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U.S. Supreme Court

Pennsylvania R. Co. v. International Coal Min. Co., 230 U.S. 184 (1913)

Pennsylvania Railroad Company v.

International Coal Mining Company

No. 14

Argued February 27, 28, 1912

Reargued November 4, 1912

Decided June 9, 1913

230 U.S. 184


Under the Act to Regulate Commerce while reasonableness of rates and permissible discriminations based upon differences in conditions are administrative matters for the Commission, the courts have jurisdiction to determine whether differentials in rates can be allowed for the same commodity under similar conditions of traffic, on account of differences in the disposition of the commodity.

A carrier can only charge the published rate for the same article and, when collected, cannot pay back any part thereof under any pretense, however equitable, to any shipper or to every shipper, and so held that carriers could not, after the passage of the Hepburn Act, continue to give rebates to shippers pursuant to arrangements made prior to the act on merchandise which the shippers had contracted to sell before that time.

A published tariff, so long as it is in force, has the effect of a statute and is binding alike on carrier and shipper.

While departure from a published tariff is forbidden by the Act to Regulate Commerce and by §§ 7 and 8 thereof, the carrier is liable to the person injured for the damages sustained, such damages must be proved, and are not to be merely measured by the difference between the published rate paid by the complaining shipper and the lower rate given to a more favored shipper.

While they may be looked at to explain doubtful expressions in a statute, not even formal reports, much less the language of a member of the committee, can be resorted to for the purpose of construing a statute contrary to its plain terms.

While the Act to Regulate Commerce is in many respects highly penal, there is no fixed measure of damages in favor of a shipper compelled to pay the published tariff rate while his favored competitors are given a lesser rate by means of rebates. Neither the American nor English decisions are authority for such a rule as to the measure of damages.

The Act to Regulate Commerce imposes on the carrier heavy penalties

Page 230 U. S. 185

for its violation payable to government and independent of the amount of rebates paid, and is thus a terror to evil doer; but for private wrongs by which private injury is inflicted, the compensation recoverable by the injured shipper is measured by the damage actually sustained and proved.

173 F. 1 reversed.

The international Coal Mining Company shipped in interstate commerce 190,655 tons of coal over the Pennsylvania Railroad between April 1, 1894, and April 1, 1901. In 1904, it sued the carrier for $37,268, being the difference between the rates paid by the plaintiff and lower rates resulting from rebates allowed other coal dealers making like shipments over the same road from the same point to the same destination.

Prior to 1899, the carrier collected its open or published rates from all persons shipping coal from the Clearfield District in Pennsylvania. It, however, made a practice of paying rebates, and the plaintiff admits on the face of its complaint that it received rebates of from 10 to 25 cents per ton. It alleges, however, that other consignors received from 15 to 45 cents per ton, and the claim made is

"for the further rebate due by the defendant to the plaintiff in excess of the rebates heretofore paid by the defendant to the plaintiff on account of said shipments."

During the trial, these claims for additional rebates on shipments prior to 1899 were eliminated by the court.

The question then left in the case involved plaintiff's right to recover on account of rebates' having been allowed other companies after April 1, 1899, on what was called "contract coal." The plaintiff had no contracts which overlapped April 1, 1899, and claimed to have learned after January, 1904, of the allowances being made. It thereupon brought this suit for the rebate or difference between the low rate allowed shippers of contract coal and the lawful rate paid by plaintiff on 41,000 tons.

There was a second count in the complaint, alleging

Page 230 U. S. 186

that the plaintiff charged excessive freight for the transportation of plaintiff's coal in that it charged sums varying from 15 cents per ton to 45 cents per ton in excess of a reasonable charge, and said defendant

"is liable to pay said sum of $37,268.85, with interest thereon from the time of the said overpayments, and this suit is brought to recover the said sums of money."

The plaintiff proved the number of tons in each shipment made by it between April, 1899, and April, 1901, and that it paid the full tariff rate thereon. It also proved that interstate shipments had been made by other coal companies on the same dates from and to the same points, and that such companies, on their "contract coal," had been paid rebates of 5, 10, 15, 25, or 35 cents per ton, depending upon the difference between the rates when shipment was made and those in force on the dates of the various contracts of sale. It did not appear how many tons had been shipped by any of these companies, nor on how many tons they had been paid 5 cents per ton, or on how many 35 cents per ton, or the intermediate figures. There was evidence that the Berwind White Company received no rebates on 90 percent of its shipments, being free coal, but that it did receive rebates on the remaining 10 percent, which was contract coal.

In addition to evidence as to the payment of such rebates, there was testimony that the railroad company had also made lateral and terminal allowances to some shippers without at the same time making lateral or terminal allowances to the plaintiff. It was claimed that these allowances were unjust discriminations, and amounted to the payment of rebates, inasmuch as there was no such dissimilarity in condition between shipments by such companies and those made by the plaintiff as would justify the payment to them without making a similar payment to the plaintiff.

The defendant admitted the difference in treatment, but

Page 230 U. S. 187

claimed that it was justified by the difference in condition. The railroad did not allow the plaintiff for services in hauling loaded and empty cars between the railroad and its nearby mine, but claimed that it paid the Altoona Company 18 cents per ton for services in hauling loaded and empty cars between the mine and the railroad station. The carrier offered evidence to show that the Altoona mine was 4 or 5 miles from the main line, which was reached by a spur track or road having very heavy grades, sharp curves, and three switchbacks over which it was impracticable for the Pennsylvania engines to be safely operated. There was evidence that the amount paid the Altoona Company for such hauling of cars was reasonable.

It was admitted also that the carrier paid the Berwind White Company, another shipper from the Clearfield District, a terminal charge for furnishing at the New York pier the labor, power, and machinery to unload and dump the cars. There was evidence that this was the customary charge allowed for such services in New York harbor.

There was no distinct ruling as to these allowances, but the court evidently treated these payments not as undue preferences or rebates, but as compensation for transportation services rendered by the shipper in hauling cars to and from the mine and for service on the pier in New York. He refused to charge that the jury could treat these initial and terminal allowances as rebates or as unjust discriminations, or that they could be considered in measuring the damages to which plaintiff might be entitled.

The items prior to April 1, 1899, and these items for initial and terminal allowances having been eliminated, the case was submitted to the jury to determine the amount plaintiff was entitled to recover in consequence of the admitted payment of rebates on "contract coal," no such payments being made to the plaintiff on its shipments of

Page 230 U. S. 188

"free coal." There was some evidence as to the commercial value of being able to ship contract coal at the original freight rate, and an estimate of the profits which would have been derived had the same rebates been allowed plaintiff. What, if any, verdict could have been based on this theory was not submitted to the jury, the court charging that, where rebates had been allowed other companies, the plaintiff "would be entitled to recover from the railroad the difference of the returns."

On May 23, 1908, the jury found for the plaintiff a verdict of $12,013.51. Both parties moved for a new trial, and both excepted to the court's refusal to set aside the verdict. 162 F.9d 6. The circuit court of appeals affirmed the judgment. 173 F. 1. The International Coal Company accepted the decision. But the Pennsylvania Railroad Company brought the case here by writ of error in which, among many other assignments of error, it complains of the court's refusal to charge that,

"to entitle the plaintiff to recover, the jury must be satisfied that it sustained some loss or injury due to the fact that the defendant was carrying at the same time at lower rates, coal shipped by other shippers. "

Page 230 U. S. 194

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