Court Opinion

ID: 8832810
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:09:06.378232+00
Date Added: 2024-06-11T17:04:58.238372
License: Public Domain

BRYAN, Circuit Judge
(dissenting). During the war all express •companies then existing were consolidated into the American Railway Express Company, which after the consolidation was the only express company in the country. It operated on all railroads from July 1, 1918, until May 1, 1921, when the Southeastern Express Company entered the field and began to do business over what is called the Southern Railway System, principally in territory south of the Ohio and Potomac rivers, and east of the Mississippi river, although it also operates over an electric railway line from Washington to Baltimore, and over the Maryland &'Pennsylvania Railway Company from Baltimore to York, Pa. The territory selected by the Southeastern was promptly abandoned by the American. The Southeastern attempted to concur in the tariffs of the American, but the latter attempted to prevent this by supplements, by which it made applicable through routes and joint rates only between its exclusive offices and the exclusive offices of the Southeastern.
After hearings upon applications made by the Southeastern and certain shippers, for through routes between the two express companies, the Commission reviewed the proceedings before it in two opinions reported in 78 Interst. Com. Com’n R. 126, and in 81 Interst. Com. Com’n R. 247. Among other things, the Commission found that:
•“Express shipments from a Southeastern exclusive point-to an American exclusive point move over a through route at a joint rate. From an intermediate common point, a shipment over the same route is assessed the combination rate, which is higher. * * * Undue prejudice is said to result from the fact that between exclusive Southeastern points and exclusive American points through routes and joint rates apply, while between near-by common points and American exclusive points a shipper has access only to the American route in the absence of proportional rates, and from the fact that some common points are accorded joint routes to and from American exclusive offices and other common points are not.”
And thereupon the Commission entered an order requiring the plaintiff company to establish and maintain—
“through routes between all points in the states of Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, and Connecticut, New York, N. Y., and all points on the direct routes of the American Railway Express Company between New York and Washington, I). C., on the one hand, and all points on the main line 'of the Southern Railway Compay from Washington to and including Birmingham, Ala., on the other, with transfer between the American Express Company and the Southeastern Express Company at Washington, D. O.”
*39The order further required that the new rates should not exceed the rates then existing, and that shippers should have the right to designate in writing over which through route shipments of express should be transported. The plaintiff contends that the order should be enjoined. because: (1) The Commission was without statutory authority to make it; (2) it is unjust and unreasonable, and is the taking of property without due process of law, in violation of the Fifth Amendment r and (3) a division of earnings is riot prescribed.
1. The Interstate Commerce Commission did not have the power to establish through routes under the original Interstate Commerce Act of 1887; hut by the amendatory Act of June 29, 1906, 34 Stat. 584, it was empowered to establish through routes and to prescribe the terms and conditions under which they should be operated--
“when that may be necessary to give effect to any provision of this act, and the carriers complained of have refused or neglected to voluntarily establish such through routes and joint rates, provided no reasonable or satisfactory through route exists.”
The proviso was stricken out in 1910, at which time it was provided that:
“In establishing such through route, the Commission shall not require any company, without its consent, to embrace in such route substantially less thin; the entire length of its railroad and of any intermediate railroad operated in conjunction and under a common management or control therewith which lies between the termini of such proposed through route, unless to do so would make such through route unreasonably long as compared with another practicable through route which could otherwise be established.” 36 ¡átat. 552.
The establishment of through routes under the Act of 1910 was dependent upon the failure of the carriers to establish voluntarily such through routes, but in 1920 by Transportation Act, 15 (3), they were authorized to be established whenever necessary or desirable in the pub - lic interest. I.imitation upon the right to establish through routes war' not substantially changed, “except as provided in section 3,” and except that for the word “company” in the act of 1910, the words “carrier by railroad,” which the majority opinion holds includes express companies, were substituted in section 15 (4) of the Transportation Act of 1920, and the limitation was further made subject to cases of emergency.
The language, in the original act of 1887, “the provisions of this act shall apply to any common carrier or carriers engaged in the transportation of passengers or property wholly by railroad, or partly by railroad and partly by water when both are used, under a common control, management, or arrangement” (24 Stat. 379), was early held by the Interstate Commerce Commission not to include express companies. Express Cases, 1 Interst. Com. Com’n R. 677. But it was provided in the act of 1906 that the term “common carrier” should include express companies, and they are clearly within section 15 (3) of the Transportation Act of 1920, where jurisdiction is given to the Commission to establish through routes “applicable to the transportation of passengers or property.”
In the Transportation Act, the term “carriers by railroad” is usually employed to designate railroad companies, Section 1 (10, 11, 12, 13, *4014, 21). Express companies, the Pullman Company, pipe lines, and telegraph and telephone companies are usually referred to as carriers or common carriers subject to the act. Sections 2, 4, 5, 6, 7, 8, 9, 10, 13. However, the terms by which the various carriers are intended to be designated are not always used. This should afford no occasion for surprise, sinc'e the act has been so often amended and the jurisdiction of the Commission has been enlarged by the use of general terms to include express companies and other common carriers, which were not originally subject to the act. It is said that, unless the term “carriers by railroad” be construed to include express companies, the jurisdiction of the Commission would be much curtailed, and especially^ as it exists by reason of sections 1 (16, 24), 6 (1), and in 3 (2). Section 1 (16) refers to routing traffic over other lines whenever any “carrier by railroad subject to this act is unable to transport it so as properly to serve the public.” It will be noted that the language is made a little broader by including the words “subject to this act.” But, if it means railroads only, it is not apparent that any important jurisdiction would be lost. Express traffic moves over railroad lines and the power is given to divert traffic if the railroad company is unable to handle it.
Section 6 (1) imposes the duty upon express companies, as well as other carriers, to publish schedules of rates. It is clear that it is the intention to make this' requirement apply from points on the route of one carrier to points on the route of another carrier. Tn doing so the second named points are defined as being on the route of another carrier by railroad, by pipe line, or by water. It may be that the language was not happily chosen to define the points of destination, but the context clearly shows that express companies are included. There can be no destination points of express companies within the jurisdiction of the Commission which are not upon the route of a carrier by railroad or water, because every point on a route of an express company is alsp a point upon a route of a railroad'company.
In construing section 1 (24), no difficulty is encountered in concluding that express companies are included within the language “any common carrier by railroad or water, or otherwise.” It will be noted that in section 3 (2) there is added to the usual designation, “carriers by railroad,” the words “subject to the provisions of this act.” It is at once apparent that the designation is different from that used in section IS (4). '
The plaintiff argues that shippers of express are given the right to designate the routing of it by section IS (8), although the carrier there defined “is any railroad corporation, being a common carrier.” If that be true, it only emphasizes the importance of considering the context in an effort to ascertain the meaning of the language used in any particular paragraph. The expression “any carrier by railroad” in section 15 (4) is limited and qualified by the language, “the entire length of its railroad and of any intermediate railroad operated in conjunction or under a common management therewith,” etc.
But it is insisted that the limitation and qualification are intended to' designate user, instead of ownership. That construction, as it appears to me, cannot possibly include “any intermediate railroad operated un*41der a common management or control” with the first-named railroad. What we are asked to do is to apply to an express company language which is descriptive only of a railroad company. Express companies as such do not have intermediate railroads upon a route under their management or control, separately or in connection with others. Section IS (3) grants the power to establish through routes “applicable to the transportation of passengers or property,” and therefore applicable to both railroad companies and express companies. But the limitation in 15 (4) applies only to railroad companies, as they usually, and not inadvertently, are referred to in the act, and further indicates that the term “carrier by railroad” is employed in the usual, and not in an exceptional, sense, by recognizing a common practice of consolidation of lines of railroads by railroad companies — a practice which never has been, and could not be, indulged in by express companies.
The liability of the initial carrier, whether railroad company or express company, for loss or damage to shipments, described in section 20 (11), is appealed to as a reason for including express companies along with railroad companies in section 15 (4), so as to enable such express companies to protect themselves, so far as possible, against liability due to the default of connecting carriers. It is not to be assumed that the Commission would establish through routes and compel the initial carrier to deliver either freight or express to a connecting carrier, which was unable to make good any loss caused by it.
Although it is conceded that a shipper of express has the right to route, yet the plaintiff contends, since such right did not exist at common law, it is not conferred by the act unless by section 15 (8). The Commission defends that part of its order allowing routing by shippers by a provision of section 15 (3), which authorizes it to prescribe the terms and conditions under which through routes may be operated, and also by special rule 3, providing for the routing of express by shippers, prescribed by it and acquiesced in by the plaintiff. When the act conferred upon the Commission the power to establish through routes, it thereby took away from the initial, carrier the common-law right to select its connecting carriers. As stated by the Commission in its opinion, the establishment of through routes would be of no advantage if shippers could not make use of them.
Furthermore, I think it is clear from the act that express companies do not stand on the same footing as railroad companies. Formerly the several express companies operated in different parts of the country, and upon all the railroads in their respective territories. There was a semblance of competition between several of them in some parts of the country, but, because of their intercorporate relations, as pointed out by Commissioner Fane in the Express Cases, 24 Interst. Com. Com’n TR. 379, there was little actual competition. The contract between the American Express Company and the railroad companies over whose lines it operates provides for a pooling of freights and a division of earnings, which is made unlawful, except by permission of the Interstate Commerce Commission, acting in the public interest (section 5 [1]), and can exist only under such rules and regulations and upon such .terms and conditions as the Commission finds to be just and *42reasonable (section 5 [2]). Such contract is also subject to any supplemental orders the Commission may deem necessary or appropriate. Section 5 (3). And the act specifically requires that within 30 days from its approval the plaintiff herein make application to the Commission for the consolidation which it now enjoys. Section 5 (7). It therefore seems to me that, in establishing through routes for express companies and in dealing generally with them, the Interstate Commerce Commission has practically unlimited power, including that to require routings by shippers to be complied with, provided always its acts are just and reasonable, and not arbitrary.
If express companies are included within the term “carriers by railroad” in section 15 (4), and therefore have a right to the long haul over the railroads with which they have contracts, then the American Railway Express Company, having such contracts with all railroad companies except the Southern, has it within its power to prevent competition by other express companies, and thus, to a considerable and dangerous extent, at least, to monopolize the express business of the entire country. The whole history of the Interstate Commerce Act, and of the many amendments to it, repels the idea that such a result was ever intended by the Congress.
2. It is to be conceded that the Interstate Commerce Commission cannot order an express company to do- an unreasonable thing. It cannot arbitrarily establish a through route, and can only do so when it acts in the interest of the public.- When it does so act, however, any damage incidental to the nature of the business of an express company does not render an order of the Commission unjust or unreasonable. I am unable to say that it is unjust or unreasonable to compel the American to deliver to the Southeastern express packages shipped from points north of Washington to points on the main line of the Southern Railway. The inequalities and discriminations which result from the present situation sufficiently appear from the reports of the Commission. The disadvantages which it is claimed by the American would result from a compliance with the Commission’s order would be largely, if not completely, overcome by a proper division of rates.
3. The fact that the Commission did not prescribe the division of rates, but withheld that subject for further consideration, does not invalidate the order. The Commission deferred that matter until the question of its right to establish routes had been determined. This it had. the right to do. Railway Co. v. United States, 43 Sup. Ct. 270, 67 L. Ed. 605, decided February 19, 1923.
I think the application for an interlocutory injunction should be denied.