Case 97 — 'Indictment against the Southern ¿Railway in Kentucky fob Discrimination in Freight .Rates.

Dec. 1.

#### Southern Railway in Ky. v. Commonwealth.

appeal from merger circuit court.

Judgment for ¿Plaintiff and Defendant Appeals.

Reversed.

Railroads — Freight ¿Rates — Discrimination—Through Shipment.

¿Held: 1. Const., section 215, providing that all railway companies shall! transport freight of the same class for all persons •from ¡and to the same points and upon the same conditions, in the -same manner, and for the same charges, does not prohibit a railway company from charging .a through rate which is less than the sum of the local rates between the two piointsi.

2. A railroad company issued a hill of lading agreeing to transport freight to ¡a point whidh was several miles from the nearest station on its line. At this station a person who had always made it a practice to carry freight between the .station and the point to which the goods in question were consigned took charge of the goods, and carried them to. the consignee, with whom he had a special contract as to the price to he charged for carrying such goods. Deducting this price from the through .rate charged by the company, the remainder was less than the local rate from the point of shipment to the station. Const., section 215, provide s that all railways shall transport freight ■of the same class from, and to the same poinis for the same charges. .Held that, notwithstanding the railroad company had no express contract with the person who carried the goods from the railroad station to their destination, nevertheless it was a through shipment, for which the railroad company was entitled to charge a sum less than th'e sum lof the local rates.

HUMPHREY, BURNETT *&*HUM¡P¿HREY, attorneys for appellant.

POINTS AND AUTHORITIES.

1. A through rate which is less than the sum of the local rates between the point of shipment and the point of destination, ¡does ¡not constitute .a discrimination undelr section 215, of the Constitution of Kentucky.

2. Delivery of .shipment consigned to Perryville, to a wagon *908line at Harrodsburg, was not a delivery to the consignee at Harrodsburg.

3. An unjust discrimination must be knowingly or willfully made in order to constitute ian offense under the law.

AUTHORITIES CITED:

.Supplement to Revised Statutes of the U. S., 2d. ed., 1874t 1891, vol. 1, p.p. 529-533; Tozer v. United iStates, 52 Fed. Rep., 918; Parsons v. Chicago *&*N. W. R. R. Co., 63 Fed. Rep., 909; Illinois Central R. R. Co. v. People, 121 XU., 304 (12 N. E„ 674); Interstate Commerce Commission v. B. & O. R. R., 145 U. S., 276; Louisville *&*Nashville R. R. v. Commonwealth, 22 Ky. Law Rep., 335-6; Parsons v. Chicago & N. W. Ry. Co., 167 U. S., 447; .Southern Pacific Ry. Co. v. Haas, 85 Tex., 401 (17 S. W., 601); Texas Pacific Ry. v. Interstate Commerce Commission, 162 U. S., 197; Robertson & Co. v. Kennedy, 2 Dana, 431; Caye v. Pool’s Assignee, 21 Ky. Law Rep., 1600 (55 S. W., 877); Dibble v. Brown, 12 Ga., 217 (56 Am. Dee., 4G0); Par-melee v. Lowitz, 74 111., 116 (24 Am. Rep., 276); Chevallier v. Strahan, 2 Tex., 115 (42 Am. Dec., 639); Potter v. United States, 155 U. S., 445; Spurr v. United 'States, 174 U. S., 735; .State *ex ret*Hickman v. Alcorn, 78 Tex., 387 (14 S. W., 663); State v. King, 86 N. C., 603; Mullins v. State, 37 Tex., 338.

HAZELRIGG *&*OH'ENAULT, and J. 'S. OWISLEY, Jk., pob appellee.

SUPPLEMENTAL BRIEF.

(Original brief not in the record.)

The cases relied on by appellant only show this: That a through joint rate may be agreed upon by common carriers, which is less in amount, than the local rates charged by the same carriers.

When examined it will be found that these same cases hold that it takes an agreement or.' contract on the part of the carriers with each other, in order to get the benefit of this principle.

The case for the railway therefore, rests upon the assertion ithat there was a contract, express or implied, between the Southern Railway Company and Irwin, the mail1 carrier, by which a joint through rate was agreed on for shipments from Louisville to Perryville.

It is argued by appellant that .such' an agreement or arrangement may be inferred from the course of the business in past *909years, and from an old contract made with James in 1889. We may admit that such an inference may be drawn, and we may ■admit further that had this court been in the shoes of the court below or the jury, the inference of a contract might have been given Sorce, but as! overcoming the inference of such a contract we have 'the direct testimony of Irwin that no such arrangement or contract -had ever been made or that he had any notice that he was being treated as a contracting party with the railroad company.

Suppose we give to the defendant therefore, the benefit of all the law ihe contends for, and try the case as if before a jury; the jury would have been instructed as follows:

“If the jury believe from the evidence that the shipment of the gasoline in question was made under a contract, express ior implied, by and between the railway and I-rwin, by which a joint rate was established of twenty-one cents for the! railway and fifteen cents for the wagon line then they will find the defendant not guilty.”

We maintain that the court acting in -place -of the jury found as a matter of fact, that there was- n-o- contract, express or implied, for this shipment at thei rate of twenty-one cents and fifteen cents', and this' finding of fact is conclusive of the case.

Opinion op toe court bt

JUD'GE HOB'S-ON

¡Reversing.

The grand jury of Mercer county returned an indictment on February 6, 1902, charging-1 that appellant witliin 12 months before the finding of the indictment, transported a barrel of gasoline for Henry E. Samuels from Louisville to Harrodsfeurg, Ky., for the price of 26 cents per 100 pounds- and contemporaneously therewith transported between the same points a barrel of gasoline of the -same class and kind of freight for Wallace Green for the price of 21 cents per 100 pounds; that this was done willfully and knowingly, with intent to discriminate in favor of Green and- against Samuels, in violation of section 215 of the Constitution of Kentucky; “All railway, transfer, belt lines, or railway bridge companies shall receive, load, unload, transport, haul, deliver, and handle freight of the same class for all persons, associations, or corporations, from and to the same points *910and upon the same conditions, in the same manner and for the same charges, and for the same method of payment.” Section 217 of the Constitution, which fixes the penalty for a violation of section 215, is as follows: “Any person, association, or corporation, willfully or knowingly violating any of .the provisions of sections two hundred and thirteen, two hundred and fourteen, two hundred and fifteen, or two hundred and sixteen, shall, upon conviction by a court of competent jurisdiction, for the first offense be fined two thousand dollars; for the second offense, five thousand dollars, and for the third offense shall thereupon, ipso facto, forfeit its franchises, privileges or charter rights; and if such delinquent be a foreign corporation, it shall, ipso facto, forfeit its rights to do business in this state; and the Attorney General of the Commonwealth shall forthwith, upon notice of the violation of any of said provisions, institute proceedings! to enforce the provisions of the aforesaid, sections.” The proof on the trial showed that Samuels lived at Harrodsburg, a point on appellant’s line of railroad, but that Green lived at Perryville, which was 10 miles away from appellant’s road. Twenty-six cents per 100 pounds' were charged Samuels for the barrel of gasoline shipped to him, which was billed to him at Harrodsburg. The barrel of gasoline shipped to Green was billed to him at Perry-ville, and was shipped at the rate of 36 cents per 100 pounds from Louisville to Perryville. When the gasoline reached Harrodsburg, it was delivered to a man named Erwin, who ran a wagon daily from Harrodsburg through Perryville to Mitchellsburg, carrying the United States mail; also persons and property. He took the gasoline to Green, collecting the charges going to the railroad, which were 21 cents per 100 pounds, and paid the amount to the company. Green paid Erwin 50 cents for bringing the barrel over, which was 10 *911cents less than was coming to Erwin on the basis of 15 cents per 100 pounds.

There was an árrangement between Green and Erwin that Erwin would haul gasoline over at 50 cents a barrel. This arrangement seems to have grown out of the fact that there is a station on the Louisville & Nashville Railroad four miles from Perryville, from which also goods were hauled to Perry-ville, and Erwin was underbidding to get the hauling on his route. The railroad had for a number of years a published: tariff on this class of goods by which the rate was fixed to Harrodsburg at 26 cents and to Perryville at 36 cents. When the rate was first made, about the-year 1889, a man named James was running the wagon line, and the rate of 15 cents for the wagon line was then agreed on between him and the the railroad company. After three years he sold out to *sc*man named Tatum, and subsequently Erwin c-ame in under Tatum; but the railroad company had no agreement with Erwin. It simply billed the goods to Perryville as before. Erwin received them at Harrodsburg and delivered them at Perryville. The railroad company did not know that Erwin was making any reduction on the 15 cents per 100 pounds allowed for his part of the haul. The goods were not delivered to the consignees at Harrodsburg, but were required to be earned over by the wagon lino and delivered at Perryville. The wagon line hauled for everybody that applied, and! also carried for a time the express.matter, each owner as he came in succeeding to all the rights and privileges of his predecessors. The proof leaves no doubt that the operator of the wagon line was a common carrier. Robertson v. Kennedy, 2 Dana 431, 26 Am. Dec. 426; Caye v. Pool (108 Ky. 124; 21 R. 1600) 55 S. W. 887, 49 L. R. A. 251; Chevallier v. Straham, 47 Am. Dec. 639.

If there had been a railroad operated by another company *912running from Harrodsburg through Perryville to Mitchellsburg, and the barrel of gasoline had been taken by appellant to Harrodsburg, and by the other company to) Perryville, appellant receiving 21 cents per 100 pounds for carrying it, .and the other company *12y2*cents, it could not be maintained that this would have been a violation of section 215 of the Constitution ; for it is well settled that a through rate can be made' less than the sum of the local rates between the two points. .Were it otherwise, all through freight would have to be hauled at the local rates. Railroad Company v. Osborne, 52 Fed. 912, 3 C. C. A. 347; Tozer v. U. S. (C. C. ) 52 Fed. 918; Interstate Commerce Commission v. B. & O. R. R., 145 U. S. 276, 12 Sup. Ct. 844, 36 L. Ed. 699; Parsons v. Chicago, etc. R. R. Co., 167 U. S. 447, 17 Sup. Ct. 887, 42 L. Ed. 231.

The fact that the connecting carrier took the goods on a ¡vehicle pulled by horses and not by steam, is not relied on as changing the principle; but it is urged that Erwin had no contract with the railroad company, and that therefore, he took the goods simply as the agent of the consignee, Green. Without considering whether a contract should be implied from the fact that'he came in under James, who made the contract with the railroad company, we rest our judgment on the ground that appellant had received the goods consigned to Perryville, and had, by its bill of lading agreed for 36 cents per 100 pounds to transport them to Perryville. This was not a shipment to Harrodsburg. There was in such a shipment and the shipment to Samuels at Harrodsburg no discrimination between shippers of the same class of freight between the same points. Appellant had the right to charge less for part of the through haul than the local rate to that point. When-it received the goods and undertook: to carry them to Perry-ville, it was its duty to see that they got to Perryville. Its obligations under such a contract were different from those *913under a contract to carry goods to Harrodsburg. It was a through shipment from Louisville to Perryville. Erwin came in under it, and whether there was any contract, ex-, press or implied, between it and Erwin, there was an express contract between it and the shipper that it would transport the goods from Louisville to Perryville. We are therefore of opinion that the facts shown establish no violation of the constitutional provision quoted. If there was anything in the evidence indicating an evasion of the constitutional provision by the billing of the goods to Perryville and tbe delivery of them at Harrodsburg to the consignee in order to discriminate between shippers, a different question would be presented. But tbe facts show perfect good faith, and also show that only in this way can appellant carry goods to Perryville.

Judgment reversed and cause remanded, withl directions to dismiss'the indictment.