The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1909-05-04
SANTA FE FINE
IS SET ASIDE BY
APPEALSCOURT
Judge WeIIbOrn 0verruIed in
Taxing Company S330,000
for Alleged Relating
Higher Federal Tribunal Finds
Evidence for Defense Was
Improperly Excluded

The largest fine pending against a
corporation in the United States was
set aside yesterday when the United
States circuit court of appeals. COM
posed of United States Circuit Judges
William B. Gilbert, Erskine NJ. Ross
decision of District Judge Olin Well
born in which he imposed a fine for
rebating on the Atchison. Topeka and
Santa Fe railway company of $500. 900
The case was tried two years ago in
Los Angeles, the action being brought
by the federal government, in which
the corporation was found guilty by
q jury on Sc counts, a fine of $4,000 on
each count being imposed
Ar appeal was taken from the lower
court last February. 1t was argued by
Oscar Lswler, United States attorney
at Los Angeles and Robert T. Devlin,
United States attorney at San Fran
cisco. al the special request OF Attor-
ney General Charles J. Bonaparte, who
was greatly concerned as to the i'm
portance TO the government of the
issues involved.
CLAIMS GOOD FAITH
The corporation eontended by way
of defense in the lower court that ii
allowed certain claims made by ship
pers for loss OF lime in transit from
Nelson, Ariz.. to Barstow, Cal, from
the regularly billed charge, claiming
such allowances were made in good
faith and without any intent to VIC
late the interstate commerce law.
Judge Wellborn, however, Instructed
H,of he
defendant accepted and received for
the transportation OF the lime a less
rate than that filed with the interstate
commerce commission II was not neces-
sary for them TO inquire or determine
whether or not the defendant intended
to violate the law. According TO the
court such intention or lack of inten-
ton upon the part Of the railroad was
entirely immaterial
It was the contention Of the gov
eminent that the railroad was bound
by the rate filed with the commits
sion, that il could not deviate from
that rate, and that il must collect that
rate in its entirety. II was also contend
ed that the railroad could not allow as
an Offset any claim made by the ship
per that IL should have received the
full amount of the freight charge. and
II the shipper had a valid claim for
loss in transit 70 allow IL in the resu-
lar course Of business
AGREE WITH WELLBORN
Before restoring the sssO.ooo and 7
per cent interest from the time jude-
ment was entered the judges of the
circuit court Of appeals take occasion
10 state that they are in entire accord
with the lower court in holding that
the interstate commerce act should be
construed or enforced by the courts so
as TO promote their policies and ex-
urpate the evils against which <hev
are directed. That In respecf -" cor,
tnues the court, to their criminal fea-
lures can only be done upon valid
Indictment in accordance with estab-
hsheo principles governing criminal
prosecutions"
Judge Wellborn held that the ar
ceptance by the company Of a rate less
than that named in its tariff was q
departure from the legal rate. and
there was no defense that the acts of
me carrier were done in compromise
Tor claims for loss of property in tran
sit The circuit court of appeals holds
That assuming the concession was a de-
psrture from the established rate. then
the intention with which such depar-
ture was made was OF the essence Of
the offense because made so by the
statute in declaring that such de-
parture must be 'willfully" made.
QUESTION OF FACT
The court based its decision upon thu
proposition that in passing upon the
rulings of the trial court IL must be
assumed that the facts were as the
evidence offered. but If the transaction
OF the company in allowing the claims
OF the shippers were a mere pretense
the crime denounced by the statute was
was question Of fact for the Jury. in
the consideration OF which evidence
the court struck out was OF impor-
tance to the defense.
The indictment, according to the
higher court, was valid. But the cues
ton of intent entered into the charge
made by the Indictment against the
defendant, and that being so the court
below was in error in withdrawing
from the consideration Of the jury the
evidence on this subject
COMPROMISE ADMISSIBLE
The government in arguing the case
contended that II was essential to
the enforcement of the interstate COM
merce act that railroads should adhere
strictly to the published rate. It con-
tended that no concession or compro-
mise OF any kind was admissible, no
matter how honest 1T might be, because
IL such practice were allowed IL would
be difficult il not impossible for the
government to prove IL was done for the
purpose OF violating the law. This con-
tention is not sustained by the higher
court, which holds that the court and
jury may inquire whether a compro-
mise Of claims is made in good faith
The court held that evidence showing
that the compromise is fairly made IL
admissible and should be received by
the court SO that the jury may deter
mine whether the act was an intention
to violate the law by the compromise
allowed.
The case was argued for the railroad
company by T. J. Norton and Gardner
Lsthrop. vice president and chief coun-
sci for the corporation.
Ripley Expected Reversal
Especial Dispatch TO The Call
SANTA BARBARA, May 3.-when
President E P. Ripley of the Santa Fe
was shown a dispatch announcing the
reversal of Judge Wellborn's decision
he said:
while the decision of the upper
cotrTf &c gratifying II Is no suFDrfee TO