?18
FEDERAL REPORTER.
way corporation. formed under the law of the state. to carry freight for nothing,orat any less rate than a reasonable one, then it necessarilY follows that this provision of the act cannot be enforced, so far as prevent the railway from,cpmpeting with the water-craft at Corvallis and other similarly situated points, :Elven if in so doing are compelled to charge less for a long haul than a short one in the same. direction. It is not the fault· or contl'ivance of the railway company that compels this discrimination.' It is the necessary result of circumstances altogether beyond its control. It is not done wantonly, for the purpose of putting the one place up or the other down, but only .to maintain its business against rival and competing lines of transportation. In other words, the matter, so far as the railway is concerned, resolveS itself into ",choice of evils. It must either compete with the bqa,ts during the season afwater transportation, and carry freight below what the legislature has declared to 'be a reasonable rate, or abandon the field, and let its road go to rust. can the shipper at the non"competing point. or over the short haul, complain, so long as his goods are. carried at a reasonable rate. It is not the fault of the railway that the shipper who does business at a competing point has the advantage of him. It is a natural advantage to which he must submit, unless the legislature will undertake to equalize the matter by prohibiting the carriage of goods by water for a less rate than by rail; and, when this is done, the inequalities of distance, as well as place, may also be overcome by requiring goods to pay the same rate over a short haul as a long one." This opinion has been before the world for more than two years, and, on account of the importance of the subject, has attracted some attention, but, so far as 1 am aware, it has received no unfavorable criticism; and time andrefiection have fully satisfied me of the correetness of the ruling. In Ex parte Koehler, 25 Fed. Rep. 73, I had occasion to consider this subject again, on account of the competition at Corvallis with the Oregon Pacific .Railway Company, running in connection with the steamers of the Oregon Development Company, for freight destined to and from San Francisco, in which the receiver was instructed to make rates that would enable the Oregon & California road to compete for freight with the Oregon Pacific Company at Corvallis. At common law a carrier has a right to charge less for a long haul than a short one in the same direction, but the rate for the short haul must be reasonable. In Atchison, T.1!c S. F.Ry. v. Denverl!c N. O. Ry., 110 U. S. 683, 4 Sup. Ct. Rep. 185, the supreme court held that the former could not be required to carry freight over its road from Kansas City to Pueblo, Colo.Jlado, for the latter, at the same rate it obtained on a division of through among combined companies, of which it was one, on a through line from Kansas to Denver, the latter being a competive point for the business to and from the Missouri river, while Pueblo is not, and this conclusion was reached notwithstanding the constitution of Colorado (section 6, art: 15) "All individuals, and corporations shall have equal rights to have persons and property transported over any railroad in this state, and no undue or. 'Qnreasonable discrimination shall be madtl in charges or facilities for transportation of freight or passengers within the state."
tha busiliess at Corvallis altogether, If the legislature cannot require a rail-
than that which the legislature lias declared to be reasonable. or elsl1 give up
it is,.in efl'eqt, required to carry freight to and from such points at a less rate
mediate between Portland and Corvallis, where there is nos'ijch competition,
EX PARTE KOEHLEB.
819
The judgment of the court is authority, then, for this proposition: Two or more corporations, in order to meet competition, may form a through line, and charge through rates for transportation thereon, which may be less than the sum of the local rates of the several roads constituting the line; ,and the portion of the through rate received by each corporation may be less than the local. rate, charged by .said corporation for carrying freiKht over the whole length of its road. The interstate commerce act is intended, among other things, to prevent discrimination between long and, short hauls, except where they are made under substantially dissimilar circumstances and conditions. In my,jud,gment, congress, in, limiting the prohibition contained in section 4 of thelWt against charges. between long and short where s\lch .hauls are made" under· substantially similar hauls, to circumstances ,and conditions," has recognized the rule laid down in ,:Ex parte Koehler as a proper one. Freight carried to or from a competitive point is always carried under "substantially diBsimilar circumstances and conditions" from thatcarrled to or from nO):l-competitive points. Inthe'lattercasethe railway makes its own rates, and there is no good reason why it should be allowed to charge less fora long haul than a short one. When each is made from or to a point, the effect of such is to build up one place at the of the other. Such action is willfully unjust, and has no justification or excuse in the exigencies or conditions of the business of the corporation.. Intheformercase the circumstances are altogether different. The PQwer of the corporation to make a rate is limited by the necessities of the situation. CompetItion controls the charge. It must take what it can get, or, as was said in :Ex parte Koehler, "abandon the field I and let its road go to rust." Competition may not be the only circumstance that makes the condition lindet which a long and a short haul are pe'rformed substantially dissin1ilar; but certainly it is the most obvious and effective one, and must have beert in the contemplatIon Of congress in the passage of the act. Section 6 of the act of July 1, 1862, (12 St. 489,) incorporating the Union Pacific, provides that the United States shall have the preference in, the use of the road of the corporation, for the transportation of mails, troops, and munitions of war "at fair and reasonable rates of compensation, hot to exceed the amount paid by private parties for the same kind of service." . In Union Ry. Co. v. S., 104 U. S. 662, and 117 U. S. 355, 6 Sup.. Ct. Rep. 772,aquestion arose under this section as to the corporation was entitled to receive for transporting persons connected with the postal and military service olthe governrt;lent, over the line of its road, when it appeared from the finding of thecbuliof claims that the uniform rate of the Union Pacific for carrying passengets over Its road between Council Bluffs·and Ogden, on tickets purchase9-ateither of these points, was by contract with connecttng :raUway corporations. passengers were carried on through ti(jketS fthIn Ne'wYork to Sari FranCisco at reduced rates, of which the
u.
320 '"
FEDERAL REl'ORTEB. . ,
as its proportion, $54 a passenger. 11!7 U. S. 362, 6 Sup. Ct.' Rep. 772. As stated by the supreme court, (1l7U. S. 363, 6 Ct. Rep. 776:) "The contention of the United States is that local passengers carried on its account between Council Bluffs and Ogden shall be carried at, the same rates as are charged for through passengers passing between these points. as part of a journey over a whole line,' although a difference is made in respect tp all other persons." The question was decided in favor of the corporation, the court holding, in the' language of the syllabus, {117 U. S. 355,6 Sup. Ct. Rep. 7720, , "The s(lrvice rendered by a railway company in transporting a local passenger from one point on its line to another is not identical with the service in transporting a through passenger over the same' rails. " The decisions of the supreme court in these two c&ses, are quite recent, (1881,1883, and 1885,) and were doubtless presentin the mind oicongress at t4e passage of the interstate commerce act' In effect, they both hold that a short haul, without competition, is not "a like service," or a service performed under "similar circumstances and conditions," with a long one subject to competition, and that the circumstances in such case are so dissimilar as to warrant di.scrimination, or a less rate over theJong haul than the shQrt ,one. Section 90 of the EngIish rail(8 & 9 Viet. c. 20) requires equality of rates for the way act' of passage of goods "passing only over the same portion, of the line of said railway, under the same circumstaru:es." In Denaby Colliery Co. v. JIq,nchester, S. Railway Co., 11 App. Cas, 97, 26 Amer. & Eng. R. Cas. 293, it was held, in an action against the defendant for overcharges, made in violation of the act, in ()arrying coalsfrom a group of collieries situate at ditferentpoints along the line of its road, at a uniform rate, that the act only applied to goods passing between the same ternvini, ap.d over no other part of the line; and that inequality of rate, where unequal distances are traversed, does not ()onstitute a .preference contrary to the act. In other words, the court held that two tons of coal, passing over the road of the defendant between B. and C., did, not pass over such portion of its line "under the same drcumstances," if one of them also passed over that portion of the road between A. and B., and therefore the defendant was not guilty of an infraction of the act when it charged rio more for carrying a ton of coal from A. to the point C. than it did from B. to such point. But, under the interstate commerce act, mere difference in distance is not such a circumstance as will justify a greater or even an equal charge for a short haul than a long one. .Yet congress must have contemplated that there might be such a difference in the circumstances attending a long and a short haul as would justify such charge,-as would make it necessary for a railway corporation,' in the retention and acquisition of the business for which it is constructed and operated, to charge less for a long haul than a short one. Congress never intended to make of this act a Procrustean bed, in which the conduct of the business of all the
. roads engaged in interstate commerce shall be made to conform to one
821.:
arbitrary rule, without reference to the probable and even unavoidable. difference in the conditions and circumstances under which it mbet be transacted. And, as I have said, in my judgment, competition between the termini of a long haul is the most obvious and effective circumstance that justifies a railway in making a rate below what it might reasonably and does. charge .where there is no competition. The places between which competition in transportation exists between water-craft and railways, or even the latter, always will and must send and receive f:l:'eight at lower rates than others not so favored. This. is the result of natural advantage, supplemented often by exceptional sagacity and enterprise, and it would befolly in the legislature to prevent it if it could. As long as people and places differ so widely in capabilities and facilities, social or business, equality is impossible. Society can do no more than to give each one an even chance and a fair show to make the most of his or its opportunities, and leave the result'to circumstances over which it has little, if any, direct control. The third question propounded by the receiver is easily answered. Section 2 of:the act, by prohibiting any carrier subject thereto from charging anyone person "a greater or less compensation for· any service" rendered in the transportlttion of persons or property subject to the act than it does any other person for" a like and contemporary service," "under similar circumstances and conditions," in effect pro.. liibits theissuing of passes 01' the carrying of any person free of charge, so long. as the same privilege is genied to any other person "under substantially similar circumstances and conditions." Now i it may be said, and with IUuch plausibility, that the wife or minor child of ap sustains a different relation to the employer from that of the public generally; and that, therefore, the carriage of such a person on a pass', or free t>f charge,is a service rendered by carri.ers under "substantially dissimilar circumstances and conditions" from that rendered to any other person not belonging to the family of an employe. But section 22 of the act contains some specific exceptions to the operation of section 2. Among them is this: "Nothing in this act shall be construed to prevent railroads from giving free carriage to their own officers and employes. 01' to prevent the principal officers of any railroad company or companies from exchanging passes or tickets with other railroad companies for their officers and employes." The language of the exception is explicit. There is no room for interpretation or construction. The words cannot be made to include the "family" of an employe without violence to the apparent purpose of the legislature. In effect, the exception declares that the "circumstance" of a person being the employe of a railway corporation is cient to justify the latter in carrying him free of charge, but not his wife or children. The exception takes the subject of free carriage, on account orany person's employment by a railway corporation, out of the question of "similar circumstances and conditions" "as provided in section 2,. and that the person so employed may be carried on v.31F.no.6-21
that account, without referen<!e to any other circurnsumce or condition, and by anecessaryin1plicatlon no One else. Doubtless it would be expediE!nt to include the immediate family-the wife and minor children -of· the employe in this exc4:\ption. By this means the corporation might; without tnaterial cost to itself, or prejudice or injustice to anyone, augment in a:graceful way the compensation and convenience of faithful servants. But the remedy, if any,. is with congress and not the courts. The receiver is instl'uctedthathe is authorized to make a less rate for a long haul than a short ,one, in 'conjunction with connecting lines or otherwise, whenever, by reason of-competition with other lines or means of transportation, the same is necessary to enable the Oregon & California road to retain or acquire[ business; and that he is not authorized to give passes over his road!t(j any member oithe family of an employe thereof,for the or in connection with interstate' travel.
v. TRAVELL1l:Rs' INS. Co. .(Oirc'Uit Oo'Urt, N.. D. (JalijQNl,ia. April 18, 1887.) 1. hiStnUNCB"":RENEWALOF 'POLlcy.-.cONDITION-WAIVER. , .An company WOlLe in of sending to its agents renewal 'dgned In blank, with authority to countersign and deliver them as they were required. The policy contained a clause making the actual payment of the,premium a condition: precedent to its binding force, and provid· ing that no. illl'aiversbouid pe qlllJmed by reason of anything done by anv agent, The custom of the agents was to give unless specia,lly authorized in credit'on the premiums, and the 'company, with knoWledge of the facts, re.ceived and retained the p.relll.lu.·mS paid. at the e.XPira.tipn of such credits. Held,.that the delivery of the .renewal receipts to the jnsured continued the policy in force from year to 2. BAME-:DELrvERY OF RENEWAL RECEIPT. Before the expiration. of the previQu8 renewal, the agent of the company, under. the ofthe out and countersigned a receipt purporting to' renew the policy fqr:'aljlother year, and also, at the request of the Insured, retained the receipt i:n'1ilil office. wl;t.ere it remained to the time of the death :of .the insured. Held" that'there was a delivery of the renewal receipt whiph theppli9Y in forCe. '. 8. BAME...,.AcCJDENT INBUBANCE-;:CAtrSIll OF· DE;ATH-EvIDENCE. Deceased. 'Vho was subjecttQ epileptic fits, was found dead in a plungebath in ali almost standing position, the water having a temperature of abou't 100 deg.. There was anabrasi,ot).between his eyes, and a bruise on one side of his head: .. His physician testified that .the entrance into the bath of one in his then condition wo'uld 'be to result in an epileptic attack, and that the. fan or blow .w'hich caused the .abrasion or bruise were not sufficient to have Held, upontlle. evidence, that the deceased came to his death through other causes "than external, violent, and accidental means, within the 'intent and meaning"of the policy in suit. . , ; -( .' , " ,,\ 'I,
Ross, J.' This action is'broughtby the administrator of the estate of William Tennant, deceased, to re¢over the amountofa policy of anee issued 'by the Travellers' Insurance Company of Hartford, Connecti-' cut,to the saidJVillia:mTennant,on the twentieth day of June, 1881.