1. The Interstate Commerce Commission has power under the
Interstate Commerce Act to order a railroad to make deliveries of
interstate carload shipments of livestock without discrimination to
a shipper on the shipper's private sidetrack, even though
compliance with that order will require the railroad to use an
intermediate segment of track maintained and operated by the
railroad but owned by and leased from a competing shipper whose
lease to the railroad precludes use of such track for the purpose
of making such deliveries to its competitors. Pp.
333 U. S.
175-178.
(a) The definitions contained in §§ 1(1)(a) and 1(3)(a) of the
Interstate Commerce Act make all trackage "in use by any common
carrier" subject to the regulatory provisions of the Act, even
though not owned by the carrier, but only used by it under a lease.
P.
333 U. S.
176.
(b) The command of Congress against discrimination cannot be
subordinated to the command of a track owner that a railroad using
the track practice discrimination. P.
333 U. S.
177.
Page 333 U. S. 170
2. It does not deprive an owner of his property without due
process of law to deny him the right to enforce conditions upon its
use which conflict with the power of Congress to regulate railroads
so as to secure equality of treatment of shippers. P.
333 U. S.
177.
3. Under § 2 of the Elkins Act, the Commission was justified in
including, in an order against certain railroads to cease
discriminatory practices, a noncarrier owner of a segment of track
who required such discriminatory practices pursuant to the contract
leasing such track to one of the railroads. P. 171,
n 2.
71 F. Supp. 499 reversed.
The Interstate Commerce Commission issued a cease and desist
order requiring certain interstate railroads and the owner of a
segment of railroad track leased to one of the railroads to desist
from certain discriminatory practices in connection with interstate
shipments. 266 I.C.C. 55. A federal district court enjoined
enforcement of the order. 71 F. Supp. 499. On appeal to this Court,
reversed, p.
333 U. S. 178.
Page 333 U. S. 171
MR. JUSTICE BLACK delivered the opinion of the Court.
This case is properly here on appeal from a District Court
decree enjoining enforcement of a cease and desist order of the
Interstate Commerce Commission. 28 U.S.C. § 345; 71 F. Supp. 499.
The order enjoined required the five railroad appellees [
Footnote 1] to abstain from refusing to
deliver interstate shipments of livestock to the sidetrack of Swift
& Company's packing plant at Cleveland, Ohio, and to establish
tariffs for such deliveries. Swift's sidetrack has only one
connection with a railroad. That connection is with the main line
of the New York Central by way of a spur track, known as "Spur No
245," operated by that railroad. One end of this spur owned by the
New York Central connects with its main line; the other end of the
spur, also owned by the railroad, connects with Swift's sidetrack
and with other private sidetracks. A 1619-foot middle segment of
the spur, known as "Track 1619," is owned by the Cleveland Union
Stock Yards Company. Under the terms of a trackage agreement with
Stock Yards, New York Central uses Track 1619 for deliveries to
Swift's sidetrack and other private sidetracks connected with Spur
No. 245. Thus, all interstate railroad shipments to Swift's siding
and to others similarly located can be made only over the segment
of track owned by Stock Yards. Because of its interest in Track
1619, Stock Yards was made a party to the proceedings before the
Commission, and was included in its cease and desist order along
with the railroads. [
Footnote
2]
Page 333 U. S. 172
So long as Stock Yards continues to own Track 1619, delivery of
livestock and other freight by New York Central to Swift and others
similarly located depends upon whether and to what extent Stock
Yards will grant or has granted New York Central a right to operate
over Track 1619. This present case involves the question of whether
the railroads, and particularly New York Central, in making
deliveries of livestock over Track 1619 to Swift's sidetrack, must
comply with certain conditions imposed by Stock Yards in its
present agreement with New York Central.
Track 1619 was constructed in 1899 on Stock Yards' property by
Stock Yards and New York Central's predecessor in interest. A
contemporaneous written agreement, cancellable on 60-days written
notice by the railroad, gave the railroad a right to use the track
for railroad purposes provided the use did not interfere with Stock
Yards' business. In 1910, after negotiations with the railroad,
Swift built its sidetrack, and the railroad extended its Spur No.
245 by a track which connected Track 1619 with Swift's siding. The
1899 written trackage agreement was superseded by another in 1924.
This one was cancellable by either party on 30-days written notice.
It provided that the railroad should maintain the tracks at its own
expense, and it granted to the railroad "the free and uninterrupted
use of any and all tracks or portions thereof belonging to the
Industry and located on its land." From 1910, when Swift's siding
was constructed,
Page 333 U. S. 173
to 1924, and for many years thereafter, the railroad continued
to deliver all kinds of commodities to Swift and to other packers
likewise served only by way of Spur No. 245 and Track 1619.
In the early 1930's, Stock Yards concluded that it was losing
patronage and fees because of delivery of livestock to Swift at its
siding. A large source of Stock Yard's income comes from fees it
charges for unloading and delivering interstate shipments of
livestock to pens within its yard. Stock carried over Track 1619 to
Swift's siding and to other private sidings are unloaded at those
sidings; as a result, Stock Yards loses the fees it would receive
if livestock consigned to Swift and to other packers were unloaded
at the Stock Yards. With a view toward collecting unloading fees
from Swift and other packers served by Spur No. 245, Stock Yards
instituted negotiations with the New York Central which, in 1935,
resulted in a modification of their 1924 agreement. The old 1924
agreement had unconditionally granted "Railroad, the free and
uninterrupted use of any and all tracks. . . ." The 1935 modified
agreement also granted New York Central "the free and uninterrupted
use," of Stock Yard's tracks, but added, "except for competitive
traffic, a charge for which use shall be the subject of a separate
agreement."
After this 1935 restrictive modification, Stock Yards demanded
that the railroad adopt one of two courses with regard to
livestock, which the parties agreed was the "competitive traffic"
the modified agreement was designed to suppress. The railroad must
either stop carrying livestock over Track 1619 to Swift and other
packers or pay Stock Yards, for use of Track 1619 in carrying
livestock to these packers, amounts equivalent to fees Stock Yards
would have collected had the livestock consigned to them been
unloaded and delivered in the yard. This amount was considered
exorbitant by New York Central and the
Page 333 U. S. 174
other railroads for whom New York Central performed switching
charges, and they therefore refused to pay it. The result was that,
in 1938, the railroads ceased delivering livestock to the sidings
of Swift and other packers served by Spur No. 245, [
Footnote 3] although they have, under
agreement with Stock Yards, continued to use the spur for delivery
of all other kinds of commodity shipments to these sidings. Swift
demanded that the railroads deliver livestock to its siding, and,
in 1941, filed a complaint with the Interstate Commerce Commission
upon their refusal to make deliveries.
After notice and hearing, the Commission concluded that the
railroad's refusal to carry livestock to Swift violated several
provisions of the Interstate Commerce Act It was found to violate §
3(1) because of the discrimination against a single commodity,
livestock, and because New York Central's deliveries of livestock
to the sidetracks of some of Swift's nearby competitors, whose
sidings were served without using Track 1619, subjected Swift to
undue prejudice and gave those competitors and undue preference.
The Commission also found that the failure to deliver, under the
circumstances shown, was a violation of § 1(6), which forbids
unreasonable practices affecting the manner and method of
delivering freight, and also a violation of § 1(9), which requires
railroads to operate switch connections with private side
tracks
Page 333 U. S. 175
without discrimination under such conditions as the Commission
found to exist here.
The Commission's findings of fact are not challenged. There can
be no doubt that those facts found would constitute a violation of
the sections referred to if Spur No. 245 were wholly owned by the
railroad. Ownership of Track 1619 by Stock Yards and its objection
to livestock deliveries is, in fact, the only reason suggested for
the railroads' failure to deliver shipments of livestock to Swift
as they do to neighboring packers, and for their failure to provide
switching connections for livestock shipments. From what has been
said, our question is this: can the noncarrier owner of a segment
of railroad track who contracts for an interstate railroad's use of
the segment as part of its line reserve a right to regulate the
type of commodities that the railroad may transport over the
segment, or would such a reservation be invalid under the
Interstate Commerce Act?
The Interstate Commerce Act is one of the most comprehensive
regulatory plans that Congress has ever undertaken. The first Act,
and all amendments to it, have aimed at wiping out discriminations
of all types,
New York v. United States, 331 U.
S. 284,
331 U. S. 296,
and language of the broadest scope has been used to accomplish all
the purposes of the Act.
United States v. Pennsylvania R.
Co., 323 U. S. 612,
323 U. S. 616.
It would be strange had this legislation left a way open whereby
carriers could engage in discriminations merely by entering into
contracts for the use of trackage. In fact, this Court has long
recognized that the purpose of Congress to prevent certain types of
discriminations and prejudicial practices could not be frustrated
by contracts, even though the contracts were executed before
enactment of the legislation.
See Philadelphia, Baltimore &
Washington R. Co. v. Schubert, 224 U.
S. 603,
224 U. S.
613-614;
Louisville & Nashville R. Co. v.
Mottley, 219 U. S. 467,
219 U. S. 483,
219 U. S.
485-486.
Page 333 U. S. 176
We think the provisions of the Interstate Commerce Act plainly
empowered the Commission to enter this order against the
discriminatory practices found, despite ownership of Track 1619 by
Stock Yards. Section 1(1)(a) makes the Interstate Commerce Act
applicable to common carriers "wholly by railroad." Section 1(3)(a)
defines the term "railroad" as including
"all the road in use by any common carrier operating a railroad,
whether owned or operated under a contract, agreement, or lease,
and also all switches, spurs, tracks. . . ."
As one of the many other indications that Congress did not
intend its railroad regulatory provisions to depend on who had
legal title to transportation instrumentalities, § 1(3)(a) also
provides that the word "transportation," as used in the Act, shall
broadly include
"locomotives . . . and all instrumentalities and facilities of
shipment or carriage, irrespective of ownership or of any contract,
express or implied, for the use thereof. . . ."
It is true, as appellees argue, that the above language of §
1(3)(a) is definitional only.
Ellis v. Interstate Commerce
Commission, 237 U. S. 434. But
it is also true that these definitions, by their unambiguous
language, make all trackage "in use by any common carrier" subject
to the regulatory provisions of the Act, even though not owned by
the carrier, but only used by it under a contract or agreement.
Thus, Track 1619, though owned by Stock Yards, was subject to the
Act because of its use by the New York Central under trackage
agreements.
It is just as prejudicial to shippers and the public for a
railroad that uses a portion of track under lease or contract to
discriminate as it is for the discrimination to be inflicted by a
railroad that owns its entire track. Practically, the only argument
suggested to justify discriminatory practices under the
circumstances here is that an owner has a right to let others use
his land subject
Page 333 U. S. 177
to whatsoever conditions the owner chooses to impose. It is even
argued that to construe the Interstate Commerce Act as limiting
that right would result in depriving an owner of his property
without due process of law. But no such broad generalization can be
accepted. Property can be used, even by its owner, only in
accordance with law, and conditions its owner places on its use by
another are subject to like limitations. Of course, it does not
deprive an owner of his property without due process of law to deny
him the right to enforce conditions upon its use which conflict
with the power of Congress to regulate railroads so as to secure
equality of treatment of those whom the railroads serve.
Here, Congress, under its constitutional authority, has provided
that no railroad shall engage in certain types of discriminatory
conduct in violation of three provisions of the Act. The Commission
found that discriminatory conduct here. The excuse offered by the
railroads is that the owner of Track 1619 required them to do the
prohibited things. But the command of Congress against
discrimination cannot be subordinated to the command of a track
owner that a railroad using the track practice discrimination.
We hold that the Commission's order was authorized by statute,
and that it does not deprive Stock Yards of its property without
due process of law. In doing so, we do not pass upon any questions
in relation to the dedication of Track 1619 to railroad use.
Neither do we decide what are the relative financial rights of
Stock Yards and New York Central under their contracts, nor whether
Stock Yards can cancel the contract with New York Central, nor what
would be the duty of New York Central should Stock Yards attempt to
terminate its right to use Track 1619. We only hold that Stock
Yards' ownership of Track 1619 does not vest it with power to
compel
Page 333 U. S. 178
the railroads to operate in a way which violates the Interstate
Commerce Act.
The Commission's order is valid, and should be enforced.
Reversed.
[
Footnote 1]
The railroad appellees are Baltimore & Ohio Railroad
Company, the Erie Railroad Company, the Wheeling & Lake Erie
Railroad Company, the New York Central Railroad Company, and the
Pennsylvania Railroad Company.
[
Footnote 2]
Appellees argue that Stock Yards was improperly made a party,
and that the Commission was without power to include Stock Yards in
its cease and desist order. We think § 2 of the Elkins Act, 32
Stat. 848, 49 U.S.C. § 42, justified the Commission's action, and
find no merit to the contention that we should be interpretation
restrict that section's broad language authorizing inclusion as
parties of "all persons interested in or affected by the rate,
regulation, or practice under consideration" by the Commission or
by a court, and which provides that decrees may be made with
reference to such additional parties to the same extent as though
they were carriers.
[
Footnote 3]
In 1938, New York Central ceased to switch livestock carloads of
other carriers over Spur No. 245 to Swift's siding, and it canceled
its tariffs for this service. Since that time, there has been no
specific tariff authority for movement of livestock to Swift's
siding when shipped to Cleveland over lines other than the New York
Central. Although New York Central has never canceled its tariff
for livestock shipments to Swift's Cleveland siding from points of
origin on its own lines, it has delivered all livestock consigned
to Swift's siding to Stock Yards since 1938. Swift has been forced
to pay charges to Stock Yards to obtain possession of livestock
unloaded at the yards.
MR. JUSTICE BURTON, dissenting.
For the reasons stated in the opinion of the District Court in
this case, 71 F. Supp. 499, I believe that the order of the
Interstate Commerce Commission exceeded its jurisdiction, and that
the judgment permanently enjoining the enforcement of such order
should have been affirmed.