# Interstate Commerce Commission v. Baltimore & O. R.

> U.S. Circuit Court for the District of Southern Ohio · August 11, 1890 · 43 F. 37

URL: https://www.frixlaw.com/law-library/cases/9305745

## Case

- **Full name:** Interstate Commerce Commission v. Baltimore & O. R. Co.
- **Court:** U.S. Circuit Court for the District of Southern Ohio
- **Decided:** August 11, 1890
- **Citations:** 43 F. 37; 6 Ohio F. Dec. 605; 1890 U.S. App. LEXIS 1604
- **Precedential status:** Published
- **Opinion:** Concurrence by Sage
- **Judges:** Jackson, Sage
- **Cited by:** 32 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9305745

## Opinion text

Sage, J.,
(concurring.) The bill is filed to enforce the opinion and order of the interstate commerce commission against the respondent, upon the complaint of the Pittsburgh, Cincinnati & St. Louis Railway Company, that the respondent had put into effect and had .in operation so called “party rates,” whereby parties of ten or more persons traveling-together on one ticket were transported over its lines of road at two cents per mile per capita, the regular rate for a single person being about three cents per mile. The complaint was, further, that the respondent was in the habit of selling round-trip excursion tickets over its lines without publicly posting the rates therefor, which were loss than rates for ordinary tickets. The respondent admitted the facts as alleged, hut denied that they wore in conflict with the law.
The hill contains, in substance, the averments of the complaint, with the further averment that the respondent, in disregard of complainant’s order, and in violation of the act to regulate commerce, persists in doing each of the acts complained of, wherefore an injunction is prayed to *56 restrain the respondent from further continuing said disregard, under a penalty of4500 for every day after a day to be named in the decree of this court.
The respondent admits the averment of fact in the bill relating to the sale and use of party-rate tickets, and justifies as in its answer to the complaint aforesaid, but denies that since the order made thereon it has failed or refused to post its rates for excursion tickets. No testimony was taken in support of the averments of the bill denied by the answer, and at the hearing this part of the complainant’s cause was abandoned, leaving as the only questions to be decided those relating to the salé of party-rate tickets, as conducted by the respondent.
The facts are not in. dispute. A single ticket is issued to a party of ten or more at the fixed rate of two cents per mile per capita, which is a reduction of about thirty-three and one-third per centum from the regular fare for a single person. This rate is scheduled, and posted, and open to the public at large. A question was made whether these tickets were known and recognized in railroad circles befóte and at the date of the passage of the act as “commutation tickets.” The evidence of railroad men of experience and prominence was taken upon this point. It clearly establishes the negative of the proposition. Some of the witnesses went further, and undertook to settle, by their testimony, whether party-rate tickets are commutation tickets; but that is a question of construction, to be determined by the court, and not by witnesses. Whether they -were, at and before the passage of the act, generally known and recognized by those engaged in railroad business as “commutation tickets,” and how those -words were then understood and used by railroad men, is competent, for the reason that the presumption is that congress employed terms used in that business in the sense in which they were so used. Construing the testimony according to this rule, my conclusion is that party-rate tickets are not included in the letter of the provision in favor of commutation tickets in the twenty-second section of the act. Their use was confined chiefly to traveling theatrical troupes. They were not on sale to the public. Although kept at the larger stations, they could not usually be obtained without an order from the general office, or from some authorized sub-office of the passenger department. They were not regarded as, nor understood to be, commutation tickets, nor are they such within the meaning of the word “commutation which, as applied to railroad tickets, is defined by Webster to be “the purchase of a right to go upon a certain route during a specified period for a less amount than would be paid in the aggregate for separate trips.” The Century Dictionary gives the following definition: “A ticket issued at a reduced rate by a carrier of passengers, entitling the holder to be carried over a given route a limited number of times, or an unlimited number during a certain period.”
There is a general sense in which the party-rate ticket may be said to be a commutation ticket, although no more so than a mileage ticket oran excursi on ticket. But the twenty-second section recognizes mileage, excursion, and commutation tickets each as distinct from the others, using the designations in their technical sense. The difference between commutation and *57 party-rate tickets is that commutation tickets are issued to induce people to travel more frequently, and party-rate tickets are issued to induce more people to travel. There is, however, no difference in principle between them, the object in both cases being to increase travel without unjust discrimination, and to secure patronage that would not otherwise be secured. The party-rate ticket is more like the excursion ticket, the apparent difference being that the excursion ticket is to return to the starting point; hut, as the return is frequently over another line, so that the excursionist is not carried both ways over any portion of the entire route, the difference is not material. For the purposes of this opinion, however, the party-rate ticket will be regarded as separate and distinct from mileage, excursion, and commutation tickets.
It- is claimed that section 22 makes certain exceptions from the operation of the act, specifying mileage, excursion, and commutation passenger tickets, and that, as party-rate tickets are not mentioned, and cannot be classed as commutation tickets, the inference, under a well-known rulo of construction, is that congress intended to exclude them. Let us look into this matter. The first section of the act contains the general provision upon which the entire act is founded. It requires that all charges for the transportation of persons or property shall he reasonable and just, and prohibits every unjust and unreasonable charge. The provisions of the second, third, fourth, and fifth sections are specific, in the nature of definitions, and in aid of the provisions of the first section. In this case we have to deal particularly with the provisions of the second and third sections, which prohibit unjust discriminations, and undue and unreasonable preferences. The second section makes it unlawful, by any special rate or other device, to demand, collect, or receive from any person or persons a greater or less compensation for any service rendered in the transportation of persons or properly than is charged, demanded, collected, or received from any other person or persons fora like contemporaneous service, in the transportation of a like kind of traffic, under substantially similar circumstances and conditions. The third section forbids any undue or unreasonable preference, in any respect whatsoever, to any particular person, company, firm, corporation, or locality, or any particular description of traffic; and to the same extent it forbids any undue or unreasonable prejudice or disadvantage. Now, it is to be observed at the outset that the act does not provide that there shall be no discrimination. The prohibition is against unjust discrimination, undue and unreasonable preference or advantage, and undue or unreasonable prejudice or disadvantage. Apparently recognizing, as the law has recognized, that discrimination, within just limits, is essential to the successful conduct of the business of the common carrier, as it is to the successful conduct of every other business, but, beyond those limits, destructive, congress attempted nothing more than to fix and enforce the limit; and this consideration furnishes the key to the proper construction of the act.
Now, let us turn to section 22. It is referred to as specifying exceptions to the operation of the act. But are they exceptions?
*58 Did congress intend to say that certain unjust discriminations, and undue and unreasonable preferences and advantages,— that is to say, those mentioned in the twenty-second section, — should be excepted? What are they? Here is one of the first: “The free carriage of destitute and homeless persons transported by charitable societies.” Would that be an unjust discrimination, but for the “exception” in its favor? Unjust to whom? Would it be less unjust to leave it to the other passengers to take up a collection and pajr their fare, or submit to see them put off the train? “Nothing in this act shall be construed to prohibit any common carrier from giving reduced rates to ministers of religion, or to municipal governments for the transportation of indigent persons, or to inmates of the national or state homes for disabled volunteer soldiers, or of soldiers’ and sailors’ orphans’ homes.” Are these unjust discriminations, or undue or unreasonable preferences or advantages, and was the twenty-second section necessary to legalize them? These provisions seem to be rather by way of recognition that the free carriage and reductions referred to are returns, slight and inadequate indeed, but proper to be made by railroad companies, for the great franchises bestowed upon them without money and without price. Again: “Nothing in this act shall be construed to prevent railroads from giving free carriage to their own officers and employes.” Can it be possible that without this provision it would be necessary for the president and directors of the company to provide themselves with tickets before starting out on a tour of inspection of the road, and that every conductor and locomotive engineer and fireman would have to pay full fare for every trip? Yet this follows logically if the twenty-second section is a section of exceptions. The analysis might be applied with like results to every specification contained in the section, but these will suffice. The language is “that nothing in this act shall prevent,” and “nothing in this act shall be construed to prohibit,” — expressions evidently used interchangeably. The word “exception” is not to be found, in the section, but there is the significant provision that “nothin'g in" this act contained shall in any way abridge or alter the remedies now existing at common law or bjr statute, but the provisions of this act are in addition to such remedies,” indicating that the act was understood by congress to be declaratory, and for the prevention of abuses and evasions of the unwritten lavr, which was adopted and incorporated into the statute that its construction and operation might be uniform throughout the land, and that it might be enforced by sanctions of federal legislation. Mileage, excursion, and commutation tickets are mentioned in the section. All these were universally regarded as just and necessary discriminations, but, mileage tickets especially, subject to abuse. No significance ought to be attached to the fact that party-rate tickets.are not mentioned, for, as is above shown, they were not in general use, but were limited almost exclusively to traveling theatrical troupes.
The true construction of the section appears to be that it specifies certain discriminations, not regarded by congress as within the letter or the spirit of the act, and therefore it provides that the act *59 shall not be construed to prevent them; and the instances given are illustrative, rather than exhaustive. It is a section furnishing an express rule of construction. It follows that the maxim expressio unius ed exdudo altering does not ajtply, but that the true rule is to look to the section as a guide to the proper interpretation of the prohibitory clauses of the preceding sections, and exclude from their operation every discrimination which is within the principle of the particular cases mentí oned in the twenty-second section. It is all wrong to cite it as authority for precisely such misconceptions and misconstructions as it was intended to prevent. Any construction which makes the statute a mere enactment of arbitrary rules, to be so administered as to force a, rigid inflexible equality, is in conflict with the objects which its framers had in mind, and a constant obstacle to the further development of a vast system of transportation, in which new situations and conditions, continually occurring, and requiring new adaptations and regulations, can be moulded into harmony with the provisions of the act only by regarding it as declaratory of principles founded upon wisdom and experience, and to be made beneficial and effective by being so expounded as to apply those principles to every new case that may arise.
This case, then, depends upon the question whether party-rate tickets, as issued by the respondent, are, upon a proper construction, prohibited by the preceding sections. It is claimed that they are obnoxious to the first section, because they are not just and reasonable. While it is admitted that, if their issue bo confined to parties of ten or more, the injustice would not bo so apparent, it is urged that it would be left to the carrier to determine what number should make a “party,” and that under the 3a,w, so construed, a reduced rate could be accorded to a party of two, as it is said was done before the act. The testimony on this point is that almost without exception ten was the smallest number of jversons to whom they were issued. .At one time, upon the Union Pacific Railroad, from tlic Missouri river to Colorado, they were issued to parties of two. It is explained, however, by the witness who testifies to this fact, that the concession was made for the benefit of variety people who traveled in pairs, but that the rate was more than three cents per mile. The one other exception testified to was made by the Wabash Railroad Company, which gave a reduced rate to four theatrical persons traveling as a party; but this reduction was granted to theatrical persons only. It appears in evidence, also, that before the law there were voluntary traffic associations, to which the leading railroad companies were parties, organized to prevent cutting of rates and undue competition. Party-rate tickets were then in vogue, and if, under those circumstances, the only departures irom the rule of ten were those cited above, there would seem to be little ground for the apprehension expressed on behalf of the complainant that to permit the continued sale and use of these tickets would open the door to all the evils which formerly existed. But suppose, for the sake of the argument, that the apprehension be well founded, the answer is twofold: (I) It cannot be doubted that whenever •the sale of party-rate tickets is by any means made a mere pretext for *60 evading the law, — as, to take the illustration put, when a ticket is issued to two at a reduced price, merely to cut rates, — the courts will so treat it, and apply the remedy. The suggestion that if railroad companies have the right to issue party-rate tickets to companies of ten or more persons, they may issue them to two, is like the old objection to the right of transit with slaves, — that if fhe master could hold his slave on free soil for an hour, he could for a day, or a year, and therefore for life, — which, although it puzzled many for a time, needed but a touch of common sense to explode it. (2) Nothing in the future of legislation is more certain than that whenever that abuse becomes prevalent the legislatures of the states will promptly reduce the individual rate to the same figure. The history of railroad passenger travel for the last forty years illustrates the constant tendency of special rates, including mileage, excursion, and commutation tickets, to reduce regular individual rates upon the one hand, especially forlong distances, and, upon the other hand, to increase facilities and accommodations, thus rendering the service cheaper and better for the general public.
The next objection is that party-rate tickets are obnoxious to the second section of the act, because they furnish to one class of passengers transportation for dower compensation than is charged to others for like and contemporaneous service, under substantially the same circumstances and conditions; and to the third section, because they give to one class of passengers an undue and unreasonable preference and advantage.
If this objection be true in statement, — that is, if those traveling under party-rate tickets are charged less than individuals for like and contemporaneous service, under substantially the same circumstances and conditions, — it is conclusive, and the issuance of the tickets must be adjudged unlawful. But how do they compare with mileage tickets, which, by the twenty-second section, are declared to be in harmony with the act? The rate for each is two cents per mile. The coupons of mileage tickets are for two miles each, but they are sold in blocks of five hundred, or for one thousand miles. The holder can use them at pleasure, for long or short rides. He may ride for any distance within the limit of his ticket, in the same car, and occupy the same seat,, -with a passenger who is charged three cents per mile for his ticket. The holder of the mileage ticket is a wholesale purchaser; the other buys at retail. The difference is recognized in every kind of business, and no intelligent, fair-minded person thinks of complaining of it. The mileage ticket, so-the testimony declares, is especially liable to abuse, and to be used by brokers for speculative purposes. The party-rate ticket, if not, as some witnesses testify, altogether unavailable for either purpose, is less so-than any other ticket, and reduces the opportunity for either to the minimum. It, too, is a wholesale ticket. It is open to purchase to all, at' the one fixed price. It has one peculiarly distinguishing feature, — it is almost proof against fraud upon the company which issues it. The-purchaser having a party of less than the number named in his ticket may, unless restricted by the terms of his ticket,. fill up his party from the outside. That he would have a right to do, provided they- *61 all travel together, on the same train, as a party, and under the one ticket, for but one ticket is issued, and whoever of the party misses the train must buy an individual ticket at full rates, or lose the trip. Suppose a car-load of sixty persons be made up of passengers traveling on party-rate tickets, how much of the receipts from the sale of those tickets will fail to reach the treasury of the company? Not one dollar. Suppose the next car in the same train contains sixty passengers traveling on individual tickets, or cash fares. What would be the comparative percentage of opportunity in the two eases for peculation at the expense of the railroad company ? If a perfect safeguard against such peculations could be provided all over the country, to what extent would it tend to reduce railway passenger fares, and to benefit railway shareholders? Again, the testimony establishes that party-rate tickets secure patronage that yields large revenues to the respondent, and that the withdrawal of those tickets would almost entirely destroy that patronage; for it appears that the rate is as high asean be made without putting it beyond the reach of those who are the main purchasers. Are all these considerations to ho left out of the account in determining whether there has been “like and contemporaneous service” “under substantially similar circumstances and conditions?” Does it depend solely upon whether party-rate passengers and those holding single tickets occupy the same cars, have the same accommodations, and are traveling from the same point to the same destination? Is that the full meaning of “similar circumstances and conditions?” The answer — which the question itself seems to suggest — is that the phrase has a much larger and more comprehensive meaning, else congress could not consistently have recognized mileage or excursion or commutation tickets, for all these trespass upon the narrow ground on which the contrary view rests. To give the act its proper interpretation, the phrase must be held to include circumstances and conditions affecting the business interests of the carrier and of its patrons; or, in other words, circumstances and conditions of a commercial character, which, while they they should not exclude or override the consideration of what is just and reasonably advantageous to those not so situated as to be able to avail themselves of reductions offered to the general public, should be so recognized as not to be prejudicial or unjust to any, and yet, upon the whole, to promote the interest of all concerned in the beneficial operation of the act. Aside from the consideration that these tickets are in principle in no wise different from mileage, excursion, and commutation tickets, which is decisive, the fact that they are on sale to all, without discrimination, and without advancing rates for single tickets, and the considerations above mentioned in favor of those who are upon the road continually, and whose business is upheld by bringing the cost of necessary travel within their reach, and those in favor of the carrier, including many not mentioned above, are ample for the vindication of the respondent against the charge that it is guilty of unjust discrimination, and undue or unreasonable preference, and therefore of violation of the provisions of the second and third sections of the act.
*62 The further objection is made that the sale of party-rate tickets is obnoxious to the fourth section, because it permits the carrier to charge and receive a greater compensation for the transportation, under substantially similar circumstances and conditions, of passengers holding single tickets for a shorter distance, than for the transportation of others holding a party-rate ticket for a longer distance; but this objection is fully met by the answers to the objections relating to the second and third sections. The bill should be dismissed at the costs of the complainant.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9305745. Public record. Not legal advice.