1. Under § 1 of the Elkins Act, making it a misdemeanor for a
shipper knowingly to accept or receive any concession or
discrimination in respect of transportation whereby property shall
be transported at less than the published rate "or whereby any
other advantage is given or discrimination practiced," a shipper
who obtains coal cars and transportation in violation of an
emergency priority order of the Interstate Commerce Commission
through practice of deceit upon the carrier with respect to the use
to which the coal is destined is guilty of the offense. P.
270 U. S.
517.
2. Guilty knowledge and collusion on the part of the carrier is
not an essential to the guilt of the shipper.
Id.
1 F.2d 738 reversed.
Error to a judgment of the district court which sustained a
demurrer to an indictment charging a shipper with fraudulently
obtaining concessions and discriminations from a carrier in coal
shipments.
Page 270 U. S. 514
MR. CHIEF JUSTICE TAFT delivered the opinion of the Court.
The P. Koenig Coal Company was indicted in the District Court
for the Eastern District of Michigan, under the Elkins Act, for
knowingly receiving as a shipper concessions from a carrier under
the Interstate Commerce Act in respect to transportation of
property in interstate commerce obtained by deceitful
representation made to the carriers on which the carriers
innocently and in good faith relied. The district court sustained a
demurrer to the indictment, and the United States prosecutes a writ
of error under the Criminal Appeals Act (Judicial Code, § 238, par.
2, as reenacted by the Act of February 13, 1925, 43 Stat. 938, c.
229), which provides that a writ of error from the district court
may be taken directly to this Court from a judgment sustaining a
demurrer to any indictment or any count thereof where such judgment
is based upon the invalidity or construction of the statute upon
which the indictment is founded.
Page 270 U. S. 515
The district court held that § 1 of the Elkins Act of February
19, 1903, c. 708, 32 Stat. 847 (reenacted in § 2 of the Hepburn Act
of June 29, 1906, c. 3591, 34 Stat. 587), under which the
indictment was found, applies only to a shipper who knowingly
receives a concession from a carrier when such concession is
knowingly granted by the carrier in equal guilt with the shipper.
United States v. P. Koenig Coal Co., 1 F.2d 738.
The Koenig Coal Company is a Michigan corporation doing business
in Detroit. The defendant was indicted on 18 counts applying
respectively to 18 carloads of coal. The shipments originated in
West Virginia, and were moved to Detroit in August, 1922, over the
Chesapeake & Ohio Railroad Company as the initial carrier for
each car.
On July 25, 1922, the Interstate Commerce Commission, acting
under the Transportation Act of February 28, 1920, c. 91, Tit. 4, §
402(15), 41 Stat. 456, 476, issued its service order No. 23.
Paragraph 15 gives the Commission, when shortage of equipment,
congestion of traffic, or other emergency requires action in any
section of the country, authority to suspend its rules as to car
service and to make such reasonable rules with regard to it as in
the Commission's opinion will best promote the service in the
interest of the public and the commerce of the people, and to give
direction for performance or priority in transportation or movement
of traffic. Service Order No. 23 declared that there was an
emergency upon the railroad lines east of the Mississippi river,
and directed that coal cars should be furnished to the mines
according to a certain order of purposes, numbered in classes 1, 2,
3, 4, and 5, and that no coal embraced in classes 1, 2, 3, and 4
should be subject to reconsignment or diversion except for some
purpose in the same or a superior class. The order required that
the carriers should give preference and priority in the placement
and assignment of cars for
Page 270 U. S. 516
the loading of coal to those required for the current use of
hospitals which were placed in class 2, in priority to cars for the
loading of coal required for the manufacture of automobiles or
automobile parts, which were placed in class 5 and later in class
3. The order remained in force from July 25 to September 20, 1922.
The first count of the indictment charged that the defendant
intending to obtain a preference and priority in transportation
which it was not then lawfully entitled to receive, and to procure
the coal for the use of Dodge & Co., engaged in the manufacture
of automobiles and parts thereof, sent a telegraphic order to the
Monitor Coal & Coke Company, of Huntington, West Virginia,
asking the shipment of carloads of coal to the Koenig Coal Company
at Detroit for the use of the Samaritan Hospital; that it thereby
secured the furnishing by the C. & O. Company on August 5, 1922
at the request of the Monitor Company, of one car suitable for the
loading and transportation of coal on its line in West Virginia,
which was billed and consigned in accordance with the telegraphic
order; that, when it reached Detroit, the defendant diverted the
car to Dodge Bros., who used the coal, the Samaritan Hospital not
needing or requiring the coal, and not having authorized or
requested the defendant to send the order; that the concession and
discrimination was thus obtained by a deceitful device of which the
carriers had no knowledge. The other 17 counts are similar, and
refer to different cars of coal, some of them to different mines
and consignors and some to different beneficiaries of the trick as
actual consumers of the coal.
The demurrer challenged the indictment on various grounds:
first, that the facts charged did not constitute a concession given
or a discrimination practiced as defined by the Elkins Act; second,
that the restrictions imposed by the Interstate Commerce
Commission's Service Order No. 23 were beyond the power of the
Interstate Commerce
Page 270 U. S. 517
Commission, in that they were an exercise of purely legislative
power which could not be delegated; third, that the service order
exceeded the authority conferred upon the Interstate Commerce
Commission; fourth, in that it was beyond the power of the federal
government thus to affect the use, consumption, price, and
disposition of coal in what was the exercise of a local police
power reserved to the states; fifth, that the order is so arbitrary
and unreasonable as not to be within the power of the national
government and to be an encroachment on the powers of the several
states; sixth, that the service order violated the Fifth Amendment
in depriving defendant of liberty and property without due process
of law; and, seventh, that it was invalid because it gave
preference to the Lake Erie ports of Ohio and Pennsylvania over the
ports of other states in respect to the transportation and shipment
of coal.
All of these objections, except the first and third, are covered
by the decision of this Court in
Avent v. United States,
266 U. S. 127,
where we held that Congress might, consistently with the Fifth
Amendment, require a preference in the order of purposes for which
coal might be carried in interstate commerce, that it did not
trench upon the power reserved to the states, that the power might
be delegated to the Interstate Commerce Commission for exercise
under rules that were reasonable and in the interests of the public
and of commerce, that the violation of such rules might be made a
crime, and that the objection that the order unconstitutionally
preferred the ports of one state over those of another could not
avail a party whom the alleged preference did not concern.
Counsel for the defendant, in his brief and argument, supports
the demurrer solely upon the same ground upon which the district
court sustained it -- namely, that the offense under which the
indictment is drawn cannot be
Page 270 U. S. 518
committed without the guilty knowledge and collusion of both the
shipper and the carrier. The relevant part of § 1 of the Elkins Act
reads as follows:
"It shall be unlawful for any person, persons, or corporation to
offer, grant, or give, or to solicit, accept, or receive any
rebate, concession, or discrimination in respect to the
transportation of any property in interstate or foreign commerce by
any common carrier subject to said Act to Regulate Commerce and the
acts amendatory thereof whereby any such property shall by any
device whatever be transported at a less rate than that named in
the tariffs published and filed by such carrier, as is required by
said Act to Regulate Commerce and the acts amendatory thereof, or
whereby any other advantage is given or discrimination is
practiced. Every person or corporation, whether carrier or shipper,
who shall, knowingly, offer, grant, or give, or solicit, accept, or
receive any such rebates, concession, or discrimination shall be
deemed guilty of a misdemeanor, and on conviction thereof shall be
punished by a fine of not less than $1,000, nor more than
$20,000."
This makes it unlawful for anyone to receive any concession in
respect of transportation of any property in interstate commerce by
a common carrier whereby any advantage is given or any
discrimination is practiced. The facts charged bring what was done
exactly within this description. It was a priority or preference in
securing the transportation of coal in an emergent congestion of
the traffic. It was certainly a concession, and one of value to one
who, under the law or the regulations having the force of law,
could not secure that priority. The words "advantage,"
"concession," and "discrimination" in the statute must be construed
to mean unlawful concession, unlawful advantage, unlawful
discrimination. It certainly was not the intention of Congress to
punish the granting or receiving of a lawful concession, a lawful
advantage,
Page 270 U. S. 519
or a lawful discrimination. It is asked, if this was a
concession, by whom was it conceded? The answer is by the carrier.
He granted the priority, and therefore he made the concession and
gave the advantage and practiced the discrimination. But it was
unlawful, and he did not know the facts which made it so. The
shipper knew them because he had secured it by his deceit and
received it. What is there in the statute that releases him from
guilt because the carrier who yielded to him the concession and
gave him the advantage and made the discrimination thought it was
lawful?
Reference is made to the debates in Congress and to decisions of
this Court to show that, in the minds of the legislators in
enacting the Elkins Act, the discrimination and inequality they
sought to prevent had in the past arisen chiefly from collusion
between the carrier and the shipper. As practical men, of course,
they knew that this was the way in which violations of the law were
most likely to occur. But this does not at all justify the
conclusion that Congress, in enacting the Elkins law, intended to
limit the offenses described in it to cases of collusion if
otherwise the acts charged came within the words of the
statute.
We have often declared that the purpose of Congress in the
Elkins law was to cut up by the roots every form of discrimination,
favoritism, and inequality.
Louisville & Nashville R. Co.
v. Mottley, 219 U. S. 467,
219 U. S. 478;
New York, New Haven R. Co. v. Interstate Commerce
Commission, 200 U. S. 361,
200 U. S. 391;
Armour Packing Co. v. United States, 209 U. S.
56,
209 U. S. 72;
United States v. Union Stockyards, 226 U.
S. 286,
226 U. S. 309. It
would be contrary, therefore, to the general intent of the law to
restrain the effect of the language used so as not to include acts
exactly described when they clearly effect discrimination and
inequality. Certainly no one would say that a shipper might not be
convicted under the act of soliciting an unlawful
Page 270 U. S. 520
concession or advantage or discrimination even though the
carrier refused to extend it to him. So, too, if a carrier offers
an unlawful advantage to a shipper who declines it, clearly the
carrier may be indicted and punished. Collusion is not necessary in
such a case. Why in this? The act is plainly not confined to joint
crimes. The general rule that criminal statutes are to be strictly
construed has no application when the general purpose of the
legislature is manifest and is subserved by giving the words used
in the statute their ordinary meaning, and thus covering the acts
charged.
In
Dye v. United States, 262 F. 6, a defendant in an
indictment under the Elkins Act was the agent of a carrier and was
in charge of the distribution of cars between coal mines during an
emergency and car shortage. By a device, he violated the rule of
distribution established by the Commission and secured an excessive
number of cars for a particular mine, the operators of which were
innocent of the inequality. He did this for his personal profit by
sale of the excess. His conviction was sustained by the Circuit
Court of Appeals for the Fourth Circuit.
In
Missouri, Kansas & Texas Pacific Ry. Co. v.
Harriman, 227 U. S. 657, the
Court had to deal with the question whether a shipper who valued
his goods for the purpose of obtaining the lower of two published
rates based on valuation was in an action for their loss estopped
from recovering a greater amount than his own valuation, the
carrier having no knowledge of the value of the shipment. It was
held that he was estopped. In reaching this conclusion, Mr. Justice
Lurton, speaking for the Court at page
227 U. S. 671,
said:
"If he knowingly declares an undervaluation for the purpose of
obtaining the lower of two published rates, he thereby obtains an
advantage and causes a discrimination forbidden and made unlawful
by the first section of the Elkins Act of February 19, 1903."
It is true that this was said
arguendo, but it has
persuasive weight, and now that the point is before us for
judgment, we reaffirm it.
Compare also Illinois Central
Railroad Co. v. Messina, 240 U. S. 395,
240 U. S.
397.
Judgment reversed.