Source: https://www.legalcrystal.com/case/99025/united-states-vs-icc
Timestamp: 2017-06-25 06:15:08
Document Index: 519445476

Matched Legal Cases: ['§ 6', '§ 22', '§ 22', '§ 2325', '§ 1', '§ 6', '§ 6', '§ 22', '§ 22', '§ 1', '§ 2', '§ 66', '§ 22', '§ 22', '§ 2']

United States Vs Icc - Citation 99025 - Court Judgment | LegalCrystal
Save as PDF Add a Tag Add a Note Semantics Visualize United States Vs. Icc - Court Judgment	LegalCrystal Citationlegalcrystal.com/99025CourtUS Supreme CourtDecided OnDec-17-1956Case Number352 U.S. 158AppellantUnited StatesRespondenticcExcerpt:
united states v. icc - 352 u.s. 158 (1956)
since may 1, 1951, railroads serving the port of norfolk, va., have refused to pay an allowance to the army for the wharfage and handling services the army performs for itself on military export traffic passing through army base piers. in their tariffs, the railroads assumed the obligation to furnish such services for all shippers that complied with the tariffs, and accordingly furnished the services for commercial..... Judgment:
in the circumstances of this case, the refusal of the railroads to make the allowance to the Army did not subject the Government to unjust discrimination and did not constitute an unreasonable practice in violation of the Interstate Commerce Act. Pp.
352 U. S. 160
(a) The circumstances of Army shipments are markedly different from those of private shippers that received wharfage and handling services; and the Army was treated identically with those shippers who, for business reasons, did not care to comply with the tariff requirements. Pp.
352 U. S. 168
(b) Although the Army hired the same private company as did the railroads to operate the Army portion of the base, the Army's control was "absolute." Pp.
352 U. S. 169
(c) The method of handling government freight did not comply with the tariff requirements. P.
352 U. S. 172
(d) Any deviation from tariffs by carriers violates § 6(7) of the Interstate Commerce Act unless they grant a concession to the United States under § 22. P.
(e) The Government was being treated just as any shipper who decides not to take advantage of the services offered in the tariff and takes deliveries of export rate traffic at private piers under his own control. Pp.
(f) That the Government took control of the piers to meet a national emergency cannot convert the Government's operation of its private piers into a category different from that of private shippers. P.
352 U. S. 173
(g) The fact that the operations of the Government and the railroads are in the same pier area is immaterial. P.
352 U. S. 174
(h) If the railroads gave an allowance in these circumstances, excepting one given as a concession to the Government under § 22 of the Act, they would have to give it at all private piers where the shipper wanted to handle wharfage at its own discretion. P.
(i) The Government has the right to have its shipments accorded the same privileges given others; in emergencies, its traffic my have "preference or priority in transportation," and it may be granted and may accept preferences in rates, but it cannot otherwise require extra services or allowances. P.
United States v. United States Smelting Co.,
339 U. S. 186
352 U. S. 175
(k) Whether circumstances and conditions are sufficiently dissimilar to justify differences in rates or charges is a question of fact for the Commission's determination. Pp.
132 F.Supp. 34, affirmed.
The present litigation was instituted pursuant to 28 U.S.C. § 2325, in a three-judge District Court of the District of Columbia by the United States, through its Department of the Army, against the Interstate Commerce Commission and the United States, to set aside the Commission's order in
United States v. Aberdeen & Rockfish R. Co.,
289 I.C.C. 49. That order dismissed a complaint filed by the United States on November 20, 1951, against several named railroads charging them with violations of the Interstate Commerce Act. The District Court, one judge dissenting, dismissed the complaint. 132 F.Supp. 34. We noted probable jurisdiction. 350 U.S. 930.
Since May 1, 1951, the railroads have refused to pay an allowance to the Army for the wharfage and handling [
] services the Army performs on military export traffic passing through Army base piers in Norfolk, Virginia. The railroads have assumed in their tariffs the obligation to
The Army sought a determination that the railroads' refusal to make an allowance to it to the same extent that the railroads paid the private company, Stevenson & Young, for handling of private shipments subjected the Government to unjust discrimination and constituted an unreasonable practice in violation of §§ 1, 2, 3, and 6 of the Interstate Commerce Act. [
] The Army also requested
an order that the railroads cease and desist from such refusal in the future. [
The transfer of export freight from rail carriers to outbound water carriers is made on piers or wharves that allow the unloading of freight from railroad cars to within reach of ships' tackle. Railroads are under no statutory obligation to furnish such piers or to unload carlot freight,
Pennsylvania R. Co. v. Kittaning Iron & Steel Mfg. Co.,
] In general, the railroads have taken on the duty of wharfage and handling for freight consigned for overseas shipment. [
] In some instances, railroads have charged for the use of the piers ("wharfage") and the necessary "handling" separately from their charge for
The Norfolk piers, involved in this matter, were managed by such operators. They were built by the United States after World War I, and have been leased in part or in whole to a series of commercial operators since then. The leases were cancelled during World War II, but they were leased to Stevenson & Young, a private terminal operator, at tne end of that war. The railroads here involved, using the single factor shipside rate described above, contracted with Stevenson & Young, as their agent, to perform the wharfage and handling for 25Ë˜ per ton for wharfage and 75Ë˜ per ton for handling on both commercial and military freight. But, with the advent of the Korean hostilities, the Government again cancelled the leases, and the Army took entire control of the piers. Apparently the military shipments require special handling and storage. To assure its complete satisfaction, the Army hired Stevenson & Young to perform those services under a general pier-operating contract for the Army. [
A typical tariff arrangement appears in the note below. It is the basic exhibit in this case. [
] It was bottomed on
It should be noted that the United States is not attacking the form of the tariff, which provides for both line haul service and the accessorial services in the single factor export rate. [
] Consequently, this case involves only charged discrimination and injustice.
Cf. United States v. Interstate Commerce Commission,
337 U. S. 437
-438. In short, the United States seeks to be excepted from the tariff requirement that calls for the shipper to use a public wharfinger under contract to the railroads for performance of the wharfage and handling. [
This controversy is similar to one that arose out of the Army's cancellation of the Norfolk pier leases during World War II,
269 I.C.C. 141. Interpreting railroad practices much like those now before this Court, the I.C.C. determined that the Army was not being discriminated against. However, on review, the Court of Appeals for the District of Columbia remanded the case to the I.C.C. for further exposition and clarification. 91 U.S.App.D.C. 178, 198 F.2d 958. On remand, the I.C.C. reaffirmed its earlier determination, and no appeal has been taken from that order. 294 I.C.C. 203. Because the question of whether the Army was discriminated against following the Government's World War II lease cancellation has never been finally passed upon, the District of Columbia ruling is not inconsistent with the Commission's conclusion in this litigation.
The Army routed its export shipments direct to itself at the Army base as consignee. As is shown by the contracts summarized above, the entire Army base property was under military control except for the commercial
operations of Stevenson & Young. The base included piers, bulkheads, railways and storage warehouses, and railroad switches, tracks and yards. The Commission found that the Army had determined "that ports of embarkation must be operated by personnel of the military service and civilian employees of the Government." 289 I.C.C. at 53. [
This Army control over the movement of freight of those portions of the piers that were not leased to Stevenson & Young left the railroads serving the base without authority in those areas to direct the switching, spotting,
The problems of the assumption by the carriers of the costs of wharfage and handling at ports have a long history. The Norfolk area has not been an exception, as has been heretofore indicated.
When the Government again in 1951 found it desirable to cancel the leases, it was familiar with the various facets of the controversy over wharfage and handling. [
It is obvious that the method of handling government freight does not comply with the tariff requirements. It does not move over wharf properties owned, leased, and operated by the Stevenson company "as a public terminal facility of the rail carriers." Rule 47(b),
289 I.C.C. at 60. Any deviation from tariffs by carriers violates § 6(7) of the Act, 49 U.S.C. § 6(7), unless they grant a concession under § 22. [
The Government actually is being treated just as any shipper who decides not to take advantage of the services offered in the tariff. It seeks a preference over these other shippers who take deliveries of export rate traffic at piers under their own control, so-called private piers. The general practice at North Atlantic ports is to refuse to absorb handling charges at private piers, even though they are absorbed where the carriers have control of the facilities.
The Government contends that it is not in the same position as other shippers who control private piers, because it took control of the Norfolk piers to meet a national emergency. But we think that the emergency cannot convert the Government's operation of its private piers into a category different from that of private shippers. [
And the fact that the operations of the Government and the railroads are in the same pier area seems to us immaterial. If the railroads gave an allowance here, excepting one given under § 22 of the Act, they would have to give it at all private piers where the shipper wanted to handle wharfage at its own discretion.
Weyerhaeuser Timber Co. v. Pennsylvania R. Co.,
229 I.C.C. 463.
The Government has the right to have its shipments accorded the same privileges given others. Moreover, in emergencies, its traffic may have "preference or priority in transportation," 49 U.S.C. § 1(15)(d), and it may be granted and may accept preferences in rates. [
] But the Government cannot otherwise require extra services or allowances. In the situation here presented, it could have used the same facilities as commercial shippers and obtained the benefits of the tariff. The evidence to this effect is uncontradicted. [
] The Commission accepted it as a fact. 289 I.C.C. at 58, 60-61, 63.
The United States argues that carriers cannot perform accessorial services in such a way that "some shippers would pay an identical line haul rate for less service than that required by other industrial plants."
339 U. S. 197
. To do so would indeed violate § 2 of the Interstate Commerce Act. [
case is not apposite. We affirmed a Commission order enjoining intra-plant car switching and spotting services after termination of the line haul. It terminated at a "convenient point" on a siding at consignee's plant. Our decision there turned on and upheld the Commission's power to determine the end point of the line haul. Because the line haul tariffs included only car movement to and from that convenient point, some shippers received more service than others for the line haul rate. 339 U.S. at
] Thus, our determination was based on the unlawful preference allowed some shippers by the tariffs, since those discriminated against could not get the same service as other shippers.
Furthermore, whether the circumstances and conditions are sufficiently dissimilar to justify differences in rates
or charges is a question of fact for the Commission's determination. [
91 U.S.App.D.C. 178 at 182, 198 F.2d 958 at 962.
See Wharfage Charges at Atlantic & Gulf Ports,
157 I.C.C. 663, 672.
No reparations were requested in this proceeding. However, as the Government indicates, if the railroads' refusal to pay for wharfage and handling is held to be a violation of the Act, the Government may deduct the prior "overpayments" from future sums due the railroads.
49 U.S.C. § 66.
289 I.C.C. at 61.
They can assume such and similar accessorial services by tariffs approved by the Commission as fair.
. It is discrimination or unfairness in the tariffs that calls for correction.
339 U. S. 194
-197. Such determinations are on a case-by-case basis.
See, e.g., United States v. Wabash R. Co.,
321 U. S. 403
Rule 47"
"[On January 1, 1952, the above rule (b) was changed. As the change strengthened the tariff in favor of the railroads, it is not quoted.
289 I.C.C. at 59.]"
See United States v. Aberdeen & Rockfish R. Co.,
289 I.C.C. at 61. It seems clear that such an attack could be made if present conditions justified a reexamination. The War Department attacked the practice in 1921, but its objection was overruled by the I.C.C. in 1929, after a thorough investigation, in a 6-5 vote.
Wharfage Charges at Atlantic and Gulf Ports,
157 I.C.C. 663, 678-686. Separation was sought largely to force the railroads to increase terminal charges so that competitive municipal and other non-railroad wharfingers might expand to develop better port facilities. The Commission reached the conclusion that such separation was inadvisable, and there was no evidence of injury from such practice.
at 684. It was the sensitivity of the foreign importers and domestic ports to rates so stated that led to this conclusion. In the highly competitive railway network, export traffic is an important factor to the carriers and the ports. Costs of port handling vary widely, 157 I.C.C. at 673. Such variations are now absorbed in the practice of quoting shipside delivery in tariffs.
The Government's request for export rates on its war shipments was granted by the railroads so that commercial and government export freight had the same rates.
Cf. War Materials Reparation Cases,
294 I.C.C. 5. This was a substantial concession by the railroads, contrary to their tariffs, and done only because of § 22 of the Interstate Commerce Act, 49 U.S.C. § 22, allowing concessions to the United States. 289 I.C.C. at 63. The railroads have also spotted cars for the Army after delivery in the storage yards without extra charge. Other shippers would be charged for such service. 289 I.C.C. at 55.
. Such relaxation of possible additional charges by the railroads does not decide the Army's claim for allowances for handling. The Commission did take the concessions into consideration, however, as to the fairness of the refusal to grant the claimed allowances. 289 I.C.C. at 64.
Although the Government seeks only an allowance of the published charge absorbed by the carriers of $1.00 per ton, the kind of service it requires in its area is illustrated by the fact that it pays $2.87 for handling. 289 I.C.C. at 61
The Army's reliance on
, is misplaced. There, this Court sustained the Commission in granting a shipper of fruit the right to pre-cool the car and contents, although the carriers were in a position to refrigerate, though not in the better way. As the carriers were not in a position to perform the service properly, they could not, by a tariff, deny the consignor such right.
49 U.S.C. § 2,
339 U. S. 196
See also United States Smelting & Refining Co.,
266 I.C.C. 476, 478.
L. T. Barringer & Co. v. United States,
For the same reasons, in
305 U. S. 526
, dealing with storage of goods in transit, and
United States v. American Tin Plate Co.,
-408, dealing with post-line haul switching practices, this Court has upheld the Commission's determination of unfairness
other shippers and its prohibitory orders.
See Seaboard Air Line R. Co. v. United States,
United States v. Wabash R. Co.,
321 U. S. 410
From the very beginning, the Interstate Commerce Act has made it unlawful for railroads to discriminate by charging some shippers more than others for carrying the same kind of freight the same distance. The provisions of the Act make it clear that the ban on such discrimination cannot be evaded by any contrivance or guise that
In 1951, however, with the outbreak of the Korean conflict, the Government found it necessary to operate directly certain portions of the piers in order to facilitate the shipment of military supplies. The Government hired the same operator who was acting for the railroads to perform the same services in handling government shipments as he had before. The sole difference was that the operator acted under contract with the Government, and
It is claimed that the railroads can establish a general rule that they will not pay for wharfage and handling costs at private piers. This is undoubtedly true, but it does not follow that they can include within the line haul rate charges for handling services at such piers that the railroads do not perform. Under any realistic appraisal, the railroads' costs for handling and wharfage services in the present situation are included as a part of their line haul rate, and are in no sense a "free service." The Government is compelled to pay this rate to get its goods transported. But, as the Interstate Commerce Commission expressly found, wartime conditions make it wholly impractical for the Government in shipping certain military goods to use the wharfage and handling services provided by the railroads under this rate. The Government is entitled to recover that portion of the "line haul"
rate which it is charged for services that it cannot use. That is all it claims. There is no reason why the railroads should be allowed to operate in a manner that exacts a transportation charge from all shippers for benefits that some can enjoy and others, although in exactly the same situation, cannot. As this Court said in
Union Pacific R. Co. v. Updike Grain Co.,