Missouri Pac. Ry. Co. v. C. E. Ferguson Sawmill Co.

235 F. 474, 149 C.C.A. 20, 1916 U.S. App. LEXIS 2200

Opinions

CARLAND, Circuit Judge.

The Sawmill Company, hereafter called the plaintiff, brought this action against the St. Louis, Iron Mountain & Southern Railway Company and the Missouri Pacific Railway Company, hereafter called defendants, to recover the sum of $583.27, and interest thereon at 6 per cent, from September 1, 1911, being the amount of an award of damages allowed by the Interstate Commerce Commission, hereafter called Commission, for unjust and unreasonable freight rates paid by the plaintiff on cypress lumber in carloads from Little Rock and Woodson, Ark., to points in Oklahoma, Kansas, and Missouri. The Chicago, Rock Island & Pacific Railway Company, Union Pacific Railroad Company, Chicago, Burlington & Quincy Railroad Company, Missouri, Kansas & Texas Railway Company, and .St. Louis & San Francisco Railroad Company were originally made defendants in the action, but were subsequently dismissed by the plaintiff. A jury being waived, the case was tried to the court.

[1] At the dose of the trial judgment was rendered for plaintiff in the a mount of the award of the Commission and interest, amounting in all to $717.17. As a part of the judgment the court allowed an attorney’s fee in the sum of $500. The defendants have brought the case here, alleging error. At the commencement of the trial counsel for defendants made a motion that the plaintiff be compelled to elect upon which order allowing reparation it would rely. The motion was denied, and an exception taken. In order to understand this motion, a brief statement is necessary.

The first petition in the proceeding which resulted in the award of reparation was filed by the plaintiff with the Commission August 31, 1909. The St. Louis, Iron Mountain & Southern Railway Company was the only defendant in this complaint. The plaintiff complained of what was called the Southwestern Line Tariff No. 50, effective August 3, 1909, -which had been issued by said railway June 24, 1909, and which named a rate on cypress lumber from Little Rock and Woodson, Ark., to Kansas City, Mo., and other principal consuming points, of 24 cents per 100 pounds, being an advance of 8 cents over the previous tariff. The complaint alleged that the tariff rate complained of was unjust, discriminatory, and unduly prejudicial to the interests of the plaintiff. The complaint prayed that the Commission order the defendant to cease and desist from said violations of the Act to Regulate Commerce, and that it be required to establish and .put in force a rate on cypress lumber from Little Rock and Woodson, as formerly carried in its Joint Freight Tariff No. 4929, and also that defendant be ordered to repay to complainant all sums paid by it for freight in excess of those rates which the Commission should determine to be reasonable and just.

May 2, 1910, the Commission made its report in the case, and found that the rates on cypress lumber in carloads from Little Rock and Woodson to points in Oklahoma, Kansas, and Missouri, located on the lines of defendant, were unjust and unreasonable, and that the maximum rates for the future between the points named should not exceed the rates set forth in a table attached to the report. The Commission said in its report that, if the plaintiff desired to question the. reasonableness of rates to points on the lines of the Missouri Pacific Railway Company, said company should be made a party.

An order was duly made, condemning the rates complained of as unreasonable and unjust, and commanding the defendant to establish and put in force rates that the Commission decided to be reasonable.. On June 27, 1910, the plaintiff filed a supplemental complaint •which in no wise differed, from the original complaint, except that the Missouri Pacific Railway Company, Chicago, Burlington & Quincy Railroad Company, Chicago, Rock Island & Pacific Railway Company, Missouri, Kansas & Texas Railway Company, St. Louis & San Francisco Railroad Company, and Union Pacific Railroad Company were made defendants. On April 1, 1912, the Interstate Commerce Commission made a supplemental report in the same case, after additional testimony had been taken and the other railroad companies made defendants. The supplemental complaint above referred to contained the same, prayer as the original complaint. In its supplemental report' the Commission adhered to its former decision and further ordered:

“That to enable the defendants to adjust the rates to points other than Kansas City in harmony with, the Commission’s report herein, and for the purpose of receiving proof upon which an order of reparation may be entered, the case be held open for such further action of the Commission as may be necessary.”

On November 4, 1913, the Commission made an award in the case, finding the amount of reparation due to the plaintiff from the defendants in the supplemental complaint in the sum of $583.27, and interest thereon at the rate of 6 per cent, per annum from September 1, 1911. The award contained the usual order for the payment of the same. The present action was commenced for the purpose of recovering the award provided for in the order of November 4, 1913. About a year after the award had been made, and about four months after the commencement of the present action, the defendants applied to the Commission for an order modifying the order of November 4, 1913, as follows: The order last referred to contained a statement that the parties had filed an agreed statement of facts respecting the movement of the shipments involved and the amount of reparation due thereon. The defendants objected to the expression “agreed statement of facts,” as they claimed that no such statement was made. On considering this application the Commission on November 25, 1914, made an order modifying its former order, and changing the recital therein as above mentioned, so that it read that by statements filed the parties have agreed as to the facts respecting the movement of the shipments involved and the amount of charges collected thereon. On the making of this modified order the plaintiff in the present action filed a supplemental complaint setting up in addition to the original order the modified order and the report of the Commission in connection therewith.

It will thus be seen that the defendants in the present action were asking the court to compel the plaintiff to elect as to whether it would rely upon the original order or the modified order. The motion to compel an election was properly overruled. There was only one order of reparation made by the Commission, and there was only one case before the Commission. It was proper that both reports and both orders be set forth in the complaint, that the true situation might be presented. In this connection it is claimed that the order of November 25, 1914, required an impossible date for the same to be performed by the defendants, in that it required the defendants to pay the award to plaintiff on or before December 15, 1913, a date nearly a year before the date of the order. This is a sample of many of the objections made at the trial. This confusion in dates occured in this way: The original order of November 4, 1913, fixed the date of the payment of the award as December 15, 1913. The modifying order of November 25, 1914, did not change the date of the performance of the original order, but simply modified it in the respect that complaint was made by the defendants. The defendants had not complied with the original order and a suit was then pending to enforce it. The modified order was not a new order, which required a new date to be fixed for its performance, and the objection has no merit. Moreover, this point was not presented to the court below.

[2] Counsel for defendants also moved to strike portions of the supplemental complaint relating to the supplemental order. This motion was rightly overruled for the reasons above stated. After the plaintiff had introduced in evidence the orders and reports of the Commission awarding damages, it called as a witness Mr. C. E. Ferguson, its president, for the purpose of showing that it had been actually damaged in the amount claimed, and the manner thereof. Counsel for defendants objected to the introduction of any evidence other than that produced before the Commission. This objection was overruled, and an exception taken. There is no merit in this contention. Section 16 of the Act to Regulate Commerce provides:

“Such suit in the Circuit [District] Court of the United States shall proceed in all respects like other civil suits for damages, except that on the trial of such suit the findings and order of the Commission shall be prima facie evidence of the facts therein stated.” Comp. St. 1913, § 8584, subd. 2.

It thus appears from the law itself that the suit must proceed in all respects like other civil suits for damages, with no distinction.between it and such other actions for damages, except that the findings and order of the Commission shall be prima facie evidence of the facts therein stated. In Meeker v. Lehigh Valley Railroad Co., 236 U. S. 412, 35 Sup. Ct. 328, 59 L. Ed. 644, the Supreme Court declared with reference to this provision as follows:

“This provision only establishes a rebuttable presumption. It cuts off no defense, interposes no obstacle to a full contestation of all the issues, and takes no question of fact from either court or jury. At most, therefore, it is merely a rule of evidence. It does not abridge the right of trial by jury, or take from any of its incidents. Nor does it in any wise work a denial of due process of law. In principle, it is not unlike the statutes in many of the states, whereby tax deeds are made prima facie evidence of the regularity of all of the proceedings upon which their validity depends.”

See Meeker v. Lehigh Valley Railroad Co., a companion case, 236 U. S. 434, 35 Sup. Ct. 337, 59 L. Ed. 659; Western New York & P. R. Co. v. P. Refining Co., 137 Fed. 343, 70 C. C. A. 23.

In the case last mentioned numerous authorities are cited to support the position here taken. The purpose of placing Mr. Ferguson on the stand was to show that the shipments of lumber were made f. o. b. destination, and, although the consignees in the first instance paid the freight, it was charged back to the plaintiff on settlement of accounts.

[3] At the close of all the evidence counsel for the defendants requested the court to declare the law to be that the plaintiff was not entitled to recover. Under this head certain reasons why the request should be granted were stated. The trial court refused to declare the law as requested,' and an exception was taken. It is first claimed that the Commission had no jurisdiction to make the award which it did for the reason (a) that the summons issued to the defendants required them to “satisfy the complaint or answer the same in writing within 20 days from this date.” The summons was dated July 5, 1910. Section 13 of the act provides that after the filing of the petition the carrier “shall be called upon to satisfy the complaint or to answer the same in writing within a reasonable time, to be specified by the Commission.” Comp. St. 1913, § 8581. Section 6 of the act provides:

“No change shall be made in the rates, fares, and charges or joint, rates, fares, and charges which have been filed and published by any common carrier in compliance with the requirements of this section, except after thirty days’ notice to the Commission and to the public published as aforesaid, which shall plainly state the changes proposed to be made in the schedule then in force and the time when the changed rates, fares, or charges will go into effect; and the proposed changes shall be shown by printing new schedules, or shall be plainly Indicated upon the schedules In force at the time and kept open to public Inspection: Provided, That the Commission may,, in its discretion and for good cause shown, allow changes upon less than the notice herein specified.” Comp. St. 1913, § 8569, subd. 3.

It is claimed that defendants could not have satisfied the complaint within 20 days by changing the rate, as the statute requires 30 days’ notice of a change in rates. Under the law above quoted and the facts in this case there is no merit whatever in this contention: First, because, if the defendants desired to satisfy the complaint by changing the rate complained of, we must presume that the Commission would upon the request of defendants have allowed a change upon less than the regular notice; second, the record shows that the original petition was filed with the Commission August 31, 1909, and answer thereto was filed October 13, 1909. The supplemental complaint was filed June 27, 1910, received by defendants July 7, 1910, and answer filed August 22, 1910. In each instance, therefore, the defendants had 45 days in which to answer the original and supplemental complaints, respectively, and of course would have been allowed a longer time for good cause shown. No extension of time was asked for, and the defendants proceeded to try the case before the Commission without objection, and the objection now made was not heard of until it was made at the trial below. As a jurisdictional question the point made is frivolous.

(b) It is contended that the Commission had no authority to award reparation on shipments that moved prior to the date of filing plaintiff’s complaint. This contention has no merit. The original complaint, as above stated, was filed August 31, 1909. It complained of a tariff effective August 3, 1909, alleging that the tariff was discriminatory, unduly prejudicial, and exorbitant, and prayed that the defendants be required to establish and put in force rates on cypress lumber from Little Rock and Woodson, Ark., as formerly carried in its Joint Freight Tariff No. 4929. The supplemental complaint alleged substantially the same facts. Each complaint prayed for reparation. The Commission in its report said that the complaint—

“alleges that defendant has recently advanced rates on cypress lumber from Woodson and Little Rock to points in Oklahoma, Kansas, and Missouri, over the rates which have been in effect for many years; that said advances are unreasonable in themselves and unjustly discriminatory against Woodson and Little Rock, and in favor of Memphis, Tenn., and other points cast of Little Rock. The prayer of the complaint is that the rates formerly in effect be restored and reparation made for all sums unlawfully collected.”

The Commission, of course, could only establish a new rate for the future, but the very meaning of reparation is compensation for what has occurred. The plaintiff could not be injured until it had paid an excessive rate.

[4] (c) It is next claimed that, as no specific statement of the shipments on which reparation was claimed was filed with the Commission until October 31, 1913, the Commission had no authority to award reparation thereon as the same were barred by the statute of limitation, found in section 16 of the act and which reads as follows:

“All complaints for the recovery of damages shall be filed with the Commission within two years from the time the cause of action accrues, and not after.”

The original complaint, filed as above, contained the prayer that has been heretofore quoted. The Commission and every other person connected with the case understood it to be a complaint for reparation, as well as for the establishment of just and reasonable rates. A specific statement of the particular shipments on which reparation was claimed is shown by the record to have been received by the Commission May 25, 1912. The defendants did not plead the statute of limitation before the Commission, but, on the contrary, received the specific statement of shipments, and held the same in their offices for about five months, finally returning the same to the Commission with the statement:

“Our claim department has checked this .statement and finds same to be correct as to shipments moved and the charges collected, and basing same on the new rates ordered in by the Commission there would be an overcharge of $592.67; but this admission should not be construed that the complainant is entitled to reparation in this case.”

This statement was signed by the general freight agent of the defendants. The defendants demanded no bill of particulars, or that the complaint be made more specific and certain, before the Commission. The statute provides that the filing of the complaint shall toll the statute. The record shows that 8 of the shipments moved in 1909, 15 moved in 1910, 5 in 1911, and 1 in 1912. We are of the opinion that under the facts shown in the record the claim for reparation was not barred.

(d) It is next claimed that, as the only evidence submitted before the Commission as to the payment of the freight charges were the expense bills given by the carriers to the consignees in whose name the bills ran, there was no evidence that plaintiff paid the freight. The case before the Commission was tried throughout by all parties on the theory that the plaintiff had paid the freight; but it becomes immaterial on a motion made in the present case that the plaintiff be nonsuited for the reason that the proof in the present action fully shows that the plaintiff paid the freight and suffered the damage.

[5] (e) Complaint is made that some of the shipments are shown by the record to have moved over the lines of other carriers than those which were parties before the Commission, and the proposition is urged that the Commission had no power to condemn what is called one leg of a through rate. So far as this objection is concerned, the record shows that all the carriers over whose lines the shipments moved were made parties defendant before the Commission, except the Atchison, Topeka & Santa Fé and the Omaha Bridge & Terminal Railway Company. These carriers are connected with the shipments in controversy in this way. '¡'here were 12 shipments of lumber made over the lines of defendants to Council Bluffs, Iowa, on a through rate. It is shown, however, in the record, that the lumber was hauled from Omaha, Neb., across the river to Council Bluffs, Iowa, by the Omaha fridge & Terminal Railway Company, that an arbitrary of $5 per carload was charged by the Terminal Company for hauling the freight across the river, and it is also shown that the defendants paid this sum on the 12 cars, the same being absorbed in the through rate. The plaintiff, however, seeks to recover nothing from the Terminal Company, and we must presume that the Commission considered all the circumstances including the payment of the arbitrary in fixing a reasonable rate for the future, and the amount of reparation to be paid by the defendants. The Terminal Company does not own any cars, its business is that of hauling cars belonging to other railroad companies, to and from industries on its tracks, and transferring such cars between various railroad companies entering the cities of Omaha, South Omaha, and Council Bluffs. The reasonableness of the rates of which complaint was made by the plaintiff before the Commission were in issue, and the defendants were parties before the Commission. To now assume that they did not present to the Commission the fact that they paid an arbitrary of $5 per carload at Omaha is to convict them of a grave inattention to business.

We now come to a carrier, however, who was not before the Commission, and who is not a defendant in this case. The connection of this carrier with the shipments in question arises in this way. There was one shipment of lumber from Woodson, Ark., to Girard, Kan. The shipment moved over the St. Louis, Iron Mountain & Southern Railway to Coffeyville, Kan., thence over the Missouri, Kansas & Texas to Chanute, thence over the Atchison, Topeka & Santa Fé to Girard. The total amount of the expense bill, roughly figured, was $103.80. Of this amount the Atchison received $17.30, the M., K. & T. $21.51, and the Iron Mountain $64.53. Each carrier received of the overcharge of 6 cents per 100 pounds, the same proportion which the total amount received by it bears to the total expense charged. This would result in the Atchison receiving about $3.50 of the overcharge and the M., K. & T., about $4.50. It goes without saying that, as the Atchison, Topeka & Santa Fé and the Missouri, Kansas & Texas were not parties to this action, no judgment can be rendered against them, and this little amount cannot be lawfully charged against the defendants.

We now come to the defendants in this case. The order granting the reparation reads thus:

“It is therefore ordered that the above-named defendants, in so far as they participated in this traffic, be and they are hereby notified and required * * * to pay unto complainant the sum of $583,27, with interest thereon at the rate of 6 per cent, per annum from September 1, 1911.”

So that it appears the defendants are liable for such part of the overcharge as each received, and technically the judgment ought to have gone that way. But as no point is made about this we assume that, ■ as the defendants are under the same management, it makes no difference to them that the amount of liability was not found separately.

It is claimed further that the judgment ought to have been for the defendants, for the reason that the Commission has overruled the principle of rate making upon which the order of reparation was based, and the cases of North-Bound Rates on Hardwood, 32 Interst. Com. R. 528, Southern Lumber Rates, 34 Interst. Com. R. 652, and North-Bound Rates on Hardwood, 34 Interst. Com. R. 708, are cited; but an examination of those cases convince that they did not have the effect of setting aside or overruling the order made in the present case. The complaint of the plaintiff referred to rates charged it as a lumber producer at Woodson, Ark., compared with shippers in its immediate neighborhood, and the Commission held that a blanket adjustment of rates which ignores so fundamental a principle as the geographical location of production can, with difficulty, be maintained in the face, of a result which compels a producer, with a 24-cent rate, to compete with a large number of neighboring producers enjoying an 18-cent rate. The cases ’referred to consider general rate-making schemes covering large sections of country involving several states.

[6] Complaint is made that the Commission had no authority to allow interest on the amount of the award. We decided in the case of D. & R. G. R. Co. v. Baer Bros., 209 Fed. 577, 126 C C. A. 399, that interest was allowable on excessive freight rates paiu under protest, and interest has been allowed in similar cases. Meeker v. Lehigh Valley Ry. Co., 236 U. S. 412, 433, 35 Sup. Ct. 328, 59 L. Ed. 644; Meeker v. Lehigh Valley R. R. Co., 236 U. S. 434, 439, 35 Sup. Ct. 337, 59 L. Ed. 659; Baer Bros. Mer. Co. v. D. & R. G. Ry. Co., 233 U. S. 479, 491, 34 Sup. Ct. 641, 58 L. Ed. 1055; So. Ry. Co. v. St. Louis Hay & Grain Co., 153 Fed. 729, 82 C. C. A. 614.

[7] It is also objected that the court erred in allowing an exorbitant and excessive attorney’s fee. Section 16 of the act provides:

“If the petitioner shall finally prevail he shall be allowed a reasonable attorney’s fee to be taxed and collected as a part of the costs of the suit.”

It appears, therefore, as matter of law, that the attorney fee was prematurely taxed, as it was not ‘known when it was taxed whether the plaintiff would finally prevail or not.

As a result of a careful examination of the whole record, we are of the opinion that the judgment below must be affirmed as to the amount of reparation and interest; that as to the attorney fee it should be reversed. The amount of the award was about $9 less than the amount admitted to be due by the defendants, if they were liable at all, and they would hardly ask us to reverse a case for the small amounts of overcharge received by the Atchison and M., K. & T.

Let the judgment be affirmed, and the case remanded, with instructions to the trial court to tax a reasonable attorney’s fee upon notice to the counsel of defendants.