INTERSTATE COMMERCE COMMISSION V.BALTIMORE eft O. R.

co.

87

INTERSTATE COMMERCE COMMISSION V. BALTIMORE

& O. R., CO.

(Oircuit Court, S. D. Ohio,W. D. August 11, 1800.)
L

CA.RRIERS-INTERSTATE COMMERCE ACT-PA.RTY-RATE TICKEOfB.

'l'he issUance of "party-rate tickets," each good for a pat'ty of ten persons, at the rate of two cents per mile per capita, while single passengers are charged three cents per mile, is neither an unjust discrimination nor an undue or unreasonable preference or advantage, within the purview of the interstate commerce act, where such party-rate tickets are o.ffered to the pUblic generally, and where it appears tj:mt the rate charged single passengers is not unreasonable.

2.

SAME-BURDEN OF PROOF.

Where a railroad company is charged with violating the interstate commerce act, by the issuance of "party-rate tickets" at less than the rates charged single passengers, the burden of proving that such lower charge constitutes an undue preference is upon the person making the charge.

S.

SAME-CONSTRUCTION OF ENGLISH ACTS.

The interstate commerce act having adopted substantially some of the provisions of the English railway traffic acts of 1845 and 1854, the construction given to such provisions by the English courts must be received as Incorporated into the act. Following McDonaliL v. Hovey, 110 U. S. 619, 4 Sup. Ct. Rep. 142.

In Equity. A. G. Safford and John W. Herron, for complainant. John K. Cowen, Harmon, Colston, Goldsmith &: Hoadly, and Hugh L. Bond, Jr., for respondent. Before JACKSON and SAGE, JJ. JACKSON, J. This is an'application or proceeding under the provision of the interstate commerce act, by the interstate commerce commission, for the issuance by this court of a writ of injunction, or other proper process, mandatory or otherwise, to restrain the Baltimore & Ohio Railroad Company fromJurther continuing in its violation of certain orders of said commission, and for a decree requiring said railroad company to pay such sum of money, not exceeding the sum of $500 1 for every day alter a day to be named in the decree that said defendant shall fail to obey said injunction or other proper process. The orders of the commission, which this court is asked to enforce by its injunc. tion or mandatory process, were made upon a complaint filed before the interstate commerce commission by the Pittsburgh, Cincinnati & St. Louis Railway Company, against the Baltimore & Ohio Railroad Com" pany, which set forth and alleged that the petitioner was duly incorporated under the laws of Pennsylvania, West Virginia, and Ohio, and was engaged as a common carrier in operating a system of railroads, extending from Pittsburgh, Pa., to various towns and cities in said state; that the Baltimore & Ohio Railroad Company was duly incorporated under the laws of the state of Maryland, and was also a common carrier operating a system of railroads, a part of which extended from said city of Pittsburgh to many of the important towns and cities in the abovO'" named states, which. were reached by petitiuner'slines of road, and thus made it a competitor of petitioner in respect to business between said points; that upon its lines of road on which business competitive with

J'ED'ltRiAL REPOBTElR ,vol.

48.,'

that of petitioner was transacted the Baltimore & Ohio Railroad Com,., panyJmd f put into effect, had then in operation, so-called·" partyrates." whereby parties of ten or more persons traveling on one ticket were transported over said lines Of road,'betweellstations located thereon, at two. cents per mile per capita, which was less than the rate for a the rate for a single being about three cents per said Baltimore & OhioRailroad Company was also in the excursion'tickets, good between points on its ,linesol railway, at less than rates charged for ordinary tickets, without publicly posting in its ticket offices, or elsewhere, the rates at which were sold j that thEl issuance of said" party-rate" said tickets, ,and the selling of excursion tickets without posting the rates therefor, wete in violation of the interstate commerce act, in petitioner's judgment, and for that reason it had declined to place the same in effect upon its lines; that by reason of said" party rates" and excursion .rates,soallowed and issued by said, Baltimore & Ohio Railroad Company traffic was diverted from petitioner's lines to those of the Baltimore & Ohio Company; and that petitioner was greatly damaged by loss of revenue thereby,-;-wherefore petitioner prayed that the Baltimore & Ohio Railroad yompany should berequired,byan order of the cominission, to withdraw from its lines of road ill· which business competitive with that of petitioner was transacted said" party rates," and to decline to give such rates in future; and also reqUiring said company to discontinue the practice of selling excursion tickets at les.s than the regular rate unless thetates for such tickets were posted in its offices. The timore & Ohio Railroad Company answered said complaint, admitting the character and business of the two companies as stated in the petition. admitting that it had and did sell, on or between special dates, round-trip excursion tickets at less rate than those charged for ordinary tickets without posting notice of the same in its ticket offices, except by way of advertisemerlt. It claimed that said excursion tickets 80 sold were such excursion tickets as are mentioned in the twenty-seeond section of the act to regulate commerce, which the act did not require should be posted, and which it would be practically useless, if not impossible,' to pt'lst,but that defendant published such rates through the usual means empll>yed by all other railroad companies, as by newspapre advertisements, etc. The defendant admitted that it had issued the so-called" Party Rates," . which, it claimed, 'were in no way a violation of the act to regulate commerce, but, on the contrary, were an accommodation to the public, business of theatrical and amusement companies and necessary to; others traveling' together. in· a .large body. The defendant also denied that the petitioner had itny right to institute said proceedings before the commission; that it was' hot such a complainant as the act to regulate commerce authorized td:make complaint,its alleged injury from defendant's acts arimg or resulting to it only as a competing carrier; and defendant moved to dismiss said petition on said ground, and because petitioner, didoot allege facts sufficient't6 bring it within any of the Classes

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of persons, firms, corporations, or associations who could properly institute such proceedings. This motion was either not insisted upon, or was denied, as thecommiasion proceeded to hear and conaider the complaint, and on February 21, 1890, filed its report in the premises, holding-First, that pll.ilsenger excursion rates are required to be published according to the provisions of section 6 of the act to regulate commerce, and that the practice of the Baltimore & Ohio Railroad Company of selling round-trip excursion tickets at less than rates charged for ordinary tickets, without publicly posting in its ticket offices the rates at which such excursion tickets were sold, was in violation of the law; and, Beccrn:dly, that "party-rate" tickets are not commutation tickets within the true meaning of section 22 of the act, and when party rates to 10 or more persons traveling together on a single ticket are lower than contemp,oraneousrates for single passengers, they constitute discrimination, and are illegal. It was thereupon ordered and adjudged by the commission that the ,Baltimore & Ohio Railroad Company "be a.nd it is hereby required to print, post, and file schedules showing the rates, fares, and charges now or hereafter established by it fore round-trip passenger excursion' tickets between points on its lines or between points on its lines the lines of other common carriers with whom it joins or hereafter may join in establishing rates, fares, and charges therefor, in conformity with the provisions of section 6 of the act to regulate commerce;" and, secondly, " that the Baltimore & Ohio Railroad Company do forthwith whollyanu immediately cease and desist from charging rates for transportation over its lines of a number of persons traveling together in one party, which are less for each person than ratescontemporaneouslycharged by said defendant under schedules lawfully in effect for the t,ransportation of single passengers between the same points." Notice embodying S/i.id orders, together with a copy of the commission's report and opinion, was duly sent to and received by the defendant. Thereafter, on May 1, 1890, the interstate commerce commission filed its petition or .bill in this court against the Baltimore & Ohio Railroad' Company, setting forth the foregoing proceedings before and orders made by the complission, and charging that the defendant, since the issuance and service upon it of said orders, had wholly disregarded and set at naught the authority and commands of said commission; that it had neglected and refused, and still does neglect and refuse, to furnish the commission, and to print, post, and file, schedules showing the rates, fares, and charges established by it for round-trip passenger excursion tickets, as reqUired by law, and as in and by the order of the commission it was enjoined and required to do; and, further, that defendant had not ceased and desisted from charging rates for the transportation over its lines:ofa number; of persons traveling together in one party,on a single ticket, which are les!! for each person of such party than rates contemporaneously charged by it under schedules lawfully in effect for of single passengers between the same points, as in the and by said order qf the commission it was required to cease frOm do· ing. .After seWng out various instances in which the defendant had,

40

1'EDERAL REPORTER,

vol. 43.

since the promulgation of said order, issued such" pa.rty-rate" tickets, the .petition or bill invokes the aid of this court to compel obedience on of defendanUo the requirements of said orders and to punish it . ali prescribed by the statute for its continual disregard thereof. The defEmdan>t duly entered its appearance and filed its answer.. After admitting the proceedings before the commerce commission, which resulted in the foregoing orders, the defendant denies that it had failed and neglected,since the issuance thereof, to furnish to the commission, and to print,ipost, and file, schedules showing the rates fixed and charges estftblished by it. for round-trip passenger excursion tickets issued by it, asreqitited by law, or even as required in and by the said order of the' commission. It admitted that it had not ceased and desisted from charging rates for transportation over its lines for a number of passengers traveling together in one party upon one ticket, which are lef:'s for each person of such party of ten or more than rates contemporaneously charged by it for transportation of single passengers between the same points. The particular instances of the issuance by it of such" party-rate" tickets set out in the bill'were admitted to be substantially true. Respondent, ever, denies that said "party-rate" tickets for ten or mOre persons traveling together as one party constituted any unjust discrimination, or are in violation of the law,and insists that, so far as said order of·the commission enjoins and requires it to desist from the issuance of such "partyrate" tickets at less rates than are contemporaheously charged for single passengers between the same places, it is alleged that respondent has not complied and should not be required to comply therewith. because it rests upon an improper finding that said "pal"ty-:ate" tickets are not "commutation passenger tickets "within the true meaning of section 22 of said act to regulate commerce, because it is based Upon an construction ofsuid act, and becauae it was beyond the power of the commisl:!ion to make it. After referring to the general practice on the part of railroads, hefore the passage of the act to l"egulate commerce, ofi8suing special rate passenger tickets of various kinds and forms, such as mileage, excursion, party, monthly\or quarterly, a specified number of trips for one person, or one trip by the specified number of persons, and ten, twenty, or thirty trip tickets, lower than the regular single fare charges, based upon the principle that when the: amount of travel thereby encouraged ordeveloped would more fha n make up to the carrier for the reduotion of the per CIlpitarate, then such special rate was reasonahle and just in the interests of both the carrier and the public, the respondent proceeds to state "that since the passage of said act to regulate commerce this respondent has continued as theretofore the practice above stated of making a lower charge on passenger travel in consideration of the amount and frequency of travel, and with that purpose, and to accommodate the various classes of passengers, it has contiliued in Use all the forms of ticket described in the next preceding section; that the charge fixed by it for the trans.. portation of parties often or more on a single ticket has been two cents per :mile per capital which is the same rate charged on thousand-mile

INTERSTATE COllOfERCE COMMISSION V. BALTIMORE &: O. R. 00.

41

tickets, and is a higher rate than it charges on long-distance passenger trav, el, and excursions, and higher than its general rates for suburban travel, on time or other suburban tickets; that the said charge for the transportation of parties on a single ticket is just and reasonable, affording a tair compensation to the carrier, and for the best interests both of the carriers and of the public, because any higher rate would destroy the business; that the business reasons, circumstances, and conditions which induce respondent to make such lower charge for the transportation of parties all aforesaid,and that make it the interest of this respondent as a carrier to make such lower charge, are precisely the same reasons, circumstances, ,and conditions that induce it and make it its interest to fix a lower charge tor transportation (If passengers buying mileage tickets, time or trip eta, and excursion tickets; that, while so called ·party-rate' tickets are ,used principally by traveling amusement companies, because no other form of ticket meets the requirements of such companies, yet this spondent has confining such tickets to any class of business, by 9ffering them on the same terms to the public at large; that this respondl'lnt has obvia,ted the danger that such lower charge for parties might be taken advantage of by speculators or ticket brokers, by issuing only one ticket for the whole party; and respondent avers that as such tickets aT.e now issn,ed by it they are not and cannot be used for speculative purposes, and afford no opportunity for evading the law in the hands of ticket brokers. This responnent further avers that it may rightly and .legally make a charge per capita for persons traveling on said party-rate tickets lower than its charge for a single passenger making one trip bll:" tween the same points, the character, circumstances; and conditions of the service. being substantially different, and that the making of sucb lower charge pfff capita to the members of the party makes or gives no undue or unreasonable preference or advantage to them, and subjects no person, company, firm, corporation. or locality, 01,' particular ,tion of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatever." The charge that defendant has neglected and refused to print and post ita rates for round-trip excursion tickets after the issuance and service of the commission's order, was denied by spondent, was unsustained by proof, and was practically abandoned at the hearing. It is therefore unnecessary for the court to express any decided opinion upon the question, as to which we have considerable doubt, whether a railroad company's rates on mileage, excursion, or commutationp!lssenger tickets,orotherspecial rates allowed by section 22 of the act to regulate commerce, are required to be printed and posted in its offices and furnished the commission in confomlity with section 6 of said act. Under section 22 of the act as ori/1:inally passed, it was.declared "that 'llothing in this act (incl uding section 6) shall apply to the * * * issuance of mileage, excursion, or commutation passenger tickets," The section, as a,mended by the act of March 2, 1889, provides "thatnothing in this act shall prevent * * * the issuance of mUeage, eJtcursion,or commutation passenger tickets." How far this change of phraseol9gy operates to bring such tickets within tbe provision of sec.

.42

FEDERAL REPORTER,

vol. 48.

tiM so, as to require railroad ct>mpa.niesto post their tat fot such tickets, is by no means free from' difficulty and 'doubt. S Bntas the'd tem1inationof the point is not nedessary to a decision of thecitse before us, we :do not deem it proper to pass upon it. , in this case is confined to the validity oftha commigsion1s'order requiring the defendant to desist ftom the issuance of "'partylrate"tickets for ten or more persons traveling together on one tickEititta lower rate per mile and per capita than i!!l cOhtemporaneously chatgedfdl' a/single passenger between thesame'stations. This issue represent!ltwoleftding and important questions, which involve the proper r.: 2, 3, anCl 22 of the act to regulate commerce, urideiltthiHacts ·established by the pleadings and' evidence: Ji'irBt, Are the ticketsinuee' by defendant embraced or included in the gedetfilidesigMtion of "Cdtnmutationpassenger tickets;" which section22, as,by the act of March' 2,1889, does bot "prevent" the railfrom iSEluing? And,secondly, if'st1ch" party rates» are tickets'" within the true meaning of said section',' db they constitute either nn unjust discrhn'inlition, as defined and prohibited by tlection2, or an:undtleor unreasonable'preference or adby'section 3, ohaidact?' ",The 'clause of section 1 of the aot to tegnllitecommerce, adopted and'establislied:for'the United States, in respect to interstate traffic, the general 'of' common law that all charges, made by common cartiers. subjeetto,the pro\7isions of saidiwt, for any service rendered in the tntn$portation passengers or. property,' should be I' reasonable and just," and that) every "unjust and unreasonable" charge for such service should be prohibitelland declared unlawful.: 'Noclaim is made that defendahts charges fol' parties often 01" more or' for single passengers have violated theprovisioDs'of saia !!lection. The report and opinion of the Sian 'dbes :not find that'tbe rates in use by defendant for either tate"· or tickets are in any way unjust or unreasonable charges forthe'aervicesrendered in trahsporting either class; ahd the proof before' this court that said "party-rates;' of' two cents per 'wile are and just, that they are promotive' of of iSBuing,theDij and a convenience to the public. The right of/the,defendant to rtfakeand collect reasonable charges for itS transpol:tation service is a property right under its franchises, of which it cannot be: deprived without due process of law. Tbisis oy. the decisi6tiof the supreme court in the case of Chicago, Milwaukee St. PaulRY. Co.'v. State oj Mitlrlisota, 10 Sup. Ct. Rep. 462. In cohsidenng the foregoing questions, on which the proper determination'of :the pre!!lentcase rests,the fact established by the proof. and noteontroverted: byoron behalf ofcomplainant, that defendant's charges for both the single passeugtlr and the party of ten or more are andj1lst itl'themselves, shouldbi'!'ll:ept in view. Do "party-rate" tickets 'corne fairly within the letter ail'd'spirlt of the general terms "commutationpaSsenger tickets," as used, ih:section 22 of the sta:tute?'Railroad experts, many of whom were examined in this case, differconsidera.bly

INTERSTATE COMmtRCt COMMISSION ". BALTIMORE & O. R. CO.

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when they undertake to give an exact, technical definition of the words. "commutation passenger tickets." Theirtestimony, however, shows that prior to the passage of the interstate commerce act railroad companies were in the constant habit of issuing a variety of special-rate tickets, such as mileage, excursion, monthly or quarterly, family, school chi1-: dren, twenty or .fifty trips, good for the specified number of trips by one person or for one trip by the specified number of persons, round-trip and party tickets for ten or more persons traveling together on a single ticket, either one way or for the round trip, and that all these different classes and forms of tickets come within the designation or general de. scription of "commutation" tickets, or "commutation" rates. This prevailing practiQe of the common carriers before the passage of said act,and whioh has been continued by many, if not by most, of them since the act went into effect, may properly be looked to in placing an interpreta.tion upon the words "commutation passenger tickets" which follow, and were manifestly intended ,to enlarge the special classes covered by the ('mileage" and "excursion" passenger tickets. After enumerating two, varieties of special-rate tickets under the heads of "mileage" and "excursion," which come within the commutation principle, language is broadened by the addition of the general terms "or commutation passenger tickets;'tthereby clearly indicating an intention on the part of congress to. allow, or not to prevent, the continuance of the general practice of common carriers to adapt their rates and charges to meet the wants and convenience of the different classes of the community while developing and enlar:;!;ing their traffic. The proof before the court fails to show that mileage and. excursion tickets differ in any essential particular from "commutatiQn passenger tickets," so as to make them a different class oftickets from lhe latter. On the contrary, the evidence establishes. that they are,partioulars of the general class covered by the more comprehensive'terms of commutation tickets or fares, which we think de. fendant's witness William B. Shattuc has most correctly and properly defined in saying that "a commutation ticket is a ticket for one passenger, good for more than one ride. or for more than one passenger for one ride, sQld at a reduced rate." When, therefore, the particularclassea of tickets (mileage and falling within the commutation' prin':' ciple, are followed by the general terms" or commutation passenger tick-ets," thi.s latter clause of the sentence, upon no sound rule of construe'; tion, should ;be taken or treated as presenting something in contrast with, or differing il;1characrer froin the previously enumerated particulars,but should rather be regarded and interpreted as enlarging such particulars, . so as to make the statute eover the whole subject of commutation tickets or rates, in aU their variety. of forms and classes, as were then in use by common carriers subject to the act, provided only tbat such charges were ' rell..$onable and just. It is clearly shown by the proof that the same business reasons, considerations, circumstances, and conditions- which ind:ll,ce the .inost enlightened railroad management, having dye regard ,interests of their linea and to the conyenience of theptiblic, rates Qnmileage, excursion, long distances, round .trip, ; to

44

FEDERAL HEPORTER,

vol. 43.

time trip, or specified number of trip tickets, apply in all their force to "party-rate" tickets for ten OT more persons traveling together in one body on a single ticket. Reduced rates to these several classes or descriptions of passenger traffic rest upon the same general principle, which the act to regulate commerce nowhere calls in qnestion, that common carriers may rightfully so adjust their charges as to encourage and develop travel; that the amount orvdlulne ot'such traffic is a legitimate element to be considered in determining what reduction should be made (}ver local or ordinary rates, so' as to make both correspond with the cost ofservice and the fair profit which the carrier is entitled to earn from each class of travel. Quantity of traffic affects both' the costs of service and the legitimate profit which maybe demanded for such service. When the profit on frequency ofJrips or on larger numbers, transported at redu()fldmtes reasonably corresponds with the fair profit of the carrier on a singletrip, or smaller number transported at the ordinary higher rate, the: caitier making such an adjustment of its charges with a view of encouraging and developing. its legitimate business is only putting into practice the reasonable and well-settled business' principle of every avocation or which recognizes quantity, whether arising from the number or size of the transactions, as a proper element in the consideration .and adjustment of the price. No complaint was ever made against commoQ oarriers acting upon this principle. The complaint made against them, and which the act to regulate commerce sought to remedy and correct"was the practice of showing favoritism and partiality between their customers or localities under the same or substantially the same oircumstances and oonditions. The act to regulate commerce dOfls not undertake to deal with· theswbject of rates for transportation services, or with the business considerations which may influence common carriers in so adjusting them as fairly to increase their revenue, while paying due regard to the <lonvenience Of the public, any further than to declare the general principle that such rates shall be reasonable and just, shall be free from unjust discrimination, and shall confer no undue or unreasonable preference or advantage, nor impose any undue or unreasonable prejudice or disadvantage. >' 8ubjflct to these conditions and limitations, the act does not, and was notintended to, restrict the common-law right and power of common carriers' to make special contracts, or adjust their rates 'With reference to existing wants and circumstances, so as to promote their own interests, while affording aU pwper and reasonable facilities andoqnveniences to the public. Subject to the above oonditions, the act'intel.lded to leave thea:djustment of rates as absolutely and completely in .the discretion of thecarl'ier as it existed at common law, which never ql1estioned or denied to common carriers the right to give ol'make lower rates, basad on increaeed quantity or amount of service. No case arising under the English railway acts of 1845, 1854, and 1873, 13d far as we have been able to find· after-careful examination, has ever called in question or impeached the right of carriers to fix rates and issue tickets based upon the consideration of the amount or volume of l10rdisputed the .easoIiableness and sound business propriety
\

INTERSTATE COMlIIE'RCll: COMMISSION fl. BALTIMORE &: O. R. 00.

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of iailroad companies granting reduced rates to parties traveling often, or furnishing increased traffic in the way of numbers. On the contrary, their right so to regulate and adjust their rates is universally recognized. While the English statutes relating to railway traffic embody the same general principles, and seek to accomplish the same leading objects, as our act to regulate commerce, they contain no such affirmative provision or declaration as found in section 22, excluding from the operation of the law the enumerated general and particular cases in which special rates were not intended to be prevented or interfered with. Said section 22 should be regarded as a legislative declaration that not merely mileage and excursion, but passenger tickets generally, based upon the commutation principle of con<:eding a reasonable deduction from regular local rates in consideration of the frequency or quantity of the traffic, if reasOliableand just in their charges, did not come within the evilssoto be temedied. To contend that a "party-rate" ticket to ten or more persons traveling together on a single ticket at reduced rates per mile does not cbme within the reason or principle of commutation tickets, which are generally issued Jor only one way, because generally needed for only one direction, while admitting, as counsel for complainant does, that a r.ound.. trip ticket for ten or more persons, traveling together at the same reduced rate, would be considered as coming .within the meaning of it commutatioil ticket as explained by complainant's expert wihlesses, is drawing It diSlinction without any substantial difrerence. It rests upon no reasoning, involves rio public policy or convenience, and is altogether too narrow and refined, to suppose that congress intended to make any such nice discriminations in. the language employed to express, in a general way, what the law was intended not to prevent. . The commission seems to have treated and construed section 22 as designating certain cases and instances of discrimination which are to be considered. as exceptions, and which, but for being so excepted, would fall within the operation of sections 2 and 3 of the act; and that, beclluse "party-rate" tickets are not specially and particularly named, they should be excluded from the list of exceptions. We cannot, in view of the whole scope and manifest purpose of the act, assent to this construction of said section. It 'should be given a broader Rnd more liberal interpretation for the reasons already stated, arid, as thus interpreted, we think that the section fairly recognizes, in respect to passenger traffic, the general principle of commutation, and that "party-rate" tickets for ten or more persons traveling together in one body ou one ticket at re· duced rates per mile, which are reasonable and just, as issued by defendant, are within the Jetter and spirit of "commutation passenger tickets" as those terms are employed in the statute. This construction of the neither disregards the· duties and obligations of the carrier to the public, nor ignores Hs just rights in the reasonable management of its business. The evidence before us shows that, if" party-rate" tickets, as described and used by defendant, cannot be lawfully issued, 01' should be discontinued, the reyenues of common carriers derived frompllssengeT traffic will be seriously impaired, while the convenxence and benefit

or bodies often or more, such as amuse-: mallt p()mpanies, associations, clubs, ()rganizations, delegates, and repreaeptatfves attepding, cooveJ;ltions. religiOlls, educational, ()r polnjcal, will atthe$anJe time be greatly interrupted and prejudiced. Ourcqnclusion on the prese,uted is "party-rate" tickets as used by defendant .are" commutatiqo passenger tickets " within the true meaning of sectio022 of the act tpfegulatecoIDllleroe. , ' Secondly, But sUPPose'itb,e thedefendant's "party-rate" tickets llrenot ticlkets, as ruled by the commission, then the questi9P rem,ains whether, they C()Jlstitute an unjust discrimination, as or 'unreasonable preference or advandefined by ,section 2, or tage to, orany undue Or prejudice or disadvantage agamst, any, particuI,ar, p,erson, com,P,',IiDY, ,firlIl ,cofP orati,on',or locality, or any par, . tic?ll\r description of tra,ffiq,ipllny respect whatsoever. The evidence diswere .issued only to theatrical closes that Qriginally Il party-rate " as mileage tickets were to commercial travor amusement elers, only; that since 'th9 of the interstate act said "partY7rate" tickets arenq .longer confined to one Class of passenger trafmileage, and rates, are. regularly schedfic, and. and the puNic at large. so that any and all parties 0.( ten or more traveling together, who choose to apply for the have equal rights and privileges of securing such tickets at the same reduced. rates. Doe$thisconceS!iion to the public, traveling in parties ot'ten more, aIld,opim indisCriminately to' all persons of the requisite. nUIll who ch908e to avail ves of the reduced rate by applying for a single the party, violate\ in letter Or spirit, the provisioosof either section 2 or 3. ofihe act? may the defendant JaWfuUy transpprt a party often or more' persons .on a single ,rate per per capi.t(.f than for carrying .R ticket at single passenger' 1;Jetweep, sarile stations? Does the fact that delendant ,charges thesinglepll,SStmger for single trip a somewhat higher rate than it c):larges ,for transporting ten or more passengers as one per party on a.siugle ticketo,ver the. same. distance, constitute unjust discrimination, a,S, defined, 2, or l.1Ddue or unreason,able preterence Or advantage i.il,'favor o:r ten or more, or any llodue or unreasona'Qle against the single prohibitedby,s,ection 30f nct? The decision of this question. involves tlle of said sections. which must read cqnsidered. 'qo,nnection with the pI'ovisions found. in sect a,d1.y;e at true scope and mea.ning When . It, tbat dId not mtend upon ,common ca;r:pers, to the prOVISlOns of the act, rule Qr duty. of absol\Jte:equtllity afmtes in their charges for, transof secti?n l,:tht\t all xu,ad.e) J()r.l;\ny render4;ld ,m"the. of.pa,ssenJust, ,,?f 2 a.ud IJ:Dphes thllt maybe dlscnmmatlons .WhlCh are pr0h.ibIted. 'S.o,Joo, the ,language employed in

.tp tp,e,'pub1tc, traveling

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IBTERSTATE COMMERCE' COMMISSION tI. BAL'l'IiORE "

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R.

co.

'4.7

'.it unlawful make or give any i'undue Unrea.. sonabJepreferenceor,advantage" to any particulilr person, etc., br to same to any "undue or unreasonable prejudice or disad;vantage," clearly implies that there 'may be a preference or advantage on' the one hand, or a prejudice or disadvantage on the other, which is due and therMbre not in contravention of the law. To be withiri 'the statute, th'e discrimination must be "unjust," and the preferenceo1' prejudice must be "tindue"or "unreasonable;" The ination which is decrared" unjust" is the charging and I collecting, directly or indirectly, from any person or persons a greater <idess compensation for any' service reh1ered in transporting 01'. I>foperty than is charged, 01' 'received by the carrier froQ} apy,other person or persons doing fOr him, or them a like and, contemporaneous service in'the traffic, "under substantiallYli!imilar circum.;. stfinces,and conditions:" When the traffic is not oflikEl' kind, or when the servi<1e is not and contemporaneous," or when 'the transpoi'tatlonis'ln'ot rendered "u'nder substantially the same circuInstancesarid conditions,," differencesin charges do not constitute "unjust discrimil1a.. fion.'" 'The evil which ,said'sections intended to remedy, was the prevailing of railroad companies of favoring Ol.' showing partiality'in: theinatter of charges toone person; firm, another 'person, firni; company, or locality. for like' and' contemporaneous serVices rendered under the orsubstimtially the same circumstances favoritism and and conUiifons., Sitid sections were intended to, parHallt,yin 'traffic rates,' where the circumstances and conditions were substantially similar and the service contemporaneous. Personsirilike situation$, requiring elr desiring like andconternporaneous service on the part ofcarriers, were to be'treated, in the matter of rates, impartially. Tliisls expressed both affirmatively and negatively in th.e' llinguage of section " The carrier shall not give any undue or unreasonable ence oradvantageto orin favor of any particular person, company, or traffic, nor' subject any particular person, company, or traffic to any uhdue' or unreasonable, prejudice or disadvantage. These words necessarily involve the idea or element of comparisoh of one service 01' traffic with another similarly situated and circumstanced,' and' r&qtlire to .be undue and unreasonable, the preference or prejudice musftelate and have reference to competing parties, producing between them unfairness and an unjust inequality in the rates charged' them r&spectively f61' service undersubstantiaUy the samecirctirhstances and conditions. In determining the question whether rates give an undue preference or imposePan undue prejudice or disadvantage, consideration' inust be had 'to the relation which the persons or traffic affected bear to each other and to the carrier. When and so long as their l'elatiol1saresimilar Of "substantially" so, the cartier is prohibited frODIdealing differently with them' in the matter ofcharges for a like'and service;, It thus appears that the ofcotigress, as expressed in,sections 1, 2,and3, was to secure two leading objects,ot' to' establishistid impose' tipoli efi'etJt'two tnairi' purposes, viz.:

to

for

FEDERAL R.EPORTER,

vol. 43.

rajlr:Qadcorppanies engaged in interstate commerce, the duty of conformtht} general rule of the common law in making their charges for services rendered reasonable just; and, second, to preinequality, partiality, favoritism, or unfairness, so far as concerned their charges for contemporaneous transportation services, as between persons, traffic, or IO',JaJ,ities, similarly circumstanced. When the carrier's charges are in unjust and unreasonable, the public and tmduly prejudiced, and put at disadvantage, and the I?lay on behalfofthe public, upon complaint made by any ?nEl,jnvestigate such charges,and order their correction, subject to the dghtof,.!he «arrier to, a judicial determination of the question whether or not re8.sonable !ind just. When the qualified requirementofimpartiality in charges as between persons, traffic, or localities is disregarded or violated by the carrier, the prejudice or disadvantage is personal or local, and the party or locality injured by',tlle undue preference orthe undue disadvantaKe can alone make or institute proceedings for its correction and for proper ' , '. , . ' redress. ; t " , Now, claimed nor proved in the present case that defend':' ant'.s 'chargqs, either for ,passenger or" party-rate" tiCkets, are in 'unjust aJ;ldunreasonable. On "the contrary, both rates are l;lQOWD reasoPltble. The public has, tperefore, no ground pf score,;norhas any legitimate complaint been made on its beha,lfijeither by.the original petltioner or by the commission. Who is :uIIljtll1Uy dis.criminatedagainst by defendant's difference in charges for. the party of ,ten or more and the single passenger? Who is. given an undue llreferel,l,ce or advantage, or subjected to an undue or disadvantage",!;>:yreason of said difference in rates? If any one, it is the singJepassenger. But no e01!l.1plaint of undue prejudice 'orA,isadvantage a,nd of consequent personat injury comes from that .quarter. When this cOl;lrt is called upon, either by the commission or others, to enforce the proyisions of the act to regulate commerce, it is indispensably' to either a case of individual grievance or ofpnblic incoP'Venience resulting or arising from acts of the carrier done in violation of the statute. The proceeding in this case is not based upon a.ny indivit;lual injury I blltrests upon the alleged ;inconvenience to and llndue that portion of the by the aingle pasaenger tramA in being charged by defendantasomewhat higher rate per mile than it and receives, of and from a party of ten or nl<!re purchasing a single ticket for the party. But bQw can this posiif, already stated, both single and "party.rate" by defendant are in themselves" reasonablean(' towards class of such traffic? When a carrier's charges are in compliance with .the requirement of section 11'hoW can they regarded ,or treated as constituting au unjust discrimiIllltiqn' uPder sectic;>n 2, or an undue preference or undue preju-; dice t+nder 5eC#01l 9, ()f ,act? The pl'Ovision!, of sections 2 and 3 were iptend.ed. restrict or qualify the rights conceded f

INTERSTATE COMMERCE COMMISSION t'. BALTIMORE & O. R.

co.

49

and the duty imposed by the first section of making charges "reasonable and just." In the case of Attorney General v. Birmingham, etc., By. 00.,2 Eng. ,Ry. Cas. 124, a railway company (whose act contained an equality clause) who traveled from D. to N., intending charged a smaller fare to to proceed from N. to Londoriby another railway, than they charged passengers from D. to N. who had no such intention. ,On motion for an injunction it, was held by Lord Chancellor COTTENHAM that the equality clause was meant only to prevent the exercise of a monopoly to the pre} udice of one passenger or carrier and in fayor of another, and that, even if he had, jurisdiction to interfere, he would not do so unless it was clear that the public interest required iti and, it being admitted in the case that the higher was not more than the act authorized, it did not appublic were prejudiced by the arrangement. In the present, case, it being neither claimed nor shown that the higher charge of three cents per mile for the single passenger on a single-trip ticket is unjust and unreasonable, Or more than the defendant is authorized to charge by section 1, it isdi@cult to see in what respect the public are prejudiced or unjustly discriminated against by the arrangement. But, aside from this view of the subject, in what respect does the difference w,hich defendant makes in the rate charged, the single passenger of ten or more traveling together on a single ticket conflict and with the provisions ofsections 2 and 30f the act? Under the flexible and elastic rule prescribed by said sections, construed in the light of section 1, a difference in charges, while an element in the proper definition of unjust discrimination or undue preference, is by no means the sole or factor. To come 'within the inhibition of said $ections the differences must be made, under like cOllditionsi that is, there must be contemporaneous service in the transportation oflike kinds of traffic, under substantially the sanle circumstances and conditions. In respect to the respective persons or classes beween passenger traffic, the whom differences in charges are made must be compared with each other, and there must be found to exist substantial identity of situation and of service, accompanied by irregularity and partiality, resulting in undue advantage to one or undue disadvantage to the other, in order to constitute unjust discrimination. The,sections substantially adopt the pIe laid down in Hay8v. Penmyloania Co., 12 Fed. Rep. 309, where the court, after stating that a common carrier hall no right to make unreasonable and unjust discriminations, said: "But what are such discriminations? No rule can be formulated with sufficient 'flexibility to apply to a,ny case that may arise. It may. however, be said that it isonly where the discrimination inures to the undue advantage of one man in consequence of some injustice inflictM on another that the law interfel'es for the protection of the latter." It cannot be properly said in the case under ,consideration that the lower rate given to a party of ten or more confers upon such party an undue advantage in consequence of. injustice inflicted upon the aingle passenger., ,;Tbere is nothing in the of,the single:pasv.43F.no.1-4
J

the party often or Ill'oi-e';whidh 'Would' make lower ro,tes to· the latter operate prejudicially to the rormer. It is well understood that the &St·oftransportation service to the' carrier decreases as distance increases, ias :tiij:lsare multiplied, arid as the numbers transpdrtedare enlarged. It 'Mststhe carrier less proportionately to transport a'party of ten or more tban 'itdoElsa single passenger. The.clm-ier is feh#tled to a fair profit an<l'whentheprofit hirger number car.. riedat rMndedrates ' i'el1soriably with'tbat resulting fromthe 'carriagb (if. an individual Itt it somewh:at higher rate,what unjust discrimin'atlon: iSlilade, what is the iIidlvidllalstibjMted to undue prejudice or' A 'single passerigerdesiringor pro-hittke ten or' more 1separate mayprobure a ticket for tqe designatbllnhmbet of trips at rates 'per are charged the siiIhepOints. Has it single passenger on a single-tnp ticket'l)etween eveilllIJeeH tlii'$l-tfO'urd operate 'to cont'irdinundue advantage upotl undue A passeD.: 'gEll' 'on to at a lower Pitfsburgh' is charged the only between said places. two may travel on the llamEftliiri and in thesa;me car, but ,'the 'difference in the rates each is pliying6vet 'the same dIstance is nofunjust' discrimination or undUe the is not identical. 'Railway 00. v. U. K, 1171]. S. 355-363, 6 SUp'. Ct. Rep. 772:: ' But 1fVhaps the real underlyiIig:prindiple which charges in sud) casesfltlisthattlie.barrier may Wake reasdrtaljle cpncessionin the wilY of reduced' rates in :cdbsideratit>n of longer of more 'fre<1ueIit ti'ipSJ J 'The reason and', the apply'to an adjust, What difference or dig.: fu'entof rates 'based upoil!huhlbers tinction is a given distance at reduced irates; 'as compared with sirigle.;.triptates, in consideration' of, his'nl.alt.ihg ten"or'more trips; ;aWd 'the 't'tanaportation of tenor more'persotistrilveling'together 011' a tickettlver 'the Same tancetmone trip' atthesamereduced riltes? There being no competitive relation' betWeen .thesiilg!le passellger'and ;the party of ten' or more, ,relative cost 1bf'service,in their transportation being different, the profit derived' 'from ,one fil'irlycorresponding with, received from t4e tither; and part of the cartiEir for making there';' duction in' fa VOl' of party being the development" and maintenance of a class of traffic which the evidence shdwscannot and will not stlitld a;!\bigher rate'tlntn two;cenbi!'per mile, we cannot properly compare t'he passengel' with ltheparty cla,ss often or more,:norfind that the latter constitute, tile circumstances, iilfavor of'such partles",qrupdue the prohibitions that their siIlgle individual. Subject to the two cnargesshall riot 'be tlnjust and unreasonable. ahdtha:t th,eyshall not to give undue prefereIicl(ot advantage, subject to undue or disadvantage'personsortl'affic similarly oireumstanced, 'the act to regulate commerce leaves common carriers as
l

or

INTERSTATE COMM£RCi;COIrlMISSION fl. BALTUIORE & O. B.

co.

61

theywere.llt common law,. -free to make special contractsloClking to the increase of their.bueiness,;to classify their traffic, to adjust and apportion their rates so as to meet the necessities of commerce, and generally to manage their important interests upon the same principles which are recognized ali! sound, and adopted in other trades and pursuits. Conceding the Sll.llle terms of contract to all persons equally, Ulay not the carrier; adopt both wholesale and retail rates for. its transportation services?Iri Niclwl$on v. Railway Co., 1 Nev. & MeN. 147, which involved the clause of the act of 1854, ERLE, C. J., said:
..I take the free power of making contracts to be essential for making commercial profit. Railway c(lIDpanies have that, power as freely as any m.erchant,s,ubject only (as to this court) to the duty,,of acting impartially without respect of persons; and this duty is performed when the offer of the contract is made to all wll0 wish to adopt it. contracts may be beyond the means of small capitalists; contracts for long distances may be beyond the needs of those whose traffic is confined toa home district; but the power 91 the rllilwaycompany to contract is. not restricted by these considerations."

.'It be Been from an examination of the EngliSh railway acts of 1845 and 1854 that section 90 of the former and section2(}f the la:tterJvere substimtially adopted and embodied in sections 2and3 act to· regulate commerce. Section 90 of the English act of 18{5 required that II tolls were at all times (to he) charged equally to all persons and after the. same rate, whether per toni per mile, or otherwise, in. respect of all passengers and. of all goods and carriages of the same description * * * passing ,only over the same portion of the line of railway under the same circumstances; and no reduction or allowance in any such tolls should be made, either directly or indirectlY', in favor of or against any particular company or person traveling upon or using the railway." Section 2 of the act of 1854, after everymgway company subject to the law to afford facih.., ties, a.cC!)rding to their respective powers, fOl' receiving, forwarding,and delivering of traffic, provided that "no such company shall make or give any undue or unreasonable preference or advantage to or in favor of anypnrticular petson or company, or any particular description of traffic, jn any respect nor shall any such company lO'ubject any parcompany, or any particular description of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever." .The English cases upon the question of "undue preterence." which have arisen under said sections will be found to confirm the' we have placed upon sections,2lmd 3 of the act, and also show which may properly Considered in detcrxiiining 'I Undue preference" has. been given .or" undue disadvantage" has beep 'im:posed. The. history and bearing of the equality clause of theacfof1845 is discussed by BJ:,AciBURN, J., in the case of Railway 00. v. R. 4 H. L. 238, 38 L. J.Exch., +77. WHb' respect t() t4e " uu.duepreference" forbidd en by of. the act o! 11354, w4ich was 1\, mere enlargement ,of section 90 of the act 1845. Ule'English cases,.ted geJ:1.erally, hoI(\. that a preferencet<> be,

will

nDERAL REPORTER,
II undue "

vol. 43.

must be,caprefereneeof a person similarlJcircumstahced and bringing a similar profit to the company. In Hoillerv. Railway 00., 1 Nev. & MeN. 30, where the passenger rates between certain stations were complained of as constituting undue preference, the lord president said: ''It [the act] provides for giving undue preference to parties pari ptI8sil in the matter, but you must bring them into competition in order to'givethem an iitterest to complain." In Jones ,v. Railway Co., Id. 45, theun.due preference complained of was a preference giv.en to the inbabitants of Harwich oVer those of Colchester in the matter of season tickets, ,lower rates being conceded to the former on' longer distance than was allowed to the latter; but the court held thattne:difference did not constitute a case of "undue preference" within the In the cases of Co., 2, O. B. (N. S.) 702, and Ex parte nfracornbe Public Co., Wkly.Notes,(1868,) 289, it was &tjd that regard must be had, to,the general conveniences orthe public, rather than to the or interests of individuals" and that it must be clearly shown thatthe course Gomplained of occasioned some substantial injufY or,inconvenleilce to the public.. In caSe of Ransome Co., (No.1,) re'ported in 1 C. B. (N. S.) 4'37,. 26 Law J. C.P. 91, CRESSWELL, J., in considering the meaning of the expressions "undue or unreasonable preferebce or advantage," and "undue or unreasonable prejudice or disadvantage,'! says: ." , .. Are these words to be cohsttued" wUh reference to the interests of the partiesllsing the railway only? or mily the Interests olthe railway owners be taken 'in any manner into consideration? Ex. gr., If 1,000 tons can be carried for a lower sum per ton per mile than 100 tons, yielding aD equal profitptlr, ton to,the railway company, may they so regl,lJate t.he charges as to ved sucbequal profit? Would lhelowerrate charged for the larger q,uantity give,an undue preference? . * * * If that may l;Je done ingwhatthe statute calls an undue or. unreasonable preference, may not the company, iIi fixing rates, consider the whole profit, and not the mere profit per mile, and,oin order to induee pepple to carry more OlHheir lines, iUld longer distli'nces. agree to make a reduction in ,such case? It is true that the sender of the quanWties for a ,sh9rterqistance will pay lJlore per mile and more per ton in the respective cases, b"t will that be or unreasonable prejudice or disadvantage? * .. * ,'" .:After a. good deal of consideration, we think that the fair interests of tbe railway ought to be taken into the account, and then the question suggested assumeS avery complicated and difficult character. It " In Oxlade v.Railway CO., lC. B.(N. S.) 454, 26 Law J. O. P. 129, it was held company was justified in carrying goods for one person at a less rate thim tnat at which they carried the same tion of goods for another, if there were circumstances .which rendered the cost to the compapy of carrying for the former less than the cost of carrying for the ,latter. In Nichol8on "T. Railway 00" 50. B. (N. S.) 435, 28 Law J. 0.P.89,,itwas held to br- competent for lltailway company to. enter into 'special' agreement, whereby advantage' may be secured to ihdividoals in thecatriage of goods, where it appeared that, in entering suchagreement, the company had only the interests of thepro'prietors'und-the legitimate the profits ,of the railway 'in view,

a.

INTERSTATE COMMEnCE COMMIssIoN

V.

BALTIMORE

&;

O. B.

CO.

58'

and the consideration given to the company in return for the advantage a'fforded by them was adequate, and the company were willing to afford the same facilities to all others upon the same terms. In Bdlsdylce Coal Co. v. North BritiBh Ry. Co., 2 Nev. & MeN. 105-110, it was said by the court that "a railway company pays no more than a due regard to its own interests if it charges for its services in proportion to their necessary cost. and has only such variation in its rates as there is in the circumstances of its customers." In Baxendale v. Railway 00., (Reading case,) 5 C. B. (N. S.) 336, 28 Law J. C. P. 81, COCKBURN, C. J., after stating that if it were madeto appear that the disproportion (in rates) was not justified 1;>y the circumstances of the traffic, the court would interfere, proceeds as follows: "So. again. if an arrangement ':Vere made by a railway company whereby persons bringing a larger aIliount of traffic to the railway should have their gQotlscarried'on more favorable terms than those bringing a less quantity" although the court might uphold such, an arrangement as an ordinary incident of commercial economy. provided the same advantages were extended to all persons under the like circumstances, yet it would assuredly insist on tile latter coudition." . " And, while recognizing the duty on thepiut of the court to redress allY: injustice or inequality prohibited .by the law, he makes th,e further pertinent observation: "At the same time we must l;larefuIlyavoid interfering, except where absolutely necessary for the .abovepurpose, with the ordinary right (SUbject to the above-named qualilications) which a railway company, in common with every other company or individual. possesses. of regUlating and managing its own -affairs. either with regard to charges or accommodation as to the agreements and bargains it may make in its 'particular business." As regards the "undue preference" branch of the Engli!:lh acts, "the .effect of the decisions seems to be that a company is bound to give the same treatment to all persons equally under the same circumstances; but tbat there is nothing to prevent a company, if acting with a view to its .own profit, from imposing such condition as may incidentally have the effect of favoring one class of traders, or one town or One portion: of their traffic, provided the conditions are the same to all persons, and are such .as lead to the conclusion that they are really imposed for the benefit of the railway company." Report of Amalgamation Committee of 1872, p. 13. Our act'to regulate commerce having adopted substantially seetions 2 and '90 ofthe English railway traffic acts of 1854 and 1845, the £ettled construction which the English courts had given to their terms .and provisions must be received as incorporated into our statute. McDonald v. Hovey, 110n. 8.619, 4 Sup. Ct. Rep. 142. TheEnglish -cases referred to above, and others that might be cited, establish the rule that, in passing upon:the question of undue oruureasonablepreference or disadvantage, it is not only legitimate, but proper, to take into -consideration, 'besides the mere differences in charges, various elements, '8uchas theconvellience of the public, the fair interest of the relative quahtities or volqd1e of the traffic involved, the relative cost of iheservices: a:nd profit to; the company ,and the situatioti and

case, of App. Cas., 97,' .frirther ,th;tt the burden of ing, the or <the uud'tie prejudice ;rests upon the cornthe latter. case l the, Earl of SELBQIDlE,aftEir referring to plidning parti' ' it was nptshown by the ,Cll-rrier that the, reduced rates wjth the reduced ''lost 'company, "I do not. fin!l, fl.Ct is, a real.difference of circum,show apy want of good the, bijrden of justifystances. ing the exact, the, same the deduction relation between it and or allowance;)' by showi ng anumeri<!al or · the actual saving, is cast upon the company" · ,

Drmaby

CoUury Co. y. J. Q. B.

cIted"

(7o.,'t.g.l1

• .,
  

"

I

,/.

.

_,-:'

"

,:;'",

';

, &52 c. 25,) for the better regulation ofrailway:.and canal traffic, cbangec:Uhis rule by providing that, 'where inequalities in 'rates:exist. "the burden of' proving that such lower 'charge or differences ;in treatment does n'ot amount to an undue the railway company.""As'po such provision is foulld in our act, the burden of showing that the difference in ' defendant's" pa,ny,t1u1d, single' rates constitutes undue preference in favor' or the former,onindueprejudice or'disadvantage against the latter, devolves upon the complainant, and must be established as result'()fthe various elements on considerations ab6ve mentioned. There is no or suAgestion that there is' any: wan t.or goqdfaith in or difference in ra!;es,complainedofwas made orij;l,pQ1ltjnued Witll a view to any actual disadvantageof,tbesingle subject,tbepublic to any inor in()o,nveni,enc.e. : ,," dere,nd,ant's ratesfqr for parties of ten op110re to thet,est of the various considerations,lndicated the,' 8S elements in tliequestio n· does it clearly ihat such mtes are so adjusted as to givelj,nupdQe to impose an undue upon,.t};1e,'o,ther class? We thInk not· ,that Kill not claimed, or sn,own that, the s,h;igle unJust and. unreaf;lOIiable, that tfie"pnrty that is no competition tive '. between the "party ,rates." all,whq, the sam.e, are a lepCle and benefj,ttoa qonsideraQle, ,!'Ott,lOn of publIc, interests':Of ,carrier by their, use, that ;cost Qf for We party?f more than 10 cba,rgesqoes 1.10t appear, tqbe lWPI;operly adjusted WIth te.ferenceto or QyMle aot).:\a1 savingQt,profit to the com,pany, it cann,ot be ptoperly's!liq"that triJ.ffic,isoOike kind, ,and that the service is identical. eame ,circumstances and condi- . cqurts" '9D,the subject of unjust dis£' · '

or

·

,

... ,

',<

, .. , , , , . , ' . '

,.L

INTERSTATE

Ii. BALTUtORE & O. R. CO.

' . r·

55

criminatioh, and considerationstpnthlay be pi-operly looked to in passing upon the question', are, we tbink, in barmony with the view /tbove expressed, and with tbe conclusions reached. See Ragan v. Aikett,9 'Lea, 6d9; Scofield v. Rb.il,roatlCo., 43 St. 571, 3' N. E. nep. 907; .John80n v. Railroad Co., 16 Fla. 623; McD'uffee v. Railroad Co., 52 N. H. 430; Killmerv. Railroad"Co., 100 N. Y. 395,3 N. E. Rep. 293; Shipptr v. Railroad Co., 47 Pa.St. 338; Christie v. Railroad eo., 94 Mo. 453,7 S. W.'Rep. 567; Bayles'v. RauroadCo.,(Colo.)22Pac. Rep. 341; and Rootv. RaJilr'oad'Co., (N.Y.) 21 N. E,'Rep. 403. , , We think there is nofotce in the suggestion that "party-rate I' ti'ckets, as used by defendant, liable to abuse than ordinary or regular tickets. 'In the present case it is clearly shown by the eVil1ilOce,of railroad superintendents and experts, familiar with the sub'ject, "party-ra'te,"tickets are less liable to abuse than brdinary :singretickets., It is from a moment's reflection that the fewer 'th,e ticiketson which thecarrier'strausportation semcesare and "Cdndticted the better it 'can protect' itself and the public against specu'lators and ticket brokers.', Xt is also manifest that the larger the number ofpassengers embraced ina aingleticket the grenterwill be the difficulty of "scalpers", or 'btokers dealing therein. But, if the single tickets 'for,'parties of ten or more traveling togetberwere Uableto the "apus6s' $irggested, that fact Would bardly control tbeproper construction "of the J.a,*,; ribir tend to that their issuance at reduced rates constituted uhduepreference or advantage on or undue or ;unreasotJable prejudice or disadvantage on, the Our conchision 'upon thewhble case is 'thaf" party-rate " tickets,asused by defendant, Jii,re'uOt in,'contravention; o{ sections 2 and 3 of the 'act to regulate com'fueree;:and that the orderoftQ:e commisslob and enjoining the defendant ,to, cease and discontinue the use of said tickets is not laWful, ,and shoi.Hdnot be enforced by thIs court. It follows tha,t the corn plain:ant's bill should be dismissed, with costs tci be It is, accordingly ·so.orderedatid adjudged; : ;

SAGli:" J;,(cancumng) The bill is filed to enforce the opinion and order of the interstate' (jbmmerce commissiort against the respondent, updn the complaint of the Pittsbnrgh,Gincinnati & St. Railway CompanY,,'that the respondent had put into effect ahd had in operation so called "party rates," whereby parties of ten or more personS traveling together on one ticket were, transported over its lines of road at two 'cents per mile per capita, regular rate for a single person being about three cents per mile. The complaint was" furtber, that the respondent was in habit of selling 'round-trip excursion tickets over its lines with'out pnbliclyposting the rates therefor, which were less than rates for ,o:dinary tickets. , T?e the; facts as but de''hIed that they were 10 bonihct Wlththe law. .. ,..' ·.. " , " :The bin 66ntains, in'sub'stitnce; the averments Of the complaint, with the: fuither l\.verment, tbat the ',respondent, in disregard of complainant's :order, andiliviolation of the act 'to commerce, persists in doing :each of complliimidof, wherefore an' injunction is prayed to

·,56

, FEDERAL REPORTER,

vol. 43.

restrain the respondent from further continuing said disregard, under a .penalty of $500 for every day after a day to be named ia the decree of this court. ' , ' ' The respondent 'admits the averment of fact in the bili' relating to the sale and use of party-rate tickets, and justifies as in fts answer to the com,plaint 'aforesaid, but denies that since the order made thereon it has ,failed or refJ,ised to post its rates for excursion tickets. No testimony was taken in>support of the averments of the liJill denied by the answer, and at the this part or the complainant's cause 'ras abandoned, the only questions to be aecided those relating to the sale of Party-ra,t,e tickets,' as conducted by the respondent. The facts, are not in displlte. A single ticket i!l is!lued to a party of ten or, qlQr,e at the of two cents per, mile per capita, which is a of :!1bout thirty..,three and one-third per pentum fr9m ,.the Jor,a singlep'flTson. rate is scheduled, aud posted,aqd,opento the puqlic at large. A question was rpade whether these ticl,\:ets ":ere,, known and recognized in railro"d cirGles before and at the date ,of the passage ortpe act as "commutation tickets." The evidenoe.o( railroad men of experience and prominence was taken upon this poiil,t: ',' It clearly establishes the J:legative of proposition. Some of went further, and un<;lertook to settle, by thei,rtestimony,' wliether party-rate tickets are commutation tickets; but that is a question);>f coostruction, to be determined by the COUll, not by witnesse/l., Whether they were, at and before the P¥sage of the act, general'JYkI}(lwn. and recognized bl those engaged in railroad bU,siness as "complutatlOntlCkets." and how those words were then understood and ,used by railroad trien, is competent, for the rElason tbllt the presumption is that etilplpyed in that business the sense in which the, W\lre used. the testimony according to this rule, that tickets are not incluQ,ed in the letter of favor of com,JPutation tickets, ,in ,the twenty-second section of the act. Their usew!ls confined chiefly to traveling theatrical troupes. They were not on sale to the public. Although kept at the statioqs., they could not without an orderfrom general pffice, pr from someauth,omed sub-office of the passenger ,TQeywere not regarded as. nor understood to be, commutation they such w,ithin the meaning of the word "commutation," applied torlloilroad tickets, is defined by Webster to be "the to go upon It certain route during a, specified period for a than would be paid in the for separate trips. " 'The qentury Dictionary gives the following definition: "A tick,et issuedataredQ,ced l'atepy a carrier of passengers, entitlillg tb llo1der to be a given route a limited number of times, or an number ,during a certai'q period." ' \ 'There is a general in may be said to be a qp;r;p.mutation ticket. although no sothan a mileage ticket oranexcursion But the twenty-second section recognizes mileage,excursion, and commutation tickets each as, distinct from the otbers. using thedesignations in their t.echnical sense. The difference between commutation and
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<

INTERSTATE COMMERCE COMMISSION". BALTIMORE &: O. R. CO.

57

party-rate tickets is that commutation tickets are issued to induce people _ to travel more frequently, and party-rate tickets are issued to induce more people to travel. There is, however, no difference in principle between them, the object in both cases being to increase travel without unjust discrimination, and to secure patronage that would not otherwise be secured. The party-rate ticket is more like the excursion ticket, the apparent difference being that the excursion ticket is to return to the starting point; but, as the return is frequently over another line, so that the excursionist is not carried both ways over any portion of the entire route, the difference is not material. For the purposes of this opinion, however, the patty-rate ticket will be regarded as separate and distinct from . milellge, excursion, and commutation tickets. It is claimed that section 22 makes certain exceptions from the operation of the act, specifying mileage, excursion, and commutation passenger tickets, and that, as party-rate tickets are not mentioned, and cannot be classed as commutation tickets, the inference, under a well-known rule of construction, is that congress intended to exclude them. Let us look into this matter. The first section of the act contains the general provision upon which the entire act is founded. It requires tbat all charges for the 'transportation of persons or property shall be reasonable aod just, and prohibits e\'ery unjust and unreasonable charge. The provisions of the second, third, fourth, and fifth sections are specific, in the nature of definitions, and in aid of the provisions of the first section. In this case we have to de:al particularly with the provisions of the second and third which prohibit unjust discriminations, and undue and unreasonablepreferences. The second section makes it unlawful, by any special rate or other device, to demand, collect, or receive from any person or persons a greater or less compensation for any service rendered in the transportation of persons or property than is charged, demanded, collected, or received from any other person or persons for a like contemporaneous service. in the transportation of a like kind of traffic, under substantiallysiIllilar circumstances and conditions. The third section forbids auy undue or unreasonable preference, in any respect whatsoever, to any particular person, company, firm, corporation, or locality, or any particular- description of'traffic; and to the same extent it forbids any undue or unreasonable prejudice or disadvantage. Now, it is to be observed at; the outset that th,e act does not provide that there shall be no discrimination. The prohibition is against unjust discrimination, undue .and unreasonable preference or advantage, and undue or unreasonable prejudice or disadvantage. Apparently recognizing, as the law has recognized, that discrimination, within just limits, is essential to the successful conduct of the business of the common carrier, as it is to the suetlessful conduct of every other business, but, beyond those limits, destructive, congress attempted nothing more than to fix and enforce the limit; and this consideration furnishes tbe key to the proper construction of the act. , Now; let us turn to. section 22. It is referred to to· the operation of the act. But are they exceptions?

Did congrefY:! ,intend to, say that certain unjust discriminations, and, undue and {Jnreaa<:>;nable preferences and advantages,-that is to say,: \hose mentipl1,eG!; in. the twenty-secQlld Section.-shouldbe excepted? What are theY? ' Here is one. of the first: "The free carriage of destitute and;bomeless :persons .transported by charitable societies." Would that be:an ,but for, the "exception" in its favor? Unjust to whom? Would it unjust to leave it to the other passengers ,to 11p,a ,collection lliljld. pay their fare, or subm,it to see them put off the , in E}hall be; construed to prohibit any; common.parrier from DjI1nisters of religion, Qr, W municipal governments fot' ,tpetransportati()n'of ,indigent persons, or to inmates of the national, orstl1<te Aomes for disable4 \Tolunteersolor of soldiers' ftnd homes." Are these unj ust dis(lri.q:linations, or, preferences 'or advantages, and to legalize them?, These proW$Il,thetwentY-Eiecond section visionsseflm ;to .he by that tbe free carriage and to are and inadequate indeed, but. , the great' franchises bestowed uponthe,nqvitbout mOPey: price. , Again: "Notb': thil;1act.,sball be constrllel1,,;tp; prevent railroads. from giving free tp officers: 'aIluezpployes." Can Hbe possible that this provision it WOUld, for the,ptesident ll:l}d directQI'S of the com pany, to provide tbe,msel,ves with tickets before starting 1>.lJ.rat9Ur, of inspeption of the roaf!,):Ilul! that every conductor and locoand firemanw9uldllave to pa,y full fare for every trip? Yet this foUO;Ws logically if tb,e t"enty-second section is a section of ex'; 'fheanalysis with lik\'! results to every SpeCWqatiop conlained in the ;qut these will spffice.The language sballpreveut," an<;l "nothing in this act shan he :e<>ne;trged: W prahi evideptly used the, "exoeption" i!'l not to be. found in tbe sectioD., but there is the significant proyision that "nothing In this aet contained shall in any w.ay ,bridge ,or alter, the remedies now existing at conunon law or by statute, hpt ,of thi" act are:iP, addition to s,uch remedies," indicatthl1ttbe .understood hy congress, to' be. declaratqry, and for the prevention of ,abuses, and evasions, of the unwritten law, which was a<;lopted ll.nd incorp,9;rated into the, that itsC9nstruction and opera#onmightbe u,niform throug4qut the land, and that it might be enMileage, ,excursion, and com, forced bysanctiops of ar.ementionedin the section. All.these were universally mutation" regardedlts just anq n,ecessary but, mileage tickets espe.claUy, subject to abuse. No significance ought to be attached to the fl¥)ftbat party-rate. tickets are not mentioned, for, at'! is above shown, tbey,were not.1n general use, but were1itnited; allllos.t exclusively to trave:lingtheatrical tro\1pes. :.'. ..' " " The true construction of the section appears to be that it specifies discriminatiOlls, not regarded by congress as within the letit provides that the act teJ.:or the spirit of the ach and

INTERSTATE COMMERCi COMMISSION 11. BALTIMORE ,ct; O. R. 00.

59

shall n6t bonstrued topreventthemi and ,'the instances given are illustrative, rather than exhaustive. It is a section furnishing an express rule 'of construction.' ,It follows that the maxim e:xpressio unius est exclu8'io alterit/,8 does not apply, buf that the true rule is to look to. the section as a guide tq,the proper interpretation of the prohibitory clauses disof the preceding 'sections,and exclude from their operation crimination which is within the principle of the particular, cases mentioned in the twenty-second sectiorl. It is all wrong to cite it as authority for, such misconceptions and misconstructions as it was tended to prevent. Any construction which makes the statute a' mere enactment of arbitrary rtiles, 'to be so administered as to force a rigid inflexible equality, is in conflict with the objects which its framers had in mind, ,and a constant obstacle to the further development of a vast sy-stem oftransportation, in which new situations and conditions, continually occurring, and requiring new adaptations and regulations, can he moulded into harmony with the provisions ofthe act only by regarding it as declaratory of prhwiples founded upon wisdom and experience, and to be made beneficial and effective by being so expounded as toapply those principIes to every new case that may arise. This case, then, depenils upon the question whether party-rate tickby the respondent, are, upon a proper construction, proets, as hibited by the preceding sections. It is claimed that they are obnoxious to the first section, because they are not just and reasonable. While it is admitted that, if their issue be confined to parties of ten or more, the injustice would not be so apparent, it is urged that it would be left to' the carrier to determine what number should make a "party," and that underthe law, so construed, a reduced rate could be accorded to a party of two, as it is said was done before the act. The testimony on this point is that almost without exception ten was the smallest number of persons to whom they were issued. At one time, upon the Union Pacific Railroad, from the Missouri river to Colorado, they were issued to parties of two. It is explained, however, by the witnesR who testifies to this fact, that the concession was made fof' the benefit of variety people who traveled in pairs, but that the rate was more than three cents per 'mile. Theone other exception testified to was made by the Wabash Railroad Company, which gave a reduced rate tofour theatrical persons traveling as apartYi .but this reduction was granted to theatrical persons only. It appeal'S in evidence, also, that before the law there were voluntary traffic ll.Ssociations, to which the leading railroad companies were parties, orglUiizedto prevent cutting of rates and undue competition. Party-rate tickets were then in vogue, and if, under those circumstances, 're the only departures from the rule of ten were those cited above, th would seem to belittle ground for the apprehension expressed on behalf of the complainant .that to permit the continued' sale and use of these tickets would open the door to all the evils which formerly existed. But suppose, for of the argument, that the apprehension be well founded, tb'e answet'is t}Vofold: (1) It cannot be doubted that whenever the sale of party-rate ticiketsis by any means made a mere pretext for

,flO

,

vol. ,43.

evading the Jaw,-,as" to ta:ke tbe illustrati<?n put, when aUcket is sued to t!'Y0 at a reduced price, merely to cut courts will so treat it, and apply tbe remeq.y. The that if railroad companies bave tbe right to issue party-ratll.ticketsto companies of ten or more tQ)'v0" is like tbe old objection to tbe persons,tpey: may issue right with slaves,"':':'that iftha master could bold his slave on free, soil fo'r, an bour, he, could fO,rll-day, or a year, and therefore for __ altbough it puzzled fora time, needed but a touch of comm,on,.-Sellse. to explode ; 1 ' (2) Nothing in the future of legislation is it., -.,( , ·.-, . " more certfpn than that abuse becomes prevalent the legislatures,of the slates,will promptly reduce the individual rate to the same fig1;lre. The histor,y of railroad passenger travel for the last forty years illustl'ates the constant tendency of rates,including mileage, excursion,ll-nd commutation tickets, 'to reduce regular individual rates uponIha ori,e):Uind, especially for long distances, and, upon tbeather hand, to increase facilities fl,nd accommodations, thus rendering the service for the ge.neral pllbli,c,. The,next objection is that ;I:lllrti-rate ,tickets are obnoxious to the second sectiOll of the act, because they 'furnish to one class of passengers transportation for lower compensation than is charged to others for like and contemporaneous service, the same Circumstances and conditions; and to the third section, because they give to one class of passengers an undue and unreasonable preference and advantage. If this opjection be true in is, if those traveling under are charged less'than individuals for like and contemporanequs service, under ,substantially the same circumstances and is conclusive, and ,the issuance of the tickets must be adjudge4 unl\l:",fu1. , Bll thow do they compare with mileage tickets, which, by, the twenty-second section, ,are declared to be in harmony with the act? The'rate for, ,each is two cents per mile. The coupons of mileage tickets aTe for they are sold in blocks of five dred, or for one thousitnd mile"." ",The holder can.use them at pleasure, ' maY: ride for apy distance within the limit for long or ,of his ticket, in the same car, occupy the Same seat, with a passenger who .is, charged three cents per mile for histi:cket. The holder of, the mileage ticket if? awholesale purchaser; the other buys at retail. The difference is, recognized in every kind of business, and no intelligent, fair-minded' person thinks of cODlplaining of it. , ,The mileage ticket, so the testimony declares, is especially liable to abuse, and to be used by brokers for specul,ative purposes. The party-rate ticket, if not, al'l some is less so witnesses testify ,altogether unavailable for than any other ticket, and reduces the opportunity for either to the minimum. ' It, is a wholesllJe ticket. It is open to purchase to all, at the one. fixed price. It has Que peculiarly distinguishing featme,-it is almost proof against fraud upon .the company W,hich issues it. The purchaser having a party of less than the num1;>ef named in his ticket may, unless ,restricted by the terms of bis ticket, fill up his party from the outside. That he would have a right to do, provided they

INTERSTATE COMMERCE COMMISSION t1. BALTIMORE & O. R. CO.

61

all travel together, on the same train, as a party, and under the one ticket, for but one ticket is issued, and whoever of the party misses the train must buy an individual ticket at full rates, or lose the trip. Suppose a car-load of sixty persons be made up of passengers traveling on party-rate tickets, how much of the receipts from the sale of those tickets will fail to reach the treasury of the company? Not one dollar. Suppose the next car in the same train contains sixty passengers traveling on individual tickets, or cash fares. What would be the comparative percentage of opportunity in the two cases for peculation at the expense of the railroad company? If a perfect safeguard against such peculations could he provided all over the country, to what extent would it tend to reduce railway passenger fares, and to benefit railway shareholders? Again, the testimony establishes that party-rate tickets secure patronage that yields large revenues to the respondent, and that the withdrawal of those tickets would almost entirely destroy that patronage; for it appears that the rate is as high as can be made without putting it beyond the reach of those who are the main purchasers. Are all these considerations to be left out of the account in determining whether there has been"like and conternporaneous service" "under substantially similar circumstances aud conditions?" Does it depend solely upon whether party-rate passengers and those holding single tickets occupy the same cars, have the same accommodations, are traveling from the same point to the same destination? Is that the full meaning of "similar circu,mstances and conditions?" The answer-which the question itself seems to suggest-is that the phrase has a much larger and more comprehensive meaning, else congress could not consistently have recognized mileage or excursion or commutation tickets, for all these trespass UpOll the narrow ground on which the contrary view rests. To give the act its proper interpretation, the phrase must be held to include circumstances and conditions affecting the business interests of the carrier and of its patrons; or, in other words, circumstances and conditions of a commercial character, which, while they they should not exclude or override the consideration of what is just and reasonably advantageous to those not so situated as to be able to avail themselves of reductions offered to the general public, should be so recognized as not to be prejudicial or unjust to any, and yet, upon the whole, to promote the interest of all concerned in the beneficial operation of the act. Aside from the consideration that these tickets are in principle in no wise different from mileage, excursion, anJ' commutation tickets, which is decisive, the fact that they are on sale to all, without disr,rimination, and without advancing rates for single tickets, and the considerations above mentioned in favor of those who are upon the road continually, and whose business is upheld by bringing the cost of necessary travel within their reach, and those in favor of the 'carrier, including many not mentioned above. are ample for the vindication of the respondent against the charge that it is guilty of unjust discrimination, and undue or unreasonable preference, and therefore of violation of the provisions of the second and third sections of the act.

bDERAL; REPORTER,· vol. 43.

'and'

coilipensation for the transporiatiOri, ,tinder suband conditions, of aitig:letlclta'tSfor"B shorter distance,thari for the tnmsportation of others ticket for a; longer distance; but this objectionis fully holding a met by the to the objections relating to', the second and third sectiona. 'ThIS bill should be dismissed at the costs of the complainant.

$t;lc'tioh, because if permits th'e:'

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'that. the sale ·of

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VJ:'I:O

RULLO. l

8, D. New York. M"J" 29,1890,)

This, court, habeas coTP'U8 .proceedings, is .not authorized to take evidence to facUl, which another. of a quasi judicial character, is constituted by ,law for the purpose of tnq]1irlng Into and determining. S.BAIIJI!:-CO'liTRAOT LABOR'LAW-AoT ·FlI:B. 28, 1887-BTATEOnIOBJUl. Where immigrants ;prevented from enterblg the coullt1'1 011 the ground that they ha\'e come contrary to the provisions of the contract labor law, the finding Il8 to the facts by the superllltendellt of immigration, when cOnfirmed by the collector, Mting pursuant to the, regUlations of the secretary of the treasury, is a finding of a tribunal dUll. constituted by law, and is not subject to review by thill court. Under the act 0 February 28, 1887, the secretary of the treasury haa the right to appoint a superlntendentofimmigration,;inl1eu of state otli081'llo

CQ1\PUS-ltBVlEw oJ'· FiOTs.

on

At Law. On petitionfor.llabWa CO'IpU8. L. fJUp, for petitioners. Daniel O'Connell, Asst. U. S. Atty., in opposition.

BROWN, J. The petitioners, immigrantsfrom Italy, having been forbidden to land, on the ground tpat they came here on contracts for labor and 1887, seek a release upon habeaa prohibited by the statutes C01pUS, on the grounds-.Ftrst-, that there has been no investigation of thei,!. case by any competent 'legal tribunal; and, second, that the state.ments in their affidavits, upop: which the refusal to permit them to lan4 was based,· were. incorrectly understood or incorrectly translated, and thatthey <lid not come here under any contract of labor. It has been repeatedly held in immigration cases that, under the statutes above re!erred to, andc;>thers similar, the court upon habeaa CQryus is not authorized to take upon the original question as to the facts concernthe. immigrant's right to lap.d, where another tribunal of a quasi judibY'law for the p;urposeof inquiring into :sl,lch facts, and determining the inu:p.igrant's rightjbut that the office of ;the writ of habe'a$ CQryUB is to inquire into the. jurisdiction exercised by and whether it has .kfilpt within its ,legal limits, and proceeded according to l&w. Inquiry into the facts· maybe had so far.'
J Reported

by Edward G. Benedict, Esq., of the New York D&I'.