Ohio Coal Co. v. Whitcomb

123 F. 359, 59 C.C.A. 487, 1903 U.S. App. LEXIS 4000

• Court: Court of Appeals for the Seventh Circuit
• Decided: April 14, 1903
• Docket: No. 925
• Status: Published

Opinions

GROSSCUP, Circuit Judge,

after the foregoing statement of facts, delivered the opinion of the Court.

The agreement of September 12, 1885, under which the Wisconsin Central Railroad Company, and its receivers, operated their road in the city of Ashland, made in our opinion the Bay Front track an integral part of the Wisconsin Central’s terminals. True, the Wisconsin Central had no title in fee to the roadbed west of the division point named. But the grant under the agreement was, for the purposes of a terminal, as complete as if it were in fee simple, or leasehold. The limitation on the grant was important as between the railroads individually, but, as between the railroads collectively and the public, the agreement simply gave to the roads more extended terminal facilities. The published tariffs from Ashland to outside points must be held—at least in the absence of a tariff differential applicable alike to all—to have included transportation over this, as over other parts, of the road’s lines.

Starting from this premise, then, the inquiry arises: Was the extra charge of two dollars a car, upon the shipments made by the Ohio Company, and upon no other, discriminative? Its justification as non-discriminative is placed principally upon three grounds: (a) that all things considered, two dollars was but a fair differential; (b) that it was a charge agreed upon by the Ohio Company and cannot therefore be the subject of complaint now: and (c) that it may be regarded as an agreed 'charge under the Wisconsin statute permitting the railroad company to charge the actual expenses of operating and maintaining a switch or spur track to a tributary industry.

None of these reasons is convincing. When it is borne in mind that the Bay Front track was a part of the Wisconsin Central’s terminals, and that no charges other than the schedule tariff rates were imposed upon shipments from industries along that terminal, other than the Ohio Company’s shipments, it becomes manifest that, barring any charge permissible under the Wisconsin statute referred to, the extra charge to the Ohio Company is discriminative. The aspect of the question raised by the Wisconsin statute will be referred to hereafter.

Nor can the right to make such charge be maintained as a special rate agreed upon between the parties. The correspondence out of which it rose, clearly reserved to the Ohio Company the right to challenge its legality. There was no agreement that the charge was legal, and no agreement that its supposed illegality should not be tested. The gist of the agreement—as evidenced in the telegrams—is that if the receivers would restore the service, the Ohio Company would pay, as the cars were served, the extra charge; but subject to its right to recover this portion back in any proper legal proceeding; and the action under review is such proceeding.

But had there been an agreed special charge, without reservation of right to question its legality, it is doubtful if such agreement would stand as a bar to an action, where, as in the case under review, it clearly appeared that the agreement was entered into by the Ohio Company solely to escape being left without service at all. Common carriers, bound by the law to serve all without discrimination, may not hold shippers to agreements exacted under the alternative of destruction of their business. The carriers having no right, other than that of physical might, to extort such an agreement, the agreement itself partakes of the character of an agreement made under duress.

Nor can the extra charge be justified, in our judgment, under the Wisconsin statute. The statute in question is as follows:

“The owner of any elevator, warehouse, mill, lumber, coal or wood yard within the yard limits of any station or terminus of any railroad may, at his own expense, construct a railroad track from such elevator, warehouse, mill or yard to such railroad and connect with the same by a switch at a point within the yard limits of such station or terminus, and the railroad corporation shall allow such connection. Such side track and switch shall at all times be under the control and management of and be kept in repair and operated for the benefit of such owner or his assigns by such corporation; but the actual cost of so maintaining and operating the same shall be paid monthly by the owner thereof; and in case of his neglect to so pay the same upon demand the obligation of this section upon any such corporation shall cease until such payment be made in full.” Section 1802, Kev. St. 1898.

The statute, it is seen, requires monthly statements; no such statements were made to the Ohio Company. The statute limits the charge to actual expenses; no pretense is made that the operation of the spur line, from the Bay Front track to the Ohio Company’s dock, cost two dollars per car. Nor was there an agreement that the charge should be accepted in lieu of the actual expenses contemplated. It was never so claimed by the receivers, or so understood by the shipper. The whole contention is a manifest after thought, brought forward now to cover what, at the time, was unthought of between the parties.

The fact that the action was not brought until after the receivership had been terminated, and the property turned over to the owners pursuant to the final decree, does not in our view of the law, bar this action. The decree in the receivership suit provided that the purchaser, at the receivership sale, should satisfy and discharge any unpaid indebtedness and liability of the receivers which had been incurred in the management and operation of the mortgaged premises, on or after September 27th, 1893; and jurisdiction to carry out that part of the decree was reserved in the court. To that extent the receivership case is still pending. The purpose of the action under review is to ascertain and liquidate the claim of the Ohio Company, if it have any, against the receivers; upon such liquidation application can be made in the original receivership suit for such proceeding as shall carry the claim to execution. There need be no conflict of tribunals.

The view of the case, thus taken, makes it unnecessary to review any of the assignments of error except that taken to the direction of the court that brought about the verdict. That direction, on the facts before us, was erroneous; and for such error the judgment below is reversed, with instructions to grant a new trial.'