New-York tribune., 1909-05-05
THE COnnODITIES DECISION.

The average lay reader OF the summary Oh
the decision OF the United States Supreme
Court sustaining the validity Of the cOmmoul-
ties clause of the Hepburn railroad rate law
must have found it difficult to harmOniZe the
prohibition contained in that act against rall-
roads transporting a commodity, other thah
lumber, in which it happened to have any III
terest. direct indirect" with the courts con
clusion that a railroad can still transport com
modify mined or manufactured by corpora
tion iD which it, the railroad. is stockhoIdef
1t was assumed by the counsel for the railroad
companies by the counsel for the government
and by the two circuit judges in the Sd tederal
Circuit who declared the clause unconstitutional
that Congress intended by the use of the
phrase ANY interest, direct or indirect TO pro
hibit a railroad to transport commodity
mined or manufactured by a corporation III
which it owned stock. But the Supreme Court
declared that the language Of the law. rightly
construed, did not support that interpretation
Justice White said in his opinion, discussing
the assumption made in the lower court:
The trouble about that is that it has been
decided in this court that ownership of stock
in corporation does not make the owner or
the stock the legal owner of the property OF the
corporation. It does not give him a legal stand
ing respects interest in the property of the
corporation in which he holds the stock
1t is said that ownership of stock in the cor
poration was in the mind of Congress. and,
therefore. we should read the act according 20
the subject to which the mind of Congress was
directed disrega riding its legal significance, and
disregarding those things which were excluded
from il and interDret Il according to sup
posed assumption with respect to that which
was in the mind Of Congress. That argument Is
not tenable. because If the mind OF the law
maker was concentrated on the adoption OF TINS
statute. under that provision, then the obvious
and plain duty was TO discuss it. not by vague
and general expression which excludes the stoch
ownership in its legal terms, because the judi
cial mind cannot contemplate that which was
excluded. and by constituting 1t to mean that
which. in its legal sense has been settled py thlS
court.
The Supreme Court held, in other words, that
the two houses of Congress must he presumed
10 have known that the language of the com
modties clause did not make it applicable to
commodities mined or manufactured by
separate corporation, operated in good faith,
in which the common carrier might have
stock interest.
1t has been said that the decision leaves the
situation practically as it was before the law
was passed But that conclusion is not justified.
The Supreme Court has emphaucally approved
of the principle of dissociating the functions OF
producer and carrier. just as it approved OF 1t
two years or more ago in the Chesapeake
Ohio Railroads case It says that Congress
is vested with power to deny common car
rer the right to transport commodities IN
which the latter has a legal interest and indi-
:
stitution 10 end the practices under which by an
, imnroper fusion of functions and interests rail
roads have been able 10 discriminate against in
dependent shippers and make them virtually
pav the cost not only of their own shipments
but the costs of the shipments of favored rivals.
Hereafte under the Supreme Courts ruling
there must be no Juggling of rates. and the coal
corpora tions in which a railroad has stock must
nav exactly the same freight charges as IN
dfyfduaI producers or nOn-affiliated corpora
tons
Attorney General Nickersham has expressed
the opinion that Congress can go ahead and
extend the provisions of the Hepburn law 10
the carriage Of commodities owned at the time
'.of shipment by i corporation in which the
carrier has a stock interest" The Supreme
Court avoided considering that probability
But its sweeping affirmation Of the power to
regulate must be considered significant, and it
is plainly committed to the principle that no
devices TO create determinations in freight
rates ought to be tolerated. 1t will probably
depend largely on the manner in which the
coal railroads conform to the spirit we'll as
to the letter Of the law whether Congress will
attempt next winter to break the bond between
the railroads and the mining corporations in
which they hold stock If old abuses revive, the
reserved power Of regulation viii undoubtedly
be appealed to.