Omaha daily bee. (Omaha [Neb.]) 187?-1922, 1906-02-20
COAL RATE CASE DECIDED
Supreme Court Rules on Right of Railroads
to Deal in Commodities.
DECISION is AGAINST CARRIERS
ANY Deal whereby Proht TO Com
pany IL Less Than. Published
Freight Tariffs In
Illegal. -

~. hhesai' 4A
WASHINGTON. ID. c., Feb. ls.-Justice
White today delivered the opinion of the
supreme court of the United States in the
cases of New York, New Haven & Hart
ford Railroad company against the Inter-
state Commerce commission and the Inter-
state Commerce commission against the
Chesapeake Ohio Railroad company
Affirming the decision of the United States
circuit court for the western district of
Virginia. The cases involved the question
of discrimination in freight rates on coal
by the Chesapeake & Ohio in favor of the
New York New Haven & Hartford road
as against other shippers. The decision
was against the railroad company.
The decision dealt with the question of
discrimination by railroad companies and
1t was apparent that it was intended to
have a general application to questions re
ceiving attention at the hands of the public.
Justice White said that to permit a carrier
to become a dealer in the commodities
carried by it would be to supply a means
for the perpetuation OF evils which the In
terstate Commerce commission is intended
t0 remedy.
Contract for Delivery of CoaI.
These cases involved a charge Of dis
elimination in favor of the New Haven
road by the Chesapeake & Ohio. The cases
grew out Of complications existing in con
nectlon with a contract made between the
two railroad companies In 1896 in accord
ance with which the Chesapeake & Ohio
| road agreed to deliver 100000 tons of btu
minous coal to the New Haven road between
the first of July 1897, and the first OF July,
| 1902. The delivery i'm the last year covered
! by the contract fell short to the extent Of
! coco tons on account of a strike in the
coal fields which rendered il impossible
| to supply the coal. Tho New Haven road
purchased coal elsewhere and presented
bill to the Chesapeake & Ohio company
/ for $4,000, representing tho difference in
| cost. Instead OF paying the money the
! Chesapeake & Ohio company delivered the
$1,000 tons OF coal, notwithstanding the
price Of coal and of transportation had adj
vanced SO that it is claimed the Chesa-
peake & Ohio lost more than 81 per ton on
its shipments.
| The case was brought to the attention
of the Interstate Commerce commission
and the charge made that the transaction
! constituted a preference I'm the matter of
| freight rates in favor OF the New Haven
road. The company contendcd that 1t was
acting in the capacity OF vendor and not
as carrier and that it was merely supply
ing the coal to pay a debt.
Practice is DiscrIminatiye.
! Putting aside for the time all other aues-
tions, Justice White took up the case az
it appears under the interstate commerce
! law and stated the question TO be decided
ITO be the following:
! Has n carrier engaged in interstate COM
merce the power to contract 10 sell and
transport in completion of the contrac ct the
commodity sold, when the price stipulated
IN the contract docs not pay the cost OF
lished freight rates?
Justice White said there were practically
no previous decisions Of the court to quote
as precedents because heretofore the fea-
| lures OF the interstate commerce law deal
ing with determinations, rebates and IA
voritism have not been involved in cases
in the court He then said:
| 1t cannot be challenged that the great
| while seeking to prevent unjust and unrea-
! sonable rates, was to secure equality of
rates TO all and to destroy favoritism. Now,
in view Of the positive command of the sec
ond section of the act that no departure
from the published rate shall be made, "di-
rectly or indirectly, how can IT in reason
out the statute In every case by simply
electing TO be a dealer and TRANSPORT a
i COMMONLY IN tndt character! fOr, OF
course, If a carrier has right to disre-
gard the published rates by resorting to a
particular form of dealing. II must follow
that there is no obligation on the part of a
carrier TO adhere to the rates. because do
ing is merely voluntary. The all-emhra-
cling prohibition AGAINST either directly OF
Indirectly. charging less than the published
rates shows that the purpose of the statute
was to make prohibition applicable to every
the forbidden result could be brought
about
Proceeding, he declared the purpose OF
the act to be ito compel the carrier as a
public agent to give equal treatment tc
ALL"
Profit Less Than Freight.
Coming to the consideration of the case
at issue. Justice White said
II is apparent that the deliveries under
of the statute whenever for any cause
such the enhanced cost of the coal al
the mines. an increase in the cost OF the
ocean carriage. etc, the gross sum realized
was not sufficient to net the Chesapeake
& Ohio it's published tariff Of rates. Thi,
must be the case in order to give vitality
to the prohibitions OF the interstate com
merce act against the acceptance at any
time by a carrier of less than it's published
rates.
Even IL the result OF applying the prohi
bitions as we have interpreted them will
be practically to render II difficult. IL no
impossible. for a carrier to deal in com
modities. this affords no ground for reliev
ing us of the plain duty of enforcing th'
provision of the statute as they exist
In conclusion Justice White upheld tn,
decision OF the court below in declaring tina
both the contracts made by the Chesapeak,
& Ohio with the New Haven were contrar!
: TO public policy and void because in con
: fict with the prohibitions OF the act to reg
: ulate commerce
I The cross-appeal OF the Interstate Com
! merce commission then consideret
briefly and the general conclusion reaches
2 that the injunction below should be modi
2 fled and enlarged by perpetualy enjoinini
= the Chesapeake & Ohio from taking les
, than the rates fixed IN its published tarii
OF freight rates. by means of dealing 4
: the purchase and sale of coal And as thu
. modified, the decree below is affirmed"
SHOTS FOR GENERAL REYES