Burlington, C. R. & N. Ry. Co. v. Northwestern Fuel Co.

31 F. 652
CourtU.S. Circuit Court for the District of Minnesota
DecidedJune 15, 1887
StatusPublished
Cited by1 cases

This text of 31 F. 652 (Burlington, C. R. & N. Ry. Co. v. Northwestern Fuel Co.) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Burlington, C. R. & N. Ry. Co. v. Northwestern Fuel Co., 31 F. 652 (circtdmn 1887).

Opinion

Brewer, J.

In this case, upon the questions which have been argued, I have come to a conclusion, and it is unnecessary to continue the argument further. I stop to consider but one question. I may premise by saying that a contract which puzzled my Brother Miller, one whose pre-eminent abilities we all recognize, may well have puzzled me; and, while upon part of the question which I shall consider I am clear in my views, upon another part I am very much’in doubt. That question is as to the validity of the contract as a whole. Its validity is questioned on the ground of discrimination, and that the one clause which provides for a discrimination is invalid I have little doubt. It provides that the company shall maintain a rate of $2.40 per ton on all coal shipped when the amount is less than 100,000 tons; and that the rate for 10Q,000 tans or more shall lie $1.60 in summer, and $1.65 in winter. That such a discrimination is against public policy, and not to be sustained, I am very clear. On the face of it, it is a discrimination, based not upon the cost of transportation, upon the time and labor and annoyances which may result to the railroad company, but solely upon the amount of the transportation.

In the case of Scofield v. Railway Co., 48 Ohio St. 606, 3 N. E. Rep. 907, are two quotations; one from Justice Miller and one from Judge Baxter. The one briefly quoted from Justice Miller is:

“1 am of the opinion that it is the duty of every railroad company to provide such conveyances, by special cars or otherwise, '* * * as are required for the safe and proper transportation of this express matter on their roads, and that the use of those facilities should be extended on equal terms to all wlio are actually and usually engaged in the express business.”

That, as a statement of the general law obligatory upon railroad companies, will not be questioned. The other quotation from Judge Baxter comes more nearly to the case at bar. In it he says:

“The discrimination complained of rested exclusively on the amount of freight supplied by the respective shippers during the year. Ought a discrimination resting exclusively on such a basis to be sustained? If so, then, the business of the country is in some degree subject to the will of railroad officials; for if one man engaged in mining coal, and dependent on the same railroad for transportation to the same market, can obtain transportation thereof at from twenty-live to fifty cents por ton less than another competing with him in business, solely on the ground that he is able to furnish, and does furnish, a larger quantity for shipment, the small operator will, sooner or later, be forced to abandon the unequal contest, anil surrender to his more opulent rival. If the principle is sound in its application to rival parties engaged in mining coal, it is equally applicable to merchants, manufacturers, millers, dealers in lumber and grain, and to everybody else interested in any business requiring any considerable amount of transportation by rail; and it follows that the success of all such enterprises would depend as much on the favor of railroad officials as upon the energies and capacities of the parties [656]*656prosecuting the same. It is not difficult, with such a ruling, to forecast the consequences. The men who control railroads would be quick to appreciate the power with which such a holding would invest them, and, it may be, not slow to make the most of their opportunities and, perhaps, tempted to favor their friends to the detriment of their personal or political opponents; or demand a division of the profits realized from such collateral pursuits as could be favored or depressed by discriminations for or against them; or else, seeing the augmented power of capital, organize into overshadowing combinations, and extinguish all petty competition, monopolize business, and dictate the price of coal and every other commodity to consumers. We say, these results might follow the exercise of such a right as is claimed for railroads in this case. But we think no such power exists in them. They have been authorized for the common benefit of every one, and cannot be lawfully manipulated for the advantage of any class at the expense of any other. Capital needs no such extraneous aid. It possesses inherent advantages which cannot be taken from it. But it has no just claim, by reason of its accumulated strength, to demand the use of the public highways of the country, constructed for the common benefit of all, on more favorable terms than are accorded to the humblest of the land; ánd a discrimination in favor of parties furnishing the largest quantity of freight, and solely on that ground, is a discrimination in favor of capital, and is contrary to a sound public policy, violative of that equality of right guarantied to every citizen, and a wrong to the disfavored party, for which the courts are competent to give redress.”

If it be true, as held by Judge Wallace, that the rule forbidding an unjust discrimination does not necessarily prevent a railroad company from charging a less rate to one who ships a large quantity than to one who ships a small quantity, (and I am not prepared to deny that, under some circumstances, there is force in that proposition, on the sainé principle that a wholesale dealer sells a large bill of goods at a less rate than a small bill of goods,) yet, even with that limitation', a discrimination so vast as this is, and so purely arbitrary, and which is so obviously solely in the interest of capital, and not based upon reasonable distinction in favor of a large as against a small shipper, cannot be sustained. For here the contract provides a special rate for shipment of 100,000 tons or over; that is, for one who ships 99,500 tons it makes a rate of $2.40; while to the man who ships-100,000 tons, or 500 tons more than the other, it makes a rate of $1.60,—a difference of 50 per cent, in favor of the latter. Such a discrimination, even if any discrimination based upon the amounts of shipments is tolerable, is one so gross that it cannot be sustained. Upon that proposition I have no doubt, and I had none when the contract was first read; but the question which is doubtful is the one which I suggested to Gov. Davis, and which Judge Young has commented upon at some length and with great ability. Conceding, and I think that Judge Young practically concedes, that this stipulation, standing by itself, cannot be upheld,—conceding, I say, that this is invalid,—let it be dropped from the contract as surplusage, and there is a contract with ample considerations on both sides, for the shipment by the fuel company of 100,000 tons and over, and for the transportation by the railroad company at a specified rate, which contract the railroad company has broken; and can it be allowed to shield itself for its breach of that- stipulation on the ground that there is some [657]*657other covenant in the contract which is void? That is a very doubtful question.

If I hold against the defendant on this question, it is upon these grounds: in the first place, I may say that the fuel company is in no attitute to ask the straining of any point in order to uphold this contract in its bphalf. It has placed itself in the position of seeking to obtain from the railroad company, not merely very favorable rates, but a discrimination against other parties.

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31 F. 652, Counsel Stack Legal Research, https://law.counselstack.com/opinion/burlington-c-r-n-ry-co-v-northwestern-fuel-co-circtdmn-1887.