixtures; and if such railroad company, after such notifi- cation, refuse to join with the railroad company giving notice in the construction of such works or fixtures, it shall be lawful for said company to enter upon the right of way and tracks of such second company, in such manner as to not unneccesarily impede the operation of such road, and erect such works and fixtures, and may recover in any action at law from such second company one-half of the total cost of erecting and maintaining such interlocking or automatic signals or works or fixtures on both of said roads. Public, No. 26, approved February 28, 1902. 918 APPENDIX. ASH PAN ACT. AN ACT To promote the safety of employees on railroads. Be it enacted by the Senate and House of Representatives of the United States of America, in Congress assembled. That on [Ash-pan equipment in interstate commerce.] and after the first day of January, nineteen hundred and ten, it shall be unlawful for any common carrier engaged in inter- state or foreign commerce by railroad to use any locomotive in moving interstate or foreign traffic, not equipped with an ash pan, which can be dumped or emptied and cleaned with- out the necessity of any employee going under such loco- motive. [A«h-pan equipment In territories and district of Colum- bia.] Sec. 2. That on and after the first day of January, nine- teen hundred and ten, it shall be unlawful for any common carrier by railroad in any Territory of the United States or the District of Columbia to use any locomotive not equipped with an ash pan which can be dumped or emptied and cleaned without the necessity of any employee going under such locomotive. [Penalties.] Sec. 3. That any such common carrier using any loco- motive in violation of any of the provisions of this Act shall be liable to a penalty of two liundred dollars for each and every such violation, to be recovered in a suit or suits to be brought by the United States district attorney in the dis- trict court of the United States having jurisdiction in the locaUty where such violation shall have been committed; [Enforcement.] and it shall be the duty of such district attorney to bring such suits upon duly verified information being lodged with [Commission to lodge information.] him of such violation having occurred; and it shall also be the duty of the Interstate Commerce Commission to lodge with the proper district attorneys information of any such violations as may come to its knowledge. [Power granted to commission.] Sec. 4. That it shall be the duty of the Interstate Com- merce Commission to enforce the provisions of this Act, and all powers heretofore granted to said Commissions are hereby extended to it for the purpose of the enforcement of this Act. ASh'pAN ACT. 919 [Receivers included.] Sec. 5. That the term "common carrier" as used in this Act shall include the receiver or receivers or other persons or corporations charged with the duty of the management and operation of the business of a common carrier. [When asli-pan is not necessary.] Sec. 6. That nothing in this Act contained shall apply to any locomotive upon which, by reason of the use of oil, elec- tricity, or other such agency, an ash pan is not necessary. Public, No. 165, approved May 30, 1908. 920 APPENDIX. REPORTS OF ACCIDENTS ACT. AN ACT Requiring common carriers engaged in interstate and foreign commerce to make full reports of all accidents to the Interstate Com- merce Commission, and authorizing investigations thereof by said Commission. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That it [Monthly reports of railway accidents.] shall be the duty of the general manager, superintendent, or other proper officer of every common carrier engaged in in- terstate or foreign commerce by railroad to make to the Interstate Commerce Commission, at its office in Washing- ton, District of Columbia, a monthly report, under oath, of all collisions, derailments, or other accidents resulting in injury to persons, equipment, or roadbed arising from the operation of such railroad under such rules and regulations as may be prescribed by the said Commission, which report shall state the nature and causes thereof and the circum- stances connected therewith: Provided, That hereafter all said carriers shall be relieved from the duty of reporting accidents in their annual financial and operating reports made to the Commission. [Failure to make report within thirty days after end of any month a misdemeanor.] Sec. 2. That any common carrier failing to make such report within thirty days after the end of any month shall be deemed guilty of a misdemeanor, and upon conviction [Penalty.] thereof by a court of competent jurisdiction shall be pun- ished by a fine of not more than one hundred dollars for each and every offense and for every day during which it shall fail to make report after the time herein specified for making the same. [Power of the commission to investigate accidents.] Sec. 3. That the Interstate Commerce Commission shall have authority to investigate all collisions, derailments, or other accidents resulting in serious injury to person or to the property of a railroad occurring on the line of any com- mon carrier engaged in interstate or foreign commerce by railroad. The Commission, or any impartial investigator thereunto authorized by said Commission, shall have au- thority to investigate such collisons, derailments, or other accidents aforesaid, and all the attending facts, conditions, REPORTS OF ACCIDENTS ACT. 92 1 [Taking of testimony.] and circumstances, and for that purpose may subpoena wit- nesses, administer oaths, take testimony, and require the production of books, papers, orders, memoranda, exhibits, and other evidence, and shall be provided by said carriers [State commisBionB.] with all reasonable f acihties ; Provided, That when such acci- dent is investigated by a commission of the State in which it occurred, the Interstate Commerce Commission shall, if convenient, make any investigation it may have previously [Reports of inveatigationa.] determined upon, at the same time as, and in connection with the state commission investigation. Said Commission shall, when it deems it to the public interest, make reports of such investigations, stating the cause of accident, together with such recommendations as it deems proper. Such re- ports shall be made pubhc in such manner as the Commis- sion deems proper. [Reporta not to be used in evidence against carrier.] Sec. 4. That neither said report nor any report of said investigation nor any part thereof shall be admitted as evi- dence or used for any purpose in any suit or action for dam- ages growing out of any matter mentioned in said report or investigation. [Form of report.] Sec. 5. That the Interstate Commerce Commission is authorized to prescribe for such common carriers a method and form for making the reports hereinbefore provided. [Repeal of prior act.] Sec. 6. That the Act entitled "An Act requiring common carriers engaged in interstate commerce to make full reports of all accidents to the Interstate Commerce Commission," approved March third, nineteen hundred and one, is hereby repealed. [''Interstate commerce" and "foreign commerce" defined.] Sec. 7. The term "interstate commerce," as used in this Act, shall include transportation from any State or Terri- tory or the District of Columbia to any other State or Terri- tory or the District of Columbia, and the term "foreign commerce," as used in this Act, shall include transportation from any State or Territory or the District of Columbia to any foreign country and from any foreign country to any State or Territory or the District of Columbia. [When act effective.] Sec. 8. That this Act shall take effect sixty days after its passage. Public, No. 165, approved, May 6, 1910. 922 APPENDIX. THE LOCOMOTIVE BOILER INSPECTION ACT OF FEBRUARY 17, 1911, 36 STATUTES AT LARGE: 916. AN ACT To promote the safety of employes and travelers, upon rail- roads, by compelling common carriers engaged in interstate commerce to fequip their locomotive with safe and suitable boilers, and appur- tenances thereto Chapter 103. — Inspection of locomotive boilers. [Scope of law.] Section 1. The provisions of this act shall apply to any common carrier or carriers, their officers, agents, and em- ployees, engaged in the transportation of passengers or property by railroad in the District of Columbia, or in any Territory of the United States, or from one State or Terri- tory of the United States or the District of Columbia to any other State or Territory of the United States or the District of Columbia, or frorn any place in the United States to an adjacent foreign country, or from any place in the United States, through a foreign country to any other place in the [Definitions.] United States. The term "railroad" as used in this Act shall include all the roads in use by any common carrier operating a railroad, whether owned or operated under a contract, agreement, or lease, and the term "employees" as used in this act shall be held to mean persons actually en- gaged in or connected with the movement of any train. [Boilers, etc., to be safe.] Sec. 2. From and after the first day of July, nineteen hundred and eleven, it shall be unlawful for any common carrier, its officers or agents, subject to this act to use any locomotive engine propelled by steam power in moving inter- state or foreign traffic unless the boiler of said locomotive and appurtenances thereof are in proper condition and safe to operate in the service to which the same is put, that the same may be employed in the active service of such carrier in moving traffic without unnecessary peril to life or limb, and all boilers shall be inspected from time to time in accordance with the provisions of this act, and be able to withstand such test or tests as may be prescribed in the rules and regulations hereinafter provided. for. [Inspectors.] Sec. 3. There shall be appointed by the President, by and with the advice and consent of the Senate, a chief in- THE LOCOMOTIVE^BOILER INSPECTION. 923 spector and two assistant chief inspectors of locomotive boilers, who shall have general superintendence of the in- spectors hereinafter provided for, direct them in the duties hereby imposed upon them, and see that the requirements of this act and the rules, regulations, and instructions made or given hereunder are observed by common carriers sub- ject hereto. The said chief inspector and his two assistants shall be selected with reference to their practical knowledge of the construction and repairing of boilers, and to their fit- ness and ability to systematize and carry into effect the pro- visions hereof relating to the inspection and maintenance of locomotive boilers. The chief inspector shall receive a salary of four thousand dollars per year and the assistant chief inspectors shall each receive a salary of three thousand dollars per year; and each of the three shall be paid his travehng ex- penses incurred in the performance of his duties. The ofTice of the chief inspector shall be in Washington, District of Columbia, and the Interstate Commerce Commission shall provide such stenographic and clerical help as the business of the ofTices of the chief inspector and his said assistants may require. (Fifty districts.] Sec. 4. Immediately after his appointment and qualifi- cation the chief inspector shall divide the territory compris- ing the several States, the Territories of New Mexico and Arizona, and the District of Columbia into fifty locomotive boiler-inspection districts, so arranged that the service of the inspector appointed for each district shall be most ef- fective, and so that the work required of each inspector shall be substantially the same. Thereupon there shall be ap- pointed by the Interstate Commerce Commission fifty in- [Inapectors in classified civil service.] spectors of locomotive boilers. Said inspectors shall be in the classified service and shall be appointed after competi- tive examination" according to the law and rules of the Civil Service Commission governing the classified service. The chief inspector shall assign one inspector so appointed to each of the districts hereinbefore named. Each inspector shall receive a salary of one thousand eight hundred dollars per year and his traveling expenses while engaged in the per- formance of his duty. He shall receive in addition thereto an annual allowance for office rent, stationery, and clerical assistance, to be fixed by the Interstate Commerce Com- mission, but not to exceed in the case of any district in- spector six hundred dollars per year. In order to obtain the most competent inspectors possible, it shall be the duty of the chief inspector to prepare a list of questions to be pro- pounded to applicants with respect to construction, repair, 924 APPENDIX operation, testing, and inspection of locomotive boilers, and their practical experience in such work, which list, being approved by the Interstate Commerce Commission, shall be used by the Civil Service Commission as a part of its examination. No person interested, either directly or in- directly, in any patented article required to be used on any locomotive under supervision or who is intemperate in his habits shall be eligible to hold the office of either chief in- spector or assistant or district inspector. [Rules, etc., of companies to be filed.] Sec. 5. Each carrier subject to this act shall file its rules and instructions for the inspection of locomotive boilers with the chief inspector within three months after the ap- proval of this act, and after hearing and approval by the Interstate Commerce Commission, such rules and instruc- tions, with such modificaT;ions as the commission requires, shall become obligatory upon such carrier: Provided, how- ever. That if any carrier subject to this act shall fail to file its rules and instructions the chief inspector shall prepare rules and instructions not inconsistent herewith for the inspection of locomotive boilers, to be obesrved by such carrier; which rules and instructions, being approved by the Interstate Commerce Commission, and a copy thereof being served upon the president, general manager or gen- eral superintendent of such carrier, shall be obligatory, and a violation thereof punished as hereinafter provided: Pro- vided also. That such common carrier may from time to time change the rules and regulations herein provided for, but such change shall not take effect and the new rules and regu- lations be in force until the same shall have been filed with and approved by the Interstate Commerce Commission. The chief inspector shall also make all needful rules, regula- tions, and instructions not inconsistent herewith for the con- duct of his office and for the government of the district in- spectors: Provided, however, that all such rules and instruc- tions shall be approved by the Interstate Commerce Com- mission before they take effect. [Duties of inspectors.] Sec. 6. It shall be the duty of each inspector to become famihar, so far as practicable, with the condition of each locomotive boiler ordinarily housed or repaired in his dis- trict, and if any locomotive is ordinarily housed or repaired in two or more districts, then the chief inspector or an as- sistant shall make such division between inspectors as will avoid the necessity for duphcation of work. Each inspector shall make such personal inspection of the locomotive boil- ers under his care from time to time as may be necessary to fully carry out the provisions of this act, and as may be THE LOCOMOTIVE BOILER INSPECTION. 925 consistent with his other duties, but he shall not be required to make such inspections at stated times or at regular inter- vals. His first duty shall be to see that the carriers make in- spections in accordance with the rules and regulations estab- lished or approved by the Interstate Commerce Commission, and that carriers repair the defects which such inspections disclose before the boiler or boilers or appurtenances per- taining thereto are again put in service. To this end each carrier subject to this act shall file with the inspector in charge, under the oath of the proper officer or employee, a duplicate of the report of each inspection required by such rules and regulations, and shall also file with such inspector, under the oath of the proper officer or employee, a report showing the repair of the defects disclosed by the inspec- tion. The rules and regulations hereinbefore provided for shall prescribe the time at which such reports shall be made. [Defective boilers.] Whenever any district inspector shall, in the performance of his duty, find any locomotive boiler or apparatus per- taining thereto not conforming to the requirements of the law or the rules and regulations estabhshed and approved as hereinbefore stated, he shall notify the carrier in writing that the locomotive is not in serviceable condition, and thereafter such boiler shall not be uSed until in service- able condition: Provided, That a carrier, when notified by an inspector in writing that a locomotive boiler is not in serviceable condition because of defects set out and de- scribed in said notice, may, within five days after receiving said notice, appeal to the chief inspector by telegraph or by letter to have said boiler reexamined, and upon receipt of the appeal from the inspector's decision the chief inspector shall assign one of the assistant chief inspectors or any dis- trict inspector other than the one from whose decision the appeal is taken to reexamine and inspect said boiler within fifteen days from date of notice. If upon such reexamination the boiler is found in serviceable condition, the chief in- spector shall immediately notify the carrier in writing, whereupon such boiler may be put into service without fur- ther delay; but if the reexamination of said boiler sustains the decision of the district inspector, the chief inspector shall at once notify the carrier owning or operating such locomotive that the appeal from the decision of the in- spector is dismissed, and upon the receipt of such notice the carrier may, within thirty days, appeal to the Interstate Commerce Commission, and upon such appeal, and after hearing, said Commission shall have power to revise, modify, or set aside such action of the chief inspector and declare that said locomotive is in serviceable condition and author- 926 APPENDIX ize the same to be operated: Provided further, that pending either appeal the requirements of the inspector shall be effective. [Report.] Sec. 7. The chief inspector shall make an annual report to the Interstate Commerce Commission of the work done during the year, and shall make such recommendations for the betterment of the service as he may desire. [Accidents to be reported.] Sec. 8. In the case of accident resulting from failure from any cause of a locomotive boiler or its appurtenances, re- sulting in serious injury or death to one or more persons, a statement forthwith must be made in writing of the fact of such accident, by the carrier owning or operating said locomotive, to the chief inspector; whereupon the facts [Inveatigations.] concerning such accident shall be investigated by the chief inspector or one of his assistants, or such inspector as the chief inspector may designate for that purpose. And where the locomotive is disabled to the extent that it can not be run by its own steam, the part or parts affected by the said accident shall be preserved by said carrier intact, so far as possible, without hindrance or interference to traffic until after said inspection. The chief inspector or an assistant or the designated inspector making the investigation shall examine or cause to be examined thoroughly the boiler or part affected, making full and detailed report of the cause of the accident to the chief inspector. [Reports.] The Interstate Commerce Commission may at any time call upon the chief inspector for a report of any accident embraced in this section, and upon the receipt of said re- port, if it deems it to the public interest, make reports of such investigations, stating the cause of accident, together with such recommendations as it deems proper. Such re- port shall be made public in such manner as the Commis- sion deems proper. Neither said report nor any report of said investigation nor any part thereof shall be admitted as evidence or used for any purpose in any suit or action for damages growing out of any matter mentioned in said re- port or investigation. [Violations.] Sec. 9. Any common carrier violating this act, or any rule or regulation made under its provisions or any lawful order of any inspector shall be liable to a penalty of one hundred dollars for each and every such violation, to be re- covered in a suit or suits to be brought by the United States THE LOCOMOTIVE BOILER INSPECTION. 927 attorney in the district court of the United States having jurisdiction in the locality where such violation shall have been committed; and it shall be the duty of such attorneys, subject to the direction of the Attorney General, to bring such suits upon duly verified information "being lodged with them, respectively, of such violations having occurred; and it shall be the duty of the chief inspector of locomotive boil- ers to give information to the proper United States attorney of all violations of this act coming to his knowledge. [Annual expenditure.] Sec. 10. The total amounts directly appropriated to carry out the provisions of this act shall not exceed for any one fiscal year the sum of three hudred thousand dollars. This Act was amended by Act of March 8, 1915, 38 Stat. at Large, p. 1192, by making its requirements extend to and include the entire locomotive without repealing in any wise the Safety Act. TABLE OF CASES. [heferences are to pages.] Acklen v. Thompson (126 S. W. 730, 122 Tenn. 43), 75. Adair v. United States (208 U. S. 161, 52 L. Ed. 436, 152 Fed. 736), 174. Adams v. Chicago & Great Western Ry. Co. (210 Fed. 362), 670. Adams Express Co. v. Croninger (226 U. S. 491, 57 L. Ed. 314), 502. Adams Express Co. v. Kentucky (166 U. S. 171, 41 L. Ed. 960), 42. Adams Express Co. v. Kentucky (206 U. S. 129, 51 L. Ed. 987), 37. Adams Express Co. v. Kentucky (214 U. S. 218, 53 L. Ed. 972), 38. Adams Express Co. v. Kentucky (238 U. S. 190, 59 L. Ed. 1267), 40. Adams Express Co. v. Kentucky (154 Ky. 462), 39. Adams v. Ohio (165 U. S. 194, 41 L. Ed. 683), 42-232. Addyston Pipe & Steel Co. v. U. S. (175 U. S. 211, 44 L. Ed. 136, 29 C. C. A. 141, 85 Fed. 271), 125- 148-152-153-156-157-169-190- 706-759. Aikens v. Wisconsin (195 U. S. 194, 49 L. Ed. 154), 248. Alabama Rate Case (170 Fed. 225, 161 Fed. 925), 221. Alabama & N. 0. T. Co. v. Doyle (210 Fed. 173), 15. Alabama & Vicksburg Ry. v. Rail- road Comm. (203 U. S. 496, 51 L. Ed. 289), 245. Allen V. Flood (67 L. J. Q. B. Rep. H. of L. 98), 189. Allen V. Oregon Ry. & Nav. Co. (98 Fed. 16), 458. Allen V. St. Louis etc. R. Co. (230 U. S. 553, 57 L. Ed. 1625), 238. Alexander v. U. S. (201 U. S. 117, 50 L. Ed. 673), 750. Allis-Chalmers Co. v. Iron Mold- ers' Union (150 Fed. 155, 166 Fed. 145), 177-191. Allis-Chalmers Co. v. Reliable Lodge (111 Fed. 264), 177. Almy V. California (24 How. 169, 16 L. Ed. 644), 7-17. American Banana Co. v. United Fruit Co. (213 U. S. 347, 53 L. Ed. 826), 724. American Brake Beam Co. v. Pungs (141 Fed. 923), 717. American Biscuit Co. v. Klotz (44 Fed. 721), 715-775. American Express Co. v. Iowa (196 U. S. 133, 49 L. Ed. 417), 35-37. American Express Co. v. U. S. (212 U. S. 522, 53 L. Ed. 635, 161 Fed. 606), 270-294-678. American Graphaphone Co. v. Boston Stores Co. (225 Fed. 785), 168. American Radiator Co. v. Diver- ickson (227 U. S. 145, 57 L. Ed. 456), 804. American Refrigerator Transit Co. V. Hall (174 U. S. 70, 43 L. Ed. 899), 43. American Seeding Co. v. Kentucky (236 U. S. 660, 59 L. Ed. 773), 250. [ 929] J-69. 930 TABLE OF CASES. [references are to pages.] American Soda Co. v. Green (69 Fed. 333), 769. American Steel & Wire Co. v. Speed (192 U. S. 500, 48 L. Ed. 538), 34. American Steel & Wire Co. v. Wire Drawers etc. (90 Fed. 608), 177. American Sugar Ref. Co. v. Del. L. & Wes. R. Co. (200 Fed. 652, 207 Fed. 733), 284-346. American T. T. Co. v. Kansas City Sou. R. Co. (175 Fed. 28>, 359. American Tob. Co. v. U. S. (221 U. S. 106, 55 L. Ed. 663), 151. American Union Coal Co. v. Penn. Ry. Co. (159 Fed. 278), 427. Ames V. American Tel. & Tel. Co. (166 Fed. 820), 748-763. Anderson v. U. S. (171 U. S. 604, 43 L. Ed. 300, 82 Fed. 529), 152- 710. Arbuckle v. Blackburn (51 C. C. A. 122, 113 Fed. 616, 65 L. R. A. 864), 22. Arizona etc. R. Co. v, Clark (235 U. S. 669, 59 L. Ed. 415, 201 Fed. 817), 802-804. Arkansas Brokerage Co. v. Dunn (173 Fed. 899), 167-724. Arkansas Fertilizer Co. v. U. S. (193 Fed. 667), 623. Arkansas Rate Case (163 Fed. 141, 187 Fed. 292, 230 U. S. 553, 57 L. Ed. 1625), 233-234. Armour V.Augusta (134 Ga. 178), 73. Armour v. U. S. (153 Fed. 1, 209 U. S. 56, 52 L. Ed. 681), 504-692. Arnold v. Yanders (Ohio) 47 N. E. 50, 56 Ohio 417), 74. Arthur v. Oakes (11 C. C. A. 209, 63 Fed. 310), 176-192-555-556. Asbell V. Kansas (209 U. S. 251, 52 L. Ed. 778), 61. Asher v. Texas (128 U. S. 129, 32 L. Ed. 268), 40. Atchison, T. & S. F. R. Co. v. Com- mission (232 U. S. 199, 58 L. Ed. 568, 204 Fed. 647), 291. Atchison T. & S. F. R. Co. v. Den- ver & N. O. R. Co. (110 U. S. 667. 28 L. Ed. 291), 243-458-460. Atchison T. & S. F. R. Co. v. Love, (177 Fed. 493, 185 Fed. 321), 221. Atchison T. & S. F. R. Co. v. Mat- thews (174 U. S. 96, 43 L. Ed. 909), 251. Atchison T. & S. F. R. Co. v. Rob- inson (233 U. S. 173, 58 L. Ed. 901), 502, 669. Atchison T. & S. F. R. Co. v. U. S. (232 U. S. 199, 58 L. Ed. 568, 204 Fed. 647), 291. Atchison T. & S. F. R. Co. v. U. S. (170 Fed. 251, 163 Fed. Ill, 203 Fed. 56), 321, 697. Atchison T. & S. F. R. Co. v. Vos- berg (238 U. S. 56, 59 L. Ed. 1199), 252. Athanasaw v. U. S. (227 U. S. 326, 57 L. Ed. 528), 14. Atkinson v. Southern Expr. Co. (44 S. C. 441), 39. Atlanta v. Chattanooga Foupdry & Pipe Co. (127 Fed. 25), 775. Atlantic Coast Line Co. v. Florida (203 U. S. 256, 51 L. Ed. 174, 48 Fla. 146), 227, 229. Atlantic Coast Line Co. v. Garaty (166 Fed. 10), 289. Atlantic Coast Line Co. v. Georgia (234 U. S. 280), 58 L. Ed. 1312), 812. Atlantic Coast Line Co. v. Gold- borough (232 U. S. 548, 58 L. Ed. 721, 155 N. C. 356), 242. Atlantic Coast Line Co. v. Int. Com. Comm. (194 Fed. 449), 624. Atlantic Coast Line Co. v. Macon Gro. Co. (166 Fed. 206), 545. Atlantic Coast Line Co. v. Mazur- sky (216U.S. 122, 54 L.Ed.411), 58. Atlantic Coast Line Co. v. N. C. Corp. Com. (206 U. S. 1, 51 L. Ed. 931, 137 N. C. 18), 245. TABLE OF OASES. 931 [references are to pages.] Atlantic Coast Line R. R. Co. v. Riverside Mills (219 U. S. 186, 55 L. Ed. 167), 530-637, 667. Atlantic Coast Line v. U. S. (168 Fed. 175), 829. Atlantic Coast Line Co. v. Whar- ton (207 U. S. 328, 52 L. Ed. 230, 74 S. C. 80), 56. Atlantic etc. Tel. Co. v. Philadel- phia (190 U. S. 160, 47 L. Ed. 995), 43. Atwater v. Railroad Co. (48 N. J. Law, 55), 345. Augusta Southern R. Co. v. Wrightsville & S. R. Co. (74 Fed. 522), 324-463. Austin V. Tennessee (179 U. S. 343, 45 L. Ed. 224), 22-35. Avinger v. South Car R. Co. (29 S. C. 265), 345. B. Bacon v. Illinois (227 U. S. 504, 57 L. Ed. 615), 42. Bacon v. Rutland R. Co. f232 U. S. 134, 58 L. Ed. 538), 218. Baer Bros. Mer. Co. v. Den. & Rio Grande R. Co. (233 U. S. 479, 58 L. Ed. 1055, 200 Fed. 614, 187 Fed. 486), 623-624. Ball, The Daniel (10 Wall. 557, 19 L. Ed. 999), 28. Baltimore & 0. R. Co. v. Hambur- ger (155 Fed. 849), 514. B. C. R. & N. R. Co. V. Northwer,t- ern Fuel Co. (31 Fed. 652), 343. B. & 0. R. Co. V. Inter. Comm. Com. (215 U. S. 216, 54 L. Ed. 164), 779. B. & 0. R. Co. V. I. C. C. (221 U. S. 612, 55 L. Ed. 878), 119-839. B. & 0. R. Co. V. U. S. (215 U. S. 481, 54 L. Ed. 292), 93-97-422- 537-683. B. & 0. S. W. R. Co. V. U. S. (220 U. S. 94, 55 L. Ed. 384, 159 Fed. 33), 850. B. & 0. S. W. R. Co. V. U. S. (290 Fed. 779), (See U. S. v. B. & 0. R. R.) B. & 0. S. W. R. Co. V. Voigt (176 U. S. 497, 44 L. Ed. 561), 797; Bangor v. Smith (83 Me. 422), 74. Bannon v. U. S. (156 U. S. 464, 39 L. Ed. 464), 185. Barnes v. Berry (156 Fed. 72), 177. Barney v. City of New York (193 U. S. 430. 48 L. Ed. 737), 214. Barret v. New York (232 U. S. 14, 58 L. Ed. 483, 183 Fed. 793, 189 Fed. 268), 271. Barrow S. S. Co. v. Kane (170 U. S. Ill, 42 L. Ed. 964), 212. Bauer v. O'Donnell (229 U. S. 1, 57 L. Ed. 1041), 168, 728. Baxendale v. Railway Co. (4 C. B. N. S. 63), 341. Bay V. Merrill & Ring Logging Co. (220 Fed. 295), 793. Beavers v. Henkel (194 U. S. 73, 48 L. Ed. 882), 559. Beers v. Wabash St. L. & Pac. R. Co. (34 Fed. 244), 555. Bellamy v. M. & N. R. Co. (215 Fed. 18), 238. Belt R. R. Co. of Chicago v. U. S. (168 Fed. 542), 808. Behlmer v. L. & N. R. Co. (175 U. S. 648, 44 L. Ed. 309). (See L. & N. V. Behlmer.) Behrens v. IlHnois Cen. R. Co (192 Fed. 581). (See 111. Cen. v. Behr- ens.) Bement v. National Harrow Co. (186 U. S. 76, 46 L. Ed. 1058), 726, 769. Bennett v. Lehigh Valley R. Co. (197 Fed. 578), 793. Bennett v. U. S. (227 U. S. 333, 57 L. Ed. 531, 194 Fed. 630), 14-15. Benedict v. Construction Co. (49 N. J. Eq. 23), 26. Berkowitz v. U. S. (93 Fed. 452), 186. 932 TABLE OF CASES. [references are to pages.] Berwind-White Coal Min. Co. v. Chicago & Erie R. Co. (235 U. S. 370, 59 L. Ec. 275), 515. Bessette v. Conkey Co. (194 U.S. 324, 48 L. Ed. 997), 198, 200-203. Bigbee Packet Co. v. M. & O. R. Co. (60 Fed. 545), 443. Bigelow V. Calumet Co. (167 Fed. 721, 704 S. P. 322), 712-748. Bishop V. American Preservers Co. (51 Fed. 272), 766. Block V. Standard District Co. (95 Fed. 978), 747. Board of Trade of Chicago v. Christy etc. Co. (198 U. S. 236, 48 L. Ed. 1031), 711. Bobbs Merrill v. Strauss (210 U. S. 339, 52 L. Ed. 1086), 168. Boehring v. Chesapeake Beach R. Co. (193 U. S. 442, 48 L. Ed. 742), 296-374. Bogardus v. Insurance Co. (101 N. Y. 329), 53. Booth V. Davis (127 Fed. 875), 716. Boston Beer Co. v. Mass. (97 U. S. 25, 24 L. Ed. 989), 22. Boston & Maine R. Co. v. Hooker (233 U. S. 97, 58 L. Ed. 868), 502. Bowman v. Railway Co. (125 U. S. 465, 31 L. Ed. 700), 34-70-7«-79. Boyd V. N. Y. & H. Ry. Co. (220 Fed. 174), 748. Boyer v. Western Union Telegraph Co. (124 Fed. 246), 187. Brass v. North Dakota (153 U. S. 391, 38 L. Ed. 757), 82. Bravis v. Chicago M. & St. P. R. Co. (217 Fed. 234), 793-798. Brennan v. Titusville (153 U. S. 289, 38 L. Ed. 719), 41. Brewer v. Central R. Co. of Geor- gia (84 Fed. 258), 389. Briggs V. C. N. & W. R. Co. (125 Fed. 745), 813. Brimmer v. Redman (138 U. S. 78, 34 L. Ed. 862), 60. Brimson v. Interstate Commerce Commission (154 U. S. 447, 38 L. Ed. 1047), 572. Broadnax v. Missouri (219 U. S. 285, 55 L. Ed. 219), 18. Brolan v. United States (236 U. S. 216, 59 L.Ed. 544), 123. Brown v. Houston (114 U. S. 622, 29 L. Ed. 257), 34. Brown v. Maryland (12 Wheaton 419, 6 L.Ed. 678), 33-117. Brown v. Spillman (155 U. S. 665, 39 L. Ed. 304), 26. Brown v. Walker (161 U. S. 591, 40 L. Ed. 819), 566. Browning v. Waycross (233 U. S. 16, 58 L. Ed. 828), 41. Buckeye Powder Co. v. Dupont De Nemours (196 Fed. 514), 766. Buckeye Powder Co. v. Hazard Powder Co. (205 Fed. 827), 766. Buck Stove & Range Co. v. Vickers (226 U. S. 205, 57 L. Ed. 189), 33. Budd V. New York (143 U. S. 517, 36 L. Ed. 247), 82. Buell V. C, M. & St. P. R. Co. (1 Wis. Com. R. 324), 234. Burlington, C. R. & N. R. Co. v. Dey (82 Iowa, 312), 100-305. Burlington, C. R. & N. R. Co. v. Northwestern Fuel Co. (31 Fed. 652), 343. Burnett v. City of New York (189 Fed. 268), 16. Burnett v. Spokane P. & S. Ry. Co. (210 Fed. 94), 803. Burrell v. Montana (194 U. S. 572, 48 L. Ed. 1122), 571. Butchers & Drovers Stock Yards Co. V. L. N. R. Co. (14 C. C. A. 290, 31 U. S. App. 252, 67 Fed. 35), 287-437-445-464. Butfield V. Stranahan (192 U. S. 470, 48 L. Ed. 525), 109-123. Butler Bros. v. U. S. Rubber Co. (156 Fed. 1), 13-31. TABLE OF CASES. 933 [references are to pages.] c. Caldwell v. North Carolina (187 U. S. 622, 47 L. Ed. 336), 41. California v. Pacific R. Co. (127 U. S. 1, 32 L. Ed. 150), 102-128. Calhoun v. City ol Seattle (215 Fed. 226), 223. CaUan v. Wilson (127 U. S. 540, 32 L. Ed. 223), 185. Cam V. Southern R. Co. (199 Fed. 211), 802. Camden Iron Works v. U. S. (158 Fed. 561), 694. Capital City Dairy Co. v. Ohio (183 U.S. 238, 46 L.Ed. 171), 21. Carew v. Rutherford (106 Mass. 1), 189. Cardwell v. American Bridge Co. (113 U. S. 205, 28 L. Ed. 959), 48. Carter v. Commonwealth (96 Va. 791), 199. Carter Crune Co. v. Perrung (86 Fed. 439), 717. Carterville L. & N. Co. v. Carter- ville (114 Fed. 699), 221. Case of Monopolies (11 Coke Rep. 84b, 99, 101), 159-171. Casey v. Central Typo Union (45 Fed. 135), 189. Central Coal & Coke Co. v. Hart- mann, 111 Fed. 96), 768. Central Stock Yards Co. v. L. & N. R. Co. (192 U. S. 568, 48 L. Ed. 565, 55 C. C. A. 63, 112 Fed. 813, 118 Fed. 113), 287-458-461^64- 533. Central Union Tel. Co. v. State (118 Ind. 194), 15. Central Vermont Ry. Co. v. White (238 U. S. 506, 59 L. Ed. 1433, 87 Vt. 330), 796. Central of Georgia v. McLendon (157 Fed. 961, 155 Fed. 974), 216-221. Central of Ga. R. R. Co. v. Murphy (196 U. S. 194, 49 L. Ed. 444), 70. Charge to Grand Jury (151 Fed. 834), 735-775. Charge to Grand Jury (62 Fed. 824, 828, 834, 66 Fed. 146, 115 Fed. 588), 178-186-557-722-735. Charleston & Wes. Car. R. Co. v. Thompson (234 U. S. 576, 58 L. Ed. 1476; 79 S. E. 242), 296. Charleston & Wes. Car. R. Co. v. Varnville F. Co. (237 U. S. 597, 59 L. Ed. 1137), 669. Charlotte C. & A. R. Co. v. Gibbes (142 U. S. 386, 35 L. Ed. 1051), 208. Chattanooga Foundry Co. v. At- lanta (203 U. S. 390, 51 L. Ed. 241, 127 Fed. 25), 761. Cherokee Nation v. Georgia (5 Peters, 1, 8 L. Ed. 25), 6. Cherokee Nation v. Kansas R. Co. (135 U. S. 641, 34 L. Ed. 295), 6. Chesapeake & Ohio Fuel Co. v. U. S. (105 Fed. 93, 115 Fed. 610), 715. Chesapeake & Ohio R. Co. v. Con- nolly (230 U. S. 153, 57 L. Ed. 1597), 253-368. Chesapeake & 0. R. Co. v. Ken- tucky (179 U. S. 388, 45 L. Ed. 244), 54. Chesapeake & O. v. Standard Lbr. Co. (174 Fed. 107), 359. Chicago Board of Trade v. Christie G. & S. Co. (198 U. S. 236, 49 L. Ed. 1031), 711. Chicago & Alton R. Co. v. Tran- barger (238 U. S. 67, 59 L. Ed. 1204, 250 Mo. 46), 246. Chicago & Alton R. Co. v. U. S. (156 Fed. 558, 148 Fed. 646, 212 U. S. 563, 53 L. Ed. 653), 699. Chicago, Burlington & Q. R. Co. v. B. C. R. & N. Co. (34 Fed. 481), 555. 934 TABLE OF CASHS. [references are to pages.] Chicago, B. & Q. R. Co. v. Oglesby (198 Fed. 153), 224-247. Chicago, B. & Q. Co. v. U. S. (220 U. S. 559, 55 L. Ed. 582, 170 Fed. 556), 815-825-829. C. C. & I. R. Co. V. Closser (126 Ind. 348, 9. L. R. A. 754), 342. C. & A. R. Co. V. Gibbes (142- U. S. 386, 35 L. Ed. 1051), 121. Chicago, B. & Q. R. Co. v. U. S. (157 Fed. 830, 209 U. S. 90, 52 L. Ed. 698; 195 Fed. 241), 509- 693. Chicago, B. & Q. R. Co. v. Fein- tuch, 191 Fed. 482), 505. Chicago, I. & L. Ry. Co. v. Hackett (228 U. S. 559, 57 L. Ed. 966), 797. Chicago, R. I. & P. R. Co. v. Ar- kansas (219 U. S. 453, 55 L. Ed. 290, 86 Ark. 412), 54-245. Chicago & Grand Trunk R. Co. v. Minnesota (134 U. S. 418, 33 L. Ed. 970), 216-227. C. I. & R. Co. V. U. S. (219 U. S. 486, 55 L. Ed. 305, 163 Fed. 114), 295. Chicago, R. I. & P. Ry. Co. v. Cra- mer (232 U. S. 490, 58 L. Ed. 697), 669. Chicago, R. I. & P. Ry. Co. v. De- vine (239 U. S. 52, 60 L. Ed. ), 796. Chicago, R. I. & P. Ry. Co. v. Haridwick Farmers Elev. Co. (226 U. S. 426, 57 L. Ed. 284), 64. Chicago, R. I. & P. Ry. Co. v. U. S. (226 Fed. 27), 843. C. B. & Q. R. R. Co. V. U. S. (195 Fed. 241), 849. Chicago, etc. R. Co. v. Gray (237 U. S. 399, 59 L. Ed. 1018, 153 Wis. 637). 805. Chicago, etc. R. Co. v. Iowa (233 U. S. 334, 58 L. Ed. 988), 281. Chicago, etc. R. Co. v. Jones (149 111. 361), 100. Chicago, etc. R. Co. v. Ketchum 212 Fed. 986), 246. Chicago, etc. R. Co. v. Miller (226 U. S. 512, 57 L. Ed. 323), 669. Chicago, etc. R. Co. v. Solan (169 U. S. 133, 42 L. Ed. 688), 51-59- 68. Chicago, etc. R. Co. v. Suffern (129 111. 274), 345-437. Chicago, M. & St. P. R. Co. v. Becker (32 Fed. 849), 274. Chicago, M. & St. P. R. Co. v. Becker (35 Fed. 883), 212. Chicago, M. & St. P. R. Co. v. Tompkins (176 U. S. 167, 44 L. Ed. 417, 110 Fed. 473), 216-226- 227-348. Chicago, M. & St. P. R. Co. v. U. S. (162 Fed. 835, 157 Fed. 84), 698. Chicago, etc. R. Co. v. Voelker (129 Fed. 522, 116 Fed. 867), 813-829. Chicago, M. & St. P. R. Co. v. Wal- lace (66 Fed. 506, 14 C. C. A. 257, 30 L. R. A. 161), 290-353. Chicago, M. & St. P. R. Co. v. Wis- consin (238 U. S. 492, 59 L. Ed. 1423), 273. C. N. 0. & T. P. R. Co. V. I. C. C. (162 U. S. 184, 40 L. Ed. 935), 265-273-281. Chicago & G. T. R. Co. v. Wellman (143 U. S. 339, 36 L. Ed. 176), 227. Chicago & N. W. R. Co. v. Dey (35 Fed. 866), 207. C. & N. W. Ry. Co. V. U. S. (226 Fed. 30), 843. Chicago Wall Paper Mills v. Gen- eral Paper Co., (147 Fed. 491), 770. Childs V. Chesapeake & O. R. Co. (218 U. S. 71, 54 L. Ed. 936), 55. Chinese Exclusion Cases (130 U. S. 581, 32 L. Ed. 1068, 149 U. S. 698, 37 L. Ed. 905), 10. TABLE OP CASES. 935 [references are to pages.] Chy Lung v. Freeman (92 U. S. 275, 23 L. Ed. 550), 20. Cilley V. United Shoe Machine Co. (152 Fed. 726, 202 Fed. 598), 765. Cincinnati etc. Co. v. Bay (200 U. S. 179, 50 L. Ed. 428), 164-712. Cincinnati Freight Bureau Case (167 U. S. 479, 42 L. Ed. 243), • 307. Cincinnati H. & D. Co. v. Int. Comm. Com. (206 U. S. 142, 51 L. Ed. 995, 146 Fed. 559), 456. Cincinnati N. 0. & St. P. R. Co. v. Commission (162 U. S. 184, 40 L. Ed. 935), 590. City of LouisvUe v. Cumberland Tel. Co. (225 U. S. 430, 56 L. Ed. 1151, reversing 187 Fed. 637), 240. City of Memphis v. Cumberland Tel. & Tel. Co. (218 U. S. 624, 54 L. Ed. 1185), 214. City of Newton v. Lewis (79 Fed. 715), 221. Claflin V. Houseman (93 U. S. 130, 23 L. Ed. 833), 86. Clark V. Central Ry. Co. (50 Fed. 338), 716. Clay V. Waters (178 Fed. 385), 200. Claybaugh v. Southern Wholesale Groc. Ass'n (181 Fed. 706), 763. Clegg V. St. Louis & S. F. R. Co. (203 Fed. 971), 700. Clement V. L. & N. R. Co. (153 Fed. 979), 538. Cleveland, C. C. & St. L. R. Co. v. Backus (154 U. S. 439, 38 L. Ed. 1041, 154 U. S. 421, 38 L. Ed. 1031), 42. Cleveland, C. C. & St. L. R. Co. v. Hirsch (204 Fed. 848), 700. Cleveland, C. C. & St. L. R. Co. v. Ilhnois (177 U. S. 514, 44 L. Ed. 868), 56. Clune V. United States (159 U. S. 590, 40 L. Ed. 269), 186-187. Coe V. Errol (116 U. S. 517, 29 L. Ed. 715), 36. Coeur d' Alene C. Mfg. Co. v. Min- ers' Union (51 Fed. 260), 177. Colasurdo v. Central R. of N. J. (180 Fed. 832), 793. Cohen v. U. S. (214 Fed. 23), 15. Cohens v. Virginia (6 Wheaton 264, 5 L. Ed. 257), 137. Collins V. New Hampshire (171 U. S. 31, 43 L. Ed. 60), 21. Columbia & P. S. R. Co. v. Sauter 223 Fed. 604), 791. Columbia Wire Co. v. Freeman Wire Co. (71 Fed. 302), 769. Columbus Iron & S. Co. v. Kana- wha & N. R. Co. (171 Fed. 713, aff. 178 Fed. 261), 546, Commonwealth v. Caldwell (190 Mass. 355), 74. Commonwealth v. Hay Co. (104 S. W. 224), 73. Commonwealth v. Hunt (4 Met- calf. 111), 185. Compton V. Allen (216 Fed. 537), 15. Connor v. V. & M. R. Co. (36 Fed. 273), 532. Connole v. Norfolk & Wes. R. Co. (216 Fed. 823), 54. Connolly v. Sewer Pipe Co. (184 U. S. 540, 46 L. Ed. 679), 249- 768. Consolidated Gas Case (212 U. S. 19, 53 L. Ed. 399), 227-311. Consolidated Steel & Wire Co. v. Murray (80 Fed 811), 177. Continental Wallpaper Co. v. Voight (212 U. S. 227, 53 L. Ed. 486, 148 Fed. 939), 768. Conway v. Taylor's Executors (1 Black. 603, 17 L. Ed. 191), 103. Cook V. County of Marshall (196 U. S. 261, 49 L. Ed. 471), 35. 253. Cook V. Railway Co. (81 Iowa. 551, 9 L. R. A. 764). 304-345-531. 936 TABLE OF CASES. [references are to pages.] Cooley V. Board of Wardens (12 Howard, 299, 13 L. Ed. 996), 46- 48. Cooper Mfg. Co. v. Fergusson (113 U.S. 727, 28 L.Ed. 1137), 31. Copp V. L. & N. R. Co. (50 Fed. 164), 530. Copp V. Railway Co. (43 La. Ann. 511, 12L. R. A. 725), 88. Coppage V. Kansas (236 U. S. 1, 59 L. Ed. 441, 87 Kans. 752), 175. Copper River etc. R. Co. v. Heney (211 Fed. 459), 791. Corey v. Independent Ice Co. (207 Fed. 459), 762-763-765. Cotting V. Goddard (183 U. S. 79, 46 L. Ed. 92), 252-310. Council Bluffs v. Railway Co. (45 Iowa, 338), 73. Counselman v. Hitchcock (142 U. S. 547, 35 L. Ed. 1110. 44 Fed. 268), 565. County of Mobile v. Kimball (102 U. S. 691, 26 L. Ed. 238), 48. Covington etc. Bridge Co. v. Ken- tucky (154 U. S. 204, 38 L. Ed. 962). 15-47-66-67-102. Covington & Lexington Turnpike Co. v. Sanford (164 U. S. 578, 41 L. Ed. 560), 216, 227-241-309. Covington Stockyards Co. v. Keith (139 U. S. 128, 35 L. Ed. 73), 287- 289-464. Cowden v. Pacific Coast S. S. Co. (94 Cal. 470, 18 L. R. A. 221), 341. Cowen V. Bond (39 Fed. 54), 370. Crandall v. Nevada (6 Wall. 35, 18 L. Ed. 745), 44. Crawford v. Railroad Co. (10 Am. Neg. Repts. 166), 810. Crenshaw v. Arkansas (227 U. S. 389, 58 L. Ed. 565), 41. Crescent Liquor Co. v. Piatt (148 Fed. 894), 38. Grossman v. Lurman (192 U. S. 189, 48 L. Ed. 401), 21. Crutcher v. Kentucky (141 U. S. 47, 35 L. Ed. 649), 31-135. Crump v. Commonwealth (84 Va. 927). 189. Cudahy Packing Co. v. Grand Trunk Wes. R. Co. (215 Fed. 93), 290. Cumberland Tel. & Tel. Co. v. Louisville (225 U. S. 430, 56 L. ■ Ed. 1151), 238. D. Davis v. C, C. C. & St. L. R. Co. (217 U. S. 157, 54 L. Ed. 708), 71. Davis V. Booth (131 Fed. 31), 717. Davis V. United States (104 Fed. 136, 43 C. C. A. 448), 558. Davis V. Virginia (236 U. S. 695, 59 L. Ed. 795), 16. Dancel v. Goodyear Shoe Machin- ery Co. (128 Fed. 753), 767. Darius Coal Trans. Co. v. White Star Line (186 Fed. 63), 706. Darnell v. Indiana (226 U. S. 390, 57 L.Ed. 267), 41. Darnell Tanzer v. Southern Pac. Co. (221 Fed. 890), 633. Darr v. Baltimore & Ohio R. Co. (197 Fed. 665), 792. De Atley v. C. & O. R. Co. (201 Fed. 591), 803. Deal V. Coal & Coke Ry. Co. (215 Fed. 285), 792. D. & P. R. Co. V. Railroad Com- mission (192 Fed. 280), 235. Decker v. Railroad Co. (30 Fed. 723), 128. Delaware, The (161 U. S. 459, 40 L. Ed. 771). 57. Delaware etc. Co. v. Kutter (147 Fed. 51), 716. Delaware etc. Co. v. Interstate Comm. Com. (166 Fed. 499, 155 Fed. 512, 159 Fed. 894, 216 U. S. 531, 54 L. Ed. 605), 356. TABLE OP CASES. 937 [references are to pages.] Delaware etc. Co. v. Switchmens' Union(158Fed. 541), 177. Del. L. & N. Co. V. Stevens (172 Fed. 595), 245. Del. L. & W. Ry. Co. v. U. S. (231 U. S. 363, 58 L. Ed. 296), 298. Del. L. & W. Ry. Co. v. Frank (110 Fed. 689), 491. Delk V. St. Louis & St. F. R. Co. (220 U. S. 580, 55 L. Ed. 590), 816-831. Del. L. & W. R. Co. v. Yurkonis (220 Fed. 429), 793. Deni v. Penn. R. R. (181 Penn. 525), 806. Denver & Rio Grande R. Co. v. Ar- right (129 Fed. 347), 829. Denver & Rio Grande R. Co. v. In- terstate Comm. Com. (195 Fed. 968), 624. Denaby, Maine Colliery Co. v. M. S. & L. Ry. Co. (6 Ry. & Can. Tr. Cas, 141), 338. Dewberry v. Southern Ry. (175 Fed. 307), 62. Diamond Glue Co. v. United States Glue Co. (103 Fed. 838), 16. Diamond Match Co. v. Ontonogon 188 U. S. 82, 47 L. Ed. 394), 35. Diggs V. U. S. (220 Fed. 545), 14. Dodson V. Farbenfabriken of Elber- feld Co. (206 Fed. 125), 773. Donovan v. Pennsylvania Co. (199 U. S. 279, 50 L. Ed. 192), 466. Dooley v. United States (183 U. S. 151, 46 L. Ed. 128), 8. Doremus V. Hennessy (176 111., 608), 189. Dow V. Bidleman (125 U. S. 680, 31 L. Ed. 841), 227. Dozier v. Alabama (218 U. S. 123, 54 L. Ed. 965), 41. Dr. Miles Med. Co. v. Park & Son (220 U. S. 373, 55 L. Ed. 502), 168-728. Dueber Watch Case Co. v. Howard Co. (66 Fed. 637), 717. Duncan v. Maine Central R. Co. (113 Fed. 508), 374. Duplan Silk Co. v. American & Foreign Marine Ins. Co. (205 Fed. 724), 509. Eastern States R. L. D. Ass'n v. U. S. (234 U. S. 600, 58 L. Ed. 1490, 201 Fed. 581). 155-156- 720-723. East Tenn. etc. R. Co. v. Commis- sion (181 U. S. 1. 1. c. 27, 45 L. Ed. 719, 729, 39 C. C. A. 413, 99 Fed. 52), 387-474-589. Easton v. Iowa (188 U. S. 220, 47 L. Ed. 452), 133. Eckman Mfg. Co. v. U. S. (239 U. S. 510, 60 L. Ed. ), 113-124. Edmunds v. 111. Cent. R. Co. (80 Fed. 79), 88-531. Elder v. Whiteside (72 Fed. 724), 177. Ellis V. Inman (124 Fed. 956), 716. Elliot Mchy. Co. v. Center (227 Fed. 124), 732. Elwood Grain Co. v. St. Joe & G. I. Ry. Co. (202 Fed. 845), 700. Ellis V. Interstate Comm. Com. (237 U. S. 434, 59 L. Ed. 1036), 575. El Paso & N. R. Co. v. Gutirrez (215 U. S. 87, 54 L. Ed. 551), 783. Eng v. Southern Pac. Co. (210 Fed. 92), 791. Engel V. O'Malley (219 U. S. 128, 55 L. Ed. 128, 182 Fed. 365), 18. Equitable Assur. Soc. v. Clements (140 U. S. 226, 35 L. Ed. 497), 33. Erb v. Morasch (177 U. S. 584, 44 L. Ed. 897), 53-279. 938 TABLE OF CASES. [references are to pages.] Erie R. Co. v. Jacobus (221 Fed. 335), 792. Erie R. Co. v. Pennsylvania (158 U. S. 431, 39 L. Ed. 1043), 42. Erie R. Co. v. Pond Creek etc. Co. (162 Fed. 878), 57. Erie R. Co. v. New York (233 U. S. 671, 58 L.Ed. 1149), 840. Erie R. Co. v. Russell (183 Fed. 722), 818. . Erie R. Co. v. U. S. (200 Fed. 406, 848. Erie R. Co. v. Williams (233 U. S. 685, 58 L. Ed. 1155, 199 N. Y. 525), 63. Escanaba Co. v. Chicago (107 U. S. 678. 27 L. Ed. 442), 28^8. Evershed v. London & N. W. R. Co. (L. R. 3 Q. B. D. 135), 344. Ewing V. Leavenworth (226 U. S. 464, 57 L. Ed. 303), 275. Ex parte Benson (18 S. C. 38). 341. Ex parte Eaglesfield (180 Fed. 558), 28. Ex parte Koehler (31 Fed. 315), 677. Ex parte Lennon (166 U. S. 548, 41 L. Ed. 1110), 199. Ex parte Massey (92 S. W. 1086, 49 Tex. Crim. Ap. 60), 75. Ex parte Robinson (19 Wallace 505, 22 L. Ed. 205), 199. Ex parte Young (209 U. S. 129). 52 L. Ed. 714), 213-216-219-221. Express Company cases (117 U. S. 1, 29 L.Ed. 791), 269. Express Co. v. Railroad Co. (Ill N. C. 463), 100. F. Fairbanks v. United States (181 U. S. 283, 45 L. Ed. 862), 17. Fanning v. Gregorie (16 Howard. 524, 14 L. Ed. 1043), 103. Fargo V. Hart (193 U. S. 490, 48 L. Ed. 761), 43. Fans V. Henderson (1 Okla. 384), 74. Farmers' Loan & Trust Co. v. Northern Pac. R. Co. (83 Fed. 249), 308. Farmers' etc. National Bank v. Deering (91 U. S. 29, 23 L. Ed. 196), 128. Feaster v. Philadelphia & R. Ry. Co. (197 Fed. 580), 793. Fidelity & Guarantee Co., U. S. to use, V. (178Fed. 721), 30. Field V. Barber Asphalt Co. (194 U. S. 618, 48 L. Ed. 1142), 711. Field V. Clark (143 U. S. 649, 36 L. Ed. 294), 109. Fitchburg R. Co. v. Gage (12 Gray, 393), 345. Fitts V. McGhee (172 U. S. 516, 43 L. Ed. 535), 216. Fleitman v. United Gas Impr. Co. (211 Fed. 103), 762. Fleitmann v. Wellsbach StreetLight- ing Co. (240 U. S. 27, 60 L. Ed. ), 762. Flint V. Stone Tracy Co. (220 U. S. 107, 55 L. Ed. 389), 127. Florida East Coast Ry. Co. v. U. S. (234 U. S. 167. 58 L. Ed. 1267), 641. Fobpiano v. Speed (199 U. S. 501. 50 L. Ed. 288). 38. Foote v. Buchanan (113 Fed. 156). 771. Foote & Co. v. Stanley (232 U. S. 494, 58 L. Ed. 698, 17 Md. 335), 66. Ford Motor Co. v. Union Motor Sales Co. (225 Fed. 373), 168. Foster v. C. C. & St. L. R. Co. (56 Fed. 434), 415. Fowle v. Park (131 U. S. 88, 97, 33 L. Ed. 74), 169. Franklin v. Philadelphia & Reading R. Co. (203 Fed. 134). 543. TABLE OP CASES. 939 [references are to pages.] Freight Association Case (166 U. S. 290, 41 L. Ed. 1007), 148-705. Ft. Leavenworth Ry. Co. v. Love (114 U. S. 525, 29 L. Ed. 264), 50. Fretz V. Bull (12 Howard, 466, 13 L. Ed. 1068), 28. Frost V. Wenie (157 U. S. 46, 39 L. Ed. 615), 554. Fulgham v. Midland Valley Ry. Co. (167 Fed. 660), 62-787. Galveston etc. Co. v. Texas (210 U. S. 217, 52 L. Ed. 1131), 43. Galveston etc. R. Co. v. Wallace (223 U. S. 481, 56 L. Ed. 516), 668. Gamble-Robinson Com. Co. v. C. & N. W. Ry. Co. (168 Fed. 161). 460-694. Gardner v. Early (69 Iowa, 42), 569. Garrett v. L. & N. R. Co. (235 U. S. 308, 59 L. Ed. 242, 197 Fed. 705), 800. Geraty v. Atlantic Coast Line R. Co. (211 Fed. 227), 542. Geer v. Connecticut (161 U. S. 519, 40L. Ed. 793), 23. General Electric Co. v. Wise (119 Fed. 922), 770. Genesee Chief, The (12 Howard, 443, 13 L. Ed. 1058), 28. Georgia etc. R. Co. v. Smith (70 Ga. 694), 100. Georgia Fruit Exchange Case (20 I.e. C.R. 623), 290. Georgia Peach Growers' Case (10 I. C. C. R. 255), 290. Gibbs V. Consolidated Gas Co. (130 U. S. 396, 32 L. Ed. 979), 155-169. Gibbes v. McNealey (55 C. C. A. 70, 118 Fed. 120, 10 Fed. 210, 102 Fed. 594, 60 L. R. A. 152), 158- 709-762. Gibbons v. Ogden (9 Wheaton, 1, 6 L. Ed. 23), 11. Gill Engraving Co. v. Doerr (214 Fed. Ill), 724. Gilbert v. Burlington C. R. & N. R. Co. (128 Fed. 529, 123 Fed. 832), 828. Gilman v. Philadelphia (3 Wall. 724, 18 L. Ed. 96), 16. Gimbel Bros. v. Barrett (215 Fed. 1004), 541. Gladson v. Minnesota (166 U. S. 427, 41 L. Ed. 1064), 55. Globe Elevator Co. v. Andrew (144 Fed. 871), 70. Gloucester Ferry Co. v. Pennsylva- nia (114 U. S. 196, 29 L. Ed. 158), 48-103. Gompers v. Buck Stove & Range Co. (221 U. S. 418, 55 L. Ed. 797), 155-179-202-720-722. Gompers v. U. S. (233 U. S. 604, 58 L. Ed. 1115), 201. Goodrich v. Interstate Comm. Com. (190 Fed. 943), 264. Goshen Rubber Co. v. Single Tube etc. Co. (166 Fed. 431), 727. Grand Rapids & Ind. R. Co. v. Os- borne (193 U. S. 17, 48 L. Ed. 598), 244. Grand Rapids & Ind. R. Co. v. U. S. (212 Fed. 577), 434, 701. Grand Trunk Ry. Co. v. Michigan (231 U. S. 457, 58 L. Ed. 310, 198 Fed. 1009), 242-440. Granger Cases (94 U. S. 113, 24 L. Ed. 77), 303. Great Atlantic & Pacific Tea Co. v. Cream of Wheat Co. (224 Fed. 566, 227 Fed. 46), 168-731. Great Northern R. Co. v. Minne- sota (238 U. S. 340, 59 L. Ed. 1337), 246. Great Northern R. Co. v. U. S. (208 U. S. 452, 52 L. Ed. 567, 155 Fed. 945, 151 Fed. 84), 692. 940 TABLE OP CASES. [references are to pages.] Great Western R. Co. v. Sutton (L. R. 4 H. L. 226, 238), 341-345- 356. Green v. Henkel (183 U. S. 249, 46 L. Ed. 177), 559. Greenlee v. Southern Ry. Co. (122 N. C. 982, 41 L. R. A. 99), 809. Greer V. StoUer (77 Fed. 1), 758. Groves v. Slaughter (15 Peters, 449, 505, 10 L.Ed. 800, 821), 7. Gulf, Colo. & S. F. R. Co. V. Helfley (158 U. S. 98, 39 L. Ed. 910), 52- 500. Gulf. Colo. & S. F. R. Co. V. Mc- Ginnis (228 U. S. 173, 57 L. Ed. 785, 147 S. W. 1178), 796-804- 805. Gulf, Colo. & S. F. R. Co. V. Miami S. S. Co. (30 C. C. A. 142, 86 Fed. 407). 147-459-747. Gulf, C. & S. Co. V. Texas (204 U. S. 403, 51 L. Ed. 540, 97 Tex. 274), 281. Gulf, Colo. & S. F. R. Co. V. Moore (Tex.) (83 S. W. Rep. 362), 88. H. Habit of Monopolies (21 Jas. I. C. 3), 159. Hadley Dean Glass Co. v. Highland Glass Co. (143 Fed. 242), 775. Hagan v. Blindell (6 C. C. A. 86, 56 Fed. 696), 747. Hague V. Wheeler (157 Pa. St. 324), 26. Hale V. Henkel (201 U. S. 43, 50 L. Ed. 652), 567-569. Hale V. O'Connor Coal Co. (181 Fed. 267), 714. Hall V. DeCuer (95 U. S. 485, 24 L. Ed. 547), 54, 55, 117. Hamm Brewing Co. v. Chicago R. I. & P. Co. (215 Fed. 672), 40. Hamlen & Sons Co. v. Illinois Cen- tral R. Co. (212 Fed. 324), 510- 671. Hamilton Gas Light Co. v. Hamil- ton City (146 U. S. 258, 36 L. Ed. 963),-214. Hammond Pack. Co. v. Ark. (212 U. S. 322, 53 L. Ed. 530, 81 Ark. 519), 250. Handy v. C. & N. R. Co. (31 Fed. 689), 343. Hanley v. Kansas City S. R. Co. (187 U. S. 617, 47 L. Ed. 333), 16-275. Hannibal Bridge Co. v. U. S. (221 U.S. 194, 55 L.Ed. 699), 110. Hannibal & St. Joe R. Co. v. Hu- sen (95 U. S. 465, 24 L, Ed. 527), 60. Hardware Co. v. Pottery Co. (120 S. W. 1088), 75. Harman v. Chicago (147 U. S. 396, 37 L. Ed. 216), 49. Harp V. Choctaw O. & G. R. R. Co. (61 C. C. A. 405, 125 Fed. 445, 118 Fed. 169), 437. Harriman v. Inter. Comm. Co. (211 U. S. 407, 53 L. Ed. 253, 157 Fed. 432), 574. Harris v. U. S. (227 U. S. 340, 57 L. Ed. 534, 194 Fed. 634), 14-15. Haskell v. Cowhan (187 Fed. 402), 27. Hayes v. Pennsylvania Co. (12 Fed. 309), 343. Head Money Cases (112 U. S. 580, 28 L. Ed. 798), 127. Heim Brewing Co. v. Belinder (97 Mo. App. 1. c. 76), 142. Heimbach v. Lehigh Valley R. Co. 197 Fed. 576), 793. Henderson Bridge Co. v. Hender- son (173 U. S. 592, 43 L. Ed. 823), 15. Henderson Bridge Co. v. Kentucky (166 U. S. 150, 41 L. Ed. 953), 42. Henderson v. Mayor of New York (92 U. S. 259, 23 L. Ed. 543), 20 47. TABLE OF CASES. 941 [references are to pages.] Hendrick v. Maryland (235 U. S. 610, 59 L. Ed. 385), 69. Hennington v. Georgia (163 U. S. 299, 41 L. Ed. 166), 52-80. Henry v. A. B. Dick Co. (224 U. S. 1, 56 L. Ed. 645), 168-727. Herndon v. C. R. I. & P. (218 U. S. 135, 54 L. Ed. 970), 56-81. Heyman v. Hayes (236 U. S. 176, 59 L. Ed. 527), 42. Higgins V. Casks of Lime (130 Mass. 1), 74. Hilton Lumber Co. v. Railroad Co. (N. C.) (60 C. L. J. 30), 345. Hipolite Egg. Co. v. U. S. (220 U. S. 45, 55 L.Ed. 364), 113. Hite V. Central Ry. N. J. (171 Fed. 370, 166 Fed. 926), 284. Hitchcock V. Counselman (142 U. S. 457, 35 L. Ed. 1110), 549. Hocking Valley R. Co. v. U. S. (210 Fed. 735), 460-694-697-742. Hoke V. U. S. (227 U. S. 308, 57 L. Ed. 523, 187 Fed. 992), 14. Hooper V. California (155 U. S. 647, 39 L. Ed. 297), 19. Hoover v. Pennsylvania (156 Pa. St. 220, 22 L. R. A. 23), 344-350- 529. Hopkins v. Oxley Stave Co. (28 C. C. A. 99, 83 Fed. 912, 72 Fed. ' 695), 177-189. Hopkins v. United States (171 U. S. 578, 43 L. Ed. 290, 296), 152- 180-556-710. Horton v. Tonpah & Goldfield R. Co. (225 Fed. 406), 413. H. & T. C. R. Co. V. Mayes (201 U. S. 321, 50 L. Ed. 772), 59. Houston etc. Co. v. Story (149 Fed. 499), 220. Houston etc. Co. v. U. S. (168 Fed. 895), 849. Houston etc. Co. v. U. S. (234 U. S. 342, 58 L. Ed. 1341; 205 Fed. 380), 120-468. Howard v. 111. Cent. (207 U. S. 463, 52 L.Ed. 297), 111-782. Howard Supply Co. v. Chesapeake & O. (162 Fed. 188), 538. Hoxie V. N. Y. & N. H. R. Co. (82 Conn. 352), 89-630-786-794. Hudson V. Chicago, St. P. M. & 0. Ry. Co. (226 Fed. 38), 670. Hudson County Water Co. v. Mc- Carter (209 U. S. 349, 52 L. Ed. 828, 70 N. J. Eq. 695), 24. Huse V. Glover (119 U. S. 543, 30 L. Ed. 487), 48. Hyde v. Southern R. R. Co. (31 App. D. C. 466), 783. Illinois V. Terminal R. Co. (168 Fed. 546), 691. Illinois Central R. Co. v. Behrens (233 U. S. 473, 58 L. Ed. 1051), 790. I. C. C. V. D. L. & W. R. R. Co. (216 U. S. 531, 54 L. Ed. 605, 166 Fed. 498), 300. Illinois Cen. R. Co. v. DeFuentes (236 U. S. 157, 59 L. Ed. 517), 63^40. Illinois Cen. R. Co. v. Henderson Elev. Co. (226 U. S. 441, 58 L. Ed. 290), 508. 111. Cent. R. Co. v. Illinois (163 U. S. 142, 41 L. Ed. 107), 55. 111. Cent. V. Inter. Comm. Com. (206 U. S. 441, 51 L. Ed. 1128), 306-313-589. 111. Cent. V. McKendree (203 U. S. • 514, 51 L. Ed. 298), 64. Illinois Cen. R. Co. v. Mulberry Co. (237 U. S. 597, 59 L. Ed. 1306; 257 111. 80), 540. Illinois Cen. R. Co. v. Nelson (203 Fed. 956), 792. Illinois Cen. R. Co. v. Porter (207 Fed. 311), 792. 942 TABLE OF CaSBS. [references ABE TO PAGES.] Illinois Cen. R. Co. v. Rogers (221 Fed. 52), 793. Illinois Cen. R. Co. v. Skaggs (125 Minn. 532, 240 U. S. 66, 60 L. Ed. ), 805. Illinois Cen. R. Co. v. Segari & Co. 205 Fed. 998), 505. Ilwaco V. Or. Ry. & Nav. Co. (6 C. C. A. 495, 57 Fed. 673), 459. Import Rate Case (162 U. S. 197, 40 L. Ed. 940, 6 C. C. A. 653, 52 Fed. 187), 91-93-348-383-473. Income Tax Cases (158 U. S. 601, 39L. Ed. 1108), 127. Indiana Mfg. Co. v. J. I. Case Thresh. Me. Co. (154 Fed. 365, 148 Fed. 21), 726. Indiana Consumers' & T. R. Co. v. Horlass (131 Ind. 446), 26. Ingraham v. National Salt Co. (130 Fed. 676; 122 Fed. 40), 769. In re Bessette (111 Fed. 417), 186- 203. In re Corning (51 Fed. 205), 716- 735. In re Christianson Engineering Co. (194 U. S. 458, 48 L. Ed. 1072), 201. In re Debs (158 U. S. 564, 39 L. Ed. 1092, 64 Fed. 724), 5-178-187- 195-199-534-721-775. In re Doolittle (23 Fed. 544), 199. In re Garnett (141 U. S. 1, 35 L. Ed. 631), 28-29. In re Grice (79 Fed. 627), 248. In re Green (52 Fed. 104), 158- 716-735-775. In re Higgins (27 Fed. 443), 199. In re Horhorst (150 U. S. 653, 37 L. Ed. 1211), 532. In re Jackson (96 U. S. 727, 24 L. Ed. 877), 126. In re Kittle (180 Fed. 946), 772. In re Lennon (166 U. S. 548, 41 L. Ed. 1110), 87-197-532. In re Metropolitan Water Co. (220 U. S. 539, 55 L. Ed. 575), 223. In re Nagel (135 U. S. 1, 34 L. Ed. 55), 10. In re Nevitt (55 C. C. A. 622, 117 Fed. 448), 200. In re Peasley (44 Fed. 271), 567. In re Philadelphia & Reading R. Co. (65 Fed. 660), 181. In re Penn. Tel. Co. (48 N. J. Eq. 191), 15. In re Reese (98 Fed. 984, 47 C. C. A. 87, 107 Fed. 942), 197-203. In re Rahrer (140 U. S. 545, 35 L. Ed. 572), 36. In re Rapier (143 U. S. 110, 36 L. Ed. 93), 126. In re Savin (131 U. S. 267, 33 L. Ed. 150), 199. In re Selmann H. & P. Co. (204 Fed. 839), 32. In re Southern Pac. (155 Fed. 1001), 176. In re Steiner (195 Fed. 1. c. 303), 199. In re Tyrrell (51 Fed. 213), 716-735. In re Winn (213 U. S. 458, 53 L. Ed. 873), 88. In re Wong Yung Quy (6 Sawyer, 442), 21. International Harvester Co. v. Kentucky (234 U. S. 216, 58 L. Ed. 1284, 147 Ky. 564), 250. International Harvester Co. v. Kentucky (234 U. S. 577, 58 L. Ed. 1479), 250. International Harvester Co. v. Mis- souri (234 U. S. 199, 58 L. Ed. 1276, 237 Mo. 269), 250. International Text Book Co. v. Gil- lespie (229 Mo. 397), 74. International Text Bk. v. Pigg (217 U. S. 91, 54 L. Ed. 768), 13-14. Interstate Commerce Commission (234 U. S. 294, 58 L. Ed. 1319, 188 Fed. 229), 285. Interstate Commerce Commission v. Alabama Mid. Ry. Cb. (168 U. S. 144, 42 L. Ed. 414)^ 473. TABLE OF CASES. 943 [references are to pages.] , Interstate Commerce Commission V. Atlantic R. Co. (35 C. C. A. 217, 93 Fed. 83), 387. Interstate Commerce Commission V. Baird (194 U. S. 25, 48 L. Ed. 860), 573-778. Interstate Commerce Commission V. Brimson (154 U. S. 447, 38 L. Ed. 1047, 155 U. S. 1, 39 L. Ed. 49, 53 Fed. 476), 573. Interstate Commerce Commission V. B. Z. & C. R. Co. (77 Fed. 942), 265-274-662. Interstate Commerce Commission V. Chesapeake & Ohio R. Co. (128 Fed. 59), 427. Interstate Commerce Commission V. Chicago B. & Q. R. Co. (186 U. S. 320, 46 L. Ed. 1182, 43 C. C. A. 209, 103 Fed. 249, 94 Fed. 272), 287-635. Interstate Commerce Commission V. Chicago & G. W. Co. (141 Fed. 1003, aff. 209 U. S. 108, 52 L. Ed. 705), 354, 444. Interstate Commerce Commission V. Cincinnati P. & V. R. Co. (124 Fed. 624), 389. Interstate Commerce Commission V. Clyde Steamship Co. (181 U. S. 33, 45 L. Ed. 731), 315. Interstate Commerce Commission V. C. R. & P. (218 U. S. 88, 54 L. Ed. 946, 171 Fed. 680), 396. Interstate Commerce Commission V. Delaware L. & W. R. Co. (64 Fed. 723), 315. Interstate Commerce Commission V. Delaware L. & W. R. Co. (220 U. S. 235, 55 L. Ed. 448), 356. Interstate Commerce Commission V. Del. & L. W. R. Co. (216 U. S. 531, 54 L. Ed. 605, 166 Fed. 498), 300-583. Interstate Commerce Commission V. Detroit, G. H. & M. R. Co. (167 U. S. 633, 42 L. Ed. 306, 21 C. C. A. 103, 74 Fed. 803), 353. Interstate Commerce Commission V. Diffenbaugh (176 Fed. 409, 222 U. S. 42, 56 L. Ed. 83), 286-415. Interstate Commerce Commission V. Goodrich Transit Co. (224 U. S. 194, 56 L. Ed. 729), 663. Interstate Commerce Commission ex rel. U. S. v. Humboldt S. S. Co. (224 U. S. 472, 56 L. Ed. 849), 276. Interstate Commerce Commission V. 111. Cent. (215 U. S. 452, 54 L. Ed. 280, 173 Fed. 930), 98, 423. Interstate Commerce Commission V. Lehigh V. R. Co. (74 Fed. 784), 315. Interstate Commerce Commission V. Louisville & N. R. Co. (73 Fed. 409), 389. Interstate Commerce Commission V. Louisville & N. R. Co. (190 U. S. 273, 47 L. Ed. 1047, 108 Fed. 988), 389-395-474. Interstate Commerce Commission V. Louisville & N. R. Co. (227 U. S. 88, 57 L. Ed. 431), 328-640. Interstate Commerce Commission V. Louisville & N. R. Co. (118 Fed. 613), 314. Interstate Commerce Commission V. N. C. & St. L. R. Co. (120 Fed. 934), 314. Interstate Commerce Commission V. Northern Pac. (216 U. S. 538, 54L. Ed. 608), 98-601. Interstate Commerce Commission V. Peavey (222 U. S. 42, 56 L. Ed. 83), 415. Interstate Commerce Commission V. Railroad Co. (167 U. S. 633, 42 L. Ed. 306, 74 Fed. 803), 283. Interstate Commerce Commission V. Reichman (145 Fed. 235), 292. 944 TABLE OF CASES. [references are to pages.] Interstate Commerce Commission V. Atchison T. & S. F. R. Co. (234 U. S. 294, 58 L. Ed. 1319. rev. 188 Fed. 229), 285. Interstate Commerce Commission V. Seaboard R. Co. (82 Fed. 563), 662. Interstate Commerce Commission V. Southern R. Co. (117 Fed. 741, 122 Fed. 800), 314-395. Interstate Commerce Commission V. Sou. Pac. (123 Fed. 597, and 132 Fed. 829), 441^87. Interstate Commerce Commission V. L. N. Ry. Co. (102 Fed. 709), 396-635. Interstate Commerce Commission V. Stickney (215 U. S. 98, 54 L. Ed. 112, 164 Fed. 638), 288, 514. Interstate Commerce Commission V. Texas & Pacific R. Co. (162 U. S. 197, 40 L. Ed. 940, 52 Fed. 187, 6 C. C. A. 653), 342. Interstate Commerce Commission V. Union Pacific R. Co. (222 U. S. 541, 56 L. Ed. 308), 328-317-639. Interstate Commerce Commission V. Western Atl. R. Co. (88 Fed. 186), 389. Interstate Commerce Commission V. W. N. Y. & P. R. Co. (82 Fed. 192), 279-590-620-637. Interstate Stockyards Co. v. In- dianapolis U. R. Co. (99 Fed. 472), 438-463-464-533. Iron Moulders' Union v. AUis- Chalmers (166 Fed. 45), 177-191. Iroquois Transp. Co. v. De Lanney (205 U. S. 354, 51 L. Ed. 837), 30. Irving V. Neal (209 Fed. 471), 723. Ives V. Buffalo etc. R. R. Co. (94 N. E. 432), 72. Ivy V. Western Union Tel. Co. (165 Fed. 371), 50. Jamison v. Indiana Gas & Fuel Co. (128 Ind. 555, 12 L. R; A. 652), 26. Jayne v. Loder (149 Fed. 21), 714- 764. Jefferson, The Thomas (10 Wheat- on, 428, 6 L. Ed. 358), 27. Jennings v. Big Sandy R. Co. (61 W. Va. 664, 57 S. E. 272), 75. Jewell Tea Co. v. Lee's Summit et. al. (189 Fed. 280), 16-223. Jewett V. Chicago M. & St. P. (156 • Fed. 160), 546. Johnson v. Pensacola, etc. Co. (16 Fla. 622), 341. Johnson v. Southern Pac. R. Co. (117 Fed. 462, 54 C. C. A. 508, 196 U. S. 1, 49 L. Ed. 363), 814. Johnson v. United States (215 Fed. 679), 14. Johnston v. The Great Northern R. Co. (178 Fed. 643), 788-817. Joint Traffic Association Case (171 U. S. 504, 43 L. Ed. 259), 706. Joy V. St. Louis (138 U. S. 1, 34 L. Ed. 843), 205. Junod V. C. & W. R. Co. (47 Fed. 290), 549. K. Kalen v. U. S. (196 Fed. 888), 14. Kalispel Lbr. Co. v. Great Northern Ry. Co. (157 Fed. 845, 165 Fed. 25), 545. Kansas City Breweries Co. v. Trickett (195 Fed. 840), 40. Kansas City etc. R. Co. v. Leslie 238 U. S. 599, 59 L. Ed. 1478), 796-802. Kansas City Sou. R. Co. v. Albers Com. Co. (223 U. S. 594, 56 L. Ed. 567), 508. Kansas City Sou. R. Co. v. Kaw Valley Drainage Co. (233 U. S. 75, 58 L.Ed. 857), 101. TABLE OF CASES. 945 [references are to pages.] Kansas City Sou. R. Co. v. U. S. (231 U. S. 423, 58 L. Ed. 296, 204 Fed. 641), 662. Kansas City Western R. R. Co. v. McAdow (240 U. S. 51, 60 L. Ed. , 164 S. W. 188), 805. Kelley's Administratrix v. Chesa- peake & 0. R. Co. (201 Fed. 602), 803. Kelley v. Rhodes (188 U. S. 1, 47 L. Ed. 359), 35. Kennedy v. Terminal Ass'n (81 Fed. 802). 306. Kentucky Railroad Tax Cases (115 U. S. 321, 29 L. Ed. 414), 42. Kentucky & Indiana Bridge Co. v. L. & N. R. Co. (37 Fed. 567, 633), 80-282-589. Kidd V. Alabama (188 U. S. 730, 47 L. Ed. 669), 41. Kidd V. Pierson (128 U. S. 1, 32 L. Ed. 346), 18-130. Kimmish v. Ball (129 U. S. 217, 32 L. Ed. 695), 60. Kinnavey v. Terminal Association (81 Fed. 802), 85. Kinner v. Lake Shore & M. S. R. Co. (69 Ohio St. 339), 491. Kinsley v. Buffalo N. Y. & P. R. Co. (37Fed. 181), 344. Kirmeyer v, Kansas (236 U. S. 568, 59 L. Ed. 721), 38. Knowlton v. Moore (178 U. S. 41, 44 L. Ed. 969), 127. Knoxville v. Knoxville Water Co. (212 U. S. 1, 53 L. Ed. 371), 220- 227-231-232-311. Knudson v. Benn (123 Fed. 636), 190-192. Knudson-Ferguson Co. v. Michigan Central R. Co. (148 Fed. 968), 290-529. Kohl V. United States (91 U. S. 367, 23 L. Ed. 449), 9, 10. KoUey v. Robinson (187 Fed. 415), 177-191. La Farier v. Railway Co. (84 Me. 286), 74. Lake Shore & M. S. R. Co. v. Ohio (173 U. S. 285, 43 L. Ed. 702), 55-80. Lake Shore & M. S. R. Co. v. Smith (173 U. S. 684, 43 L. Ed. 858), 241-679, Lamphere v. Oregon R. & N. Co. (196 Fed. 336), 792. L. & Y, R. Co. V. Greenwood (Law Rep. 21Q.B.Div.215,338. Laurel Cotton Mills v. Gulf, etc. R. Co. (37 Sou. Rep. 134), 371-376. Law V. Illinois Central R. Co. (208 Fed. 869), 791. Lawler v. Loewe (235 U. S. 522, 59 L. Ed. 341, aff. 209 Fed. 721), 179. Lee V. St. Louis Ry. Co. (193 Fed. 685), 803. Legal Tender Cases (110 U. S. 421, 28 L. Ed. 204), 9-10. Lehigh Valley R. Co. v. American Hay Co. (219 Fed. 539), 632. Lehigh Valley R. Co. v. Clark (207 Fed. 717), 636. Lehigh Valley R. Co. v. Dupont (128 Fed. 840), 518. Lehigh Valley R. Co. v. Pennsyl- vania (145 U. S. 192, 36 L. Ed. 672), 275. Lehigh Valley R. Co. v. Rainey 112Fed. 487), 530. Lehigh Valley R. Co. v. U. S. (204 Fed. 986), 307. Leisy V. Hardin (135 U. S. 100, 34 L. Ed. 128), 34-46-78. Leloup V. Port of Mobile (127 U. S. 640, 32 L. Ed. 311), 5. License Cases (5 Howard, 504, 12 L. Ed. 256), 34-35-46. J— 60. 946 TABLE OF CASES. [references ABE TO PAGES.] Little Rock & N. R. Co. v. St. L. Iron Mt. & S. R. Co. (41 Fed. Rep. 559, 59 Fed. Rep. 400), 458- 459. Little Rock & St. L. R. Co. v. Op- penheimer (64 Ark. 271, 44 L. R. A. 353), 421. Livingston v. Van Ingen (9 Johns. 507), 11. Loeb V. Eastman Kodak Co. (183 Fed. 704), 763. Loewe v. California State Federa- tion of Labor (189 Fed. 714), 180. Loewe v. Lawlor (208 U. S. 274, 52 L. Ed. 488, 235 U. S. 522, 59 L. Ed. 341, 148 Fed. 924), 156-179- 722-767. Logan Coal Co. v. Penn. Ry. Co. (154 Fed. 497), 424. Looney v. Railway Co. (192 111. App. 273), 670. Lottery Cases (188 U. S. 321, 47 L. Ed. 492), 15. Lombardo v. Boston & M. R. Co. (223 Fed. 427), 791. Loomis V. Lehigh Valley R. Co. (240 U. S. 43, 60 L. Ed. 538). Louisiana & P. Ry. Co. v. United States, 299 Fed. 244-362. Louisville & Nashville R. Co. v. Behlmer (169 U. S. 644, 42 L. Ed. 889, 175 U. S. 648, 44 L. Ed. 309), 274-315-474-517-589. Louisville & Nashville R. R. Co. v. Brown (123 Fed. 946), 315. Louisville & Nashville R. Co. v. Cent. Stockyards Co. (212 U. S. 132, 53 L. Ed. 441, 30 Ky. L. R. 18), 242. Louisville & Nashville v. Cook Brewing Co. (172 Fed. 117, aff. 223 U. S. 70, 56 L. Ed. 355), 547. Louisville & Nashville R. Co. v. Commonwealth (51 S. W. Rep. 167), 569. Louisville & N. R. Co. v. Dickerson (191 Fed. 705), 584-607-637. Louisville & N. R. Co. v. Eubanlc (184 U. S. 27, 46 L. Ed. 416), 210. Louisville & N. R. Co. v. Finn (235 U.S. 601, 59 L. Ed. 379), 242. Lousiville & N. R. Co. v. Garret 231 U. S. 298, 58 L. Ed. 229), 235 U. S. 601, 59 L. Ed. , 214 Fed. 265), 213-218-220-222. Louisville & N. R. Co. v. Hughes (201 Fed. 727), 812. Louisville & N. R. Co. v. Interstate Comm. Com. (184 Fed. 118), 599. Louisville & N. R. Co. v. Kentucky 183 U. S. 503, 46 L. Ed. 298, 161 U. S. 677, 40 L. Ed. 849) . Louisville & N. R. Co. v. McChord (103 Fed. 216), 144-210-243. Louisville & N. R. Co. v. Maxwell (237 U. S. 94, 59 L. Ed. 853), 504. Louisville & N. R. Co. v. Missis- sippi (133 U. S. 587, 33 L. Ed. 784), 54. Louisville & N. R. Co. v. Mottley (219 U. S. 467, 55 L. Ed. 297, 133 Ky. 615, 211 U. S. 149, 53 L. Ed. 126, 150 Fed. 406), 294-732. Louisville & N. R. Co. v. Railroad Com. of Alabama (191 Fed. 757. 196 Fed. SCO, 208 Fed. 35), 222- 235-239-247. Louisville & N. R. Co. v. Siler (186 Fed. 176, 231 U. S. 298, 58 L. Ed. 229), 211-21fr-222-224. Louisville & N. R. Co. v. U. S. (238 U. S. 1, 59 L. Ed. 1177, 216 Fed. 672, 197 Fed. 58, 225 Fed. 571, 218 Fed. 89), 319-439-485-639- 641. Lousiville & N. R. Co. v. U. S. (227 Fed. 273), 100-440. Louisville & N. R. Co. v. Western Union Tel. Co. (207 Fed. 1), 51. TABLE OF CASES. 947 [heferences are to pages.] Louisville & N. R. v. West Coast Naval Stores Co. (198 U. S. 483, 49 L. Ed. 1135), 417. Louisville & Nashville Consolidated R. Co. v. Wilson (132 Ind. 517, 18 L. R. A. 105), 344. Louisville Tel. Co. v. Cumberland Tel. Co. (UlFed. 663), 221. Lowe V. Railroad Co. (63 S. C. 248), 74. Lowenstein v. Evans (69 Fed. 908), 764. Lowry v. C. B. & Q. R. Co. (46 Fed. 83), 532. Lucke v. Clothing Cutters & Trim- mers' Assem. (77 Md. 396), 189. Lundquist v. Grand Trunk R. Co. (121 Fed. 915), 356. Lusk V. Town of Dora (224 Fed. 650), 247. Luxton y. North River Bridge Co. (153 U. S. 525, 38 L. Ed. 808), 102-129. Lyng V. Michigan (135 U. S. 161, 34 L. Ed. 150), 35. L. & Y. Ry. Co. V. Greenwood (21 Q. B. Div. 217, 218), 384. M. McAlister v. Henkel (201 U. S. 90, 50L. Ed. 6fl), 568. McCabe v. Atchison, T. & S. F. R. Co. (186 Fed. 966, 235 U. S. 149, 59 L. Ed. 169), 54. McCall V. California (136 U. S. 134, 34 L. Ed. 391), 44. McConnell v. Camors-McConnell Co. (152 Fed. 321), 714. McCready v. Virginia (94 U. S. 391, 24 L. Ed. 248), 24. McCuUoch v. Maryland (4 Wheat. 316, 4 L. Ed. 579), 9-10-11-117. McDermott v. Wisconsin (228 U. S. 115, 57 L.Ed. 754), 64. McGovern v. Phil etc. R. Co. (235 U. S. 389, 59 L. Ed. 283), 209- 806-975. McGrew v. Missouri Pac. R. Co. (114 Mo. 210), 305. McKinney v. Kansas Natural Gas Co. (206 Fed. 772), 49. McNeill V. Southern R. Co. (202 U. S. 543, 50 L. Ed. 1142, 134 Fed. 82), 59-217-300. Mackin v. U. S. (117 U. S. 348, 29 L. Ed. 909), 185. Magnolia, The (20 How. 296, 15 L. Ed. 909), 28. Maine v. Grand Trunk R. Co. (142 U. S. 217, 35 L. Ed. 994), 43. Majestic Coal & Coke v. Illinois Cent. Ry. (162 Fed. 810), 424. Makall v. Ratchford (82 Fed. 41), 177. Mallinckrodt Chem. Co. v. Mis- souri (238 U. S. 40, 59 L. Ed. 1191, 249 Mo. 702), 250. Menacho v. Ward (27 Fed. 529), 341. Manchester v. Massachusetts (139 U.S. 240, 35 L.Ed. 159), 24. Mannington v. Hocking Valley R. Co. (183 Fed. 133), 749. Manufacturers' Gas Co. v. Indiana Nat. G. & F. Co. (155 Ind. 545), 26. Manufacturers' Light & Heat Co. v. Ott (215 Fed. 940), 100. Manufacturers Railway of St. Louis (21 I. C. C. R. 304), 267. Marienelli v. United Booking Offi- cers of America (227 Fed. 165), 764. Martin v. Southward (191 U. S. 1, 48 L. Ed. 65), 289. Martin v. West (222 U. S. 191, 56 L. Ed. 159, 47 Wash. 417), 49. Marye v. Baltimore & Ohio R. Co. (127 U. S. 117, 32 L. Ed. 94), 43. Massachusetts v. Telegraph Co. (141 U. S. 40, 35 L. Ed. 628), 42. Maximum Rate Case (167 U. S. 479, 42 L. Ed. 243), 99-207-303- 335. 948 TABLE OF CASES. [references are to pages.] May V. New Orleans (178 U. S. 496, 44 L. Ed. 1165, 51 La. Ann. 1064), 35. Meeker v. Lehigh Valley R. Co. (162 Fed. 354, 236 U. S. 412, 59 L. Ed. 644), 144-622-632-771. Mercantile Trust Co. v. Texas Pac. R. Co. (216 Fed. 225), 132. Merchants' Bridge T. Ry. Co. v. U. S. (188Fed. 191), 110. Merchants' Coal Co. v. Fairmount Coal Co. (160 Fed. 769), 683. Merchants' Cotton Comp. Co. v. Insurance Co. (151 U. S. 368, 38 L. Ed. 195), 379. Merchants & Miners Transp. Co. v. U. S. (199 Fed. 902), 700. Merchants' Stock & Grain Co. v. Board of Trade (187 Fed. 893), 201. Messenger v. Pennsylvania Co. (37 N. J. L. 531), 345. Metropolitan Trust Co. v. Railroad Co. et al. (90 Fed. 683), 310. Metropolitan Water Co., Ex parte (220 U. S. 539, 55 L. Ed. 575), 223. Meyer v. Mobile (147 Fed. 843), 39. Michie v. N. Y. N. H. & H. (151 Fed. 694), 284-358. Michigan Elliott Machinery Co. v. Center (227 Fed. 124), 732. Michigan Insurance Bank v. Eldred (130 U. S. 693, 32 L. Ed. 1080), 530. Michigan C. R. Co. v. Michigan R. Commission (236 U. S. 615, 59 L. Ed. 750, 168 Mich., 230), 59. Michigan C. R. Co. v. Vreeland (227 U. S. 59, 57 L. Ed. 417), 787- 805. Miles Med. Co. v. Park & Sons (220 U. S. 373, 55 L. Ed. 502, 164 Fed. 803, 226 Fed. 812), 155-168-637- 728. Miller v. 111. Cent. (168 Fed. 982), 795. Miller v. The Mayor (109 U. S. 385, 27 L. Ed. 971), 28. Mills V. Lehigh Valley R. Co. (237 U. S. 888, 59 L. Ed. 1414, 207 Fed. 107), 632. Mines v. Scribner (147 Fed. 927), 713. Minneapolis & St. L. R. Co. v. Min- nesota (193 U. S. 53, 48 L. Ed. 203), 244. Minneapolis & St. L. R. Co. v. Min- nesota (186 U. S. 257, 46 L. Ed. 1151), 82-227-243. Minnesota v. Barber (136 U. S. 313, 34 L. Ed. 455), 23-60. Minnesota v. Northern Securities Co. (194 U. S. 48, 48 L. Ed. 870, 123 Fed. 692), 749. Minnesota Rate Case of 1902 (186 U. S. 257, 46 L. Ed. 1151), 309- 324. Minnesota Rate Case (184 Fed. 765), 234. Mississippi Ry. Commission v. 111. Cent. (203 U. S. 335, 51 L. Ed. 209), 59, 88. Missouri K. & T. R. Co. v. Cade (233 U. S. 642, 58 L. Ed. 355), 252. Missouri K. & T. R. Co. v. Haber (169 U. S. 613, 42 L. Ed. 878), 61-80. Missouri K. & T. R. Co. v. Harris (234 U. S. 412, 58 L. Ed. 1377), 669. Missouri K. & T. R. Co. v. Harri- man Bros. (227 U. S. 657, 57 L. Ed. 690), 669. Missouri K. & T. R. Co. v. May 194 U. S. 267, 48 L. Ed. 971), 252. Missouri K. & T. Co. v. Meyer (204 Fed. 140), 42. Missouri K. & T. R. Co. v. U. S. (178 U. S. 15), 846-848-849. Missouri Pac. R. Co. v. Castle (172 Fed. 841), 68. TABLE OF CASES, 949 [references are to pages.] Missouri Pac. R. Co. v. Kansas (216 U. S. 262, 54 L. Ed. 472), 245. Missouri Pac. R. Co. v. Larodee Flour Co. (211 U. S. 612, 53 L. Ed. 352), 58. Missouri Pacific R. Co. v. Nebraska (217 U. S. 196, 54 L. Ed. 727, 81 Nebr. 51), 242. Missouri Pac. R. Co. v. Nebraska (164 U. S. 403, 41 L. Ed. 489), 436-438. Missouri, K. & T. R. Co. v. New Era Milling Co. (80 Kan. 141), 73. Missouri Pac. R. Co. v. Omaha (235 U. S. 121, 59 L. Ed. 157, 197 Fed. 516), 246. Missouri Pac. R. Co. v. United States (189 U. S. 274, 47 L. Ed. 811, 65 Fed. 903), 533-778. Missouri Pac. R. Co. v. Texas Pac. R. Co. (31 Fed. 862), 585. Missouri Rate Case (168 Fed. 317, 230 U. S. 474, 57 L. Ed. 1572), 211-233. Mitchell Coal & Coke Co. v. Penn. R. R. Co. (81 Fed. 403, 183 Fed. 908, 230 U. S. 247, 57 L. Ed. 1472), 360-541. Mitchell V. Hitchman Coal & Coke Co. (214 Fed. 685), 723-748. Mobile J. & K. Ry. Co. v. Missis- sippi (210 U. S. 187, 52 L. Ed. 1016, 86 Miss. 172, 89 Miss. 724), 245. Mogul Steamship Co. v. McGregor (App. Cases, 23 Q. B. Div. 598), 147-158. Monarch Tob. Wks. v. American Tob. Co. (165 Fed. 774), 714. Mondou V. N. Y. & N. H. Ry. Co. (223 U. S. 59, 56 L. Ed. 327), 786-795-796. Monongahela Bridge Co. v. U. S. (216 U. S. 177, 54 L. Ed. 435), 110. Montague v. Lowrey (193 U. S. 38, 48 L. Ed. 608, 115 Fed. 27, 106 Fed. 38), 152-158-707-761. Montana R. Co. v. Morley et al. (198 Fed. 991), 424. Montana Cent. R. Co. v. U. S. (164 Fed. 400), 847. Montello, The (20 Wall. 430, 22 L. Ed. 391), 28. Montgomery v. C. B. & Q. R. Co. (228 Fed. 617), 539. Moore v. U. S. (85 Fed. 465), 745. Moores v. Bricklayers' Union (23 Weekly Law Bui. 48, 7 Ry. & Corp. L. J. 108), 189. Morrisdale Coal Co. v. Pac. R. R. Co. (176 Fed. 749, 230 U. S. 304, 57 L. Ed. 1494, 183 Fed. 929), 540-628-629. Morgan v. Louisiana (118 U. S. 455, 30 L. Ed. 237), 7-48-64. Mormon Church v. U. S. (136 U. S. 1, 34 L.Ed. 481), 276-744. Motion Picture Patents Co. v. Eclair Film Co. (208 Fed. 416), 770. Motion Picture Patents Co. v. Laemmle (178 Fed. 104), 770. Motion Picture Patents Co. v. UU- man (186 Fed. 174), 770. Mugler V. Kansas (123 U. S. 623, 31 L. Ed. 205), 22. Munn V. Illinois Cent. R. Co. (94 U. S. 113, 24 L. Ed. 77), 82. Murray v. C. & N. W. R. Co. (62 Fed. 24, 35 C. C. A., 62, 92 Fed. 868), 85-87-530-532. Murray v. G. & S. W. Co. (4 Ry. & C. Tr. Cases 460), 338. Murray v. Hoboken Land Co. (18 How. 272, 15 L. Ed. 372), 144. Mutual Film Corp. v. Industrial Commission (236 U. S. 230, 59 L. Ed. 561, 215 Fed. 138), 69. Mutual Transit Co. v. U. S. (178 Fed. 664), 265. 950 TABLE OP CASES. [references are to pages.] M, St. L. Ry. Co. V. Denaby, Maine Colliery Co. (4 Ry. & Can. Tr. Cas. 452), 338. N. Narramore v. Railroad Co. (96 Fed. 298), 828. Nash V. U. S. (229 U. S. 373, 57 L. Ed. 1233), 737. Nashville Grain Exchange v. United States (191 Fed. 37), 583. Nashville etc. R. Co. v. Alabama (128 U. S. 96, 32 L. Ed. 352), 53- 64. Nathan v. Louisiana (8 How. 73, 12 L. Ed. 992), 17. National Fire Proof Co. v. Mason Builder Assn. (169 Fed. 259), 748. National Folding Box Co. v. Rob- ertson (99 Fed. 985), 770. National Oil Co. v. Texas (197 U. S. 115, 49 L. Ed. 689, 72 S. W. 615), 248. National Pole Co. v. Chicago & N. W. R. Co. (200 Fed. 185), 543. National Water Wks. v. Kansas City (62 Fed. 853), 232. Naylor v. Lehigh Valley R. Co. et al. (188 Fed. 860), 635. Nebraska Rate Case (169 U. S. 550, 42 L. Ed. 820, 64 Fed. 172), 211- 587. Nelms V. Mortgage Co. (92 Ala. 157), 17. Nelson v. U. S. (201 U. S. 92, 50 L. Ed. 673), 568. Nevada Rate Case (170 Fed. 752), 234. Newell V. B. & 0. Ry. Co. (181 Fed. 698), 788. New England Tel. Co. v. Town of Essex (206 Fed. 926), 105. New England R. Co. v. Conroy (175 U. S. 323, 44 L. Ed. 181), 810. New Mexico ex rel. v. Baker (196 U. S. 432, 49 L. Ed. 541), 550. New Mexico ex rel. v. D. & R. G. (203 U. S. 38, 51 L. Ed. 78), 23. New York ex rel. v. Miller (202 U. S. 584, 50 L.Ed. 1155), 44. New York v. Miln (11 Pet. 102, 9 L. Ed. 648), 46. New York Cent. v. Interstate Comm. Com. (200 U. S. 361, 50 L. Ed. 515), 298-600. New York Cent. v. Interstate Comm. Com. (168 Fed. 131), 607. New York Cent. & H. R. Co. v. Carr (238 U. S. 261, 59 L. Ed. 1298), 790. New York Cent. v. U. S. (212 U. S. 481, 53 L. Ed. 613, 146 Fed. 298, 203 Fed. 953), 692-696-702-847. New York Cent. & H. R. Co. v. U. S. (212 U. S. 50, 53 L. Ed. 624) 693. New York Cent. v. U. S. (165 Fed. 833), 849. New York ex rel. v. Hesterby (211 U. S. 31, 53 L. Ed. 75, 184 N. Y. 126), 23. New York ex rel. v. Sohmer (235 U. S. 549, 59 L. Ed. 355), 30. New York Life Ins. Co. v. Cravens (178 U. S. 389, 44 L. Ed. 1116), 19-33. New York Life Ins. Co. v. Deer Lodge County (231 U. S. 495, 58 L.Ed. 332), 19-33. New York Life Ins. Co. v. Statham (93 U. S. 21, 23 L. Ed. 789), 33. New York etc. R. Co. v. New York (165 U. S. 628, 41 L. Ed. 853), 53. New York Ry. Co. v. Commission (168 Fed. 131), 391. N. Y. N. H. & H. Ry. Co. v. Com- mission (200 U. S. 361, 50 L. Ed. 515), 298. New York & N. R. Co. v. N. Y. & N. E. R. Co. (50 Fed. 867), 458. New York & P. & N. R. Co. v. Pe- ninsular Produce Exchange (240 U. S. 34, 60 L. Ed. ), 668. TABLE OF CASES. 951 Irefehences are to pages.] Niagara Fire Ins. Co. v. Cornell (110 Fed. 816), 251. Nicholson v. G. W. R. Co. (4 C. B. (N. S.) 366, 28 L. J. C. P. 889), 343-352. Nichols & Cox Lbr. Co. v. U. S. (212 Fed. 588), 434-554-694. Nicol V. Ames (173 U. S. 509, 43 L. Ed. 786), 127. Nordgard v. Merryville etc. Co. (211 Fed. 721, 218 Fed. 737), 793. Norfolk & Wes. R. Co. v. Connelly (236 U. S. 605, 59 L. Ed. 745), 227. Norfolk & Wes. R. Co. v. Holbrook (235 U. S. 625, 59 L. Ed. 392, 215 Fed. 687), 804. Norfolk & Wes. R. Co. v. U. S. (195 Fed. 953), 321. Norfolk & Southern R. Co. v. Fers- bee (237 U. S. 781, 59 L. Ed. 1303), 805. North Carolina R. Co. v. Zachry (232 U. S. 246, 58 L. Ed. 591, 162 N. C. 290), 790-795-796. Northern Pac. R. Co. v. Adams (192 U. S. 440, 48 L. Ed. 513), 296-374. Northern Pac. R. Co. v. Keyes (91 Fed. 47), 226. Northern Pac. R. Co. v. Maerkl (198 Fed. 1), 791. Northern Pac. R. R. v. North Da- kota (216 U. S. 579, 54 L. Ed. 624), 224. Northern Pac. Co. v. Neese (239 U. S. 614, 60 L. Ed. ), 800. Northern Pac. R. Co. v. North Da- kota (236 U. S. 585, 59 L. Ed. 735, rev. 26 N. Dak. 438), 229. Northern Pac. R. Co. v. Pacific Coast etc. Co. (165 Fed. 1), 545. Northern Pac. R. Co. v. Tynan (56 C. C. A. 192, 119 Fed. 288), 810-829. Northern Pac. R. Co. v. U. S. (213 Fed. 162, 208 U. S. 452, 52 L. Ed. 567, 155 Fed. 945, 151 Fed. 84), 841. Northern Penn. R. Co. v. Commer- cial Nat. Bank of Chicago (123 U. S. 727, 31 L. Ed. 287), 287. Northern Securities Co. v. Harri- man, 197 U. S. 244, 49 L. Ed. 739), 753 Northwestern Consolidated Milling Co. V. Callam & Son (177 Fed. 787), 717. N. O. & T. P. R. Co. V. Commission (162 U. S. 184, 40 L. Ed. 935), 635. N. & W. R. Co. V. Sims, 191 U. S. (441, 48 L. Ed. 254), 41. O. Dates V. National Bank, 100 U. S. (239, 25 L. Ed. 580), 84. O'Halloran v. Seagreen Slate Co., (207 Fed. 187), 714. Ohio Coal Co. v. Whitcomb (123 Fed. 359), 378. Ohio Oil Co. V. Indiana (177 U. S. 190, 44 L. Ed. 729), 26. Ohio Tax cases (232 U. S. 574, 58 L. Ed. 737), 43. Oklahoma Rate Case (185 Fed. 329), 234. Old Dominion Steamship Co. v. McKenna (30 Fed. 49), 189. Oliver v. Gilmore (52 Fed. 563), 169. Oliver v. Northern Pac. R. Co. (196 Fed. 432), 799. Oklahoma Rate Case (177 Fed. 493), 237. Omaha v. Omaha Water Co. (218 U. S. 180, 54 L. Ed. 991), 232. Omaha & Council Bluffs St. Ry. Co. V. Interstate Comm. Com. 230 U. S. 324, 57 L. Ed. 1501^ 191 Fed. 40, 179 Fed. 243), 277* 952 TABLE OF CASES. [references are to pages.] Opinion of Justices (14 Gray 615), 11. Ordway v. Central Nat. Bank (47 Md. 243), 88. Oregon- Washington N. Co. v. U. S. (205 Fed. 337), 850. Oregon Nav. Co. v. Campbell (173 Fed. 957, 230 U. S. 525, 57 L. Ed. 1604), 211-238. Oregon Nav. Co. v. Campbell (177 ' Fed. 318), 220. Oregon St. L. & U. N. R. Co. v. N. P. R. Co. (9 C. C. A. 409, 61 Fed. 158, 51 Fed. 465), 443-45&- 459. Orient Ins. Co. v. Daggs (172 U. S. 557, 43 L. Ed. 552), 33. Osborne v. Railroad Co. (3 G. C. A. 347, 52 Fed. 912), 474. Otis Steel Co. v. Local Union No. 18 (110 Fed. 698), 177. Oxdale v. N. E. R. Co. (1 Ry. & Can. Tr. Cases 73), 453. Oxlaid V. Northeastern R. Co. (15 Com. Bench [N. S.] 680), 421. Pabst Brewing Co. v. Crenshaw (198 U. S. 17, 49 L. Ed. 925), 38. Pacific S. S. Co. V. Railroad Com- missioners (18 Fed. 10), 104. Pacific Coast R. v. U. S. (173 Fed. 448), 809. Pacific Ry. Co. v. Harper Bros. (201 Fed. 671), 672. Pacific Railroad Removal Cases (115 U. S. 2, 29 L. Ed. 319), 128. Packet Co. v. Aiken (121 U. S. 444, 30 L. Ed. 976), 48. Paine Lbr. Co. v. Neal (214 Fed. 82, 212 Fed. 259). 748. Party Rate Case (145 U. S. 263, 36 L. Ed. 703), 341-350-384-294. Parsons, The Robert W. (191 U. S. 17, 48 L. Ed. 73), 29. Parsons v. C. & N. W. R. Co. (167 U. S. 447, 42 L. Ed. 231, 11 C. C. A. 489, 63 Fed. 903), 506-529. Passaic Print Goods Co. v. Ely Walker Dry Goods Co. (105 Fed. 163), 167. Passenger Cases (7 How. 283, 12 L. Ed. 702). 46. Patapsco Guano Co. v. North Caro- hna Board of Agr. (171 U. S. 345. 43 L. Ed. 191), 23-65. Patterson v. United States (222 Fed. 599), 739-740. Paul V. Virginia (8 Wall. 168, 19 L. Ed. 357), 19-31. Paulsen v. United States (199 Fed. . 423), 15. Peavey v. Union Pacific (176 Fed. 409). 415. Peavey v. Updike Grain Co. (178 Fed. 223). 415. Pederson v. Del. L. & W. R. Co. (197 Fed. 537), 793. Peet v. Mills (76 Washington 437), 800. Peik v. Railroad Co. (94 U. S. 164, 24 L. Ed. 97), 82-90. Pennsylvania R. Co. v. Clark Bros. Min. Co. (237 U. S. 896, 59 L. Ed. 1406, 241 Pa. 515), 542-627- 631. Penn. Ry. Co. v. International Coal etc. Co. (173 Fed. 1), 378. Pennsylvania R. Co. v. U. S. (227 Fed. 911), 293. Pennsylvania R. Co. v. Interstate Comm. Com. (193 Fed. 81), 627. Pennsylvania Refining Co. v. West- ern N. Y. P. R. Co. (208 U. S. 208, 52 L. Ed. 456. aff. 153 Fed. 343), 353-428. Pennsylvania Sugar etc. Co. v. American etc. Co. (166 Fed. 254, 160 Fed. 144), 713. Pennsylvania v. Wheeling etc. Bridge Co. (18 How. 241, 15 L. Ed. 435). 9-101. TABLE OF CASES. 953 [beferences are to pages.] Pennsylvania R. Co. v. Interna- tional Coal Co. (230 U. S. 184, 57 L. Ed. 1446), 290-360-377- 378-379-529-531-626. Pennsylvania R. Co. v. Knox (218 Fed. 748), 794. Pennsylvania R. Co. v. U. S. (236 U. S. 351, 59 L. Ed. 616, 214 Fed. 445), 439. Pennsylvania R. Co. v. Puritan Coal Min. Co. (237 U. S. 127, 59 L. Ed. 867, 237 Pa. St. 420), 539. Pennsylvania R. Co. v. Hughes (191 U. S. 477, 48 L. Ed. 268), 57-68. Pennsylvania R. Co. v. Jones (155 U. S. 333, 39 L. Ed. 176), 518. Pensacola Tel. Co. v. W. U. Tel. Co. (96 U. S. 1 24 L. Ed, 13-15- 49-105. People V. Coler (166 N. Y. 144), 74. People V. Cook (148 U. S. 397, 37 L. Ed. 498), 244. People V. Coombs (158 N. Y. 532). 569. People V. Hawkens (157 N. Y. 1), 74. People V. Kelley (24 N. Y. 74), 565. People V. Sheldon (139 N. Y. 251), 170. People's Tob. Co. v. American Tob. Co. (170 Fed. 396), 714. Perkins v. Northern Pac. (155 Fed. 445), 221. Pettibone v. United States (148 U. S. 197, 37 L. Ed. 419), 185-775. Philadelphia Fire Ass'n v. New York (119 U. S. 110, 30 L. Ed. 342), 32. Philadelphia & Redding Co. v. Schubert (224 U. S. 603, 56 L. Ed. 911), 797. Philadelphia & R. Ry. Co. v. U. S. 219 Fed. 988), 392-402-615. Phillips V. Grand Trunk Wes. R. Co. (236 U. S. 662, 59 L. Ed. 774), 543-622-624. Phillips V. Tola Cement Co. (125 Fed. 593, 61 C. C. A. 19), 167- 716. Pidcock V. Harrington (64 Fed. 821), 747. Pierce Co. v. Wells Fargo & Co. (236 U. S. 278, 59 L. Ed. 576, 189 Fed. 561), 671. Piersall v. Great Northern R. Co. (161 U. S. 646, 40 L. Ed. 838), 243. Pittsburgh etc. Coal Co. v. Bates (156 U. S. 577, 39 L. Ed. 538), 34. Pittsburgh etc. R. Co. v. Backus (154 U. S. 421, 38 L. Ed. 1031), 42. Pittsburgh etc. R. Co. v. Glinn (219 Fed. 148), 792. Plessy V. Ferguson (163 U. S. 537, 41 L. Ed. 256), 54. Plumley v. Massachusetts (155 U. S. 461, 39 L. Ed. 223), 21. Pondecker Lumber Co. v. Spencer (30 C. C. A. 430, 86 Fed. 846, 81 Fed. 277), 504. Poor v. Iowa Cent. R. Co. (155 Fed. 226), 219. Port Richmond & B. F. R. Co. v. Bd. of Freeholders (234 U. S. 317, 58 L. Ed. 1330), 103. Post V. Buck Stove & Range Co. (200 Fed. 918), 762. Postal Tel. & C. Co. v. Adams (155 U.S. 688, 39 L.Ed. 311), 98. Powell V. Pennsylvania (127 U. S. 678, 32 L. Ed. 253), 22. Prentice v. Atlantic Coast Line (211 U. S. 210, 53 L. Ed. 150), 215-218. Prescott & A. Cent. R. Co. v. A. T. & S. F, R. Co. (73 Fed. 438), 458. Proctor & Gamble Co. v. U. S. (Com. C.) (188 Fed. 221, 225 U. S. 282, 56 L. Ed. 1021), 642- 643. Pullman Co. v. Kansas (216 U. S. 56, 54 L. Ed. 378), 30. 954 TABLE OF CASES. [references are to pages.] Pullman Co. v. Linke (203 Fed. 1017), 72-272. Pullman Palace Car Co. v. Penn- sylvania (141 U. S. 18, 35 L. Ed. 613), 43. R. Ragan v. Aiken (9 Lea, 609), 341. Railroad v. State (85 Ark. 284, 107 S. W. 989), 73. Railroad Co. v. Baker (33 C. G. A. 648, 91 Fed. 224), 829. Railroad Co. v. Baugh (149 U. S. 368, 37 L. Ed. 772), 84. Railroad Co. v. Ellis (165 U. S. 54, 41 L. Ed. 667), 212-251. Railroad Co. v. Fuller (17 Wall. 560, 21 L. Ed. 710), 52-80. Railroad Co. v. Forsaith (59 N. H. 122), 345. Railroad Co. v. Husen (95 U. S. 465, 24 L. Ed. 527), 60. Railroad Co. v. Iowa (94 U. S. 155, 24 L. Ed. 94), 82. Railroad Co. v. National Bank (102U. S. 14, 26L. Ed. 61),84. Railroad Co. v. Ohio (173 U. S. 285, 43 L. Ed. 702), 241. Railroad Co. v. Pemiston (18 Wal- lace, 5, 21 L. Ed. 787), 209. Railroad Co. v. People (77 111. 443), 305. Railroad Co. v. Pratt (22 Wall. 123, 22 L. Ed. 827), 429. Railroad Co. v. Richmond (19 Wall. 584, 22 L. Ed. 173), 79. Railroad Com. of La. v. Texas Pac. Ry. Co. (229 U. S. 336, 57 L. Ed. 1215, 184 Fed. 989), 275-281. Railroad Commission of Alabama v. Cent, of Ga. (170 Fed. 225, 161 Fed. 925, 208 Fed. 35), 221-222. Railroad Commission of Ohio v. Worthington (187 Fed. 965), 62. Railroad Commission cases (116 U. S. 307, 29 L. Ed. 636), 100-207. Rasmussen v. Idaho (181 U. S. 198, 45 L. Ed. 820), 62. Ramsey v. Tacoma Land Co. (196 U. S. 360, 49 L. Ed. 512), 774. Rattican v. Terminal R. R. Assn. (114 Fed. 666), 530. Reagan v. Farmers' Loan & T. Co. (154 U. S. 362, 38 L. Ed. 1014, 207-212-216-219-227. Reagan v. Mercantile Trust Co. (154 U. S. 413, 38 L. Ed. 1028), 131-209. Red "2" Oil Mfg. Co. v. Bd. of Agriculture (222 U. S. 393, 56 L. Ed. 244), 65. Regina v. Bauld (13 Cox, C. C. 282), 188. Reid V. Colorado (187 U. S. 137, 47 L. Ed. 108), 61-118. Rex V. Waddington (1 East, 167), 171. Reynolds Tob. Co. v. Allen Bros. Tob. Co. 155 Fed. 819), 770. Rhodes v. Iowa (170 U. S. 412, 42 L. Ed. 1088), 35-37-190. Rice V. Standard Oil Co. (134 Fed. 464), 734^-765. Richmond v. Southern Bell Tel. Co. (174 U. S. 761, 43 L. Ed. 1162), 107. Richmond etc. R. Co. v. Tobacco Co. (169 U. S. 311, 42 L. Ed. 759), 57-69. Riddle v. N. Y. L. E. & W. R. Co. (39 Fed. 290), 549. Robbins v. Shelby County Taxing District (120 U. S. 489, 30 L. Ed. 694), 41-78. Robertson v. Baldwin (165 U. S. 287, 41 L. Ed. 719), 192. Robinson v. B. & O. R. Co. (129 Fed. 753, 237 U. S. 84, 59 L. Ed. 849), 437-797. Robinson v. Suburban Brick Co., (127 Fed. 804), 717. TABLE OF CASES. 955 [references are to pages.] Rose Co. V. State (133 Ga. 353), 73. Rosenbaum Grain Co. v. C. R. & T. R. Co. (130 Fed. 46), 435. Rossi V. Pennsylvania (238 U. S. 60, 59 L. Ed. 1201), 38. Rossman v. Gamier (211 Fed. 401), 18. Rubber Tire W. Co. v. Milwaukee Rub. Wks. (154 Fed. 358, 142 Fed. 331), 726. Russell V. Croy (164 Mo. 69), 72. Rupert V. U. S. (181 Fed. 87), 24. Ryan Steamship Co. v. Common- wealth (30 Ky. L. R. 1276), 74. San Diego Land Co. v. National City Co. (174 U. S. 739, 43 L. Ed. 1154), 216-227-310. San Pedro etc. Co. v. Davide (210 Fed. 870), 791. San Pedro etc. Co. v. U. S. (213 Fed. 326), 842. Sands v. Manistee River Imp. Co. (123 U. S. 288, 31 L. Ed. 149), 48. Sandusky-Portland Cement Co. v. B. & O. R. Co. (187 Fed. 583), 546. Santa Clara County v. So. Pae. R. Co. (118 U. S. 394, 30 L. Ed. 118), 212. Santiago v. Jasper (189 U. S. 439, 47 L. Ed. 892, 110 Fed. 702), 232. Sault St. Marie v. International Transit Co. (234 U. S. 333, 58 L. Ed. 1337), 103. Savage v. Jones (225 U. S. 501, 56 Ed. 1182), 48. Searchlight Gas Co. v. Presto-lite Co. (215Ped. 692), 769. Security Mutual L. Ins. Co. v. Prewitt (202 U. S. 246, 50 L. Ed. 1013), 32. Schlemmer v. Railroad Co. (207 Pa. 198), 809-811-815-826. Schlemmer v. Buffalo, etc. Co. (205 U. S. 1, 51 L. Ed. 681, 89-788- 810-811-815-826. Schlemmer v. Buffalo, etc. R. R. (220 U. S. 590, 55 L. Ed. 596), 830. Schmidt v. People (18 Colo. 78), 73. Schofleld v. L. S. & M. S. R. Co. (43 Ohio St. 571, 3 N. E. 907), 345. SchoUenberger v. Pennsylvania (171 U. S. 1, 43 L. Ed. 49), 21-35. Scott v. Donald (165 U. S. 58, 41 L. Ed. 632), 68. Seaboard etc. R. Co. v. Horton (233 U. S. 492, 58 L. Ed. 1062, 162 N. C. 424), 788-798-799. Seaboard Air Line v. Seeders (207 U. S. 73, 52 L. Ed. 108, 73 N. C. 71), 245. Seaboard Air Line v. Fla. (203 U. S. 261, 51 L. Ed. 176), 227. Searight v. Stokes (3 How. 151, 11 L. Ed. 537), 8. Seattle Electric v. Seattle R. & S. Co. (185 Fed. 365), 214. Shanley v. Phil. P. R. Co. (221 Fed. 1012), 794. Shawnee Compress Co. v. Ander- son (209 U. S. 423, 50 L. Ed. 865), 749. Sheldon v. Wabash R. Co. 105 Fed. Rep. 785), 85-88-532. Shepard v. Northern Pacific R. Co. (184 Fed. 765), 239. Sherlock et al. v. Alhng (93 U. S. 99, 23L. Ed. 819), 51. Sigel V. N. Y. C. & H. R. Co. (178 Fed. 873), 831. Siler V. L. & N. (213 U. S. 175, 53 L. Ed. 753), 213. Sligh V. Kirkwood (237 U. S. 52, 59 L. Ed. 835; 65 Fla. 123), 58. 956 TABLE OP CASES. [references are to pages.] Simpson v. Shepard (230 U. S. 352, 57 L. Ed. 1511, rev. 184 Fed. 765) (Minnesoata Rate Case of 1913), 211-233-235-239-469. Simpson-Crawford Co. v. Borough of Atl. Highland (158 Fed. 372), 35. Singer Sewing Mach. Co. v. Brickell (233 U. S. 304, 58 L. Ed. 974), 41. Sioux Remedy Co. v. Cope (235 U. S. 197, -59 L. Ed. 193, 28 S. D. 397), 32. Smiley v. Kansas (196 U. S. 447, 49 L. Ed. 546), 248. Smith V. Alabama (124 U. S. 465, 31 L. Ed. 508), 51-53-84. Smith V. Industrial Accident Ass'n (147 Pac. Rep. 600), 799. Smyth V. Ames (169 U. S. 466, 42 L. Ed. 819), 131-144-209-212- 215-216-220-225-227- 230-231- 304. Social Circle Case (162 U. S. 184, 40 L. Ed. 935), 92, 307, 474, 517. Soda Fountain Co. v. Green (69 Fed. Rep. 333), 769. South Carohna v. Georgia (93 U. S. 4, 23 L. Ed. 782), 16. South Carolina ex rel. v. McMaster (237 U. S. 63, 59 L. Ed. 839), 20. South Covington & C. S. R. Co. v. Covington (235 U. S. 537, 59 L. Ed. 350), 66. Sorrell v. Railroad Co. (75 Ga. 509), 305. Southern Cal. R. Co. v. Ruther- ford (62 Fed. Rep. 796), 177-205. Southern Indiana Ex. Co. v. U. S. Exp. Co. (35 C. C. A. 172, 92 Fed. 1022, 88 Fed. 659), 269-747. Southwestern Tel. & Tel. Co. v. Danoher (238 U. S. 482, 59 L. Ed. 1419), 94 Ark. 443, 102 Ark. 547, 252. South Dakota Rate Case (176 U. S. ; 167, 44 L. Ed. 417, rev. 90 Fed. 363), 219-226-233-324. Southern Express Co. v. Long (202 Fed. 462), 21. Southern Pac. R. Co. v. Campbell (189 Fed. 182, 230 U. S. 537, 57 L. Ed. 1611), 238. Southern Pac. R. Co. v. Colorado Fuel & Iron Co. (42 C. C. A. 12, 101 Fed. 779), 304-308. Southern Pac. R. Co. v. Crockett 234 U. S. 725, 58 L. Ed. 1564), 788-833. Southern Pac. R. Co. v. Goldfield & Cons. M. & T. Co. (220 Fed. 14), 633. Southern Pac. R. Co. v. Interstate Comm. Com. (219 U. S. 433, 55 L. Ed. 283), 177 Fed. 963, 219 U. S.), 317, 498 (55 L. Ed. 310), 99-329-417, 607-615. Southern Pac. R. Co. v. Interstate Comm. Com. (166 Fed. 134), 779. Southern Pac. R. Co. v. Interstate Comm. Com. (200 U. S. 536, 50 L. Ed. 585), 441-488. Southern Pac. R. Co. v. Lee (199 Fed. 621), 235. Southern Pac. R. Co. v. Railroad Commission (193 Fed. 699), 235. Southern Pac. R. Co. v. United States (171 Fed. 364, 197 Fed. 167, 237 U. S. 202, 59 L. Ed. 916), 321-850. Southern Pac. Co. In re (155 Fed. 1001), 176. Southern R. Co. v. Burlington Lbr. Co. (225 U. S. 100, 56 L. Ed. 1001), 63. TABLE OF CASES. 957 [references are to pages.] Southern Ry. v. Campbell (239 U. S. 99, 60 L. Ed.— 94 S. C. 95), 681. Southern Ry. Co. v. Carson (194 U.S. 136, 48 L.Ed. 907), 811. Southern Ry. Co. v. Greenboro Ice & Coal Co. (134 Fed. 82), 212. Southern Ry. Cq. v. King (160 Fed. 332, affirmed in 217 U. S. 524, 54 L. Ed. 868), 51-53. Southern Ry. Co. v. Machinists' Local Union (111 Fed. 49), 177. Southern Ry. Co. v. McNeil. See McNeil v. Southern Ry^ Co. Southern R. Co. v. Railroad Com. of Ind. (236 U. S. 439, 59 L. Ed. 661, 197 Fed. 23), 812. Southern Ry. Co. v. Reid (222 U. S. 425, 56 L. Ed. 257), 63. Southern Ry. Co. v. St. Louis, H. & G. Co. (214 U. S. 297, 53 L. Ed. 1004), 432-542. Southern Ry. Co. v. Snyder (187 Fed. 492), 817. Southern Ry. Co. v. Tift (206 U. S. 428, 51 L. Ed. 1124), 97-538-544. Southern R. Co. v. U. S. (222 U. S. 20, 56 L. Ed. 72, 164 Fed. 347, 204 Fed. 465), 120-405-809-818. So. Wire Co. v. St. L., etc., R. Co., (38 Mo. App. 191), 378. Spoflord V. B. & M. R. Co. (128 Mass. 326), 345. Staley v. Illinois Cent. R. Co. (109 N. E. 342), 799. Standard Oil Co. of N. J. v. U. S. (221 U. S. 1, 55 L. Ed. 619), 775, rev. 113 Fed. 390), 148-718. Standard Sanitary Mfg. Co. v. U. S. (226 U. S. 20, 57 L. Ed. 107, 191 Fed. 172), 168-727-775. Standard Oil of Ky. v. Tennessee (217 U. S. 413, 54 L. Ed. 817), 249. Standard Stock Co. v. Wright (225 U.S. 541, 56 L.Ed. 1197), 63. Stanislau v. Joaquin (192 U. S. 214, 48 L. Ed. 406, 113 Fed. 390), 239. State ex rel. v. Associated Press (159 Mo. 410), 82. State ex rel. v. Indiana etc. Mining Co. (120 Ind. 575), 25. State V. Atlantic C. L. (56 Fla. 617, 32 L. R. A. [N. S.] 639), 109. State V. Bayer (34 Utah 257), 75. State V. Donaldson (32 N. J. L. 151), 189. State V. Cumberlaad R. Co. (105 Md._478), 74. State V. Donovan (10 N. D. 203), 569. State Freight Tax Case (15 Wall. 232, 21 L. Ed. 146), 43-47. State V. Glasby (50 Wash. 704), 75. State V. GUdden (55 Conn. 46), 189. State of Iowa v. Chicago, M. & St. P. R. Co. (33 Fed. Rep. 391), 462. State V. Missouri Pac. R. Co. (212 Mo. 658), 62-74. Stevens v. M. K. & T. R. Co. (106 Fed. 771), 221. Stewart v. Michigan (232 U. S. 665, 58L. Ed. 786), 41. State v. Omaha R. Co. (Iowa) (113 la. 30), 73. State V. Peet (68 Atl. 661, 80 Vt. 449), 25. State V. Railroad Cos. (47 Ohio St. 130), 345. State Railroad Tax Cases (92 U. S. 575, 23 L. Ed. 663), 42. State V. Scott (98 Tenn. 254), 75. State V. Smith (74 Iowa, 580), 569. State V. Stewart (59 Vt. 273), 189. State of Wis. v. C. M. & St. P. R. Co. (136 Wis. 407), 62, 75. Steel V. United Fruit Co. (190 Fed. 631, 194 Fed. 1023), 755. Stockard v. Morgan (185 U. S. 27, 46 L. Ed. 785). 41. 958 TABLE OF GASES. [references are to pages.] Stockton V. Baltimore, etc., (32 Fed. Rep. 9), 10. StoU V. Pacific Coast Steamship Co. (205 Fed. 169), 54. Stone V. Mississippi (101 U. S. 814- 818, 25 L. Ed. 1079), 137. Strother v. Union Pac. Ry. Co. (220 Fed. 731), 803. Strout V. United Shoe Machinery Co. (195 Fed. 313), 763-765. Stubbs V. Colorado (40 Colo. 404), 73. St. Clair Co. v. Interstate Sand & Car Tr. Co. (192 U. S. 454, 48 L. Ed. 518), 48-103. St. Joseph Stockyards Co. v. U. S. (187 Fed. 104), 847. St. Louis S. F. Co. V. Allen (181 Fed. 710), 72. St. Louis S. W. Ry. v. Arkansas (217 U. S. 136, 54 L. Ed. 698, 85 Ark. 311), 59. St. Louis etc. Co. v. Delk (158 Fed. 931), 831. St. Louis & S. W. Ry. Co. v. Lew- ellen (192 Fed. 540), 508. St. Louis Drayage Co. v. L. & N. R. Co. (65 Fed. Rep. 39), 459. St. L. & S. F. R. Co. V. Gill (156 U. S. 649, 39 L. Ed. 567), 218- 227. St. Louis, I. M. & S. R. Co. v. Craft (237 U. S. 648, 59 L. Ed. 1160), 801. St. Louis, I. M. & S. R. Co. v. Hes- terly (228 U. S. 700, 57 L. Ed. 1031), 64. St. Louis & San Francisco R. Co. v. Hadley (168 Fed. 317, 155 Fed. 220), 221-234. St. Louis, L M. & S. R. Co. v. Hampton (162 Fed. 693), 70. St. Louis, I. M. & S. R. Co. v. Mc- Whirter (229 U. S. 265, 57 L. Ed. 1179), 842. St. Louis, L M. & S. R. Co. v. Tay- lor, 210 U. S. 281, 52 L. Ed. 1061), 815-822-829. St. Louis Mer. Bridge Ter. Co. v. U. S. (209 Fed. 600), 848. St. Louis San Francisco R. Co. v. Conarty (238 U. S. 241, 59 L. Ed. 1290), (106 Ark. 421), 815. St. Louis S. W. R. Co. v. Arkansas (235 U. S. 350, 59 L. Ed. 265. 106 Ark. 321), 59. St. Louis S. W. R. Co. v. Spring River Stone Co. (236 U. S. 716, 59L. Ed. 805), 505. St. Louis & S. Fe v. U. S. (169 Fed. 69), 850. St. Louis V. Western U. Tel. Co. (148 U. S. 92, 37 L. Ed. 380), 106. State ex rel. Johnson v. C. B. & Q. Ry. Co. (165 Mo. 228), 72. Strauss v. American Pub. Ass'n (231 U. S. 222, 58 L. Ed. 192, 177 N. Y. 473), 727. Sunset T. & T. Co. v. Ureka (172 Fed. 755), 14. Susquehanna Coal Co. v. South Amboy (228 U. S. 655, 57 L. Ed. 1015), 42. Swift V. R. R. Co. (63 Fed. 59), 306. Swift V. Railroad Co. (58 Fed. Rep. 858), 85-88-532. Swift V. Tyson (16 Peters, 1, 10 L. Ed. 865, 84. Swift V. U. S. (196 U. S. 375, 49 L. Ed. 518), 156-196-376. T. Taenzer & Co. v. C. R. I. & P. R. Co. (191 Fed. 543), 506. Taylor v. Southern R. R. Co. (178 Fed. 380), 794. TABLE OF CASES. 959 [references are to pages.] Taylor v. Taylor (232 U. S. 263, 58 L. Ed. 638), 798. Telegraph Co. v. Philadelphia (190 U. S. 160, 47 L. Ed. 995), 50. Telegraph Co. v. Texas (105 U. S. 460, 26 L. Ed. 1067), 49. Texas & N. O. R. Co. v. Sabine Tram Co. (227 U. S. Ill, 57 L. Ed. 442), 275. Texas & Pac. v. Abilene Co. (204 U. S. 426, 51 L. Ed. 553), 97- 99- 537. Texas & Pac. R. Co. v. Allen (98 S. W. 450, 42 Texas, 331), 75. Texas & Pac. R. Co. v. American Tie Co. (234 U. S. 138, 58 L. Ed. 1255, 190 Fed. 1022), 541. Texas & Pac. R. Co. v. Archibald (170 U. S. 665, 42 L. Ed. 1188), 810. Texas & Pac. R. Co. v. Cisco Oil Mills (204 U. S. 449, 52 L. Ed. 566), 507. Texas & Pac. R. Co. v. Int. Comm.- Comm. (162 U. S. 197, 40 L. Ed. 940), 337-390-583-635. Texas & Pac. R. Co. v. Mugg (202 U. S. 242, 50 L. Ed. 1011), 503. Texas & Pac. R. Co. v. Railroad Commission (192 Fed. 280), 235. Texas etc. R. Co. v. Swearinger (122 Fed. 193), 828. Texas & Pac. R. Co. v. U. S. (205 Fed. 380), (See Houston etc. Co. V. U. S.) The Queen (206 Fed. 148), 48. Thomas v. Chicago etc. R. Co. (202 Fed. 766), 801. Thomas v. Boston & M. R. Co. (218 Fed. 143), 794. Thomas v. C. N. O. & T. P. R. Co. 62 Fed. 803), 177-181-195-199- 556-722-774. Thomas v. U. S. (156 Fed. 897, 145 Fed. 74), 698. Thompson v. Columbia etc. R. Co. (205 Fed. 203), 791. Thompson v. London & N. W. R. Co. (2 Ry. & Can. Tr. Cases 115), 453. Thomsen v. Union Castle etc. Co. (166 Fed. 251), 725, 763. Thornborn v. Gates (225 Fed. 613), 772. Toledo etc. R. Co. v. Pennsylvania R. Co. (54 Fed. 730, 19 L. R. A. 387), 177-182-197-205- 53^555-722. Toledo etc. R. Co. v. Slavin (236 U. S. 454, 59 L. Ed. 671), 803. Townsend v. State (147 Ind. 624), 26. Trade Mark Cases (100 U. S. 82, 25 L. Ed. 550), 18. Traders Live Stock Exchange (171 U. S. 578, 43 L. Ed. 300), (See Anderson v. U. S.) Trallich v. Chicago M. & St. P. R. Co. (217Fed. 675), 791. Trans-Missouri Freight Ass'n Case (166 U. S. 318, 41 L. Ed. 1007), 139. Tribolet v. U. S. (95 Pa. St. 87), 775. Troxler v. Southern Ry. Co. (122 N. C. 902, 44 L. R. A. 313), 809. Trust Co. of America v. Chicago, P. & St. L. R. Co. (199 Fed. 593), 235 U. Union Castle Mail S. S. Co. v. Thomsen (190 Fed. 536), 763. Union Pac. Coal Co. v. U. S. (173 Fed. 737), 157-750. Union Pac. R. Co. v. Chicago & C. R. Co. (163 U. S. 564, 41 L. Ed. 265, 79-465. Union Pac. R. Co. v. Frank (226 Fed. 906), 747. Union Pac. R. Co. v. Goodrich (149 U. S. 680, 37 L. Ed. 896), 339. 960 TABLE OF CASES. [references are to pages.] Union Pac. R. Co. v. Ruff (120 Fed. 102), 192. Union Pac. R. Co. v. U. S. (99 U. S. 402, 25 L. Ed. 274), 313. Union Pac. R. Co. v. U. S. (117 U. S. 355, 29 L. Ed. 920), 348. Union Pacific v. Updike Grain Co. (178 Fed. 223, 222 U. S. 215, 56 L.Ed. 171), 416. Union Refrigerator Transit Co. v. Lynch (177 U. S. 149, 44 L. Ed. 708), 43. Union Stockyards Co. of Omaha v. C. B. & Q. R. Co. (196 U. S. 217, 49 L. Ed. 453), 820. Union Stockyards v, U. S. (161 Fed. 919, 169 Fed". 404), 808. United States Tobacco Co. v. American Tob. Co. (163 Fed. 701), 714. United States v. Adams Express Co. (229 U. S. 381, 57 L. Ed. 1237, 199 Fed. 321), 556. United States v. Agler (62 Fed. 826), 178-722. U. S. V. American Can Co. (Fed- eral Trade Rep. March 1, 1916), 756. U. S. V. American Express Co. (199 Fed. 321), See U. S. v. Adams Express Co.) United States v. Amalgamated Ass'n, 54 Fed. 994), 178-191-192. United States v. Amedy (11 Wheat. 329, 6 L. Ed. 502), 774. United States v. Am. Nav. Stores Co. (186 Fed. 592), 735. United States v. American Tob. Co. (221 U. S. 106, 55 L. Ed. 619), 719-775. United States v. Anderson Tobacco Co. 163 Fed. 517), 830. United States v. Armoyr (142 Fed. 808), 114-569-570. United States v. A., T. & S. F. R. Co. (166 Fed. 160), 847-849. United States v. A., T. & S. F. R. Co. (142 Fed. 176), 771. U. S. V. Atchison, T. & S. F. R. Co. (234 U. S. 476, 58 L. Ed. 1408), 482. United States v. Atlantic Coast Line (173 Fed. 764), 848. United States v. B. & 0. et al. (153 Fed. 997), 385-558. United States v. B. & 0. S. W. (159 Fed. 33), 849. U. S. V. Baltimore & Ohio R. Co. (226 Fed. 220), 841. U. S. V. Baltimore & Ohio R. Co. (184Fed. 94), 821. U. S. V. Baltimore & Ohio R. Co. (231 U. S. 274, 58 L. Ed. 218, 200 Fed. 779), 347-418-614. U. S. V. B. & 0. S. W. R. Co. (222 U. S. 11, 56 L. Ed. 68), 110-408. U. S. V. B. & O. S. W. R. Co.. (226 U. S. 14, 57 L. Ed. 104), 605. United States v. Boyer (85 Fed. 425), 61. United States v. Brigantine Wil- Uam (2 Hall's Am. L. J. 255), 6. United States v. Bunch (165 Fed. 736), 696. U. S. V. Butler County R. Co. (234 U. S. 29, 58 L. Ed. 1196, aff. 209 Fed. 260), 362. U. S. V. C. B. & Q. R. Co. (237 U. S. 410, 59 L. Ed. 1023, 211 Fed. 12), 818. United States v. Cassidy (67 Fed. 698), 178-186-775. United States v. Cadwallader (59 Fed. 677), 734. United States v. Central Vermont Ry. Co. (157 Fed. 291), 702, United States v. Chesapeake & 0. Fuel Co. (105 Fed. 93), 708. U. S. V. Chicago, M. & St. P. R. Co. (197 Fed. 624), 843. U. S. V. Chicago Junction Ry. Co. 211 Fed. 724), 846. TABLE OF CASES. 961 [references are to pages.] U. S. V. Chicago etc. R. Co. (211 Fed. 770), 846. United States v. Chicago & N. W. R. Co. (127 Fed. 785), 677. United States v. Coal Dealers Ass'n of Cal. (85 Fed. 252), 708-747. United States v. C. & N. W. (157 Fed. 616, 168 Fed. 236), 817. United States v. Colorado (57 Fed. 321), 809. United States v. Delaware etc. Co. (152 Fed. 269), 698. U. S. V. Delaware etc. Co. (238 U. S. 514, 59 L. Ed. 1438, 213 Fed. 240), 299. U. S. V. Delaware & Hudson Co. 213 U. S. 366, 53 L. Ed. 836, 164 Fed. 215), (152 Fed. 269), 297, 692-780. U. S. V. Del. L. & W. R. Co. (40 Fed. 101), 342-385-683. United States v. De Coursey (82 Fed. 302), 501-557-558. U. S. V. Dupont De Nemours & Co. (188 Fed. 127), 142-733-757-775. U. S. V. Eastman Kodak Co. (226 Fed. 62), 167. United States v. Elliott (64 Fed. 27, 62 Fed. 801), 178-722. U. S. V. Erie R. Co. (236 U. S. 259, 59 L. Ed. 567, 237 U. S. 401, 59 L. Ed. 1019, 213 Fed. 391, 212 Fed. 852), 295-818-819. U. S. to Use V. Fidelity & Guaranty Co. 178 Fed. 721-30. United States v. Forty-three Gal- lons of Whiskey (93 U. S. 188, 23 L. Ed. 846), 6. United States v. Gailford (146 Fed. 298), 698. United States v. Geddes (131 Fed. 452, 180 Fed. 480), 265, 807, 808. U. S. V. Grand Rapids & I. Ry. Co. (224 Fed. 667), 840. U. S. V. Grand Trunk R. Co. (225 Fed. 283). 506. U. S. V. Great Lakes Towing Co. (208 Fed. 733), 715. U. S. V. Greenhut et al. (51 Fed. 205, 735. United States v. Hanley (71 Fed. 672), 557. U. S. V. Hamburg American Line 216 Fed. 971), 725. U. S. V. Hamburg P. F. A. (200 Fed. 806), 725. United States v. Holte (236 U. S. 140, 59 L. Ed. 504), 14. United States v. Houston, B. & T. R. Co. (205 Fed. 344-843. United States v. Howell (56 Fed. 21), 558. United States v. International etc. Co. (174 Fed. 638), 809. U. S. V. International Harvester Co. (214 Fed. 987), 165. U. S. V. 111. Cent. R. R. (177 Fed. 801-830. United States v. Jelico Mt. Coal & Coke Co. (46 Fed. 432), 708. United States v. Joint Traffic Asso- ciation (171 U. S. 505, 43 L. Ed. 259), 148-196. United States v. Kagama (118 U. S. 375, 30 L. Ed. 228), 6. United States v. Kane (23 Fed. 748), 199. United States v. Kissel 173 Fed. 823, 218 U. S. 601, 54 L. Ed. 1168), 736-739-775. U. S. V. Kellogg Toasted Corn Flakes Co. (222 Fed. 725), 732. U. S. V. Keystone Watch Case Co. (218 Fed. 502), 733-755. United States v. Knight Co. (156 U. S. 1, 39 L. Ed. 325, 60 Fed. 306, 934), 18-125-149-160-705. U. S. V. Lake Shore & M. S. R. Co. 203 Fed. 295), 715. United States v. Lehigh Val. R. Co. (220 U. S. 257, 55 L. Ed. 459, 115 Fed. 372, 225 Fed. 399, 204 Fed. 705), 275-297-717-850. J-61. 962 TABLE OF CASES. [references are to pages.] U. S. V. Louisville & T. R. Co. (234 U. S. 1, 58 L. Ed. 1185), 362. U. S. V. Louisville & N. R. Co. (235 U. S. 314, 320, 59 L. Ed. 245), 409-485. U. S. V. Louisville & N. R. Co. (186 Fed. 280), 817. U. S. V. Louisville & N. R. Co. (236 U. S. 318, 59 L. Ed. 598), 485. United States v. McAndrews etc. Co. (149 Fed. 823), 736-739-740- 775. U. S. V. McCullough (221 Fed. 288), 24. United States v. Martin (176 Fed. 110), 295. United States v. Maurer (187 Fed. 127), 736. United States v. Mellin (53' Fed. 229), 557. United States v. Milwaukee etc. Co. (145 Fed. 1007), 699. United States v. Michigan Cent. R. Co. (43 Fed. 26), 557. U. S. V. Missouri Pacific R. Co. (213 Fed. 169), 842. United States v. Morsinan (42 Fed. 448), 269. United States v. Mosley (187 U. S. 322, 47 L. Ed. 198), 648. United States v. Nelson (52 Fed. 646), 735. United States v. N. Y., N. H. & H. (212 U. S. 509, 53 L. Ed. 629), 693. U. S. V. New Departure Mfg. Co. (204 Fed. 107), 736. United States v. N. Y., N. H. & H. R. Co. (165 Fed. 742), 775-780. U. S. V. N. Y. Cent. & H. R. R. R. Co. (212 U. S. 509, 53 L. Ed. 629; 157 Fed. 209), 693. U. S. V. N. Y. Cent. & H. R. R., 205 Fed. 428-819. U. S. V. N. Y. O. & W. R. Co. (216 Fed. 702), 842. United States v. Norfolk & W. R. Co. (109 Fed. 831), 420-683. United States v. Northern Pac. R. Co. (120 Fed. 546, 215 Fed. 64), 107-842. United States v. Northern Securi- ties Co. (193 U. S. 197, 47 L. Ed. 679, 120 Fed. 721), 149-196-706 775. United States v. Ohio Oil Co. (234 U. S. 548, 58 L. Ed. 1459, 204 Fed. 798), 266. United States v. Oregon R. & N. Co. (163 Fed. 641), 849. United States v. Oregon Short Line Ry. Co. (180 Fed. 483), 824. U. S. v. Oregon Washington N. Co. (213 Fed. 688), 843. United States v. Patten (187 Fed. 664, 226 U. S. 525, 57 L. Ed. 333), 736-741-775. United States v. Patterson, 58 Fed. 505-722. United States v. Patterson (201 Fed. 697, 205 Fed. 292, 222 Fed. 599), 739-740. United States v. Penn. Ry. Co. (153 Fed. 625), 702. U. S. V. Pere Marquette R. Co. (211 Fed. 220), 814. U. S. V. Philadelphia R. Co. (188 Fed. 484), 698. United States v. Philadelphia & R. Ry. (160 Fed. 696), 824. United States v. Pomeroy (152 Fed. 279), 702. U. S. v. Portale (235 U. S. 27, 59 L. Ed. Ill), 14. U. S. V. Powers-Weightman-Rosen- garten Co. (211 Fed. 169), 276. U. S. V. Price (96 Fed. 960), 571. U. S. V. Reagan (232 U. S. 37, 58 L. Ed. 494), 849. U. S. V. Railroad Co. (81 Fed. 783), 265-274. U. S. V. Reading Co. (226 U. S. 324, 57 L. Ed. 243, 123 Fed. 427), 719. United States v. Sanche (7 Fed. 715), 185. TABLE OF CASES. 963 [references are to pages.] United States v. Seaboard R. Co. (82 Fed. 563), 274. U. S. V. Shauver (214 Fed. 154), 24. United States v. Sioux City etc. Co. (162 Fed. 556), 848-849-850. XT. S. V. Southern Pacific (167 Fed. 407), 829. U. S. V. Southern Pacific (157 Fed. 459, 178 Fed. 15), 846-847-849. U. S. V. Southern Ry. (164 Fed. 347, aff. 222 U. S. 20, 56 L. Ed. 72), 808. U. S. V. Southern Wholesale Groc. Ass'n. (207 Fed. 434), 717. U. S. V. Standard Oil Co. of Ind. (170 Fed. 988, 155 Fed. 305, 164 Fed. 376, 148 Fed. 719), 695-696. U. S. V. Standard Oil of N. J. (152 Fed. 290, 173 Fed. 177), 160- 757. U. S. V. Standard Oil of N. Y. (192 Fed. 438), 696. United States v. Standard Oil (148 Fed. 719), 702. United States v. Stearns S. & L. Co. (165 Fed. 735), 696. U. S. V. Sterling Salt Co. (200 Fed. 593), 558. United States v. Stephens (44 Fed. 132), 555. United States v. Stockyards Ter- minal Co. (172 Fed. 452), 848. United States v. St. Joseph Stock- yards (181 Fed. 625), 847-850. U. S. V. St. Louis etc. R. Co. (184 Fed. 28), 825. U. S. V. St. Louis etc. Co. (154 Fed. 516), 818. U. S. V. Sunday Creek Co. (194 Fed. 252), 695. U. S. V. St. Louis Terminal Co. (236 U. S. 194, 59 L. Ed. 535), 754. U. S. V. Swift (186 Fed. 1002), 570- 741-775. U. S. V. Swift (122 Fed. 529. 188 Fed. 127, 188 Fed. 92), 190-709- 736-775. U. S. V. Terminal R. Co. (224 U. S. 383, 56 L. Ed. 810), 166-268. U. S. V. Thomas (145 Fed. 74), 698. U. S. V. Tozer (39 Fed. 369), 351. U. S. V. Terminal R. R. Assn. (154 Fed. 268-750. United States v. Trans-Missouri Freight ass'n. (58 Fed. 58), 775. United States v. Trans-Missouri Freight Ass'n. (156 U. S. 290, 41 L. Ed. 100), 196-489. United States v. Tucker (196 Fed. 260), 743. United States v. Union Pacific R. R. (169 Fed. 65), 848-849. United States v. Union Pacific Ry. Co. (213 Fed. 332), 846. U. S. V. Union Pac. Ry. Co. (226 U. S. 61, 57 L. Ed. 124, 188 Fed. 102), 165-166-719. U. S. V. Union Pacific Ry. Co. (226 U. S. 470, 57 L. Ed. 306), 166. United States v. U. S. Fidelity Co. (178Fed. 721), 30. U. S. V. United States Shoe Ma- chinery Co. (222 Fed. 349), 730. U. S. V. United States Steel Corp. (223 Fed. 55), 733-755. United States v. Vacuum Oil Co. (158 Fed. 536), 696. United States v. Virginia etc. Co. (163 Fed., 66), 739. United States v. Weber (114 Fed. 950), 177. U. S. V. Western & A. R. Co. (184 Fed. 336), 818-825. United States v. West Va. & N. R. Co. (125 Fed. 252), 419-683. United States v. Westman (182 Fed. 1017), 13. U. S. V. Whiting (212 Fed. 466), 737. United States v. Williams (159 Fed. 310), 295. 964 TABLE OF CASES. [references are to pages.] U. S. V. Winslow (227 U. S. 202, 57 L. Ed. 481), 729. United States v. Wood (145 Fed. 405), 693-697. United States v. Workingmen Amalgamated Ass'n (54 Fed. 994), 178-191-192. United States ex rel v. B. & 0. R. Co. (215 U. S. 481, 54 L. Ed. 292), 615. U. S. ex rel Atty. Gen'l v. L. & N. R. Co. (212 Fed. 486, 236 U. S. 363, 59 L. Ed. 598), 575-663- 664. United States ex rel Com. v. K. & S. R. R. Co. (81 Fed. 783), 662. U. S. ex rel Friedman v. U. S. Express Co. (180 Fed. 1006), 38. United States ex rel. v. Norfolk & W. Ry. (143 Fed. 266), 683. United States ex rel. v. Oregon R. & N. Co. (159 Fed. 975), 419. U. S. ex rel v. L. & N. R. Co. (195 Fed. 88), 683. U. S. ex rel Pitcairn Coal Co. v. B. & 0. R. Co. (154 Fed. 108, 165 Fed. 113), 424. U. S. ex rel v. Union Stockyards & Transit Co. of Chicago (192 Fed. 330), 268. U. S. ex rel. Zimmerman v. Oregon Washington N. Co. (210 Fed. 378), 39. United States Fidelity & G. Co. v. Commonwealth of Ky. (112 S. W, 314, 139 Ky. 27), 14. U. S. Fidelity & G. Co. v. Kentucky (231 U. S. 394, 58 L. Ed. 283), 17. U. S. Telephone Co. v. Central Union Tel. Co. (202 Fed. 66), 715. U. S. Tobacco Co. v. American Tob. Co. (163 Fed. 701), 714. Vance v. Vandercook (170 U. S. 438, 42 L. Ed. 1100), 38-68. Van Brimmer v. T. & P. R. R. Co. (190 Fed. 394), 802. VandaUa R. Co. v. U. S. (226 Fed. 713), 695. Van Patten v. C. M. & St. P. R. Co. (81 Fed. 545, 74 Fed. 981), 88-306-531. Veazie Bank v. Fenno (118 Wall. 533, 19 L. Ed. 482), 127. Vegelhan v. Hunter (167 Mass. 92), 189. Virginia Rate Cases (211 U. S. 210, 53 L. Ed. 150), 99-227-308. Virtue v. Creamery Package Co. (227 U. S. 8, 57 L. Ed. 393, 179 Fed. 115), 157-167-726-727. Voelker v. Railroad Co. (116 Fed. 867), 810. Vulcan Steam Shovel Co. v. Flanders (205 Fed. 102), 32. W. Wabash R. Co. v. Hannahan, et al. (121 Fed. 563), 176-195-556. Wabash R. Co. v. Hays (234 U. S. 86, 58 L. Ed. 1226), 798. Wabash R. Co. v. lUinois (118 U. S. 557, 30 L. Ed. 244), 67-78. Wabash Ry. Co. v. U. S. (168 Fed. 1), 817-829. Wabash St. L. & Pac. R. Co. v. Illinois (104 111. 476), 70-76. Wadley Southern R. Co. v. Georgia (233 U. S. 651, 59 L. Ed. 405, 137 Ga. 497), 203-459. Walker v. Cronin (107 Mass. 555), 189. Walker v. Keenan (19 C. C. A. 668, 73 Fed. 755, 64 Fed. 992), 288-514. Wall V. Norfolk & W. R. Co. (52 W. Va. 485, 64 L. R. A. 501), 71 Walling V. Michigan (116 U. S. 446, 29 L. Ed. 691), 68. Ware-Cramer Tob. Co. v. Ameri- can Tob. Co. (180 Fed. 160), 714. TABLE OF CASES. 965 [references are to pages.] Waterhouse v. Comer (55 Fed. 149), 178-722. Waters-Pierce Oil Co. v. Texas (177 U. S. 28, 44 L. Ed. 657), 32. Wear-Kramer Tob. Co. v. Ameri- can Tob. Co. (180 Fed. 160, 178 Fed. 117), 764. Weber v. Freed (224 Fed. 355), 123. Weber v. Virginia (103 U. S. 344, 26 L. Ed. 565), 60. Webster v. Union Pac. R. Co. (200 Fed. 597), 849. Webster Coal Co. v. Cassat (207 U. S. 181, 52 L. Ed. 160), 549. Weems S. B. Co. v. People's S. B. Co. (214 U. S. 344, 53 L. Ed. 1024), 417. Wells Fargo Co. v. Johnson (205 Fed. 60), 42. Welsch V. U. S. (220 Fed. 764), 14. Welton V. Missouri (91 U. S. 275, 23L. Ed. 349), 47-117. Wenslow v. Atlantic Coast Line (79 S. C. 334), 74. West V. Kansas Nat. Gas. Co. (221 U. S. 229, 55 L. Ed. 716, 172 Fed. 545), 25-27. West Virginia Nav. Co. v. United States (134 Fed. 198), 683. Western etc. Co. v. Ann Arbor R. Co. (178 U. S. 239, 44 L. Ed. 1052), 106-214. Western N. Y. & P. R. Co. v. Penn. Refining Co. (137 Fed. 343), 632. Western Trunk Line Case (20 L C. C. R. 307), 312. Western Union Tel. Co. v. Call Pub. Co. (181 U. S. 92, 45 L. Ed. 765), 85-346. Western Union Tel. Co. v. Childs (214 U. S. 274, 53 L. Ed. 994), 50. Western Union Tel. Co. v. Colman (216 U. S. 1, 54 L. Ed. 355), Western Union Tel. Co. v. Brown (234 U. S. 542, 58 L. Ed. 1457), 50, Western Union Tel. Co. v. Com- mercial Mill Co. (218 U. S. 408, 54 L. Ed. 108), 50. Western Union Tel. Co. v. Crovo (220 U. S. 264, 55 L. Ed. 498), 50. Western Union Tel. Co. v. Gott- leib (190 U. S. 412, 47 L. Ed. 1116), 42. Western Union Tel. Co. v. James (162 U. S. 650, 40 L. Ed. 1105), 50. Western Union Tel. Co. v. Kansas (216 U. S. 1, 54 L. Ed. 355, 75 Kans. 609), 30-81. Western Union Tel. Co. v. Massa- chusetts (125 U. S. 530, 31 L. Ed. 790), 42-106-232. Western Union Tel. Co. v. Pendle- ton (122 U. S. 347, 30 L. Ed. 1187), 13-50. Western Union Tel. Co. v. Penn. R. R. Co. (195 U. S. 540, 49 L. Ed. 312, 332), 106. Western Union Tel. Co. v. Tag- gard (163 U. S. 1, 41 L. Ed. 49), 42. Westmoreland & Cambria Nat. Gas Co. V. Dewitt (130 Pa. St. 235), 26. West Virginia v. Adams Express Co. (219 Fed. 794), 39. Wheaton v. Donaldson (8 Peters 1, c. 658, 8 L. Ed. 1079), 84. Wheeling Terminal R. Co. v. Russell (209 Fed. 795), 819. Wheeler-Stenzel Co. v. Nat. Win- dow Glass Co. (152 Fed. 864), 713. Whittaker v. I. C. Ry. (176 Fed. 130), 795. Whitwell V. Continental Tobacco Co. (125 Fed. 454, 63 C. C. A. 290), 167-716. Wickwire Steel Co. v. New. York Central Co. (181 Fed. 316), 546. 966 TABLK OF CASES. [references are to pages.] Wight V. United States (167 U. S. 512, 42 L. Ed. 258), 339. Wilcox V. Consolidated Gas Co. (212 U. S. 19, 53 L. Ed. 399), 238. Wilder Mfg. Co. v. Corn Products Ref. Co. (236 U. S. 165, 59 L. Ed. 520), 770. Williams v. Arkansas (217 U. S. 79, 54 L. Ed. 673, 86 Ark. 412), 253. William R. Compton v. Allen (216 Fed. 537), 15. Williams v. Western Union Tel. Co., (203 Fed. 140), 263-544. Willimette Bridge Co. v. Hatch (125 U. S. 1, 31 L. Ed. 629), 102. Wilmington Trans. Co. v. Railroad Comm. (236 U. S. 151, 59 L. Ed. 508, 166 CaU. 741), 58-104. Wilmington & W. R. Co. v. R. R. Commissioners (90 Fed. 33), 220. Wilson V. Atlantic Coast Line R. Co. (129 Fed. 774), 353. Wilson V. Black Bird Creek Marsh Co. (2 Peters, 245, 7 L. Ed. 412), 46. Wilson V. United States (220 U. S. 614, 55 L. Ed. 581), 569-570. Wilson V. United States (232 U. S. 563, 58 L. Ed. 728), 14. Windsor Coal Co. v. C. & A. R. Co. (52 Fed. 716), 304-305. Winkler v. Pennsylvania R. Co. (53 Atl. Rep. 90), 810. Winchester Arms Co. v. Bunger (199 Fed. 786), 727. Winfield v. New York Cen. & H. R. Co. (110 N. E. 614), 799. Winslow V. Atl. Coast Line (60 S. E. 709, 79 S. C. 344), 74. Wisconsin & C. R. Co. v. Jacobson (179 U. S. 287, 45 L. Ed. 194), 243. Wisconsin & M. R. Co. v. Powers (191 U. S. 379, 48 L. Ed. 229) 43. Wogan V. American Sugar Ref. Co. (215 Fed. 273), 757. Wood V. VandaUa R. Co. (231 U. S. 1, 58 L. Ed. 97), 230. Woodruff V. Parham (8 Wall. 123, 19 L. Ed. 382), 8-17-34. Woodside v. Tonapah R. Co. (231 U. S. 298, 58 L. Ed. 229, 184 Fed. 358), 211. Worcester v. Georgia (6 Pet. 515, 8 L. Ed. 483), 6. Yazo & Miss. Val. R. Co. v. Green- wood & Co. (227 U. S. 1, 57 L. Ed. 389), 246. Yazo & Miss. Val. R. Co. v. Wright (235 U. S. 375, 59 L. Ed. 277, 207 Fed. 281), 789. Yellow Pine Rate Cases (206 U. S. 441, 51 L. Ed. 1128), 319. Young V. Kansas City, St. J. & C. B. R. Co. (33 Mo. App. .509). 305. Zikos V. Oregon R. R. etc. Co. (179 Fed. 893), 792. INDEX. [references are to sections.] A. ACCIDENT LAW OF MARCH 3. 1901 (See Appendix) p. 920. ACCESSORIAL SERVICES (see Cartage, Storage, Delivery, De- murrage) — under Interstate Commerce Act, 171. must be rendered equally to all alike. 286. icing service and rates, 176. instrumentalities furnished and services performed by shipper, 228. plant facilities allowed for, 242. short railroad line, serving industries, 245. elevator service, undue preference in allowance for, 287. elevator, leasing by railroad, 247. elevators treating grain, 287. transportation elevation defined by commission, 287. wharfs and approaches thereto, 289. fabrication in transit, 302, 383. storage in transit, privilege of, 305. transit privileges in lumber shipments, 306. switch connections and local terminal facilities, 310. re-shipping privileges, 347. accessory charges ig^tariff under control of commission, 385. lighterage service, 462. ACCOUNTS— by railroad, not compelled to keep separate account as shipper and carrier, 246. accounts, records and memorandums of railroad company liable to inspection, 500. ACTS IN THE REGULATION OF COMMERCE (see Amendments)— July 1, 1862, Government aided Pacific Railroads, 57. June 15, 1866, 44. scope and purpose of, 44. did not compel through routing, 44. did not interfere with State police laws, 44. did not interfere with State Sunday laws, 44. did not exempt interstate roads from attachment and garnish- ment, 44. July 24, 1866. prohibits State monopolies in interstate telegraph business, 57. permissive only, 57. [967] 968 INDEX. [references are to sections.] ACTS IN THE REGULATION OF COMMERCE— Con/inuerf. does not grant telegraph company eminent domain over road's property, 57. does not apply to telephone companies, 7, 57. May 29, 1884, Bureau of Animal ludustry, 60. June 29, 1886, authorizing incorporation of national trades unions, 100. Aug. 7, 1888, supplementary to the Act of 1862, 57. July 2, 1890 (see Anti-Trust Act). Aug. 30, 1890, unconstitutional, 36. March 2, 1893 (see Safety Appliance). May 2, 1895, prohibiting interstate carriage of condemned animal carcasses, 60. Feb. 2, 1897, prohibiting interstate carriage of obscene literature, 60. June 1, 1898, arbitration between carriers and employees, 100. March 3, 1899, Secretary of War vested with certain powers, 59. May 25, 1900, prohibiting interstate carriage of game unlawfully killed, 60. March 3, 1901, Accident law (see Appendix). May 9, 1902, police power of State extended to oleomargarine, 60. July 1, 1902, prohibiting interstate carriage of dairy products falsely labeled, 60. Feb. 2, 1903, respecting admissions of live stock into State, 60. Feb. 25, 1903, immunity to testifying witnesses, 605. June 30, 1906, Food and Drug, 60. June 30, 1906, Meat Inspection, 60. June 30, 1906, Quarrantine, 60. June 11, 1906, National Employers' Liability, 60, 64, 615. April 22, 1908, Employers' Liability, 618. March 4, 1907, Hours of Service, 666. June 25, 1910, White Slave, 60. ACTIONS AT LAW (see Commencement of Actions) — under section 7, Anti-Trust Act, 592. under section 8, Interstate Commerce Act, 390. attorney's fee allowed by statute to shipper, 149. undercharge may be recovered by railroad in action at law, 368. right of action based on statute, 391. complaint must show right of action under the act, 402. treble damages, who may recover, 593. ADDYSTON PIPE TRUST CASE, 87, 92. 94, 535. ADJOURNMENTS AND EXTENSIONS OF TIME (see Rules of Practice, rule 8). ADMIRALTY AND MARITIME JURISDICTION— not limited to tide waters, 13. extends to public navigable lakes and rivers, 13. INDEX. 969 [references are to sections.] ADMIRALTY AND MARITIME JURISDICTION— Con/inuerf. what are navigable waters, 13. boundaries and limits of matters of judicial cognizance, 15. extends to Erie Canal, 14. jurisdiction of Federal Courts, 15. pilotage laws of state, n. 26. lien for maritime tort, 26. ocean carrier subjecting itself to jurisdiction of commission water transportation between states, acts applicable to, 536. ADVANCE OF RATES— without reason, subject of investigation, 366. considerations for advance of rates, 200. advance rate cases of 1914 and 1915, 459. increase of rates and territories granted railroads, 459. AFFREIGHTMENT— effect of rebates, on contract of, 258. AGENT— act of, binds carrier, 519. ALASKA IS TERRITORY OF THE UNITED STATES WITHIN MEANING OF ACT— 163. ALIENS— power to exclude, 2, 5. Service upon foreign corporations doing business in district, 607. aliens as beneficiaries under Employers Liability Act, 633. AMENDMENTS TO THE INTERSTATE COMMERCE ACT (see Interstate Commerce Acts) — March 2, 1899. mandamus to compel carrier to furnish equal facilities, 52, 516. Feb. 11, 1893. enforcement of self-incriminating testimony, 52, 422, 605. Feb. 11, 1903. • Expedition Act, 51, 52, 610. Feb. 19, 1903 (see Elkins Act). June 29, 1906, 52. April 13, 1908, 52. June 18, 1910, 52. Panama Canal Act amendment, 1912, 52. Cummings Amendment to Carmack Act of 1915, 52. (See Carmack Amendment.) AMENDMENTS OF PLEADINGS (see Rules of Practice, rule 7) . AMERICAN TOBACCO CASE, 86, 87. 548, 584. ANIMAL INDUSTRIES ACT— scope of, 36. 970 INDBX [references are to sections.] ANSWERS (see Rules of Practice, rule 4). ANNAPOLIS CONFERENCE— in relation to, constitutional convention, 1. ANTI-TRUST ACT (see Restraint of Trade Conspiracy)- Section 1, 531. Section 2, 565. Section 3, 575. Section 4, 577. Section 5, 585. Section 6, 588. Section 7, 590. Section 8, 608. passage of, 77. purpose of, 77. general provisions, 78, 531. common-law protection irrespective of act, 83. constitutionality of, 84, 531. construction of, by Supreme Court, 86. not inconsistent with Interstate Commerce Act, 85. railroads included in, 85. territories and District of Columbia included, 465. reasonable construction and reasonable restraints distinguished, 86. direct and incidental restraint, 87. Standard Oil Case, 87. what monopolies denounced, 86, 85. agreements for charges for local facilities not included, 87. not restraint of trade, illegal, but contract in restraint thereof, 87. no application to commerce within a State, 92. State, holding companies, 93, 121, 534. application to combinations of labor and capital, 102, 552. employment of common agency, 554. no distinction as to commodities subject of contract, 98. necessities of life on same footing with other articles, 87, 98. combination between interstate railroads for suppression of com- petition, 85. combination to regulate competition and rates by pooling, 85. restrictive sales in interstate commerce, 97. procedure under the Act, 578. agreements within Act, 544. not to sell to persons who cut prices, 544. inducement to maintain arbitrary prices, 544. interstate transportation is subject to the Act, 534. applies to transportation wholly within a territory, 163. Addyston Pipe Trust Case, 535. California Tile Trust Case, 536. INDEX. 971 [references are to sections.] ANTI-TRUST ACT— Continued. Tennessee, California and Ohio Coal Cases, 537. Chicago Meat Trust Case. 538. Washington Shingle Trust Case, 539. incidental restraint of trade not violative of the Act, 540, 541, 545. Kansas City Live Stock Exchange Case, 541. Chicago Board of Trade Case, 542. Calumet and Heckla Mining Case, 542. Standard Oil Case, 583. American Tobacco Case, 87, 448, 584. Powder Trust Case, 551. agreements not within the Act, 541, 545. acts done outside of U. S., 555. patent monopoly not within the Act, 557, 601. secret formula contracts, 559. prevention of dealing with competitors through payment of rebates not unlawful, 545. restriction of sales to certain territory not unlawful, 545. incidental restraint of trade through purchase of competitors, 545. agreement of manufacturers to fix arbitrary price on goods not un- lawful, 545. agreements not to enter into competition, 545. criminal provisions of the Act, 407, 565, 566, 575. indictment under, essentials of, 545, 570. suit by Government for dissolution procedure, 582. decree in Standard Oil Case, 583. decree in American Tobacco Case, 584. Chicago Meat Trust indictment, 538. criminal conspiracy under Act, 568. limitations of prosecutions under, 569. sufTiciency of indictment for, 570. corporations indictable, 571. conspiracy to run a corner, 572. ' injunction under the Act limited to the Government, 578, 579. State cannot enjoin under the Act, 581. State not a person or corporation, 581, 595. bringing in new parties and service of subpoenas, 585. construction of sec. 5, 586. seizure and condemnation of property, 588. private action at law under section 7, 590. construction of by Supreme Court, 592. measure of proof, 594. petition when sufficient, 597. The Danbury Hat Case, 597. plea of nolo contendere, 574. measure of damages, 600. limitations of private actions, 604. 972 INDEX. [references are to Sections.] ANTI-TRUST ACT— Continued. the Act as defense in suits by alleged illegal combinations, 601. the Act as defense in patent litigation, 601. no recovery under Act for violation of Interstate Commerce Act, 603. term "person" or "persons" include what, 608. self-incriminating testimony, 605. commodity may be subject of illegal agreement in restraint of trade, yet subject to State taxing power, 89. does not apply to agreements between business men for better con- duct of their business, though incidentally affecting interstate commerce, 87. interstate contract unenforcible at common law violative of the Act, 91. suppression of competition included in restraint, of trade 80. congressional discussions of anti-trust act, 80. competition, substantial suppression not specially defined, 80. unfair methods of competition, 82. illegal combinations in interstate commerce, 89. circulation of confidential information among members of Trade association, 89. Danbury hat case, 89, n. 103, 599. channels of interstate commerce, flow of trade in, 89. common carriers holding stock of another where no substantial com- petition, 95. stock control by Union Pacific over Southern Pacific, 95. seller of business withdrawing from occupation, 94. terminal monopoly regulated by re-organization, 96. natural monopoly by physical conditions, 96. reorganization to remove objectionable features, 96. sale of patented articles distinguished from license to use inventions, 97. Proprietary medicine, ruling in case of, 97, 544. selection by manufacturer of customers, 97. manufacturer's right to refuse to sell, 97. Cream of Wheat case, 97. articles of prime necessity, 98. common law of conspiracy in United States, 98. combiuations to eliminate natural and existing competition, 544. combinations in instrumentalities of interstate commerce, 544. term of lease as evidence of creation of monopoly, 544. continuation of association for certain purpose after dissolution by court, 546. combination of railroads held to be within anti-trust act, 549. eastern retail dealers association case, 550. labor combinations, application of the act to, 552. * labor unions as such not unlawful under the act, 553. INDEX. 973 [references are to sections.] ANTI-TRUST ACT— Continued. combinations affecting foreign commerce wherever made, within the act, 556. combination of steamship companies with reference to transporting steerage passengers, 556. agreement between steamship companies to sell tickets to members only, 556. Henry V. Dick, 557. patentees and copyright holders agreements violative of the act, 558. Bauer v. O'Donnell, 558. secret formulae contracts under the act, 559. combinations in non-competitive patents not violative of the act, 560. tieing contract, 561. Shoe Machinery cases, 561. restrictive sales under Clayton and Sherman acts, 562. United States Steel Corporation case, 564. indictments under Sherman act, sufficiency of, 566. indictments including those engaged in conspiracy, 566. criminal conspiracy acts sufficiently definite for prosecution, 567. overt act not necessary for criminal prosecution, 568. cornering the market, 572. injunction based on statute, not limited to government, 579. injunction on behalf of minority stockholders, 579. War, actualities of may render nugatory proceedings under Sherman act, 556. Decrees, scope of under anti-trust act, 586. treble damages under anti-trust act, 590. who may recover treble damages, 593. who liable as defendants in conspiracy, 596. evidence under section 7, 598. damages after action has been commenced, 599. infringers of trade mark as violaters of the anti-trust act, 601. contracts, legality of, when party is alleged to be in illegal combina- tion, 602. statutes of limitation, 604. service upon foreign executor, 606. service upon foreign corporation doing business in district, 607. definitions under the act, 608, 609. due process of law, acts violative of, 614. amendment of act of 1908 and 1910 sustained by Supreme Court, 620. anti- trust provision of Tariff Act, appendix p. 851. Clayton Act of 1914, appendix p. 853 APPEAL (see Expedition Act of Feb. 11, 1903) — right of, 393. under Fourteenth Amendment, 124. review upon certiorari of proceedings of trade commission, 82. 974 INDEX. [references are to sections.] APPEAL— Continued. Supreme Court has appellate jurisdiction of orders granting or de- nying interlocutory injunction, 132. appeal from order of commission, immaterial when, 129. what courts review orders of commission, 484. courts review limited to cases of affirmative action by the commission, 485. limitation of courts review of action by commission, 485. APPENDIX (see table of contents, p. 851) ARBITRATION ACT OF 1913. (Appendix, p. 919.) ARBITRATION ACT— report of Board of Arbitration, n. 110. Secretary of Labor, power to act as mediator, 99. power of Secretary of Labor to appoint commissions of conciliation, 99. Mediation, conciliation and arbitration act of 1913, 100. services of Board of mediation may be applied for, 100. witnesses compelled to attend arbitration boards, 100. books and papers produced before board of arbitration, 100. "ARRIVAL"— meaning of term in Wilson's Original Package Bill, 18, 58. contract for, at given time enforcible, 286. ARTICLES OF CONFEDERATION, 1 ASH PAN ACT (see Appendix p. 918.) ASSIGNMENT— cause of action may be, 395. ASSOCIATIONS— are persons within meaning of Anti-Trust Act, 608. circulation of confidential information among members of trade associations, 89. Eastern retail dealers association case, 550. labor unions as such not unlawful under the act, 553. ASSUMPTION OF RISK (see Safety Appliance Act). ATTACHMENT— of foreign railroad cars, 41. ATTORNEYS— allowance of fees, 479-590. AUTOMATIC COUPLERS (see Safety Appliance Act, sec. 2). "AVERAGE HABITUAL USE"— rule of, 22. INDEX. 975 [references are to sections.] B BANKRUPTCY— power to establish uniform system, 47. BASING POINT SYSTEM— meaning of, 272. not illegal, 272. not exempt from regulating power of Commission, 273. BELT RAILROAD— subject to State control when doing local business, 330. BILL OF EXCHANGE— not interstate commerce, 8. BILL OF LADING— when on interstate commerce. State tax on void, 8, 42, n. when on foreign shipment exempt from State or Federal taxation, 8. goods intended to be shipped, bill of lading of, 161. export freight on local bills of lading, 161. BLANKET RATES (see Grouping of Rates). BOOKS AND PAPERS (see Immxjnity)- Amendments of 1893 only refers to testimony before the Commis- sion, 422. Section 9, compelling production of, unconstitutional, 407. compulsory production of before Commission, 441. compulsory production of under Expedition Act, 611. compulsory production not enforced when party or corportion there- by exposed to penalty or forfeiture, 422. distinction by Commission between those of carriers and strangers, 441. Board of arbitration to compel production of books and papers, 100. inspection of books and papers by examiners of interstate commerce commission, 431. distinction by Commission between "private" and "public" docu- ments, 441. may be summoned before commission from any part of the United States, 428. BOUNDARIES ON SEA— State may define, subject to hmitations, 11. BOYCOTTS (see Illegal Combinations, Strikes and Boycotts). BRAKES— driving wheel and train brakes required (see Safety Appliance Act, sec. 1). 976 INDEX. [references are to sections.) BRANCH LINE— point on may be charged higher rate, 286. tap line railroad entitled to allowance of joint rate, 242. short railroad line serving industries, allowance to, 245. industrial railways case, 245; BRIDGES— not common carriers, 7. power of Congress to authorize between States, 55. regulation of over navigable streams, 26, 55, 59. when included in term "Railroad," sec. 1, 170. power of Congress to charter between States, 71. State regulation of toll, on interstate void, 7. when carrying on interstate commerce, 16, 35. State cannot regulate tolls on interstate, 7, 38, 39. as affecting unjust discrimination against locality, 279. BRIEFS (see Rules of Practice, rule 14). BROKER— State tax on money or exchange broker not a regulation of com- merce, 8. commercial agencies, n. 8. BROTHERHOOD OF LOCOMOTIVE ENGINEERS— rule 12 of, violated section 10 of the Act, 412. BURDEN OF PROOF (see Presumptions)— follows general rules, 440. on carrier when seeking relief under section 4, 440. on party complaining, 440. on complainant shipper before the Commissioner, 133. on carrier to show dissimilar circumstances and conditions under section 4, 346. on carrier where there is a departure from the rule of the law, 440. on carrier to show unreasonable limitation fixed by State, 193. on complainant to show carrier has exceeded reasonable standard, 193. to show unreasonableness of rates, 137. to show discrimination, 34. in prosecution under Safety Act, 656. in court after finding of Commission, 477. on complainant to show unreasonableness, 203. on carrier where departure from equal rates on several branches of the road, 440. on carrier where facts justifying disparity peculiarly within his knowledge, 440. BUREAU OF CORPORATIONS, 61. INDEX. 977 [references are to sections.] BUREAU OF LABOR— created under Act of June 27, 1884, 99. made Department of Labor June 13, 1888, 99. BUREAU OF MANUFACTURE— established Feb. 18, 1903. 61. CALIFORNIA COAL CASE, 537. CALIFORNIA TILE TRUST CASE, 536. CALUMET AND HECKLA MINING COMPANY CASE, 543. CANALS (see Erie Canal)— between points in same State, subject to State control, 25. water route, through rating by, 270. Jurisdiction over water carrier, 269. Panama Canal act, 362, 386. amendment to Panama Canal act, 386. Panama Canal act construed by commission, 363. railroad ownership of water lines, policy to separate, 363. Panama Canal opening commented on by commission, 387. CAPITALIZATION OF RAILROAD— as basis for rate making, 194, 204. value and not cost of railroad considered, 141. cost of reproduction, 141. uses to which railroad property could be put and basis of value, 141. items of appreciation and depreciation of railroad property, 141. indefinite estimate of railroad property, 141. increase of value of property no justification for unreasonable rate, 195. four per cent return unreasonable and confiscatory, 144. six per cent profit considered, 144. CARCASSES— interstate carriage of condemned prohibited, 60. CARRIERS (see Railroads)— status as shippers and consignees, 376. Interstate commerce commission enforces Clayton act applicable to carriers, 81. what is a common carrier, 158. boat lines as common carriers, 158. oil pipe lines as carriers, 156. incorporation not a condition precedent of being a common carrier, 158. J— 62, 978 INDEX. {references are to sections.] CARRIERS— Continued. stock yard company not a common carrier, 158. street railroads in interstate service not included in the act, 164. interurban electric railroads transporting freight, 165, 455. railroad company as shipper, 246. water carriers and railroad carriers to be separated, 363. application of railroads to operate lake boats and ferry boats, 363. initial carrier liable under Carmack amendment, 502. intermediate carrier issuing bill of lading under Carmack amendment not liable, 504. agent at Washington, Code provision for, (see Appendix, p. 878). CAR SERVICE— meaning of "car" in Safety Appliance Act, 642. Commissioner's report for 1904 concerning, 297. Commission's ruling in coal car service sustained, 292. order of Commission requiring counting, 291. powers of Commission in 451. when "engaged" in interstate commerce, 646. common-law duty to furnish, 291. undue preference in, 291, 297. may be against localities or individuals, 291. compulsion by way of mandamus, 291, 292. no defense for refusal to furnish, that cars can be more profitably employed elsewhere, 291, 292. delay in furnishing cars, when discrimination, 291. discrimination in carrier's own favor, 297. furnishing of cars on spur track not discrimination, 291. no duty to notify shipper when he can obtain cars, 291. no duty of carrier to meet extraordinary demand, 291. discrimination in private cars, 224, 292, 297. two classes whether or not owner interested in contents, 297. rules and rates of carriage must be published, 377. tank cars, duty to furnish impartially, 297, 319. carrier may acquire cars as it pleases, 266, 298, 299. leasing of car does not carry right of exclusive use by owner, 300. no discrimination against locality where lack of cars, 291. shortage how dealt with, 516, 517. carrier not responsible for detention of cars, 291. refusal to receive from connecting line (see Safety Appliance Act, sec. 3). may refuse to haul private cars, 297. state cannot impose penalty on carriers for delay in furnishing cars, 42 n. common-law duty requires furnishing of refrigerator cars, 176. icing service and rates, 176. enforcement of carrier's duty to furnish cars, 178. INDEX. 979 [references are to sections.] CAR SERVICE— Co/i/inued. peddler cars, unlawful use of, 185. distribution of coal cars, 293. embargo by carrier of coal cars, 294. distribution of grain cars, 295. reparation for discrimination and distribution of cars, 471. switch engine not a carrier within the meaning of the Safety Ap- pliance act, 644. CARGO RATES— discriminative, 239. CARLOADS AND LESS THAN CARLOAD RATES— legality recognized, 235. must bear reasonable relation, 235. discrimination in, 238. discrimination based on ownership of cargo, 236. proper differential between, from Middle West to Pacific Coast, 235. create dissimilar circumstances and conditions, 235. differential between may effect unjust discrimination, 235, 286. minimum charge to be for one hundred pounds, 236. forwarding agents, extra charge unjust discrimination, 237. unlawful use of peddler cars, 185. CARMACK AMENDMENT— Carmack amendment as amended by Cummings Act, 501. Carmack amendment sustained by Supreme Court, 502. Initial carriers liable under Carmack amendment, 502. Jurisdiction of State Courts and United States Courts under Carmack amendment, 503. State laws displaced by Carmack amendment, 503. Intermediate carriers issuing bill of lading under Carmack amend- ment not liable, 504. Carmack amendment, limitation of liability under, 505. Cummings and Carmack Amendments construed, 506. baggage as affected by Cummings amendment to Carmack amend- ment, 506. CARRIER AND SHIPPER THE SAME— carrier may not give itself undue preference, 296. CARTAGE (see Storage, Delivery) — Commission may require publication of charges for under section 6, 171, 377. railroad not bound by custom to pay charges, 171. unjust discrimination and undue preference may be based on, 171. 286. not in general a terminal expense, 171, 377. switching to team tracks and freight sheds in terminals, 172. transportation of sugar from refinery to cars not within act, 171. 980 INDEX. [references are to sections.] CATTLE (see Differentials in Rates, Live Stock). special rate to export shipment of cattle, 528. confining cattle contrary to twenty-eight hour law, 664. knowledge of the length of time confined imputed to carrier, 664. accommodation for animals, substitution for, provisions of the act, 668. CHANCERY (see Equity Proceedings). CHANNELS, IMPROVEMENT OF NAVIGABLE (see Regulation of Commerce, Concurrent Jurisdiction). CHARGES REASONABLE AND JUST (see Rates)— under state statute, 188. provision of first section afiirmance of common law, 186. rule in England, 186. question of reasonableness one of fact, 187, 263. in absence of legislation court must decide what is reasonable, 186. practical difficulties in enforcement of rule, 187. rate unreasonable when paid may become reasonable before trial in court finished, 187. for local facilities not within anti-trust act, 87. reconsignment, 303. consent of shipper to special charge not binding, 172. rates and not systems of rates determined by commission, 171. advance of rates, consideration in, 200. cost an important element in determining reasonableness of rates, 200. review of commission's rulings on rates, 205. rates exceptionally high justified by exceptional operation, 211. no vested interest in rates, 214. undercharge recovered by railroad, 368. accessory charges controlled by commission, 385. reasonable profit may be included in charges for services, 402. carrier's duty to route on lowest rates, 457. procedure in reparation cases, 477. damages recoverable in reparation actions, 478. jurisdiction of district court in reparation action, 480. CHARTER CORPORATE— State may alter, amend or repeal, when, 146. federal power of granting, 71. power to grant not within enumerated powers of Congress, 71. incorporation hot a condition precedent of being a common carrier, 158. CHICAGO MEAT TRUST CASE, 538. CHOICE OF ROUTE— undue preference in denying shipper, 312. routing instructions, 457. INDEX 981 [references are to sections.] CIGARETTES— State may declare how far to be sold, 10. State may prohibit sale entirely after leaving original package, 10. cannot prohibit importation in original package, 10. CIRCUIT COURT OF APPEALS (see Federal Courts)— jurisdiction on appeal in contempt cases, 113. to enforce orders of trade commission, 61, 82. CIRCUMSTANCES AND CONDITIONS— of through and local traffic are dissimilar, 229. not made dissimilar by quantity of freight, 232. rendered different by accessorial services, 234. employment of forwarding agent as creating dissimilar, 237. increased cost of service resulting from stoppage create dissimilar, 229. of carload and less than carload are dissimilar, 229, 235, 236. ocean transportation creates dissimilar, 266. dissimilarity of, renders preference not undue, 263, 264, 271. under fourth section, 271. competition may create dissimilar, 229, 264, 266, 271, 343. under second section not rendered dissimilar by competition, 230. Pullman sleeping cars, when an instrument of interstate commerce, n. 41. insignificant competition, 94. terminal facilities and plant facilities, 172. plant facilities allowed for, 242. short railroad line serving industries, allowance to, 245. water route, through rating by, 270. conditional allowance on return of empty cars, 287. CIRCUS TRAIN— carrier may refuse to transport except under special contract limit- ing liability, 234. CITY ORDINANCE— regarding stone, when void, 42, n. regarding street railroad in interstate commerce, 42, n. CLASSIFICATION (see Interstate Commerce Act) — commodity, when not classified, given commodity rate, 320. undue preference in, 324. complaint concerning, against whom made, 438. consultation of carriers in classification not illegal combination, 323. proof of undue preference in, necessary to obtain order of change, 324, 326. in State railroad legislation, 149. reasonable regulations in classification, 326. justice of classification determined by comparison, 324. 982 INDEX. [references are to sections.] CLASSIFICATION— Co/1/inued. power of Commission in correcting, 325. no contract right to special classification, 325. transfer from low to high class may be unlawful, 324. governing principles of freight classification, 324. specific commodities. dried fruits and raisins, 324. hub blocks and lumber, 324. railroad ties and rough lumber, 324. Hostetter's Stomach Bitters with other liquids, 324. patent medicines and ale, beer, mineral water, 324. toilet soap and laundry soap, 324. celery and vegetables, 324. open end envelopes and merchandise envelopes, 324. iron pipe fittings in pipes and in barrels, 324. flour and cereal products, 324. cow peas and grain, and fertilizers, 324. uniform classification recommended, 321. power to discriminate between classes of passengers, 147. classified messages, of telegraph companies, 153. contract, shipment of coal, 254. cotton bales compressed, rate on, 308. classifications, to be uniform, recommended, 321. excursion tickets, 514. CLAYTON ACT. (See Act in appendix)— 79. penalty for violation of act, 461. jurisdiction of Interstate Commerce Commission under act, 461. suppression of competition by Clayton act, 80. competition defined, 80. enforcement of the Clayton act, 81. conclusiveness of findings on hearings authorized by Clayton act, 82. jurisdiction with power over quasi public institutions and private business, 81. competitive bidding under Clayton act, 461. money judgment under Clayton act, 476. enforcement of orders under Clayton act, 476. COAL (see Differentials in Rate) — desirable traffic owing to small hazard, 215. embargo by carrier of coal cars, 294. mine rating and distribution of coal cars, 293. "CO-EFFICIENT" POWER— meaning of, 5. COINAGE OF MONEY— power of congress over, 5. INDEX. 983 [references are to sections.] COMBINATIONS (see Restraint of Trade, Anti-Trust Act, Strikes AND Boycotts, Conspiracy, Tenth Section). other than in transportation, 535. COMMENCEMENT OF ACTIONS— when suit begun, 465, 467. ■where to be filed, 464, 465, 477. limitations applicable to contempt proceeding, n-115. service upon foreign corporations doing business in the district, 607. service on foreign executor, 606. limitations, 604. COMMERCE (see Interstate Commerce, Regulation of Commerce, Department of Commerce and Labor) — what is, 7. not traffic alone, but intercourse, 7. importation the test, 7. correspondence school, 7. white slave trafiic, 7, n. transportation of passengers, 7. what is not, 8. insurance, 9. what are subjects of, 10. oleomargarine, 10. tobacco, 10. State cannot determine what are subjects of, 10. game and fish, 11. liquor, 17. oil and gas, 12. manufacture not, 532. sale as an incident of manufacture not, 532. traffic in stocks, bonds and securities, 7. soliciting sales in foreign states, 7. delivery of accessories to articles sold, 7. commercial agencies — list of attorneys, n-8, trademarks subject to regulation, 8. private banking not commerce, 8. Migratory Birds act unconstitutional, 11. prize fight films, 67. COMMERCE CLAUSE— in the Constitution discussed, 1. judicial construction of, 6. rulings of State courts on, 42. with reference to admiralty jurisdiction, 13. police power and the, commerce clause, 67. 984 INDEX. [references are to sections.] COMMERCE COURT (see act abolishing— appendix, p. 905). court abolished, 481. short life of, 54. COMMISSIONER OF CORPORATIONS (see Department of Com- merce AND Labor), COMMODITIES (see Kinds of Traffic, Differentials). COMMODITIES CLAUSE— validity of, 181. rulings on, 181. violation of commodities clause, how corrected, 245. railroad as shipper, 246. "COMMON CONTROL, MANAGEMENT," ETC.— what constitutes, 161. test of, is through routing in interstate commerce, 161. immaterial that one road receive sole benefit, 161. express agreement obviated by acquiescence, 161. holding companies considered in Clayton act, 93. stock control by Union Pacific over Southern Pacific, 95. boat line, discrimination through interest in, 243. lease by railroad company of elevator, 247. COMMON LAW— in interstate commerce, 48. Western Union Telegraph Co. v. McCall Pub. Co., 48. state regulation under, 34. right of discriminations, 225. right of discrimination not unlimited, 226. no obligation to charge equal rates to all customers, 225. contract governed by, when in interstate commerce, 83. contracts in restraint of trade unenforcible at, 83, 87, 91, 98. no common law of conspiracy, 98. COMMUTATION RATES (see Sec. 23)— reasonableness in, 209. jurisdiction of Commission in, 515. enforcement of excursion rates, when unreasonable, 147. power to make exceptions in favor of particular class of passengers of locality. 147. discrimination in favor of classes of passengers, 147. COMPARISON— not a basis for determining reasonableness of rates, 203. INDEX. 985 [references are to sections.] COMPETITION— does not render circumstances and conditions dissimilar under sec- tion 2, 230. as affecting through rates, 229. effect on long and short haul, 263, 345. burden of proof, 346. allows giving of preference or discrimination, 263. at the seaport renders circumstances and conditions dissimilar, 266. railroad competition same as water competition, 271. creating dissimilar circumstances and conditions under section 4, 342, 345. when with foreign or other railroads not subject to the Act, 342. in peculiar cases between railroads subject to the Act, 342. resort to Commission for this purpose, 345. preferences of localities enforced by, not undue, 263, 276. competition between cities on opposite banks of rivers, 279. differentials between, 283. application of the competition rule, 264, 265. qualification in the application of the rule, 275. question of fact whether controlling, 271, 265. competition created by carriers, 271. basing point system, 272. natural advantages, 276. suppression of competition under Clayton Act, 80. competition defined, 80. unfair method of competition, 82. trade commission empowered to prevent unfair competition, 82-79. common carrier holding stock of another where no substantial com- petition, 95. competition must be substantial, 94. insignificant competition, 94. purchase of stock by Union Pacific of Southern Pacific, 95. competition of localities, 278. water competition amendments, 353. competitive bidding under Clayton Act, 461. combination in non-competitive patents not violative of the Act, 560. zones of competition crossed by state boundary line, 123. COMPLAINTS (see Pleadings, Rules op Practice, Rule 3). COMPLIANCE WITH ORDERS (see Rules of Practice, Rule 18). CONCURRENT AND EXCLUSIVE POWERS— distinguished (see Regulation of Commerce). jurisdiction of Trade Commission not made exclusive, 82. enforcement of Clayton Act by Federal Reserve Board, Interstate Commerce Commission and Trade Commission, 81. 986 INDEX. [references are to sections.] CONGRESS, JURISDICTION OF (see Regulation of Commerce)— no jurisdiction over commerce wholly within one State, 92. labor legislation, 99. extent of power, 62. limitation of power, 68. the unexercised power of, 62. co-efflcient power, 5. absence of legislation by Congress, 123. State regulation of State rates of interstate carrier, 123. extent of power of State regulating intra-state rates, 123. powers within State favored against points without State, 123. remedy of intra-state discriminatory rates, 123. West Virginia rate case, n-136. North Dakota rate case, 137. CONNECTING CARRIERS— State cannot make receiving carrier agent of, 42, n. discrimination by having interest in, 243. liability for discrimination of initial carrier, 257. rights as to milling in transit, 335. uniting in joint tariff not a standard of determination of separate tariff, 344. stock control by Union Pacific over Southern Pacific, 95. routes between street railroads and steam railroads, 164. Canadian through joint rate, 167. terminal facilities and plant facilities, 172. spur track as part of carrier's terminals, 172. team tracks and freight sheds within switching limits, 172. short railroad lines serving industries, allowance to, 245. industrial railway case, 245. short time agreements of industrial lines, 2^5. lease by railroad of elevator, 247. water route, through rating by, 270. wharves and approaches thereto, 289. amendments of 1906 and 1910 in regard to switches, spurs, terminals, delivery, elevation, etc. 310. interchange of railway traffic controlled by Congress, 310. exaction of pre-payment from connecting carriers, 328. operation of lake boats and ferry boats by railroads, 363. through route between Louisville & Nashville and Tennessee railroads ordered by Commission, 452. water and rail through routes established, 453. lateral branch line, 454. reparation not apportioned between carriers, 469. initial carrier liable under Carmack amendment, 502. intermediate carrier issuing bill of lading not liable under Carmack amendment, 504. INDEX. 987 [references are to sections.] CONNECTING CARRIERS— Con/znued. combinations in instrumentalities of interstate commerce, 544. knowledge of length of time cattle confined computed to connecting carrier, 664. CONSIGNEES— doing business in State, 16. CONSPIRACY (see Anti-Trust Act)— defined, 106. may result from boycott, 103. a misdemeanor, not a felony, 106. essential of indictment for, 106, 566, 570. doctrine of merger inapplicable, 106. obstruction to United States mail, 106. each conspirator liable for acts of co-conspirator, 106. enforcement of rule of Brotherhood of Engineers as, 106. conspirators liable for loss to private parties, 106. concerted quitting employment, 104. doing a lawful thing in unlawful manner, 106. conspiracy to run a corner, indictabihty of, 572. limitation of prosecutions for, 569. English legislation on, 107. conspiracy under the Act distinguished from common law conspir- acy, 107. malice in conspiracy, 108. application to contempt cases, 116. United States statute concerning, 106, 412. under section 10, 414. incidental interference with commerce not, 104, 413. what constitutes, 107, 413, 414. illegal combinations in interstate commerce, 89. Danbury Hat case, 89 n-703-599. common law of conspiracy in United States, 98. indictment including those engaged in a conspiracy, 566. criminal conspiracy, acts sufficiently definite for prosecution, 567. overt act not necessary for prosecution of criminal conspiracy, 568. conspiracy to run a corner in cotton indictable, 572. "cornering" the market, 572. when liable as defendants in conspiracy charge, 596. combination to compel railroad to break contract for use of cars, 103. as applied to proceedings for contempt, 116. newspaper reports, etc., to show character of, 106. CONTAGIOUS DISEASES— State legislation may exclude persons infected with, 10. 988 INDEX. [references are to sections.] CONTEMPT IN UNITED STATES COURTS— proceedings criminal in nature, 113. United States statute concerning, 113. power of Congress over, 113. power to. punish for, at common law, 113. interference with receiver appointed by court a contempt, 113. not triable by jury, 113. court may punish for crime, though indictable, 113. for refusal to testify, 428. claim that proceeding should not be summary, 113. involves no element of personal injury, 113. application of law of conspiracy, 113. liability not hmited to party of record, 113. review of contempt finding on appeal, 113. only matters of law considered, facts of trial tribunal being con- clusive, 113. power to punish for disobedience of injunction, 113. by railroad employees engaged in interstate commerce, 398. direct and indirect contempt, 114. criminal and civil contempts, 115. conspiracy and contempt, 116. contempt in labor disputes, 115. Gomper's case, in -115. — limitation applicable to contempt proceedings, n. 115. contempt under Act of 1914, 117. procedure in contempt against person, 117. jury trial in contempt cases, 117. jury trial not mandatory in contempt cases, 117. contempt in the presence of the court, 117. contempts near to court, 117. obstructing the administration of justice, 117. fine in contempt cases, 117. imprisonment in contempt cases, 117. CONTINENTAL TOBACCO CASE, 91, 98. CONTINUOUS CARRIAGE (see Through Traffic). CONTRACTS (see Restraint of Trade, Charters, Anti-Trust Act) — between shipper and carrier governed by law of State where made, 33. in interstate commerce governed by rules of common law, 70. in restraint of trade not illegal at common law, 83. secret formula contracts, 453. limiting liability valid, 234. no contract right to special classification, 225. jurisdiction of Commission over, between carriers, 327. INDEX. 989 [references are to sections.] CONTRACTS— Con/mued. telegraph companies contract with railroad — exclusive use of wire, n. 57, 153. tying contracts and factor's agreement, 97, 561. price control by contract, 97. resale contract must tend to create monopoly, 97. validity of tying contracts, 97. tying contracts contempt under Clayton Act, 97, 561. contracts for different than published rates invalid, 371. contract limiting carrier's liability, 506. contract to avoid provisions of employer's liability acts, 626. CONTRIBUTORY NEGLIGENCE (see Safety Appliance Act, Anti- Trust Act). contributory negligence in connection with Safety Appliance Act, 622. CONVICTS— State legislation may exclude, 10. CORPORATIONS— State corporation in interstate commerce (see Foreign Corpora- tion). not a "citizen" within meaning of Constitution, 16. a "person" or "citizen" when necessary to effective legislative intent in statutes, 423. a "person" within meaning of 14th Amendment, 16, 124. requirement of Federal franchise, 74. railroad bperating in several States corporation of what State, 119. are persons within meaning of Anti-Trust Act, 489. ■ relation of State to Fedral corporations, 73. as to self-incriminating testimony, 423. subject to penalties, 423. Subject to indictment, 423, 571. visitorial power over, 66. Federal power over capitalization, 66. power over stock and bond issue, 66. power of Congress to charter, 71. power of Congress to charter bridge across navigable stream, 57. place of, immaterial, 168. place of, immaterial as to regulating power, 121. cannot appropriate property without compensation therefor, 23. conviction for misdemeanor, 519. power of Congress to charter not in enumerated powers, 71. affidavit required of corporation by State Anti-Trust Law, 148. minority stockholders applying for injunctive relief, 579. private banking not commerce, 8. federal corporations, regulation of, 73. holding companies under Clayton Act, 93. 990 INDEX. [references are to sections.] CORPORATIONS— Continued. stock of one corporation held by another, 95. corporations purchasing stock for investment, 95. CORRESPONDENCE SCHOOLS (see Commerce). CONSTITUTION— article I, section 8, par. 3, 1. article I, section 8, par. 18, 1. article I, section 9, par. 5, 1, article I, sec. 10, par. 2, 1. article IV, section 2, 1. article VI, par. 2, 1. article I, section 9, par. 5, 3. article III, section 2, par. 5, 15. CONSTITUTION, AMENDMENTS TO— V, 1. IX, 1. X, 1, 5. XIV, 1, 124, 145. COPIES OF PAPERS OR TESTIMONY (see Rules of Practice, Rule 17). CORPSE— not a subject of commerce, 10. COSTS— how levied, 464. how paid in suits by Commission, 464. COST OF CARRIAGE— in relation to receipts as regulating charge, 198. COURTS (see Federal Courts) — no revisory power after finding by Commission, 481, 482. power to enforce, testimony before Commission (see Witnesses). prior leave of, unnecessary to entitle shipper to proceed against rail- road in hands of receiver, 437. have no power to fix rates, 192. contempt in the presence of court, 117. Commerce Court abolished, 481. review of Commissions ordered by Supreme Court, 482. what courts review orders of Commission, 484. court's review limited to cases of affirmative action by Commission, 485. CREDIT, RAILROADS PROHIBITED FROM EXTENDING THEIR CREDIT TO INDIVIDUALS (see Rebates)— 434. INDEX. 991 [references are to sections.] CRIMES— none at common law in United States, 83. State legislation may prevent spread of, 10. CROSSINGS ON SURFACE— State may regulate, 30. D. DAIRY PRODUCTS— interstate carriage of falsely labeled, prohibited, 60. DAMAGES (see Eighth Section; Ninth Section) — failure to adjust, 34. measure of in unjust discrimination, 256, 446. proof of, must be made by complainant, 446. speculative, not allowed, 446. jurisdiction of Commission in awarding, 446, 472. measure of, where rate charged exceeds published rate, 446. liability of carrier, 390. for discrimination, 406. for discrimination in car service, 291. remedy for failure to render special service, 234. measure of, in rate wars, 314. to through shipment, 495. allegation and proof of damages by plaintiff under section 8 of Act, 392. attorney's fees, allowance of as costs, 393. damages trebled under the Anti-Trust Act, 590. who may recover trebled damages, 593. damages after action has been commenced, 599. measure of damages under Employer's Liability Act, 630, 631. set-off under Employer's Liability Act, 632. DECREES, FORM OF ENTERED IN ANTI-TRUST CASES (see Appendix, p. 879). DEFENSE— of judgment before Commission to action in Federal court, 407. individual claimant not barred by suit of his association, 407. of statute of limitations (see Limitations of Actions). no defense in discriminations between persons that the privilege may be withdrawn at will, 256. adoption, printing and posting schedule of rates as, 189. statute of limitation a defense in contempt proceedings, 115. DELAY— not of itself ground for complaint, 438. in furnishing cars may effect discrimination, 291. 992 INDEX. [references are to sections.] DELEGATION OF POWER— to Interstate Commerce Commission, 59. upon President, 59. upon Secretary of War, 59. discussion as to whether Trades Commission Act violates Constitu- tion, 81. DELIVERY (see Storage, Cartage)— no additional duty of, imposed by section 1, 171. services if rendered must be impartial and reasonable, 171, 234, 286. distinction between American and English customs of, 171. live stock and perishable property require additional facilities for, 175. extra charge for these additional facilities unlawful, 175. railroad may contract with stock-yards company for delivery of live stock, 175. where consignees oft main hne, 175. higher charge for quick delivery, 234. compensation for instrumentality furnished and service performed by shipper, 228. State and congressional regulation of delivery of freight cars, 36. distribution of coal cars, 293. distribution of grain cars, 295. Switch connections and local terminal facilities, 310. amendment of 1906 and 1910 in regard to switches, spurs, terminals, delivery, elevation, etc., 310. interchange of railway traffic controlled by Congress, 310. preferential switching charges, 311. accessory charges in tariffs, control of, by Commission, 385. lighterage service, 462. delivery of connecting carrier under Twenty-eight hour law, 675. plant facilities allowed for, 242. DEMURRAGE CHARGES— undue preference shown by, 286. unjust discrimination in failure to collect, 247. uniform rules recommended, 285. on private cars, 298. publication of demurrage tariff, 378. DEMURRER— notice in nature of (see Rules of Practice, Rule 5). statute of limitations raised by, 256. DEPARTMENT OF COMMERCE (see Bureau of Corporations, Federal Trades Commission, Clayton Act, Department of Labor). estabhshed by Act of Feb. 18, 1903, 61. INDEX. 993 [references are to sections.] DEPARTMENT OF COMMERCE AND LABOR— established March 18, 1903, 61. DEPARTMENT OF COMMERCE AND DEPARTMENT OF LA- BOR— separated by Act of March 4, 1913, 99. Secretary of Commerce a cabinet member, 61. ceased to exist September 26, 1914, 61. functions given to Federal Trade Commission, 61. DEPARTMENT OF LABOR— estabhshed June 13, 1888, 99. duties of Commissioner, 99, 100. made part of the Department of Commerce and Labor, 99. DEPARTMENT OF LABOR ERECTED (see Labor Combinations, ETC.)— 99. Secretary of Labor, power to act as mediator, 99. labor disputes and power of Secretary of Labor to appoint Commis- sions of Conciliation, 99. DEPOSITIONS (see Rules of Practice, Rule 12)— taken by order of Commission, 420. notice must be given, 420, 438. testimony by deposition may be compelled, 420. manner of taking, 420. when witness in foreign country, 420. must be filed with Commission, 420. before whom taken, 420. "Fishing Expeditions" in taking testimony by Interstate Commerce Commission, 430. testimony taken by Commission not to be aimless, 430. DETENTION— not of itself ground for complaint, 438. DIFFERENTIALS (see Kinds of Traffic)— in rates on live hogs and packing house products, 315. wheat and flour, 315. raw materials and manufactured product, 315. anthracite and bituminous coal, 315. live hogs and cattle and dressed products of each, 315. grain and grain products, 318. competitive cities, 283. may be preferential, 286. discrimination between contract purchaser and ordinary purchaser of coal, 254. competitive localities, 278. differentials between East coast cities considered, 283. St. Louis and East St. Louis rates, 280. fabrication in transit, 302, 383. J-63. 994 INDEX. [references are to sections.] DIRECTORS OF CORPORATIONS (see Clayton Act). DISCRIMINATION (see Unjust Discrimination). DISEASED CATTLE, EXCLUSION OF (see Regulation of Com- merce, Concurrent Jurisdiction). DISPENSARY LAWS OF SOUTH CAROLINA (see Spiritous Liq- uors). DISTRICT ATTORNEY (see Safety Appliance Act)— power of, under Elkins Act, 397. duty to prosecute under section 12, 420. in general, 464. DISTRICT OF COLUMBIA— power of Congress to grant charters in, 71. agents of common carriers to be located in the District of Columbia, Appendix, p. 878. DIVERSE CITIZENSHIP (see Jurisdiction of Federal Courts). DIVISION OF TERRITORY— undue preference in, 313. increase of rates and territories granted railroads, 459. zones of competition crossed by State boundary line, 123. zones created by Commission sustained by court, 351. points within State favored against points without State, 123. DOCKS, REGULATION OF (see Regulation of Commerce, Concur- rent Jurisdiction). wharves and approaches thereto, 289. "DOING BUSINESS"— distinction from "carrying on" interstate commerce, 16. delivery of accessories to articles sold, 7. DRAW BARS (see Safety Appliance Act, sec. 5). DRUMMERS— may be sent through various States, 16. soUciting sales in foreign States, 7. commercial agencies — list of attorneys, n. 8. soliciting orders for intoxicating liquors, 19. E. EARNINGS— relation of rates to investment of, 196. four per cent, returned unreasonable and confiscation, 144. experiment as to what is confiscation, 144. separate record of intrastate and interstate business of carrier, 142. cost an important element in determining reasonableness of rates, 200. INDEX. 995 [references are to sections.] ECONOMIC CHANGES— influence of, on construction of Federal Constitution, 76. EIGHTH SECTION— liability of carriers for damages, 390. construction of, 391. plaintiff must show injury, 392. action at law, 391. cause of action under may be assigned, 395. limitation of actions, 394. jurisdiction of Federal Courts, 395. proceedings under section 8, 392. allegation and proof of damages by plaintiff under section 8 of Act, 392. EIGHTEENTH SECTION— salaries of Commissioners, Secretary, etc., 489. expenses of the Commission, 489. employees of the Commission, 489. offices and supplies of the Commission, 489. ELECTION (see Ninth Section). ELECTRIC RAILROADS— between States, subject to the Act, 164. between States, rates on, 164. switching connections, 454. street railroads in interstate service not included in the Act, 164. routes between street railroads and steam railroads, 164. street railroads and interurban electric railroads transporting freights distinguished, 165, 455. ELEVATORS— undue preference in allowance for service, 287. construction of, on right of way, 309. leased by railroad of elevator, 247. Undue preference in allowance for elevator grain service, 287. two kinds of grain elevation, 287. Elevators treating grain, 287. amendment of 1906 and 1910 in regard to elevation, switches, etc., 310. ELEVENTH AMENDMENT— suit against State Commission not suit against State within meaning of, 125. ELEVENTH SECTION (see Interstate Commerce Commission)— Interstate Commerce Commission, 418. number of Commissioners, 418. 996 INDEX. [references are to sections.] ELEVENTH SECTION— Continued. how appointed, 418. term of, 418. requirements of, 418. removal, 418. organization and members, 418. ELKINS ACT (see Rebating)— discussed, 52, 224, 365, 375, 397, 410. general provisions, 519. Elkins Act does not repeal section 10, 411. amendments, 530. repealing clause of Hepburn Act did not bar prior offenses, 521. validity and enforcibility, 522. unit of offense under, 524. Standard Oil case, 524. scope of personal provisions, 528. requisite of indictment under, 530. contents of, 530. EMBARGO— Congress may place on foreign commerce, 2. embargo by coal carrier on coal cars, 294. EMINENT DOMAIN— power of, in Congress, 5. power of, in telegraph companies under Act of 1866, 57. does not give telegraph company right of way over railroad prop- erty, 57. EMPLOYEES (see Employers' Liability Act) — interstate commerce in relation to employees therein, 60, 64, 108. Federal regulation of interstate employers, 64. not impaired because intrastate service incidentally affected, 64. relation of carrier and employee that of free contract, 108. right to leave employment, subject to certain limits, 104, 108. distinction between relation of ^uasi-public and private corporations to employees, 108. abandonment of train, 110. peaceable strike lawful, 413. State laws establishing qualifications of, valid, 30. passes issued to employees of common carrier not subject to Act, 179. corporations bound by knowledge of agents, 529. transportation of employees under Employers' Liability Act, 623. train employee in interstate commerce within meaning of Hours of Service Act, 684. INDEX. 997 [references are to sections.] EMPLOYERS' LIABILITY ACT— general provisions Act of 1906, 615. invalid as to interstate commerce, 616. valid as to District of Columbia and territories, 617. Act of 1908 general provisions, 618. amendments to of 1910, 619, 621. construction of Act of 1908, 620. the fellow servant rule, 620. contributory negligence, 622. what is employment in interstate commerce, 623. bridge gang, 623. track walker, 623. concurrent jurisdiction of State courts, 624. contracting out of Act prohibited, 626. superseding State statutes, 627. removal of cases under the Act, 629. employment in interstate commerce under Employers' Act, 623. carrier must be engaged in interstate commerce at time of injury. 623. State and interstate service of same train under Act, 623. service incidental to operation of train in interstate commerce under Act, 623. transportation of employees under Employers' LiabiUty Act, 623. interstate service of locking railroad under Act, 623. jurisdiction of Supreme Court in suits brought in State under Employers' Liability Act, 625. contracts to avoid provisions of Employers' Act, 626. parties entitled to action under Act, 628. deceased employee leaving no widow, children or parents, 628. proceedings in trials under Act, 630. measure of damages under Employers' Liability Act, 630, 631. set-off under Employers' Liability Act, 632. aliens as beneficiaries under Act, 633. contributory negligence and assumption of risk distinguished, 622a. Employers' Liability Act and State compensation laws, 627a. ENGLISH ACTS IN REGULATION OF COMMERCE— Railway Clauses Consolidated Act, 47. Railway and Canal Traffic Act, 47, 261, 262^ Regulation of Railways Act, 1873, 46. Conspiracy and Protection of Property Act, 1875, 107. difTerence between conditions in England and United States, 46. ENUMERATED POWERS— government one of, 5. power to charter corporations not within, 71. 998 INDEX. [references are to sections.] EQUITY PROCEEDINGS (see Injunction)— jurisdiction of Federal court over, 397, 580. by Act of February 19, 1903, 397. for protection of interstate commerce against combination in viola- tion of the Act, 398. pleading in (see Pleading and Proof). jurisdiction irrespective of citizenship, 398. to protect against combinations in restraint of trade, 83. under ninth section, 405. under Anti-Trust Act, 578. minority stockholders applying for injunctive relief, 579. decrees, scope of, under the Act, 586. decrees, form of, 586, appendix, p. 879. ESCH-TOWNSEND BILL OF 1906, 52. ESTOPPEL— Interstate Commerce Commission not bound by ruling of State Com- mission, 65. EVIDENCE (see Ninth Section, Testimony, Witness) — reports of railway accidents as (see Accident Law, sec. 3). tax return of railroad officials to establish reasonableness, 198. contracts and tariffs filed and published under section 6, 366. of contract for through routing, 161. contract between third persons not party to proceeding, 429. advanced rate filed with Commission going in effect pending hearing, 198. newspaper reports, etc., to show character and purpose of conspiracy, 106. witnesses compelled to attend Arbitrators Board, 100. books and papers produced before Board of Arbitrators, 100. conclusiveness of facts embodied in report of Commission, 475. burden of proof showing discrimination, 354. evidence under section 7, 598. conclusiveness of findings on hearings authorized by Clayton Act, 82. EX PARTE STATEMENTS (see Moot Question). EXPEDITION ACT FEB. 11, 1903 (see Interstate Commerce Acts)— terms, 610. judicial application of, 611. Amendment of 1910, 612. construction of statute, 613. EXPERT TESTIMONY (see Testimony, Witness, Evidence). INDEX. 999 [references are to sections.] EXPORTS (see Imports and Exports, Preference Clause) — prohibition of tax or duty on, from any State not applicable to inter- state traffic, 4. tax on personal property actually in transit, 17. Ohio tax cases, 22. inspection charges imposed by State, when unlawful, 38. EXPRESS COMPANIES— under the Act, 159. railroad not bound to grant equal facilities to, 159. may pool earnings, 360. express rates and practices considered by Commission, 159. EXTENSION OF. TIME (see Rules of Practice, Rule 11, appendix, p. 889). F. FACILITIES FOR INTERCHANGE OF TRAFFIC— tap lines, 242. plant facilities, 242. danger of strike as excuse for refusal, 412. injunction to compel, 412. State control of, 330. does not compel through routing, 327. meaning of "track and terminal facilities," 327. tap line railroad entitled to allowance of joint rate, 242. boat line, discrimination through interest in, 243. short line railroad serving industries, 245. industrial railways case, 245. short time agreement on industrial lines, 245. leasing by railroad of elevator, 247. terminal charges, St. Louis and East St. Louis, 281. reshipment privilege, held not preferential, 282, 347. elevator grain service, undue preference in allowance for, 287. elevation of grain, two kinds, 287. conditional allowance on empty cars, 287. wharves and approaches thereto, 289. embargo by carrier on coal cars, 294. fabrication in transit, 302, 383. storage in transit, privilege of, 305. transit privileges in lumber shipment, 306. switch connections and local terminal facilities, 310. terminals, regulation of, 310. terminals, Tennessee Central litigation, in regard to, 310. interchange of railway traffic controlled by Congress, 310. switching charges, absorption of when preferential, 311. baggage transferred under Act, 337. yard operations under Safety AppUance Act, 646. 1000 INDEX. [references are to sections.] FEDERAL CAUSE OF ACTIONS IN STATE COURTS (see State Courts). FEDERAL CONTROL OF STATE REGULATION— State regulations through State commissions, 119. expenses of, 120. State regulation not dependent on State incorporations, 121. nor congressional incorporations, 121. cannot regulate any part of interstate commerce, 122. competitive effect of intrastate rates on interstate commerce, 123. The Fourteenth Amendment, 124. Federal review of State regulation, 125. jurisdiction of U. S. Courts, 125. construction by State, 125. Federal jurisdiction must be invoked on substantial grounds, 126. mere delegation of jurisdiction insufficient, 126. Federal jurisdiction cannot be limited by State legislation, 127. due process of law, 127. injunction against State officials, 128. Federal control, over orders of Commission, 129. , procedure in, 130. temporary injunctions against legislation, under Act of 1910, 130. Supreme Court on State regulation, 135. schedules of rates and special rates, 136. reasonableness of rates, 193. valuation of property, 138, 194. apportionment of railroad property, 139. confiscation, 140. cost and revenue, 140. rate of profit necessary to avoid confiscation, 144. protection against discriminating State legislation, 145. State Anti-Trust Laws, 148. State classification in railroad legislation, 149. State tax on towing, 16. Ohio tax cases, 22. pilotage laws of State, n. 26. receiver appointed by State Court in intra-state railroad of foreign corporation, 26. State statutes in regard to shipping immature fruit, 34. Food and Drug Act invalidating State statutes, 36. power to fix inspection fees left to State, 38. inspection of interstate and foreign commerce, 38. Federal control over intrastate rates, 65. Shreveport rate case, 65. delegation of power to Commission to control intrastate rates, 65. State cannot impose confiscatory rates, 137. West Virginia rate case, n. 136. INDEX. 1001 [references are to sections.] FEDERAL CONTROL OF STATE REGULATION— Con/inuerf. confiscatory rate, what is, 137. North Dakota rate case, 137. Missouri rate case, 141. Jurisdiction of State courts and United States Courts under Carmack Amendment, 503. State laws displaced by Carmack Amendment, 503. jurisdiction of Supreme Court in suits brought in State court under Employers' Liability Act, 625. State statutes superseded by Employers' Liability Act, 627. State legislation affecting Safety Appliance Act, 640. State statute invalidated by Hours of Service Act, 679. FEDERAL COURTS, JURISDICTION OF— in admiralty cases, 15. exclusive of State courts under the Act, 49, 396. concurrent jurisdiction where action based on common law of inter- state commerce, 49, 396. distinction between cause arising or not arising under Act, 396. suit, where brought, 396. amount in controversy, 49. over equity proceedings under the Act, 397. under Elkins Act, 410, 519. no jurisdiction of intrastate combinations not affecting interstate commerce, 68. in reparation cases under sec. 16, 473. irrespective of citizenship, 130, 396. prior to adoption of Fourteenth Amendment, 124. based on cause arising under Constitution and laws of United States, 49, 396. when such a suit arises, 49, 50, 397. no jurisdiction on removal where State court has none, 48, 396. power of, cannot be limited by State legislation, 46, 107. in admiralty and maritime cases, 15. under Judiciary Act of 1879, 15. includes maritime cases wholly within single State, 15. of District Court, 480. of Circuit Court of Appeals in contempt cases, 113. suits by non-resident stockholders against State Commission con- testing State imposed rates, 130. under Anti-Trust Act, 578, 579, 580. power of State regulation of intrastate traffic subject to review by, 125. in questions involving reasonableness of rates, 125, 126. cannot be limited by State law, 127. in general, 49. where State statute denies due process or equal protection of the law, 125. 1002 INDEX. [references are to sections.] FEDERAL COURTS. JURISDICTION OF— Continued. injunction against State officials, 128. mandamus, 516. not bound to follow State courts, 45. over Commission's orders, 481, 482. of District Court over violations of Commission's orders, 480. no revisory power of Commission's findings, 343. Circuit Court of Appeals to enforce order of Trades Commission, 61. judicial code amended in regard to interlocutory injunctions, 132. Supreme Court has appellate jurisdiction from orders granting or de- nying interlocutory injunctions, 132. three judges must hear application for interlocutory decree, 132. whole question determined by Federal Court on apphcation for tem- porary injunction, 132. review of Commission's rulings on rates, 205. when action of Commission necessary before courts will take juris- diction, 405. limitations on the right to sue in State Courts, 474. jurisdiction of District Court in reparation actions, 480. court's review limited to cases of affirmative action by Commission, 485. jurisdiction of State Courts in United States Courts under Carmack Amendment, 503. jurisdiction of Supreme Court in suits brought in State Court under Employers' Liability Act, 625. FEDERAL REGULATION (see Regulation of Commerce)— Federal sovereignty, 5. power of Congress complete in itself, 7. FEDERAL TRADES COMMISSION (see Clayton Act)— Act in full (see Appendix p, 869). established by Act of Sept. 26, 1914, 61. pending matters before Bureau of Corporations transferred, 61. office of Commission in Washington, 61. exercise all its powers at any place, 61 . one or more of its members to hold hearing, 61. empowered to prevent persons, etc., from using unfair methods of competition in commerce, 61. orders issued after hearing, 61. orders of Commission enforcible by Circuit Court of Appeals, 61. new Commission has independent status, 61. to assist Attorney General in investigation, 61. may require annual or special reports on interstate corporations, 61. information obtained by Commission published at its discretion, 61. trade secrets and names of customers cannot be published, 61. empowered to investigate trade conditions in and with foreign coun- tries, 61. INDEX. 1003 [references are to sections.] FEDERAL TRADES COMMISSION— Continued. to report to Congress with recommendation, 61. duties in respect to industrial corporations similar to duties of I. C. C. with respect to railroads, 61. political affiliation of members of Trades Commission, 61. orders of Trades Commission after hearing, 61, 82. Trades Commission not a judicial body, 81. Trades Commission Act, provisions separable, 82. Trades Commission enforces Clayton Act, when, 81. discussion as to whether Trades Commission Act violates Constitu- tion, 81. rules of practice, appendix p. 887. FEES— of attorney, how allowed and collected, 390. of attorney, under Anti-Trust Act, 590, 592. of witnesses, 420 (see Rules of Practice, Rule 13.) FERRIES (see Regulation of Commerce) — when included in term "railroad," section 1, 170. regulation of, on navigable streams, 55. in interstate commerce, 16. as instrumentahties of interstate commerce, 55. free from State control, 55. ferries not obstruction to navigation, 55. ferries, when conducting interstate commerce, 55. ferry boats operated by Canadian corporation, 55. operation of lake boats and ferry boats, by railroads, 363. FIFTEENTH SECTION (see Interstate Commerce Commission)— as amended, 448. Amendments of 1906 and 1910, 449. constitutionahty of Amendment of 1906, 450. enlarged powers of Commission, 451. FIFTH SECTION— pooling of freights and division of earnings forbidden, 356. construction of, 357. agreements controlling through routing and allotting territory, 358. agreement not within the prohibition, 359. agreements for division of through freights between members of trunk Une not unlawful, 359. agreement for consultation for promotion of reasonable rates, 359. division of immigrant traffic in proportion to domestic traffic, 359. relation to Anti-Trust Act of 1890, 360. "physical" pooling, 357. "money" pooling, 357. pooling as defense to action by carrier, 361. 1004 INDEX. [references are to sections.] FILING OF SCHEDULES (see Schedules). FINES— for refusal to obey injunction or other process, 464. FIRE INSURANCE— not interstate commerce, 9. FIRST SECTION OF ACT OF 1887, 150. as amended June, 1910, 151. amendments to section, 152. all of interstate commerce not included, 154. parties subject to, 155. common carriers under Act, 157. express companies, 159. sleeping car companies, 160. common control, etc., for continuous carriage, 161. transportation through a State, 162. territorial transportation, 163. electric railroads, 164. receivers, lesses and purchasers pendente hte, 161. foreign commerce, 167. place of incorporation immaterial, 168. intention of shipment, 169. transportation, meaning of, 170. delivery, cartage, storage, etc., 171. terminal facilities, 172. accessory charges, 174. duty of carriers as to carriage of live stock and perishable property, 175. refrigeration in transit, 176. prohibition of passes, 179, 252. commodities clause, 181. switching connections, 182. through routes, 183. classifications, regulations and practices, 184. charges, reasonable, 186. standard of reasonableness, 189. power to fix rates, 190, 192. reasonableness of rates under, 197. FISHERIES— how far State may regulate, 11. FLOUR (see Differentials in Rates). FOOD AND DRUG ACT, 7. invalidating State statutes, 36. Food and Drug Act invalidating State statutes, 36. INDEX, 1005 [references are to sections.] FOOD PRODUCTS— protection against adulterated, 10. State may protect people against fraud in sale of, 10. sale of articles of prime necessity, 98. refusal by manufacturer to sell, 97. FORECLOSURE SALE— purchasers have no contract right against State legislation subsequent to mortgage, 146. FOREIGN COMMERCE (see Commerce, Interstate Commerce, Regulation of Commerce) — when subject to the Act, 161. Congress may place embargo on, 3. no power in State over, 3. congressional inaction in foreign and interstate commerce distin- guished, 40. foreign boats operated by a Canadian corporation, 55. Canadian through joint rates, 167. foreign transportation of freight while still in the United States, 167. bills of lading of goods intended to be exported, 161. ocean carrier subjecting itself to jurisdiction of Commission, 270. FOREIGN CORPORATIONS (see Corporations)— State may exclude or impose conditions on, 16, 45. right to engage in business in local State depends on whether corpo- ration is carrying on interstate commerce, 16, 45. may depend upon it own charter, 16. meaning of term "carrying on interstate commerce," 16. public carriers are "carrying on interstate commerce," 16. bridge companies are "carrying on interstate commerce," 16. ferry companies are "carrying on interstate commerce," 16. telegraph companies are "carrying on interstate commerce," 16. telephone companies are "carrying on interstate commerce," 16. steamboat companies are "carrying on interstate commerce," 16. railroad companies are "carrying on interstate commerce," 16. manufacturer who ships goods to purchaser in another State is, 16. manufacturer or trading company is, 16. may send drummers through other States, 16. cannot establish office in local State without latter's consent, 16. soliciting sales in foreign States, 7. receiver appointed by State Court of intrastate railroad owned by foreign corporation, 26. FOREIGN COUNTRIES— Porto Rico not, 3. FORMS (see Appendix). 1006 INDEX. [references are to sections.] FOURTEENTH AMENDMENT— adoption of, 124. applies to corporation as well as individuals, 124. protects carrier from unreasonable State interference, 145. FOURTEENTH SECTION— report of investigation, 443. amendments to, 444. FOURTH SECTION (see Long and Short Haul)— history of and amendments, 342. construction of, prior to amendments, 343. similar circumstances and conditions, 343. proviso of, 341. burden of proof under, 346. "over the same line," meaning of, 344. intention of Congress in regard to section 4, 351. application for relief in courts, 355, 352. application for reUef under proviso (see Rules of Practice, Rule 19, 345, 349. carrier may judge in first instance controlling effect of competition, 345. construction of by Commission, 347. application to different classes of rates, 347. the five trade zones, 350. FRANCHISE— State tax on valid, 23. requirement of federal franchise for business corporation in inter- state commerce, 74. FRAUD— cause of action at common law for unjust discrimination irrespective of, 256. FREE OR REDUCED RATE TRANSPORTATION— persons and property entitled to, 509. enforcement excursion rates, when unreasonable, 147. excursion tickets, 514. mileage books, construction of forfeiture clause, 515. pass situation investigated by Commission, 179. passes issued to employees of a common carrier not subject to Act, 179. FREIGHT— terms means commodity carried, not compensation paid, 357. FUNCTIONS OF GOVERNMENT— blending of legislative, executive and judicial in Interstate Commerce- Commission, 55. power of Congress complete in itself, 7. INDEX. 1007 [references are to sections.] GAS (see Natural Oil and Gas). GAME (see Commerce) — unlawfully killed, interstate carriage prohibited, 11, 60. Migratory Bird Act held unconstitutional by District Court, 11. GARNISHMENT— railroad not subject to because in possession of cars of foreign car- rier, 41. railroad is subject to for debts of shipper, 41. GIBBONS V. OGDEN— discussed, 6. GRAB IRONS AND HANDHOLDS (see Safety Appliance Act). GRAIN AND GRAIN PRODUCTS (see Differentials in Rates)— inspection of, 39-n. differentials between, 318. millers, town and country, 276. elevator grain service, undue preference in allowance for, 287. elevation of grain, two kinds, 287. elevators treating grain, 287. GROUPING OF RATES— meaning of, 274. not unlawful unless undue preference results, 274. illustrative cases on the subject, 274. rates and not systems of rates, determined by Commission, 191. joint coal rates canceled, 452. water and rail through rates established, 453. GUARDS AND GUARD POSTS— State law valid requiring them on bridges and trestles, 30. H. HARBORS, POLICING OF (see Regulation of Commerce). HEARINGS (see Rules of Practice, Rule 11)— place of, 491. practice of Commission, 491. assignments for at request of either party, 438. notice of hearing of application for injunction given to Governor and Attorney General, 132. three judges must hear application for interlocutory decree, 132. labor disputes and power of Secretary of Labor to appoint Commis- sioners of Conciliation, 99. 1008 INDEX. [references are to sections.] HEARINGS— Con^jnuerf. witnesses compelled to attend Arbitrators Board, 100. books and papers produced before Board of Arbitrators, 100. hearings before Trade Commission, 61, 82. order of Trade Commission after hearing, 61. HEATING OF PASSENGER TRAINS (see Act of 1866)— may be regulated by State law, 30. HEPBURN ACT OF 1903 (see Elkins Act; Interstate Commerce Acts) — Attorney General Moody's opinion, 52, n. passage of, 52. Esch-Townsend Bill, 52, n. HIGHWAYS— construction of, subject to State control, 25. power of Congress to authorize national, 71. "HOLDING COMPANIES" (see Anti-Trust Act). holding companies considered in Clayton Act, 93. stock of one corporation held by another, 95. corporation purchasing stock for investment, 95. common carriers holding stock of another where no substantial com- petition, 95. stock controlled by Union Pacific over Southern Pacific, 95. HOURS OF SERVICE ACT— mentioned, 60, 64. general provisions, 666. constitutionality, 667. not void for uncertainty, 669. authority to require reports, 670. no privilege to corporations or corporation officer against self-incrimi- nation, 671. State statutes invalidated by Hours of Service Act, 668. report under Hours of Service Act, 670. liability of carriers under Hours of Service Act construed, 672. act of God an unavoidable accident under Hours of Service Act, 672. train employee in interstate commerce within meaning of Hours of Service Act, 673. I. ICING— an important factor in refrigerator car service, 176. icing service and rates, 176. ILLEGAL COMBINATIONS (see Tenth Section, Anti-Trust Act. Restraint of Trade). INDEX. 1009 [references are to sections.] IMMUNITY TO TESTIFYING WITNESSES (see Witnesses)— no vicarious immunity, 422. none to corporation from enforced testimony of ofTicers, 423. to corporations imder Elkins Act, 422, 519. under Hours of Service Act, 670. in criminal prosecution, 573. IMPORTS AND EXPORTS (see Interstate Commerce)— lower rate on from or to seaport than on domestic traffic, not un- due preference, 266. intermediate points entitled to proportionate reduction, 268. Power of President to suspend free importation of certain articles, 59. publication and filing of rates under section 6, 267, 378. rulings of Commission on, 348. application of Commission on, 348. pilotage laws of state, n. 26. export freight on local bills of lading, 161. IMPRISONMENT— abolished by Elkins Act, 410. restored by Amendment of 1906, 519, 520. imprisonment in contempt cases, 117. INCORPORATION (see Corporations)— power of Congress to charter bridge across navigable streams, 55, 59. railroad running through several States and holding charter from each, a corporation of each, 119. place of, immaterial as to regulating power, 119, 168. power of Congress to charter companies engaged in interstate com- merce, 71. federal incorporation, 72. requirement of federal franchises, 74. INDIAN SUPPLIES— for United States may be transported at less than published rate, 513. INDIAN TRIBES (see Regulation of Commerce). INDICTMENT— defective in not showing discrimination, 414. essentials of, 414. agent of railroad who merely collects freight not indictable, 414. who in general, 414. essentials of under Anti-Trust Act, 545. sufficiency of indictment under interstate commerce act, 415. sufficiency of indictment under Sherman act, 566. indictment for conspiracy, 566. INFORMATION TO PARTIES (see Rules of Practice, rule 20 Ap- dix, p. 901). J-64. 1010 INDEX. [references are to sections.] INITIAL CARRIER— liability for damage to through shipment, 495, 502. INJUNCTIONS (see Equity Proceedings)— to enjoin interference with interchange of traffic, 103. for protections to receivers, 103. against labor combinations interfering with commerce, 103. in interstate commerce, 112. not defeated because crime involved, 112. scope of, in trade disputes, 112. distinction where persons are in privity or independent tort-feasors, 112. contempt, 113. mandatory injunction in interstate commerce, 118. cannot enjoin competition, only agreements not to compete, 89. value of preliminary injunction, 118. to restore passage of freight backward and forward, 398. to restrain order of State Railroad Commission, 307. against unjust discrimination, 288. to enforce section 2, 256. under section 16, 464. to compel interchange of facilities, 412. not issued to compel performance of personal services, 412. in rate wars, 314. defense of pooling of earnings, 361. government only can enjoin under Anti-Trust Act, 578. private party cannot enjoin under Anti-Trust Act, 579. State cannot enjoin under Anti-Trust Act, 581. injunction against State officials, 128. temporary injunction against State legislation, 130. under Act of 1910, 132. injunctions in labor controversies under Clayton Act, 105. application for interlocutory injunction presented to Circuit Judges, 132. notice of hearing of application for injunction given to Governor and Attorney General, 132. Supreme Court has Appellate jurisdiction from orders granting or denying interlocutory injunction, 132. stay of proceedings in application for interlocutory injunction, 132. the judges must hear application for interlocutory decree, 132. whole question determined by Federal Circuit Court on application for temporary injunction, 132. interlocutory injunctions in judicial review, 483. injunction based on statute not limited to government, 579. injunction under Section 16 Anti-Trust act of 1914. 579. injunction on behalf of minority stockholders, 579. change of existing law in injunction proceedings discussed, 105. INDEX. 1011 [references are to sections.] INSECTICIDE ACT 60, 162. INSPECTION LAWS (see Regulation of Commerce)— absolute prohibition of certain cattle within certain seasons un- lawful, 35. of State, valid, but must be reasonable, 10, 35. State cannot require inspection of animals before slaughtering, when, 42, n. Congress has no power of, over State manufacturing business, 36. effect of Congressional legislation upon, 36. inspection of grain, 39, n. inspection charges imposed by state when unlawful, 38. power to fix inspection fees left to state, 38. inspection fees not for revenue, 38. inspection of interstate and foregin commerce, 38. INSURANCE— not interstate commerce, 9. subject to State legislation, 9. incorporation by Congress in District of Columbia, 71. INTENTION— does not make shipment interstate, 169. INTERCHANGE OF TRAFFIC (see Facilities for Interchange of Traffic, Terminals) — Interlocking and automatic signal act, see Appendix p. 917. INTERSTATE COMMERCE (see Commerce, Corporations, Regula- tion OF Commerce, Original Packages, Taxation, Acts, Re- straint OF Trade) — Federal sovereignty in, 5, 76. common law of, 48. free from State control by police or taxing power, 21, 39. under Federal Constitution, 7. Federal regulation, 43, 76. in relation to employes therein, 39, n. 64, 108, 1 10. shipment not made interstate by intention, 169. State cannot make routing instructions, 39. limitations upon Federal power therein, 68. when carried on by water subject to maritime law, 48. no statutory regulation of prior to Interstate Commerce Act, 48. navigation is, 7. correspondence schools, 7. transportation is, 7, 534. telegraph messages, 7, 15, 16. telephone messages, 7, 16. carrying of lottery tickets between States, 7, 69. spiritous liquors, 10, 18. 1012 INDEX. [references are to sections.] INTERSTATE COMMERCE— Continued. white slave traffic, 7. business of "carrying on," free from State taxation, 21. right to sell or solicit sales free from State taxation, 21. immaterial that taxation is without discrimination, 21. immunity from unlawful interference not limited to railroads, but extends to all engaged in interstate commerce, 108. carriage between points in same State passing through another State, 7. Congress alone can act as to admission of goods from one State to another, 18. ferry companies between States, 16. bridge companies between States, 16. certificates of stock, bonds and securities subject to interstate com- merce, 7. soliciting sales in foreign state, 7. delivery of accessories to articles sold. 7. trademarks subject to regulation, 8. private banking not commerce, 8. regulation of place and manner of sale, 8. soliciting orders of intoxicating liquors, 19. tax of personal property actually in transit, 20. lottery act, 7. ferries when conducting interstate commerce, 55. ferry boats operated by Canadian corporation, 55. INTERSTATE COMMERCE ACT (see Various Subjects and Various Sections) — genesis of the Act, 51. passage of the Act Feb. 4, 1887, 51. debate on, 51. purpose and scope of the Act, 52. judicial construction of the Act, 52. power of Congress with reference to, 60. amendments of the Act, 52. amendment of 1889, 52. amendment of 1893, 52. amendment of 1903, 52. amendment of 1906, 52. amendment of 1908, 52. amendment of 1910, 52. amendment of 1912, 52. amendment of 1915, 52. INTERSTATE COMMERCE COMMISSION (see Eleventh Section, Twelfth Section) — enlarged powers, 53, 449. reports from railroads, 53, 495. INDEX. 1013 [references are to sections.] INTERSTATE COMMERCE COMMISSION— Continued. reports to Congress, 508. original members, 419. present members, 419. appointment, term, qualification, vacancies, etc. (see Sec. 11). a general reference, 326, 327, 518. quasi-iudicial body, 53, 451. general powers, 433, 451. jurisdiction over contracts of carriers, 460. as to commutation rates, 515. powers of, construed, 463. resort to before seeking redress in courts, 53. finding of facts by prima facie evidence, 444, 446. must make reports of investigation, 443. what report necessary, 444. powers of under section 6, 365. powers of under section 12, 433. power as to car service, 435, 431. no power in granting special privileges, 433. no power to compel extra allowance for baggage, 433. power to fix through route, 451. limitations of, 452. orders of, when effective and limitation of, 456. orders of when reviewable, 484, 486. orders of finality, 486. no power to allow attorney's tees, 433. no power of entering judgment, 433. no power of imposing penalties, 433. no power to make order over one not party to proceeding, 433. power to institute investigation, 433. to summon witnesses, 53, 433. to determine relation of rates as between localities and commodities, 325, 433. to find existing rates unreasonable or unfair, 53, 433. over foreign commerce extends to what, 167. over foreign corporation limited to this country, 167. power to compel through routing, 161, 327. commission to enforce Clayton Act where appUcable to carriers, 81. commission sustained by Supreme Court in creating zones, commission must first act before Courts will take jurisdiction, 405. investigation by Commission not to be aimless, 430. inspection of Examiners of Commission, 431. reports of Commission, 434. rules of practice. Appendix p. 892, Forms proceedure. Appendix p. 902. no power to enforce finding, 445. discretion of under section 7, Safety Appliance Act, 59. 1014 INDEX. [references are to sections.] INTERSTATE COMMERCE COMMISSION— Con/muerf. only violation of the Act considered, 438. rulings of the Commission as precedents, 53, 442. may declare rate unreasonable, 53. rulings on car service, 292. rulings on import and export rates under 4th section, 348. rulings of on application for relief, 349. may determine whether rate is reasonable or unreasonable, 53, 199. power to fix rates, maximum, minimum or absolute, 53, 190. rulings on interdependence of rates, 213. rulings on reasonableness of rates, 199. limitation of its power to fix rates, 201. power to establish through rates, 53. no power to raise rate in rate wars, 220. power to compel carrier to deliver cars to another carrier, 451. power to grant relief under section 4, 59 (see Sec. 4). duty of chairman under Act of June 1, 1888, 100. jurisdiction over carriers, and those interested in controversy, 155. jurisdiction in awarding reparation, 470. jurisdiction in awarding general damages, 472. powers and duties of Commission under Act of 1888, 57. not bound by ruling of State Commission, 65. power to correct classification, 325. resort to determine effect of competition on rate, 345. prima facie effect of findings, 53, 446. prima facie effect of orders, 475. address of, Washington, D. C, 491. procedure before, 447. form of procedure, 488. report of decisions, 446. oflficial seal of, 446. oaths by members, 446. quorum, what constitutes, 488. appearance of parties before, 488. proper party to complaint, 488. subpoenas may be signed by members, 488. sessions of, 491. salaries of commissioners, 53, 489, 578. secretary of, 489, 518. expenses of, 489, 498. employes, 489. offices and supplies, 489. commission's report on relation between Louisville and Nashville and Chatanooga Railroad Companies, 334. report of Commission on Rock Island, 334. senate resolution requesting reports of Commission, 334. petroleum industry, report of Commission on, 334. INDEX. [references are to sections.] 1015 INTERSTATE COMMERCE COMMISSION— Con/iTiuerf. through route between Louisville and Nashville and Tennessee Rail- roads ordered by Commission, 452. jurisdiction of Commission in reparation for discrimination in car distribution, 471. orders of Commission prima facie evidence of facts therein, 475. form of Commission's finding, 475. report of Commission on physical valuation, 494. power of Commission in compelling reports sustained, 499. limitation of power of Commission in compelling inspection, 500. INTERVENING PETITIONS— when allowed, 446, 466. INTRASTATE RATES (see Rates)— State power in regulating limited by federal authority, 133. standard of reasonableness considered by court not same as that con- sidered between carrier and patron, 133. what is reasonableness, 134. what considered in determining, 134. no definite standard of, 134. interstate rates necessarily affected by intrastate rates, 123. extension relations between intrastate and interstate rates not to be disturbed, 123. zones of competition crossed by state boundary line, 123. remedy of intrastate discriminatory rates, 123. Maximum intrastate rates established by state, 123. state regulation of state rates of interstate carrier, 123, West Virginia rate case, n. 136. North Dakota rate case, 137. Minnesota rate case, 141. Missouri rate case, 141. apportionment in Minnesota rate case, 142. separate record of intrastate and interstate business of carriers, 142' practical testing of state rates, 143. Shreveport rate case, 65. intrastate rates, federal control of, 65. power of Commission to control intrastate rates, 65. INVESTIGATION— of complaints by Commission, 435. preUminary investigation by Commission not necessary, 477. "JIM CROW" CARS— not prohibited by second section, 250. how far State may regulate, 31. 1016 INDEX. [heferences are to sections.] JOINT RATES (see Through Rates). JOINT STOCK COMPANIES— Uable to criminal prosecution under commerce act, 412. JUDGMENTS, ENTERING OF (see Interstate Commerce Commis- sion, Powers of). JUDICIAL PRECEDENT— doctrine of, has limited application, 53, 283, 442. judgment before Commission bar to action in the court, 407. JUDICIARY ACT OF 1789— jurisdiction of federal courts under, 16. ■ appellate jurisdiction of Supreme Court under, 42. judicial code, amendment of, 42. amended in regard to interlocutory injunctions, 132. JURY TRIAI^ right to discussed, 466. jury trial in contempt cases, 117. jury trial permissive, not mandatory, 117. K KANSAS CITY LIVE STOCK EXCHANGE CASES, 193, 541. KINDS OF TRAFFIC (see Differentials in Rates)— discrimination in, 315. may also be against locality, 315. second section does not deal with discrimination between, 223. preference against must involve injury, 316. classification, 319. discrimination in favor of classes of passengers, 147. classified messages, telegraph, etc., companies, 153. transportation of low grade commodities, 215. discrmination in rating of Sunday magazines, 257. competition of localities, 278. KNIGHT COMPANY CASE, 85, 92. LABELLING OF GOODS— State cannot require it, when, 42, n. trademarks subject to regulation, 8. INDEX. 1017 [references are to sections.] LABOR COMBINATIONS IN INTERSTATE COMMERCE (see Con- spiracies, Strikes and Boycotts, Anti-Trust Act, Employer's Liability Act) — Danbury Hat case, 89, 599, n. 103. Secretary of Labor, power to act as mediator in labor disputes, 99. agreements not to join labor organizations, 100. Arbitration and Conciliation Act of 1913, 100. power of mediation and conciliation provided for, 100. service of Board of Mediation may be applied for, 100. witnesses compelled to attend Arbitration Board, 100. books and papers produced before Board of Arbitrators, 100. injunctions in labor controversies, under Clayton Act, 105. labor combinations in Sherman Act, 105, 552. labor disputes with interstate carriers, 109. report of Board of Arbitrators, n. 110. labor union as such not unlawful under the Act, 553. legislation by Congress, 99. Bureau of Labor, 99. Department of Commerce and Labor, 99. regulation of interstate commerce in relation to labor, 100. organization of labor, 100. railroads discharging members, 100. arbitration, 100. the courts on labor combinations in relation to interstate commerce, 101. constitutionality of incorporation of unions, 101. interstate commerce and labor, 102. employes, 108. striking, 108. immunity of interstate commerce from unlawful strikes, 108. the relation of employes to interstate carriers, 110. leaving employment, 110. right of representation. 111. injunctions, 112. mandatory injunctions, 118. to preserve status quo, 118. under Sec. 10 of Act, 412. LABOR LEGISLATION OF CONGRESS (see Department of Labor). LABOR ORGANIZATION— right of includes rights of representation. 111. LEGAL TENDER NOTES— power to issue, 5. 1018 INDEX. [references are to sections.] LESSEES— when subject to the Act, 166. Lessees and sales of goods patented or unpatented, 97. leasing by railroad company of grain elevator, 247. LICENSE FEE— city may exact of interstate telegraph companies, 23. State cannot exact for use of navigable waters, 26. pilotage laws, n. 26. soliciting sales in foreign states, 7. state tax on towing, 16. inspection charges imposed by state when unlwaful, 38. inspection fees not for revenue, 38. registration of foreign automobiles, n. 39. police power and the Commerce clause, 67. LIFE INSURANCE— not interstate commerce, 9. LIKE KIND OF TRAFFIC— meaning of in section 2, 254. LIME— State cannot require inspection of when imported into State, 42, n. LIMITATION— of orders of Commission, 456. limitation of Court's review of action by Commission, 485. limitation of the power of Commission in enforcing inspection, 500. LIMITATION OF ACTION— no provision in Interstate Commerce Act, 394. State statute controls, 394, 467. question raised by demurrer, 394. when statute begins to run, 394. when suit is begun, 467. private actions under Anti-Trust Act, 569. in cases of criminal prosecution, 417. limitation applicable to contempt procedings, n. 115. limitation barring remedy and destroying liability, 467. hmitation of five years construed in Meeker case, 467. Umitation of right to sue in state courts, 474. LIMITATION OF LIABILITY— to stipulated valuation, 33. to carrier's own line, 33. complete exemption, 33. INDEX. 1019 [references are to sections.] LIMITATION OF LIABILITY— Con/i/?«erf. complete exemption where pass used, 252. State statute placing duty on carrier of tracing loss void, 39. State statute placing duty on carrier of showing loss not on his line valid, 39. limitation of liability under published rate for loss or injury to bag- gage, 367. contract limiting carrier's liability, 506. LIQUOR TRAFFIC (see Commerce Wilson Act)— state control,' 19. inspection fee, 19. soliciting orders for intoxicating liquors, 19. State enabled to exercise its power of legislation by Webb-Kenyon Act of 1913, 20. law not applicable when liquor used in violation of laws, 20. LIS PENDENS— purchasers bound by order of Commission, 166. LIVE HOGS (see Differentials in Rates). LIVE STOCK (see Regulation of Commerce, Concurrent Jurisdic- tion, 28 Hour Law) — inspection laws, 35, 36. transportation from State to State not included in Act of 1884, 60. increased hazard in carriage warrants higher rate, 215. require additional facilities for delivery, 175. railroad may contract with stock yards company for delivery of, 175. when commercial transit of ends, 17, 89. power of Secretary of Agriculture over, 60. State cannot require inspection of and fee, 42, n. LOCAL BUSINESS OF INTERSTATE COMPANIES (see Railroads, Police Power) — license to do business, 23. State power of taxation, 23. State control upon entering, 45. preventing removal of causes, 45. local incorporation, 45. LOCAL AND THROUGH RATES— charging of local rate not unjust discrimination when no through rate, 332. locality, power to make exception to, 147. tap line railroad entitled to allowance of joint rate, 242. joint rates controlled by Commission to prevent discrimination, 244. short railroad line serving industries, allowance to, 245. Industrial Railways case, 245. 1020 INDEX. [references are to sections.] LOCAL AND THROUGH RATES— Continued. short time agreements of industrial lines, 245. water route, through rating by, 270. competition of localities, 278. switch connections and local terminal facilities, 310. zones created by Commission sustained, 351. application for relief under section 4 of Act, 352, 354, 355. through route between Louisville and Nashville and Tennessee rail- roads ordered by Commission, 452. water and rail through routes established, 453. carrier's duty to route on lowest rate, 457. charge of local rate greater than proportionate part of through rate not unlawful, 208. division of through rates usually less than corresponding local, 145. distinction between, 208. the Commission on, 199, 220. mileage basis not required, 208. responsibility for through rates, 208. manner of making through rate only important as to its legality, 208. local rate, including terminal expenses, is prima facie excessive as part of through rate, 208. local rate need not correspond with division of joint through rate, 208. LOCAL AND THROUGH TRAFFIC— circumstances and conditions of are dissimilar, 229. through traffic different "kind of service" from local traffic, 229. LOCALITY— second section does not deal with preferences in favor of or against, 223. rates will not be changed to equalize commercial conditions, 202. adjustment of rates between, 275. preference of excused by competition, 263, 264. competing cities on opposite banks of rivers, 279. recognition of natural advantage of situation not undue preference, 276. power to make exception as to different locality, 147. competition of localities, 278. LOCAL INDUSTRIES— Congress no power over, 92. LOCOMOTIVE BOILER INSPECTION ACT (Appendix p. 922)— LONG AND SHORT HAUL (see Fourth Section)— application where short haul wholly within one State. 122. 343. 344. INDEX. 1021 [references are to sections.] LONG AND SHORT HAUL— Continued. carrier may judge in first instance whether circumstances and con- ditions dissimilar, 263. application to Commission to determine effect to competition on rate, 345. LOTTERY TICKETS— as subjects of commerce, 9. carriage between States may be prohibited by Congress, 7, 60. carriage between States may be punished by Congress, 60. in general, 62, 69. M MADISON, JAMES— on federal regulation of interstate commerce, 1. MALICE— as an ingredient of civil action, 108. MANDAMUS— to compel transfer and return of cars, 34. to compel equal distribution of cars, 291, 516, 517. remedy cumulative, 516, 517. by interstate Commerce Commission, 54. to compel carrier to obey the law, 50, 516. to compel express companies to receive shipment of liquor, 18. to compel compliance with sec. 20 requiring reports, 495, 498. MANDATORY INJUNCTIONS (see Injunctions, Mann-Elkins Act, Interstate Commerce Acts, Amendments of). MANUFACTURE— distinguished from commerce, 532. M ANUFA CTURER— when engaged in interstate commerce, 16. manufacturer's right to refuse to sell, 97. manufacturer's right to select customers, 97. MANUFACTURING, BUSINESS OF— not interstate commerce, 8. MANUFACTURING CORPORATIONS (see Foreign Corporations). MARINE INSURANCE— not interstate commerce, 9. marine insurance policy of carrier in violation of commerce act un- enforceable, 373. maiine insurance as discrimination, 373. 1022 INDEX [references are to sections.] MARITIME JURISDICTION (see Admiralty and Maritime Juris- diction). MEASURE OF DAMAGES (see Damages). MEASURE OF PROOF (see Proof). MEAT INSPECTION ACT, 60. MILEAGE BASIS— rule as to State taxation, 22. Commission no power to make, 216. no requirement for in Act, 208. MILEAGE TICKETS (see Tickets). Construction of forfeiture clause of mileage books, 515. MILLING INDUSTRY— discrimination against, 315. MiUers, town and country, 227. MILLING IN TRANSIT (see Stoppage in Transit)— privilege of, 267. rights of connecting carrier, 335. inclusion of transit privileges in tariffs, 383. elevation of grain, two kinds, 287. elevators treating grain, 287. fabrication in transit, 302, 383. privilege of storage in transit, 305. transit privileges in lumber shipments, 306. MISDEMEANOR— failure to publish rate, 519. as to rebates, 519, 527. person engaged in monopoly guilty of, 565. party to contract or combination, of conspiracy in restraint of trade guilty of, 566. under Anti-Trust Act, 531, 565, 575. conspiracy a misdemeanor not felony, 106. MISROUTING— claims for, 375. MODE OF SHIPMENT— discrimination in, 319. MONEY— power of coinage, 5. INDEX. 1023 [references are to sections.] MONOPOLY (see Amti-Trust Act; Restraint of Trade; Con- spiracy) — meaning of term, 91. means attempting to control market, 91. in law and in fact distinguished, 83. persons engaged in guilty of misdemeanor, 565. MOOT QUESTIONS— not decided, 438. MUNICIPAL SUBSCRIPTIONS— for building road, no effect on competing locality, 276. N. NARROW GUAGE RAILROADS (see Railroads). NATIONAL BANK— power to charter, 5, 73. NATIONAL HIGHWAYS (see Regulation of Commerce)— power of Congress to authorize, 71. NATIONAL INCORPORATIONS (see Corporations)— relation of State to federal corporations, 73. State cannot interfere with Federal corporation, 73. franchise not subject to State taxation, 73. requirements for federal franchise for business corporation in in- terstate commerce, 74. as a means of regulating commerce, 72. power of Congress to charter corporations, 71. removal of case from State to Federal Court under Act of 1875, 71. power of Congress to incorporate interstate railroad companies, 71. power to charter corporation for construction of interstate bridge, 71. Federal corporations, regulation of, 73. NATIONAL QUARANTINE ACT (see Appendix). NATIONAL TRADE UNION INCORPORATION ACT (see Appen- dix). NATURAL ADVANTAGES (see Localities). NATURAL OIL AND GAS (see Oil)— as subject of commerce, 12. not subject to State legislation, 12. distinction between and animals "ferae naturae," 12. State statute prohibiting piping out of State void, 12. State statute prohibiting escape of into air valid, 12. 1024 INDEX. [references are to sections.] NAVIGABLE WATERS (see Admiralty and Maritime Jurisdic- tion) — what are, 13. navigable in law if so in fact, 13. immaterial that rapids and falls interrupt the flow, 13. navigation- Is interstate commerce, 7. "NECESSARY AND PROPER"— construction of term, 5. NECESSITIES OF LIFE (see Anti-Trust Act). sale of articles of prime necessity, 98. NEGLIGENCE— State abolition of fellow servant's rule applicable to interstate em- ployes, 39 n. assumption of risk in negligence distinguished, 622a, 627a. contributory negligence in connection with Safety Appliance Act, 622. NINETEENTH SECTION— principal office of the Commission, etc., 491. place of hearing, 492. NINTH SECTION— right of election in appealing to Commission or court, 399. limitation of right of private action, 400. testimony clause unconstitutional, 407. suit may be brought either before Commission or in United States courts, 405. equity jurisdiction under, 405. judicial application of, 407. NOLO CONTENDERE (see Pleading). pleading nolo contendere to indictment as estoppel in Appellate Court, 526, 574. NOTICE IN NATURE OF DEMURRER (see Rules of Practice, Rule 5). O. OBSCENE LITERATURE— interstate carriage of prohibited, 60. OCEAN TRANSPORTATION— creates dissimilar circumstances and conditions, 266. OFFICER— act of the act of carrier, 519. OHIO COAL CASE, 537. INDEX. 1025 [references are ro secTiOks.] OIL (see Natural Oil, Commerce) — discrimination in mode of shipment, 319. higher rate for barrel than tank car shipments unlawful, 319. higher rates for less than car load than for car load of barrels not un- lawful, 319. allowance for leakage in tanks and not in barrels unlawful, 319. oil pipe lines included in act, 156. oil pipe lines as interstate commerce, 156. OLEOMARGARINE— subject of commerce, 10. subject to taxation, 10. State may prohibit manufacture and sale of, 10. cannot prohibit its introduction into State in original package, 10. police power of State extended to, 60. OPINION EVIDENCE (see Evidence, Witnesses, Testimony). ORIGINAL PACKAGE (see Wilson's Original Package Bill) — meaning of term, 17, 18. time when taxing power of State begins, 17. in relation to State taxing power, 17. in relation to State police power, 17, 18. meaning of the term "arrival," 59. when transit ends, 17, 18. Webb-Kenyon Act of 1913, 20. Webb-Kenyon law not applicable when liquor used in violation of State laws, 20. OVERCHARGE— retention of a violation of the law, 255. "OVER THE SAME LINE"— meaning of term in section 4, 344. OWNERSHIP— discrimination based on ownership of cargo, 236. OYSTERS— how far State may regulate business, 11. oyster inspection fees not for revenue, 38. oyster inspection fees imposed by State unl iwful, 38. PANAMA CANAL ACT, 362, 386— Interstate Commerce Act amended by, 386. regulation of Panama Canal, 362. Panama Canal Act amendments construed by Commission, 363. restoration of water routes of the country, ? .o. Panama Canal, opening of. Commented on by Commission, 387. water lines and railroads, construction of Act by Commission, 387. J-fl6. 1026 INDEX. [references are to sections.] PARALLEL LINES— one railroad owning both should provide equal advantages, 217. PARLOR CAR RATES— discrimination in between local and through passengers, 250. PARTIES TO CASES (see Rules of Practice, Rule 2, Appendix p. 892) — any person or association may complain either for himself or community, 437. parties entitled to apply to court for review of Commission orders, 48L under Elkins Act, 519. under Anti-Trust Act, 596. when a shipper not a party to a complaint before the Commission can claim reparation, 469. reparation to members of complaining association, 469. all carriers on the route not necessary, 446. in suit against unincorporated association, 578. in suit by unincorporated association, 437. owner Cf portion of through line not "necessary, 437. Commission may bring in all parties interested, 437. PARTY RATES— government not entitled to, 511. Party Rate case discussed, 231. PASSES— prohibition of, 179. rulings on, 179. issuing of unlawful unless excused by section 23, 252. no recovery for injury, if risk assumed, 252. to officers and employes do not include their families, 511. passes issued to employes of common carrier not subject tq Act, 179. pass situation investigated by Commission, 179. PASSENGERS— unjust discrimination in service to, 250. State imposed duty on master of vessel to report arrival of valid, 23. State tax on immigrant void, 23. PAUPERS— State cannot compel gratuitous removal of by railroad, 42 n. State legislation may exclude, 10. PATENTS— power to grant, 5. sale subject to State police power, 34. monopoly in, subject to Anti-Trust Act, 557. leases and sales of goods patented or unpatented when condemned by Clayton Act, 97. INDEX. 1027 [references are to sections.] PATENTS— Continued. sale of patented articles distinguished from license to use invention, 97. ruling in case of proprietary medicines, 97, 544. combination in non-competitive agreements non-violative of the Act, 560. Henry v. Dick, 557. patentees and copyright holders agreements violative of the Act, 558. Bauer v. O'Donnell, 558. Shoe Machinery cases, 561. PAYMENT (see Prepayment)— by shipper ignorant of discrimination not voluntary and may be recovered back, 187, 255. PEACE OF THE UNITED STATES— meaning of, 5. enforcement of by executive, 5. PENALTIES (see Interstate Commerce Commission, Powers of) — for failure to adjust losses, 34. for failure to furnish cars, 34. for refusal to testify, 420. corporations subject to, 423. for violation of the Act, 408. in section 10 apply to employees refusing to haul freight of other roads, 102. for failure to publish rates or observe published rate, 519. as to rebates, 519. for violation of Safety Appliance Act, 653. under Anti-Trust Act, 531, 565, 566. fine in contempt cases, 117. imprisonment in contempt cases, 117. penalty for violation of Clayton Act, 461. treble damages under Anti-Trust Act, 590. who may recover treble damages, 593. PERISHABLE PROPERTY— duty of carrier under Act, 175. PERSONAL SERVICES— equity cannot enjoin performance of, 412. "PERSON" OR "PERSONS"— meaning of in Anti-Trust Act, 595. corporation a person within meaning of Fourteenth Amendment, 16, 124. corporation a person when necessary to effect legislative intent in statutes, 423. 1028 INDEX. [references are to sections.] PETITION (see Pleadings). PHYSICAL VALUATION OF PROPERTY OF RAILROAD (see Rates)— 493. report of Commission on physical valuation, 494. PICKETING AND SOLICITING— in interstate commerce, 109. PIERS, REGULATION OF (see Regulation of Commerce). PILOTS (see Regulation of Commerce). PHOTOGRAPHS— State tax on when void, 42, n. PLANT FACILITIES— discrimination in, 242. allowance for plant facilities, 242. accessory charges in tariff, control of by Commission, 385. wharves and approaches thereto, 289. fabrication in transit, 302, 383. privilege of storage in transit, 305. switch connections and local terminal facilities, 310. PLEADINGS (see Procedure)— necessary averments for a cause of action in relation to schedules, 189. no replication, 437. in equity cases, 464, 477. complaint concerning classification against whom made, 437. necessary averments in action for damages under section 2, 256. , petition to state what under section 7, Anti-Trust Act, 597. Danbury Hat case, 599. plea of nolo contendere under Anti-Trust Act, 574. petition to recover penalty must show what, 392. application for interlocutory injunction presented to Circuit judges, 132. notice of hearing of application for injunction given to Governor and Attorney General, 132. complaint must show right of action under the Act, 402. complaint must show final determination by Commission, 403. decrees, form of, 586. POLICE POWER (see State Legislation, Regulation of Commerce) State not deprived of by regulating power of Congress, 10, 34, 44. distinguished from regulation of commerce, 39. in relation to sale of United States patents, 34. Federal Government as such has none, 5. in relation to inspection of live stock (see Inspection Laws). INDEX. 1029 [references are to sections.] POLICE POWER— Con/muerf. extends to reasonable inspection of articles brought from another State, 10, 18. State may exact inspection and license fee, 18. White Slave Act, 7. Food and Produce Act invalidating State statutes, 36. inspection charges imposed by State — when unlawful, 38. inspection of interstate and foreign commerce, 38. automobiles, registration of foreign, n. 39. Insecticide Act, 60, 162. police power and the commerce clause, 67. prize-fight films barred from express companies, mails, or common carriers, 67. police power of State regulating uses of switches, 144. discriminations as subject to State regulation, 144. viaducts over street crossings regulated by State, 146. crossings of streets regulated by State, 146. Migratory Bird Act held unconstitutional, 11. POOLING (see Fifth Section)— recommendations of Presidents Taft and Roosevelt, 52 n. forbidden, 84. cannot be lawfully employed as preventive of rebates, 357. reservation of initial carrier of power to route shipment beyond its own line unlawful, 313, 358. meaning of term "pool," 357. express companies may pool earnings, 360. as defense to action of carrier, 361. agreements not within the prohibition, 359. meaning of term "freights," 358. "physical" pooling, 357. "money" pooling, 357. POST OFFICES AND POST ROADS— power to establish, 1, 5, n. POWER OF GOVERNMENT (see Functions of Government). PRACTICE BEFORE THE COMMISSION, RULES (see Appendix)— before commerce court (see Appendix). PRE-COOLING (see Refrigeration). PREFERENCE AND ADVANTAGE (see Unjust Discrimination)— form of immaterial, 286. preference of locality excused by competition, 263, 264. competition rule, 264. qualifications of, 275. between domestic and foreign traffic in import and export rates not undue, 266. where preference rate exceeds competitive rate, 265. 1030 INDEX. [references are to sections.] PREFERENCE AND ADVANTAGE— Con/inued. advantages of location, etc., 276. competing cities on opposite banks of rivers, 279. cannot be alleged by town which railroad does not reach, 276. shown by "demurrage," 284, 298. failure to publish rate through to particular town is, 286. failure to allow equal "accessorial service" is, 286. allowances to shipper for services, 462. in differential between carload and less than carload, 286. not unjust preference where circumstances and conditions dissimi- lar, 286. against traffic must involve injury, 316. delay in furnishing cars (see Car Service) 291 — guarantee to party rate purchaser, arrival at certain time not prefer- ential, 286. in denying shipper choice of route, 312. in arbitrary division of territory, 313. in classification, 320, 324. in elevator service, 287. in wharfage rights, 288. in management of stations and warehouses, 290. in private cars, 297. in side tracks and connections, 309. rate wars, 314. reasonable regulation of car load weights not preferential, 317. in mode of shipment, 319. Shreveport rate case, 65. power to make exceptions as to locality, 147. power to make exceptions in favor of particular class of passengers, 147. equal protection of laws as between shippers who promptly use cars furnished, 149. difference between rates of street cars and railroads, 149. discrimination in rating of Sunday magazines, 251. discrimination between contract purchaser and ordinary purchaser of coal, 254. preference in export rates and bills of lading, 269. differentials between East coast cities considered, 283. undue preference in allowance for services in grain elevator, 287. preference in allowance for return of empty cars, 287. distribution of coal cars, 293. irregularities of mine rating, 293. preference through action of State commission, 338. discrimination in exacting prepayment from connecting carriers, 328. preferential switching charges, 311. discrimination as a criminal offense, 524. separate shipments and separate offenses, 625. INDEX. 1031 [references are to sections.] PREFERENCE CLAUSE, IN CONSTITUTION— discussed, 3, 62. no application to interstate commerce, 3. transportation from United States to Porto Rico not included, 3. PREPAYMENT (see Payment)— requirement of from shipper, 328. discrimination in exacting prepayment from connecting carriers, 328. PRESIDENT OF THE UNITED STATES— power to suspend free importation, 59. PRESUMPTIONS (see Burden of Proof, Rates)— rates established by law are presumed to be reasonable, 202. long continuance of rate presumption of reasonableness, 202, 203. PRIMA FACIE CASE— reports of proceedings before Commission as, 53, 446, 475. rulings of Commission on unreasonableness as, 199. PRINTING OF PLEADINGS (see Rules of Practice, Rule 16). PRIVATE CARS (see Car Service)— under Act, 177. PRIVITY OF CONTRACT— none between car owner and shipper where carrier pays mileage, 300. PORTO RICO— not a foreign country, 3. PROCEDURE (see Pleadings and Proof, Sections 16a and 17) — in federal review of State legislation, 130. before Commission simple, 435, 437, 446. dilatory proceedings not favored, 435, 437. who may complain, 435. where suit to be filed, 464, 477. appearance, 488. leave of court unnecessary in suits against receivers, 437. failure of proof, effect of, 437. hearings, 438, 491. rehearing review, etc., 487. failure of carrier to answer. Commission will proceed, 438. no replication required, 438. hearings orally or on brief, 438. complaints, how and by whom made, 438. how served upon carriers, 435. immaterial that trade organization is unincorporated, 437. in federal review of State regulation of carriers, 130. suit by United States under Anti-Trust Act (see Anti-Trust Act) 582. 1032 INDEX. [references are to sections.] PRO CEDURE— Confeuerf. restraining order may issue without notice, 577. proceedings by Commission to enjoin violations, 519. effect on other action, 519. complaint to be issued by Trade Commission, 82. Trade Commission to have hearing, 82. review by Supreme Court upon certiorari proceedings of Trade Com- mission and judgment of Circuit Court of Appeals, 82. enforcement of Clayton Act, 81. Federal Reserve Board enforces Clayton Act where applicable to banks, 81. Interstate Commerce Commission enforces Clayton Act where appli- cable to carriers, 81. Trades Commission enforces Clayton Act where applicable to com- merce, 81. procedure to enforce Clayton Act, 81. jury trial in contempt cases, 117. stay of proceeding in application for interlocutory injunction, 132. notice of application for injunction given to Governor and Attorney General, 132. application for interlocutory injunction presented to circuit judges, 132. three judges must hear application for interlocutory decree, 132. whole question determined by Federal Circuit Court on application for temporary injunction, 132. burden of proof to show unreasonableness of rates, 137. review of Commissions ruling on rates, 205. burden of proof showing discrimination, 354. Commission must first act before courts will take jurisdiction, 405. investigation by Commission not to be aimless, 430. inspection by examiners, 431. reports of Commission, 434. procedure in court in reparation cases, 477. orders of Commission reviewed by Supreme Court, 482. what courts review orders of Commission, 484. courts review limited to cases of affirmative action by Commission, 485. accounts, records and memoranda of interstate railroad company liable to inspection, 500, 582. nolo contendere to indictment as estoppel in Appellate Court, 526, 574. service upon foreign executor, 606. -^ service upon foreign corporation doing business in district, 607. parties entitled to right of action under Employes' Liability Act, 628. proceedings in trials under Employers' Liability Act, 630. set-offs under Employers' Liability Act, 632. appeal from order of Commission, immaterial when, 129. INDEX. 1033 [references are tq sections.] PRODUCTS OF OTHER STATE;S-- State cannot discriminate against, 42, n. PROOF (see Evidence, Burden of Proof) — plaintiff must show injury, 392. reasonable time allowed for making, 438. measure of, under Anti-Trust Act, 594. newspaper reports, etc., to show conspiracy, 106. plaintiff must show rate unreasonable, 189. in case of unpublished rate, 392. failure of proof. Commission may take charge, 437. for recovery of penalty, 392. relief not given without, 440. in case asking reparation proof necessary, 446. burden of proof, 440. plaintiff must show irreparable injury to property or property rights before injunction will issue, 105. conclusiveness of facts embodied in report of Commission, 205. burden of proof showing discrimination, 354. proof of damages by plaintiff under section 8 of Act, 392. order of Commission, prima facie facts therein, 475. proof of knowledge of agent of corporation, 529. evidence under section 7, 598. proof of value discussed in Minnesota rate case, 141. conclusiveness of findings on hearings authorized by Clayton Act, 82. PROPORTION as affecting reasonableness of rates, 219. competition condemned under Clayton Act must be substantial, 80, 94. apportionment of cost in the Minnesota rate case, 142. "allocating" expense properly chargeable to classes of tralTic, 140. estimating the cost of intrastate and interstate traffic condemned by Supreme Court, 140. "PROPORTIONAL TARIFFS"— meaning of term, 307. State Commission no control over, when, 307. PUBLICATION UNDER SECTION 6 (see Schedules, Sixth Sec- tion) — joint rates must be duly authorized before published, 146, 381. effect of publication, 189, 366 what is sufficient, 378. publication of conflicting rates, 366. conclusiveness of published rates irrespective of reasonableness, 369. publication of demurrage tariff, 378. 1034 INDEX. [references are to sections.] PUBLICATION UNDER SECTION &— Continued. contracts and tarifls filed may be considered before Commission without introduction, 366. published rate conclusively deemed legal, 368, 519. enforcibility of unpublished rate, 368. good defense to action for damages, 188. of joint traffic and through rates, 379. of State rates in connection with interstate, 379. excursion rates must be, 379. schedules need not be duplicated by each company, 378. posting notice that all rates are on file in office not sufficient, 378. schedules, what included in, 377. terminal charges must be, 377. storage charges must be, 377. rules and rates of carriage of private cars, 377. application to import and export rates, 167, 382. of charges for refrigerator in transit, 176. failure to post rates, 372. failure to publish when undue preference, 286, 408. failure to publish or observe, a misdemeanor, 519. reduction of rate without filing schedule unlawful, 379. increase of rate, 379. contract for rate lower than pubfished rate not binding, 366. PUBLIC CHARGE— State legislation may exclude persons likely to become, 10. PUBLIC OPINION— influence of on construction of Federal Constitution, 76. PUBLIC SAFETY— in general, 30. PUBLIC SESSIONS (see Rules of Practice, Rule 1). PUNISHMENT— for refusal to obey injunction or other process, 464. enforcement of Clayton Act, 81. fine in contempt cases, 117. penalty being excessive does not prevent enforcement, 125. Q. QUARANTINE LAWS— of State valid (see Regulation of Commerce, Concurrent Juris- diction). national quarantine laws, 60. INDEX. 1035 [references are to sections.] R. RAILROADS (see Federal Control of State Regulation) — concurrent State power in interstate railroad regulation, 28. employees, 30. carriers for hire, 46. subject to legislative control unless exempt by charter, 46. duty to carry, 46. State rules and regulations respecting, 39, 46, 122. owned by corporations of two States, a corporation of each, 119. Federal review of State regulation, 125. in interstate commerce, 16. term "railroad" in section 1 includes all bridges and ferries used or operated in connection with any railroad, 170. but not when operated by railroad company, 170. included in Anti-Trust Act, 85. Federal incorporation of interstate roads, 71. State power of regulation cannot extend to interstate traffic, 46. State power of regulation may fix a limit of charge, 46. State control of terminals, 331. cannot require exclusive business of shipper, 309. wholly in one State when not subject to the Act, 154. when subject to the Act, 154. State regulations under State Commissions, 119. power of regulation independent of incorporation, 120. regulations may be made by railroads for delivery of freight, 309. regulations may be made by railroads respecting reduced rate ticket, 250. government regulation of, in England, 47. when not subject to Sec. 20, 497. Government aided (see Act July 1, 1862). reports of accidents (see Accident Law, sec. 1). Railroad Commissions established in States, 46. valuation of property as a basis for rate making, 194. the unearned increment, 195. damage to through shipment, 495. receiver appointed by a State court of interstate road of foreign cor- poration, 26. reproduction of railroad property, 141. value and not cost of railroad considered, 141. uses to which railroad property could be put a basis of value, 141. items of appreciation and depreciation of railroad property, 141. indefinite estimate of value of railroad property, 141. practical testing of State rates, 143. 4 per cent return held confiscatory, 144. 6 per cent profit considered, 144. 1036 INDEX. [references are to sections.] RAILROADS— Con/inuerf. police power of State regulating use of switches, 144. viaduct over street crossings regulated by State, 146. what is a common carrier, 158. routes between street railroads and steam railroads, 164. spur tracks as part of carrier's terminals, 172. team tracks and freight sheds within switching limits, 172. enforcement of railroad's duty to furnish cars, 178. increase of value of property no justification of unreasonable rates, 195. short railroad lines serving industries, allowance to, 245. Industrial Railways case, 245. physical valuation of railroad property, 493. report of Commission of physical valuation, 494. combinations of railroads held to be within Anti-Trust Act, 549. RAPID TRANSIT— warrants higher charge, 209, 234. RATES (see Tickets, Through Rates, Charges Reasonable and Just, Interstate Commerce Commission, Unjust Discrimi- nation, Carload Rates, Cargo Rates, Amendments to the Interstate Commerce Acts, Publication) — quantity of freight as affecting rates, 226, 231, 232. wholesale rates in passenger and freight traffic distinguished, 232, 233. limitation by Federal authority of State power in regulating interstate rates, 133. what is reasonable in the limitation of State authority, 133. reasonableness of State rate determined without reference to inter- state commerce, 134. character of freight as affecting rate, 198, 215. cost of service and needs of shipper as affecting rates, 218. rapid transit as affecting rates, 215, 234. cost of handling as affecting rates, 215, 218. distance as affecting rates, 217, 274. reasonableness of rates question one of fact, 187, 263. no definite standard of, in railroad rates, 133. finding of Commission does not extend to ultimate question of, 55. practical difficulties in the enforcement of, 187. standard of, under State statutes, 187. standard of, under the Act, 188. supreme court on State regulations, 135. schedules of and special rates, 136. what considered in determining, 133, 196, 275. presumption of reasonableness from long continuance, 202. burden of proof, 203. INDKX. 1037 [references are to sections.] RATES — Continued. interests of both the public and owner of property to be considered, 139. in absence of legislation court must decide, 186. Federal courts, on reasonableness of, 193. capitalization of railroad as basis of rates, 194. reasonableness of, under section 1, distinguished from preferences under section 3, 197. comparison not a basis for determining reasonableness, 203. fixing of future rate a legislative, not administrative function, 217. or judicial function, 55, 192. power of Interstate Commerce Commission, to fix rates, 53, 190, 451. limitation of that power, 201. effect- of Commission's ruling on reasonableness of rates, 199. Interstate Commerce Commission may fix maximum rates for the future, 53, 201, 451. competitive effect of intrastate rates on interstate rates, 123. question of reasonableness raised by defense in action at law, 130. question of reasonableness raised by bill in equity, 130. may be unreasonable because too low as well as too high, 193. reasonableness under Sees. 1 and 3, of Act, 197, 275. consideration of, in the courts, 198. rulings of Commission, 199. immaterial whether railroads combine or act separately, 206. tax return of railroad officials to establish, 198. interstate rates bear no comparison to State rates, 210. reasonableness and proportion, 219. in comparison of rates, dissimilar circumstances and conditions are to be considered, 210, 346. what is a reasonable rate, 207. rates as affected by development of country, 211. res adjudicata, 207. respecting reduced rate tickets, 250. collection of extra fare from passenger without ticket, 250. unreasonable, may be discriminative, 239. extension relations between intrastate and interstate rates not to be disturbed, 123. zones of competition crossed by State boundary line, 123. interstate rates necessarily affected by intrastate rates, 123. extent of power of State regulating intrastate rates, 123. points within State favored against points witout State, 123. remedy of intrastate discriminative rates, 123. West Virginia Rate case, n-136. State cannot impose confiscatory rates, 137. burden of proof to show reasonableness of rates, 137. what is confiscatory rate, 137. 1038 INDEX. [references are to sections.] RATES— Continued. revenue theory to ascertain separate cost, 140. North Dakota rate case, 137. estimating the cost of intrastate and interstate traffic condemned by Supreme Court, 140. value and not cost of railroads considered, 141. Missouri rate case, 141. practical testingt)f State rates, 143. 4 per cent return unreasonable and confiscatory, 144. 6 per cent profit considered, 144. Cumberland Telephone & Telegraph case, n-144. express rates and practices considered by Commission, 159. sleeping car rates considered by Commission, 160. upper berths in sleeping cars and the Wisconsin statute, 160. Canadian joint through rates, 167. icing service and rates, 176. rates and not systems of rates determined by Commission, 191. considerations in allowing the advance of rates, 200. cost an important element in determining reasonableness of rates, 200. review of Commission's ruling on rates, 205. rate exceptionally high justified by exceptional operation, 211. the Supreme Court on the considerations admissible in fixing rates, 212. conclusions of Interstate Commerce Commission on rates not dis- turbed by court, 212. no vested interests in rates, 214. joint through rates, tap line railroad allowance, 242. joint rates controlled by Commission to prevent discrimination, 244. preference in export rates and bills of lading, 269. rate breaking point, 277. competition of localities, 278. St. Louis and East St. Louis rates, 280. terminal charges, St. Louis and East St. Louis, 281. rates on bales of compressed cotton, 308. classification distinct from rate making, 322. passenger rates, interstate and state, 339. application for relief under section 4 of Act, 352, 355. intention of Congress in regard to section 4, 354. publication of conflicting rates, 366. limitation of liability over baggage under published rates, 367. recovery of undercharge rates, 368. conclusiveness of published rates irrespective of reasonableness, 369. contract for different rates than those published invalid, 371. erroneous quotation of interstate rates, 372. accessory charges in tariff under control of Commission, 385. error in tariff, 375. publication of demurrage tariff, 378. INDEX [references are to sections.] 1039 RATES— Con