1. A suit by a shipper to recover money exacted by a carrier
under an interstate tariff alleged to be unauthorized by the
Interstate Commerce Act, or unconstitutional, is within the
jurisdiction of the district court, irrespective of the amount
involved, as a suit arising under a law regulating commerce.
Jud.Code § 24, par eighth. P. 271 U. S.
2. Preliminary resort to the Interstate Commerce Commission is
not essential to a suit to recover alleged wrongful demurrage
charges, no administrative question being presented. P.
271 U. S.
3. An additional demurrage charge, miscalled a penalty, of ten
dollars per car, per day, imposed by tariff on cars of lumber held
at initial destination beyond a specified time, for reconsignment,
and found reasonable, on evidence, by the Interstate Commerce
Commission, does not exceed the Commission's statutory authority,
nor the power of Congress to delegate authority to the Commission.
P. 271 U. S.
4. Neither is such charge violative of due process because
without notice other than that conveyed by the tariff, or violative
of equal protection of the laws because applicable only to cars
loaded with lumber. P. 271 U. S. 263
2 F.2d 292 affirmed.
Error to a judgment of the district court for the railway
company in an action by the lumber company to recover a sum
collected under a demurrage tariff.
Page 271 U. S. 260
MR. JUSTICE BRANDEIS delivered the opinion of the Court.
Turner, Dennis & Lowry Lumber Company brought this action
against the Chicago, Milwaukee & St. Paul Railway Company in
the federal court for Western Missouri to recover $40 alleged to
have been illegally exacted in December, 1921. That sum was
collected by the carrier, in accordance with a demurrage tariff
duly filed, as a so-called penalty at the rate of $10 a day for the
detention of a car containing lumber shipped interstate over the
defendant's railroad to the plaintiff at Aberdeen, South Dakota,
and there held at its request for reconsignment. The claim that the
charge was illegally exacted rests upon the contentions that
imposition of a penalty exceeds the statutory authority conferred
upon the Commission; that, if the Interstate Commerce Act be
construed as conferring such authority, the provision is void
because Congress is without power to authorize the Commission to
impose it, since prescribing a penalty is a legislative function
which cannot be delegated, and that, even if authority to impose a
penalty was validly conferred, this particular provision is void
because, by imposing the penalty without notice, there is a denial
of due process of law, and that, being imposed only on shippers of
lumber, there is a denial of equal protection of the laws.
The tariff in question provides:
"To prevent undue detention of equipment under present
emergency, the following additional penalties for detention of
equipment will apply:"
"On cars loaded with lumber held for reconsignment a storage
charge of $10 per car will be assessed for each day or fractional
part of a day that a car is held for reconsignment after 48 hours
after the hour at which free time begins to run under the demurrage
Page 271 U. S. 261
"These charges will be assessed regardless of whether cars are
held on railroad hold tracks or transfer tracts, including
consignee's or other private sidings, and will be in addition to
any existing demurrage and storage charges."
The general nature of charges under the Uniform Demurrage Code
was considered in Swift & Co. v. Hocking Valley Ry.
Co., 243 U. S. 281
Pennsylvania R. Co. v. Kittanning Iron & Steel Co.,
253 U. S. 319
The origin and purpose of the penalty charge here in question were
discussed in Edward Hines, etc., Trustees v. United
States, 263 U. S. 143
nature and scope of the reconsignment privilege are stated in
Reconsignment Case, 47 I.C.C. 590; Reconsignment case No. 3, 53
I.C.C. 455; Stetson, Cutler & Co. v. New York, New Haven &
Hartford R. Co., 91 I.C.C. 3. This penalty charge was attacked as
unreasonable and unjustly discriminatory in American Wholesale
Lumber Association v. Director General, 66 I.C.C. 393, and there
held by the Interstate Commerce Commission to be neither
unreasonable nor otherwise unlawful. *
By stipulation in writing, a jury was waived, the case was
submitted on agreed facts, these were adopted by the court as a
special finding of facts, and judgment was entered for the
defendant on November 8, 1924, 2 F.2d 291. The district court had
jurisdiction under paragraph 8 of § 24 of the Judicial Code,
despite the small amount, because the suit arises under a law
regulating commerce. Louisville & Nashville R.
Page 271 U. S. 262
Rice, 247 U. S. 201
Preliminary resort to the Interstate Commerce Commission was
unnecessary, because no administrative question is presented.
Great Northern Ry. Co. v. Merchants' Elevator Co.,
259 U. S. 285
case is here on direct writ of error under § 238 of the Judicial
Code, prior to its recent amendment, because of the constitutional
The efficient use of freight cars is an essential of an adequate
transportation system. To secure it, broad powers are conferred
upon the Commission. Compare United States v. New River
Co., 265 U. S. 533
Avent v. United States, 266 U. S. 127
United States v. P. Koenig Coal Co., 270 U.
. One cause of undue detention is lack of
promptness in loading at the point of origin, or in unloading at
the point of destination. Another cause is diversion of the car
from its primary use as an instrument of transportation by
employing it as a place of storage, either at destination or at
reconsignment points, for a long period while seeking a market for
the goods stored therein. To permit a shipper so to use freight
cars is obviously beyond the ordinary duties of a carrier. The
right to assess charges for undue detention existed at common law.
Now they are subject, like other freight charges, to regulation by
the Commission. Demurrage charges are thus published as a part of
the tariffs filed pursuant to the statutes.
All demurrage charges have a double purpose. One is to secure
compensation for the use of the car and of the track which it
occupies. The other is to promote car efficiency by providing a
deterrent against undue detention. Pennsylvania R. Co. v.
Kittanning Iron & Steel Co., 253 U.
, 253 U. S. 323
Edward Hines, etc., Trustees v. United States,
263 U. S. 143
263 U. S. 145
The charge here in question, although called a penalty, is, in
essence, an additional demurrage charge, increasing at a step rate.
Such additional charges increasing with the length of the
Page 271 U. S. 263
of detention were introduced in respect to some cars by the
National Car Demurrage Rules. See
Rule 7, Demurrage
Charges, sections A and B. They were widely applied while the
railroads were under federal control. See
of the Director General, Nos. 37, 7 and 7a; Bulletin No. 4, Revised
(1919) pp. 146, 151; Supplement to Bulletin, Revised (1920) p. 44.
The power to impose such charges, if reasonable, is clear. Those
here in question have been found by the Commission to be
reasonable. It is not claimed that there was no evidence to support
the finding. Compare Louisiana & Pine Bluff Ry. Co. v.
United States, 257 U. S. 114
The further contentions are that there was a denial of due
process of law because the so-called penalty was imposed without
notice, and that there was a denial of equal protection of the laws
because the charge was applicable only to cars loaded with lumber.
The demurrage charge is, however, a tariff provision, and not a
penal law, and thus the tariff duly filed charges the shipper with
the requisite notice. And neither the Constitution nor the rule of
reason requires that either freight or demurrage charges or the
reconsignment privilege shall be the same for all commodities. We
find no reason to disturb the basis of the Commission's
* During the period of federal control, this tariff was filed
with the Interstate Commerce Commission, as provided by law, to be
effective October 20, 1919. After the termination of federal
control, the defendant and other railroads continued to maintain
the provision in their published tariffs until March 13, 1922, when
it was cancelled in pursuance of the decision and order of the
Commission in American Wholesale Lumber Co. v. Director General, 66