Source: http://www.chanrobles.com/usa/us_supremecourt/287/144/case.php
Timestamp: 2019-06-25 21:45:12
Document Index: 761101530

Matched Legal Cases: ['§ 209', '§ 77', '§ 209', '§ 209', '§ 212', '§ 79', '§ 209', '§ 209', '§ 209', '§ 212', '§ 212', '§ 209']

The respondent was a railroad under federal control when control was relinquished by the government on March 1, 1920. By the Transportation Act of that year (41 Stat. 464, § 209, 49 U.S.C. § 77), it had the protection of guaranty as to its railway operating income for six months thereafter. The United States guaranteed that, during this guaranty period, the income should be not less than one-half of the annual compensation to which the carrier was entitled during the period of federal control. United States v. Guaranty Trust Co., 280 U. S. 478; Texas & Pacific Ry. Co. v. United States, 286 U. S. 285; Continental Tie & Lumber Co. v. United States, 286 U. S. 290. Upon the Interstate Commerce Commission was laid the duty of ascertaining the amounts necessary to make good this guaranty, and of certifying to the Secretary of the Treasury the results of the inquiry. Something more was required for this purpose than the mere comparison of receipts and expenses during the period of control with receipts and expenses during the six months following. In the ascertainment of railway operating income or any deficit therein, the amount to be included in operating expenses for maintenance of way and structures, or for maintenance of equipment, was to be fixed by the Commission, and was not dependent solely on the action chanroblesvirtualawlibrary
A task so vast and intricate exacted time and study. Many of the carriers, however, including this respondent, were in urgent need of cash for pressing obligations. The statute contained provisions that were intended to relieve the pressure. By § 209(h), the Commission was empowered, upon application during the guaranty period, to issue certificates for advance payments, such advances to be not in excess of the "estimated amount" necessary to make good the guaranty. The Secretary of the Treasury was directed to make the advances in the amounts specified in the certificate upon the execution by the carrier of a contract, "secured in such manner as chanroblesvirtualawlibrary
The relief permissible under § 209(h) turned out to be inadequate. It was limited to applications made before the guaranty period had expired, to applications, that is to say, before September 1, 1920. In the case of the respondent, as in that of other carriers, the guaranty period expired with the Commission still unready to announce its ultimate award, and with the pressure of the need for intermediate relief as urgent as before. Accordingly, the Transportation Act 1920 was amended on February 26, 1921, by authorizing the Commission, if not at the time able finally to determine the whole amount due, to make its certificate for any amount definitely ascertained by it to be due, and thereafter in the same manner to make further certificates, until the whole amount due had been certified. Act of February 26, 1921, c. 72, 41 Stat. 1145, § 212, 49 U.S.C. § 79. The text of the statute is quoted in the margin. * chanroblesvirtualawlibrary
The Commission, after satisfying thus the instant needs of the respondent, continued the investigations necessary to ascertain the final balance. Not till five years had passed was it ready to announce its findings. In the meantime, it had filed a series of reports or decisions defining or revising the principles and formulae that were to govern it thereafter in the allowance or disallowance of expenditures for maintenance. See, e.g., Maintenance Expenses under § 209, 70 I.C.C. 115; In the Matter of Final Settlement under § 209 of the Transportation Act 1920, 70 I.C.C. 771. By its final certificate issued on June 8, 1926, under § 209(g), it certified that the total amount necessary to make good the guaranty was chanroblesvirtualawlibrary
We may assume in favor of the petitioner that a certificate issued by the Commission under § 212 of the statute is open to impeachment for fraud or mistake, and that payments burdened with those infirmities are subject to be reclaimed. If this be assumed, it does not avail without more to lay a duty of restitution upon the carrier before us. Fraud in the making of the certificate is neither proved nor even intimated. Mistake also there was none, but merely a revision of judgment in respect of matters of opinion. The respondent reported that it had paid out for maintenance during the guaranty period $28,982,000. There is no claim that this report was false, even to a penny. Readjustments were needed, however, as we have already pointed out, whereby allowance might be made for fluctuations in the cost of labor and material, as well as for other economic changes, between the period of test and the period of guaranty. The formulae for the readjustment of maintenance expenditures in use by the Commission on March 1, 1921, reduced the maintenance allowance to $27,233,000, which was more than one and a half million dollars less than the expenditures actually made. The formulae in use on June 8, 1926, reduced the allowance for maintenance to $23,815,000. In this last reduction lies the explanation of the discrepancy between the partial certificate and the final one. Neither set of formulae is an expression of mathematical truth in such a sense that accuracy may be affirmed of one and error of the other. Each makes it necessary to multiply the expenses of the test period by a factor derived from an imperfect and approximate estimate of a composite change of prices. To what extent the factor is an expression of mere opinion is perceived when the process back of it is chanroblesvirtualawlibrary
In these circumstances, we find no basis for a holding that the payment made to the respondent under the partial certificate of March 1, 1921, was due to any mistake of fact, either unilateral or mutual. United States v. Barlow, 132 U. S. 271, 132 U. S. 280-281. Cf. 105 U. S. 557-558. The officials of the government knew precisely what they were doing, and kept well within the statute defining their authority. They did not act illegally, like the officials whose acts were challenged in the cases cited by the petitioner. Wisconsin Central R. Co. v. United States, 164 U. S. 190; Grand Trunk Western Ry. Co. v. United States, 252 U. S. 112; Burnet v. Porter,@ 283 U. S. 230. Charged with a difficult task exacting judgment and discretion, they came to a decision in good faith, with knowledge of the relevant facts and without departure from the law. If the payment under their certificate is to be reclaimed, some other ground than mistake or illegality must be found to sustain the reclamation.
Mistake and illegality being thus excluded from the reckoning, we are brought to a second ground for reclamation put forward by the government. The argument is made that, by the true construction of the statute, a certificate issued by the Commission under § 212 is provisional and tentative; that, upon the issuing of a final certificate of inconsistent tenor, it is superseded and nullified as to the past, as well as to the future, and that payments made under its authority, though legal in the making, become illegal by retroaction. We do not so interpret the meaning of the statute. If all that the lawmakers had in view was to authorize mere advances on the basis of an estimate, the carrier remaining bound to refund the excess in the event that the estimate was thereafter found to be too high, a suitable form was at hand in § 209(h) for the expression of their purpose. All that was necessary was to strike out the requirement that application must be made during the guaranty period, and to provide that the promise of the carrier to refund might be accepted without security. Section 209(h), thus reframed, would have given expression with nicety to the obligation which the respondent is said to have assumed. chanroblesvirtualawlibrary
Thus far, we have not traveled, in our search for the meaning of the lawmakers, beyond the borders of the statute. In aid of the process of construction, we are at liberty, if the meaning be uncertain, to have recourse to the legislative history of the measure and the statements by those in charge of it during its consideration by the chanroblesvirtualawlibrary