Appellees Brief — United States v. St. Louis, SF & TR Co.

IN THE

Supreme Court of the United States

October Term, 1925.

No. 91.

—

Tue Unirep States, Appellant,

vs.

Sr. Louis, San Francisco & Texas Rarnway Company.

APPEAL FROM THE COURT OF CLAIMS.

BRIEF FOR THE APPELLEE.

Auex. Britton,

Lawrence H. Cake, ,

Counsel for Appellee.

PREss OF Byron S. ADAMS, WASHINGTON, D. O.

> Mie 232

CONTENTS.

Conclusion... .

Page

Opinion of the Court of Claims .................. 1

Grounds of Jurisdiction ........................°°° 2

--~seege oases omnes OEE 2

The Question on Appeal ..................000 077° 2

Se PE 6 hind onan sevnsiensieancccc. +

OEE 656d 0s ohadinversesiacnacssyanc, tc, a

I. Section 16, paragraph (3) of the Interstate Com-

merce Act, as amended, does not apply at all to.

claims presented to the Court of Claims ........ 4

(1) The intention to exclude the Government as

a shipper from the operation of the Interstate

Commerce Act is evident from section 22, and

from section 3, paragraph (2) as amended .. 4

(2) It is a fair construction to read section 16 (3)

with section 3 (2), as amended, the intention

obviously being to prevent unjust discrimina-

tion and to require prompt payment ........ 6

(3) The conclusion is helped by consideration of

the nature of claims presented to the Court of

Claims and the jurisdiction of the Court of

saan ae ee oT nniie 7

(4) Section 16, paragraph (3), does not apply, by

its terms, to claims in the Court of Claims 8

(5) Cases cited by the Government examined and

NE 4658 lini dasatd occ 9

II. Section 16, paragraph (3), as amended, in any event —_/

does not apply to causes of action or claims which /

ME TONY OOO oo isocscesercsss,... 11

(1) The act is not to be given retroactive effect _ 12

(2) The effect of the amendment of June 7,1924. 17

(3) The rule in Sohn v, Waterson .............. 19

TR GAGHSO DAREN SERS ROYAL Ese Eo dade 20

ee eee

CASES AND AUTHORITIES CITED.

Page

Atchison, T. & S. F. Ry. Co. v. United States, 59 Ct.

: . PePPerrrrrrrrrrerryerereyy ry Tree recy 8

Bonfils v. Public Utilities Commission, 67 Colo. 563... 14

Bush, Receiver v. United States, 52 Ct. Cls. 199 ...... 8

Button v. A. T. & S. F. Ry. Co. 1 Fed. (2d) 709 . 16

Christie-Street Com. Co. v. United States, 136 Fed.

re Ener rr Teer errr Sree ere 9, 11

Dupont de Nemours €& Co, v. Davis, 264 U.S. 456 . rt 5

Fort Pitt Gas Co. v. United States, 49 Ct. Cls. 924. 9, 11

Fullerton-Krueger Lumber Co. v. Northern Pacific Ry.

oS 2: SF PPPrerrT merrrr rie rey Tre Tie 12, 13

Kahn v. United States, 55 Ct. Cls. 271 ...........-... 9

Kansas City Southern Ry. Co. v. Wolf, 261 U. 8. 133 . 18

Los Angeles & Salt Lake Rd. Co. v. United States, 55

Sk, MO SE an ckccka dn dusawsaeeasddnduanada ds 8

Ludwig v. Stewart, 32 Mich. 27 ...........e0-ee-eees 14

Missouri Pacific Rd. Co. v. United States, 56 Ct. Cls.

| Try errr TT TT TT TULIP ery P PCT ere eS. 2

Murray v. Gibson, 15 How. 421 .............eeeeees 14

New York Central Rd. Co. v. York & Whitney Co., 256

Re Se PEPE Ter ee ee PTT TOT eL TC CeTee 7

Pittsburgh, etc., Ry. Co. v. Fink, 250 U.S. 577........ 7

Robertson v. Wheeler, 162 Ill. 566 .................. 14

Schaff, Receiver v. United States, 59 Ct. Cls. 318 ..... 1

Se OR, TO Wis Oe ok acca nceandenenasins 12

Sohn v. Waterson, 17 Wall. 596 ............... 14, 17, 19

St. Louis, B. & M. Ry. Co. v. United States, 268 U. S.

ERE OT EOE EEE COUT EET TCCCUT TCR CET OTC 2

Twenty Percent Cases, 20 Wall. 179 ............... 12, 13

Union Pacific Rd. Co. v. Laramie Stock Yards Co., 231

wh. SP heaukideceacabacsabiseben caw acans 12, 13

U. S. Fidelity Co. v. Struthers Wells Co., 209 U. S.

SEE EE OEE OES CTP OTe ETETTECTTOTET CTE 12, 13

United States v. Heth, 3 Cranch 399 ............... 12, 13

Umited States v. Southern Ry. Co., No. 501 this term . 15

United States v. Sugar Refining Co., 202 U.S. 563... 18

Wabash Railway Co. v. United States, 59 Ct. Cls. 322. 1

Winfree v. Northern Pacific Ry. Co., 227 U. S. 296 . 12-

Yazoo & Mississippi Valley Rd. Co. v. Umted States,

a, OC MD va eecaendn kes Gd ancnaxdedanac dias 8

17 Tipline Case Law GOS-GG4..... 2... cc ccs cc eecaces 14

95 Ruling Case LGW T60-100 20... cccccscccsceces 12, 14

Congressional Record, Vol. 65, pp. 5061, 5072-5073. ..18, 19

STATUTES CITED.

Judicial Code:

Section 145 ........ Sli te ere ee eT eee eee 8

-cctoh pegs tbag so ARE OOO ES 8, 9, 12, 20

Sections 242 and 243 ........................... 2

Section 3, paragraph (2) as amended ........ 5, 6

Section 16, paragraph (3) as amended ... 3, 6, 8, 11, 16

steak OL Os 5, 6

Act of March 3, 1887, ch. 359, 24 Stats. 905, (the

og gat ak RON Ne 10

Act of Feb. 28, 1920, ch. 91, 41 Stats. 456 (Trans. Act,

ingyen TRE OEE OE en , 4, 11, 14, 16

Act of June 7, 1924, ch. 325, 43 Stats. 6833 .......... 3, 17

Revised Statutes:

2s a EE OEE Se 9, 10

—— — -

IN THE

Supreme Court of the United States

October Term, 1925.

No. 91.

Tue Usiren States, Appellant,

vs.

Sr. Lovis, Sax Fraxcisco & Texas Ramway Company.

_—_—_

APPEAL FROM THE COURT OF CLAIMS.

_

BRIEF FOR THE APPELLEE.

THE OPINION OF THE COURT OF CLAIMS.

With the findings of fact the Court of Claims filed simply

a memorandum as follows:

‘‘See cases of Schaff, Receiver, No. A-241, decided

March 3, 1924, and Wabash Railway Company, No.

C-74, decided March 3, 1924.’’ (R. 6.)

The opinions in the cases referred to are reported in

59 Ct. Cls. 318, 322,

2

GROUNDS OF JURISDICTION.

The judgment of the Court of Claims was entered March

17, 1924, and the Government’s motion for a new trial

was overruled April 7, 1924. The appeal was allowed June

2, 1924, on motion of the Assistant Attorney General,

under sections 242 and 243 of the Judicial Code. (R. 6, 7.)

STATEMENT OF THE CASE.

In August, 1917, the railway company (the appellee)

carried twenty-seven carloads of ‘‘military impedimenta™

for the United States, on Government bill of lading, from

Ft. Sill, Oklahoma, to Camp Bowie, Texas. In due time it

presented its bill for $2,452.29 on the basis of freight rates.

The bill was disallowed by the Auditor for the War De-

partment, September 16, 1918, because of a ruling of the

Comptroller of the Treasury to the effect that the Gov-

ernment was entitled to the carriage of one carload of mili-

tory impedimenta free for every twenty-five Soldiers carried

as passengers, under certain provisions of the passenger

tariffs. (R. 5.)

In suits brought by other companies the Court of Claims

held that the Comptroller’s ruling was wrong. Missouri

Pacific Railroad Co. v. United States, 56 Ct. Cls. 341, decided

June 13, 1921. See also the opinion of this court in Sf.

L. B. € M. Ry. Co. v. United States, 268 U.S. 169, 173.

Thereupon the railway company filed its petition in the

Court of Claims, on March 8, 1923, claiming $2,452.29 on

account of the service rendered. (R. 1.)

The Court of Claims found that the amount to which the

railway company was entitled, on the basis of freight rates

less land-grant deductions, was $2,234.97, and entered judg-

ment for that amount. (R. 6.)

THE QUESTION ON APPEAL.

The railway company’s petition was filed in the Court

of Claims on March 8, 1923. The service was rendered in

ale

<— oe

3

August, 1917. Obviously the petition was filed within the

six years allowed under Section 156 of the Judicial Code.

The sole question for decision is whether the amendment of

section 16, paragraph (3) of the Interstate Commerce Act,

by the Transportation Act of February 28, 1920, ch. 91, 41

Stats. 456, and the act of June 7, 1924, ch. 325, 43 Stats.

633, as follows:

‘All actions at law by carriers subject to this Act for

recovery of their charges, or any part thereof, shall be

begun within three years from the time the cause of

action accrues, and not after.’’

barred the railway company’s claim because (1) the pe-

tition had not been filed within three years from the date

the service was rendered, or because (2) it had not been

filed within three years from the date of the amendment,

February 28, 1920.

4

THE ARGUMENT.

SUMMARY.

I. Section 16, paragraph (3), as amended, does not apply

at all to claims presented to the Court of Claims, first,

because it was clearly not intended, and, second, because

the amendment by its terms does not apply to such claims,

Il. The amendment is prospective in its effect and does

not apply to causes of action or claims in existence at thy

date of its enactment.

I.

THE RAILWAY COMPANY’S CLAIM IS NOT AP-

FECTED IN ANY WAY BY THE AMENDMENT OF

SECTION 16, PARAGRAPH (3), BECAUSE THE SEC-

TION DOES NOT APPLY AT ALL TO CLAIMS PRE-

SENTED TO THE COURT OF CLAIMS. IT DOES

NOT AMEND OR HAVE THE EFFECT OF AMENDING

SECTION 156 OF THE JUDICIAL CODE WHICH

ALLOWS SIX YEARS FOR PRESENTING CLAIMS TO

THE COURT OF CLAIMS. IT WAS CLEARLY NOT

THE INTENTION OF THE LEGISLATORS TO DO SO,

AND THE WORDS USED DO NOT HAVE THAT

EFFECT.

From the act as a whole (either the Interstate Commerce

Act as amended, or the Transportation Act considered

separately) the intention of section 16 (3) is fairly indicated

to limit the collection of charges under the act from shippers

subject to the act.

That the intention of Congress is to be determined from

a consideration of the act as a whole and the purposes to

be served is obvious.

E. I. Dupont de Nemours & Co. v. Davis, 264 U.S.

456.

(1) The amendment of section 16, paragraph (3) is

contained in Title IV of the Transportation Act, 1920. The

5

act consists of five titles. As this court said in Dupont

v. Davis, 264 U.S. 460, while these titles are concerned with

related subjects, they are entirely distinet one from another.

Title IV consists entirely of amendments to the inter-

state Commerce Act. The evident purpose of Title IV

was to perfect the Interstate Commerce Act, to adjust dif-

ferences between the carriers and the shipping public, to

remedy defects and inequities revealed by the practical

operation of the law. It is impossible to find any purpose

to deal with the relations between the carriers and the

Government. On the contrary, in amending section 3 of

the act to require collection of charges before delivery or

relinquishment of possession, Congress was careful to add

a proviso that this should not be construed to prevent

the extension of credit to the Government.

The intention to exclude the Government as a shipper

from the operation of the Interstate Commerce Act is evi-

dent from section 22, and section 3, paragraph (2) as

amended by the Transportation Act. Section 22 reads:

‘*That nothing in this Act shall prevent the carriage,

storage or handling of property free or at reduced rates

for the United States, State, or municipal govern-

ments.’’

And section 3, paragraph (2), as amended by the Trans-

portation Act:

“*(2) From and after July 1, 1920, no carrier by

railroad subject to the provisions of this Act shall

deliver or relinquish possession at destination of any

freight transported by it until all tariff rates and

charges thereon have been paid, except under such

rules and regulations as the Commission may from

time to time prescribe to assure prompt payment of

all such rates and charges and to prevent unjust dis-

crimination; Provided, That the provisions of this

paragraph shall not be construed to prohibit any car-

rier from extending credit in connection with rates and

charges on freight transported for the United States,

a

for any department, bureau, or agency thereof, or for

any State or Territory or political subdivision thereof,

or for the District of Columbia.”

6

The proviso was added because of the long established

practice of handling transportation accounts between the

Government and the railroad companies. It is well known

that the railroads perform service for the Government, on

bills of lading and transportation requests, without re-

quiring prepayment of the charges for transportation. The

forms of bills of lading and transportation requests are pre-

scribed by the Comptroller of the Treasury (now the Comp-

troller General) and approved by the Secretary of the

Treasury, and after accomplishment are used to support

the carrier's bills when presented for payment. 14 Comp-

troller’s Decisions 967.

(2) It is a fair construction to read section 16 (3) with

section 3 (2) as amended, the intention obviously being to

prevent unjust discrimination and to require prompt pay-

ment. By section 16 (3) it was provided that the three

years’ period within which actions at law for recovery of

charges shall be brought, begins to run ‘‘upon delivery or

tender of delivery’? of the shipment. This is to be read

with section 3 (2), which provides that from and after

July 1, 1920, no carrier by railroad, subject to the provisions

of this Act, shall deliver or relinquish possession at des-

tination of any freight transported by it until all tariff rates

and charges thereon have been paid, except under such

rules and regulations as the Commission may from time to

time prescribe to assure prompt payment and to prevent

unjust discrimination. The purpose of these sections is

plainly to prevent unjust discrimination and to that end

to require prompt payment of charges.

By the express terms of the Act, however, the carriers

may discriminate in favor of the United States (section

22) and may extend credit to the United States, section 3

(2) as amended, and judicial notice will be taken of the

-_-

7

fact that all such transportation is performed on credit.

It is a fair reading of the Act to infer that it was not in-

tended to require collection of charges from the United

States within three years, as from other shippers, especially

as such a conclusion means a repeal by implication of sec-

tion 156 of the Judicial Code. The Government availing

itself of this privilege of transportation on credit, neces-

sarily reads itself outside of those provisions of the Act

dealing with cash payments and prompt settlements.

(3) The conclusion is helped by consideration of the

nature of claims presented to the Court of Claims and the

jurisdiction of the Court of Claims.

Certainly an action or suit in that court is not an action

at law for transportation charges fixed under the Intérstate

Commerce Act, because the Government is expressly ex-

empt, under section 22, from the operation of the Act in so

far as the collection of tariff charges is concerned. A suit by

a carrier in the Court of Claims for money claimed to be due

for the transportation of freight or passengers is a suit on

an express contract, evidenced by the government bill of

lading or transportation request, or else a suit on implied

contract under section 145 of the Judicial] Code. The ear-

rier has performed service for which it is entitled to be

paid and its claim rests on contract. It is not a claim for

statutory charges fixed by law, as when such charges are

collected from a private shipper. Pittsburgh ete. Railway

Co. v. Fink, 250 U.S. 077; New York Central Railroad Co.

v. York & Whitney Co. 256. U. 8. 406.

Ordinarily a carrier suing the Government in the Court

of Claims presents its claim on the basis of tariff rates less

land-grant deductions, on the theory that there is an im-

plied agreement to pay such rates in the absence of an

express agreement to pay more or less. In fact, however,

claims may be and sometimes are presented for more or

less than tariff rates, as, for example, when a special

service is rendered not covered by the tariffs, or when there

is an express agreement on the part of the Government to

8

pay more or on the part of the carrier to accept less than

tariff rates.

Bush, Receiver v. United States, 52 Ct. Cls. 199.

Yazoo & Mississippi Valley R. R. Co. v. United

States, 54 Ct. Cls. 165.

Los Angeles & Salt Lake R. R. Co. v. United States,

55 Ct. Cls. 305.

Atchison, Topeka and Santa Fe Ry. Co. v. United

States, 59 Ct. Cls. 275.

(4) Section 16, paragraph (3), does not apply, by its

terms, to claims in the Court of Claims.

It provides that all ‘‘actions at law,’’ ete., shall be begun

within three years from the time the cause of action ac-

crues, and not after.

A claim presented to the Court of Claims is not an ‘‘ae-

tion at law.’’ The act establishing and defining the juris-

diction of the Court of Claims, as now incorporated in see-

tion 145 of the Judicial Code, provides that the Court of

Claims ‘‘shall have jurisdiction to hear and determine the

following matters:

‘all claims * * * in respect to which claims the party

would be entitled to redress against the United States

either in a court of law, equity, or admiralty if the

United States were suable.”’

So also it is provided by section 156 of the Judicial Code:

“See. 156. ‘‘Every claim against the United States

cognizable by the Court of Claims, shall be forever

barred unless the petition setting forth a statement

thereof is filed in the court, or transmitted to it by the

Secretary of the Senate or the Clerk of the House of

Representatives, as provided by law, within six years

after the claim first accrues.”’

9

It may be said, therefore, that a claim pending in the

Court of Claims on petition of a claimant is hardly an ‘‘ae-

tion at law’’ to enforce a legal right, but is more in the na-

ture of a proceeding authorized by statute to establish by

proof a claim against the Government to be reported to

Congress for appropriation, which is exactly the procedure

im every case. The appropriation, while usually made as a

matter of course, may nevertheless be withheld, and in some

cases has been withheld, as in many of the French Spolia-

tion cases.

(5) The Government cites and relies on Fort Pitt Gas

Co. v. United States, 49 Ct. Cls. 224; Kahn v. United States,

0) Ct. Cls. 271; and Christie-Street Commission Co. v.

United States, 136 Fed. 326. In those cases it was held that

suits against the United States to recover taxes illegally

exacted are governed by section 3227 of the Revised Stat-

utes which provides for a limitation of two years for all

such suits, and not by section 156 of the Judicial Code which

applies generally to suits in the Court of Claims.

First, it is to be observed by comparing the language of

the statutes that there is a difference between the statute

considered in those cases and the statute under considera-

tion here. R. 8. 3227 provides:

‘‘No suit or proceeding for the recovery of an inter-

nal tax alleged to have been erroneously or illegally

7] * * * ° . .

assessed or collected shall be maintained in any

court unless the same is brought within two years next

after the cause of action acerued.”?

Section 156, Judicial Code, provides:

‘“‘Every claim against the United States cognizable

by the Court of Claims, shall be forever barred unless

the petition setting forth a statement thereof is filed in

the court, or transmitted ¢o it by the Secretary of the

Senate or the Clerk of the House of Representatives, as

provided by law, within six years after the claim first

accrues.’’

10

It is apparent, as the courts held in the cases cited, that

there is no necessary inconsistency between the two statutes

and that it was clearly the intention of Congress to treat tax

cases as a special class of cases, a policy which was in effect

before the enactment of the Tucker act in 1887. R. S. 3227

stood by itself and could be given effect only by applying

it to all cases covered by its terms.

But in the present case we have under consideration a

statute which is an amendment of one paragraph of one

section of the Interstate Commerce Act. It may be given

effect, as we think was intended by Congress, by limiting

it to its natural operation as a part of the Interstate Com-

merce Act, without applying it to claims against the Gov-

ernment and without disturbing the jurisdiction of the

Court of Claims or the operation of Section 156 of the Ju-

dicial Code in any manner.

Second. It is also to be noted that Section 3227 of the

Revised Statutes was enacted and was law before the Tucker

Act was passed in 1887 (the act of March 3, 1887, ch. 359,

24 Stats. 505), containing the six years limitation now in-

corporated in Section 156 of the Judicial Code. The court

in its opinion in Christie-Street Commission Co. v. United

States, supra, called attention to this fact, 186 Fed. 332.

When the Tucker Act was passed in 1887 there was and had

been for many years a code of laws which prescribed the

rights of citizens in the adjustment of claims for excessive

payment of taxes, including the limitation contained in

R. 8. 3227. The Tucker Act of 1887 was a general law ap-

plying to many classes of claims, and was not inconsistent

with the then existing statute which prescribed a limitation

applicable to a particular class.

In the present case, however, we have a general law which

has been in force since 1887, and against it we have the

statute under consideration, an amendment to the Inter-

state Commerce Act, which, it is argued, by implication

limits the application of the general law. The cases are

quite different, and the same argument, that repeals are

il

not to be implied, which helped the decision in Christie-

Street Commission Co. v. United States and Fort Pitt Gas

Co. v. United States, is effective and supports our argu-

ment in the present case, namely, that the operation of sec-

tion 156, Judicial Code, is not affected by the act of Febru-

ary 28, 1920.

We return then to our first proposition that section 16

(3) does not apply at all to claims presented to the Court

of Claims by railroad companies who have not been paid

for transportation service furnished the government, be-

cause

(1) It is clear, from consideration of the Transporta-

tion Act alone or the Interstate Commerce Act as a whole,

that the Government as a shipper is excluded generally

from the operation of the act, as evidenced by section 22

and section 3, paragraph (2);

_ (2) Section 16, paragraph (3), and section 3, paragraph

(2), read together, show that the purpose of those two sec-

tions as amended by the Transportation Act was to pre-

vent unjust discrimination and to that end to require

prompt payment of charges;

(3) The nature of such claims and the jurisdiction of the

Court of Claims negative the idea that it was intended by

Congress to apply the statute to such cases;

(4) Section 16, paragraph (3) dees not apply, by its

terms, to such claims.

Il.

SECTION 16, PARAGRAPH (3) AS AMENDED BY

THE ACT OF FEBRUARY 28, 1920, IN ANY

EVENT DOES NOT APPLY TO CAUSES OF AC-

TION OR CLAIMS WHICH HAD ALREADY

ACCRUED.

If the amendment is to be given effect as to claims in the

Court of Claims, assuming for the argument that we are

12

mistaken in supposing that it was not intended and does

not apply at all to such claims, then we submit that in ac-

cordance with the well known rules of statutory construc-

tion it must be given prospective and not retroactive effect.

Given such effect it applies to all causes of action or claims

arising after its enactment and on such causes of action

suit must be instituted within three years from accrual of

the cause of action. But as to causes of action or claims

in existence on February 28, 1920, such as the claim in the

present case, the amendment does not apply. Such claims

are not barred by limitation except in case of failure to file

the petition in the Court of Claims within the six years

allowed by section 156 of the Judicial Code.

The general rule is that statutes, other than curative

and remedial statutes, are always to be construed prospec-

tively unless it is distinetly expressed or clearly and neces-

sarily implied that the statute is to have a retroactive effect,

and that the words of the statute are not to be given a retro-

spective meaning unless they are so clear, strong and im-

perative that no other meaning can be annexed to them or

unless the intention of the legislature cannot be other-

wise satisfied.

United States v. Heth, 3 Cranch 399.

Twenty Percent Cases, 20 Wall. 179.

U.S. Fidelity Co. vs. Struthers Wells Co., 209 U.S.

306.

Winfree v. Northern Pacific Railway Co., 227 U.S.

296.

Union Pacific Railroad Co. v. Laramie Stock Yards

Co., 231 U.S. 190.

Shwab v. Doyle, 258 U. S. 529.

Fullerton-Krueger Lumber Co. v. Northern Pacific

Railway Co., 266 U. S. 435.

25 Ruling Case Law 785-793, sees. 34-39.

The cases cited are some of the cases in this court in

which the general rule has been stated and applied. The

language used in the opinions is clear and positive.

13

‘*Words in a statute ought not to have a retrospective

operation, unless they are so clear, strong, and impera-

tive, that no other meaning can be annexed to them, or

unless the intention of the legislature cannot be other-

wise satisfied. This rule ought especially to be adhered

to, when such a construction will alter the preexisting

situation of parties, or will affect or interfere with

their antecedent rights, services, and remuneration ;

which is so obviously improper, that nothing ought to

uphold and vindicate the interpretation, but the un-

equivocal and inflexible import of the terms, and the

manifest intention of the legislature.’’ United States

v. Heth, 3 Cranch 399, 413.

‘“‘Kven though the words of the statute are broad

enough in their literal extent to comprehend existing

cases, they must yet be construed as applicable only to

vases that may hereafter arise, unless the language

employed expresses a contrary intention in unequivo-

cal terms.”” Twenty Percent Cases, 20 Wall. 187.

‘““There are certain principles which have been ad-

hered to with great strictness by the courts in relation

to the construction of statutes as to whether they are

or are not retroactive in their effect. The presumption

is very strong that a statute was not meant to act retro-

spectively, and it ought never to receive such a construe-

tion if it is susceptible of any other. It ought not to

receive such a construction unless the words used are

so clear, strong and imperative that no other meaning

can be annexed to them or unless the intention of the

legislature cannot be otherwise satisfied.”’ U. g. Fidel-

ity Co. v. Struthers Wells Co., 209 U. S. 314.

“The rule has been expressed in varying degrees of

strength but always of one import, that a retrospective

operation will not be given to a statute which interferes

with antecedent rights or by which human action is

regulated, unless such be ‘the unequivoeal and inflexible

import of the terms, and the manifest intention of the

legislature.’ ’’ Union Pacific Railroad Co. v. Laramie

Stock Yards Co., 231 U. §. 199,

Fullerton-Kruger Lumber Co. v. Northern Pacific Rail-

way Co., 266 U.S. 435, decided at the last term, is a case in

which it was sought to give retroactive effect to another

14

section of the Transportation Act, 1920, namely, section 206,

paragraph (f) which provides:

‘“‘The period of Federal control shall not be com-

puted as a part of the periods of limitation in actions

against carriers or in claims for reparation to the Com-

mission for causes of action arising prior to Federal

control.’’

The plaintiff sued the railway company for excess freight

charges collected. The defense was the local statute of limi-

tations under which the plaintiff’s claim had been barred

some time during Federal control. The plaintiff contended

that section 206, paragraph (f) of the Transportation Act

had the effect of reviving causes of action when the period

designated by the State statute for bringing them had ex-

pired during Federal control and asserted that the mischief

to be remedied indicated such purpose and the ordinary

meaning of the words employed disclosed it. But this court,

applying the rule that all statutes are to be considered pros-

pective ‘‘unless the language is express to the contrary, or

there is a necessary implication to that effect’’ held that

the statute should not be applied to causes barred by limi-

tation before its passage.

The general rule applies to statutes of limitation as well

as to other statutes.

Sohn v. Waterson, 17 Wall. 596.

Murray v. Gibson, 15 How. 421.

Bonfils v. Public Utilities Com. 67 Colo. 563, 189

Pae. 775.

Ludwig v. Stewart, 32 Mich. 27.

Robertson v. Wheeler, 162 Ill. 566, 44 N. E. 870.

25 Ruling Case Law, 792-793; 17 Ruling Case Law,

682-684.

As the court held in Ludwig v. Stewart, 32 Mich. 27, if

a statute of limitations is to apply to past transactions it

must fix with certainty the time within which the action

a

must be brought, and in the absence of such provision

such cases are governed by the statute in force at the

time of the transaction.

Counsel for the Government contend that the general

rule of construction that statutes are to be considered pro-

spective is inapplicable to the present case and assert that

courts have never hesitated to give a retrospective effect

to statutes of limitation when the time remaining to the

plaintiff within which to bring a suit is reasonable, relying

upon cases in which various periods of time were held to be

reasonable. In such cases, however, it invariably appeared

that it was the intention of the legislature to have the act

apply to causes of action which had already accrued, and the

question was whether the time allowed for bringing suit

on such causes of action was, on the one hand, reasonable,

or, on the other hand, so short that the act would be invalid

on constitutional grounds. That is true of the cases cited

in the Government’s brief on page 17, except Button v. A,

T. & 8S. F. Ry. Co., which will be referred to hereinaf ter.

The argument for the Government is that in the present

case giving the statute retroactive effect the plaintiff would

have had three years from the accrual of its cause of ac-

tion (August, 1917) which would have meant until August

1920, thus there would have been a period of about six

months from the date of the Act within which the plaintiff

might have filed its suit. The argument, if valid at all, ap-

plies to all cases. In other eases three years from the

accrual of the cause of action might have already elapsed

when the act was passed on February 28, 1920. That is ex-

actly true of the case of United States v. Southern Railway

Company which is now pending in this Court, No. 501 at this

term, on appeal from the Court of Claims, decided by the

Court of Claims on February 21, 1925. An examination

of the record in that case will disclose that the cause of

action accrued in November 1916. If the act of February

28, 1920, were given retroactive effect, as contended by the

Government, it would destroy the plaintiff’s cause of action

15

16

without allowing any time for filing suit. The Southern

case illustrates the fallacy of the argument. The act cannot

be held retroactive and applied to one case without apply-

ing it to all cases, which would obviously result in destroy-

ing some causes of action without allowing any time what-

ever for filing suit, as in the Southern case.

The case of Button v. Atchison, Topeka and Santa Fe

Railway Co. 1 Fed. (2d) 709, is not persuasive when the

opinion of the court is examined in the light of the facts of

the case. The railway company sued for an undercharge

after having quoted the charges in advance and received

payment. At the time the shipment was made there was no

federal statute of limitations (the shipment was before the

enactment of the Transportation Act, 1920) and actions by

railroad companies for recovery of transportation charges

were governed by the State statutes of limitation. The

statute of Oklahoma allowed three years. On February

28, 1920, the railway company’s cause of action had been

subject to the local statute for two years and four months.

The Transportation Act, 1920, amended section 16, para-

graph (3) of the Interstate Commerce Act and provided

that all actions at law by carriers for recovery of their

charges shall be begun within three years from the time

the cause of action accrues, thus enacting for the first time

a federal statute of limitations for such actions. The rail-

way company contended that under the amendment it was

entitled to the three years fixed by the federal statute from

February 28, 1920, in addition to the time which had already

run under the local statute. Its suit was actually filed more

than three years from the accrual of its cause of action and

was already barred under the local statute. The curious

thing about the case is that the court instead of holding that

the federal statute was not retroactive and leaving the

claim to be governed by the local statute under which it was

already barred, held that the federal statute should be given

retroactive effect from the accrual of the plaintiff’s cause of

action, so as to bar the claim, just as it was already barred

17

under the local statute. It may be observed also that the

court was careful to say that the case might be different if

the State statute provided a longer period of limitation

(as for example, in this case the general Court of Claims

statute allowing six years) or if the plaintiff’s right under

the former law were impared or destroyed by applying the

federal statute and giving it a retroactive effect. See the

last paragraph of the opinion, 1 Fed. (2d) 712.

(2) The amendment of June 7, 1924.

The act of June 7, 1924, ch. 325, 43 Stats. 633, reenacted

section 16, paragraph (3), with slight changes immaterial

so far as the question here under consideration is con-

cerned, adding, however, subdivision (h) as follows:

**(h) The provisions of this paragraph (3) shall ex-

tend to and embrace cases in which the cause of action

has heretofore acerued as well as cases in which the

cause of action may hereafter gecrue, * * **

Counsel for the Government concede that if the act of

June 7, 1924, is to be treated as effecting a change in the

law, and not as a declaration of the intention of the 1920

act, it would be unconstitutional with respect to private

shippers in some cases. See pages 25 and 27 of their brief.

For that reason they argue that the act of 1924 must be

accepted as declaratory of the purpose of the earlier act,

so that the rule in Sohn r. Waterson, 17 Wall., 596, may be

applied, thus barring a claim not filed within three years

from the date of the act of 1920, as the claim in this case.

We point out simply that there is nothing in the act of

1924 which expressly makes the act of 1920 retroactive or

bars any suit which had been filed prior to the act of 1924.

The act of 1924 provides:

**(3) (a) All actions at law by carriers subject to

this Act for recovery of their charges, or any part

thereof, shall be begun within three years from the

time the cause of action acerues, and not after. * * *

18

‘*(h) The provisions of this paragraph (3) shall

extend to and embrace cases in which the cause of action

has heretofore accrued as well as cases in which the

cause of action may hereafter accrue, * * *”’

The language is clear—that all actions shall be barred

within three years and that the limitation shall be applica-

ble to causes of action which have already accrued, but

there is not one word which suggests that any suit which has

already been filed is to be barred. On the other hand, the

words ‘‘shall be begun’’ indicate clearly that the statute

applies to actions brought after its passage although on

causes of action which had accrued prior thereto. As this

Court said in United States vs. Sugar Refining Co., 202

U. S. 563, 578-579:

‘“‘Future time and past time are directly opposite,

and by no inadvertence or intention can we believe or

suppose that Congress, having in mind and purpose

the distinction between the past and the future, should

use language that expressed the one while it meant

to provide for the other.’’

We also point out that the legislative history of the act

of June 7, 1924, shows clearly that the purpose of the act

was not to bar any causes of action, vut on the contrary was

to revive those causes of action which had already accrued

in favor of shippers for the recovery of straight over-

charges, and which had become barred by the interpretation

of the 1920 act by this Court in Kansas City Southern Rail-

way Co. v. Wolf, 261 U. S. 133. The reports of the com-

mittees of the House and Senate give fully the reasons for

the passage of the act of 1924, and negative any possibility

that it was passed for any such purpose as is contended for

by the Government in this case. The report of the Senate

Committee on Interstate Commerce is printed at pp. 5072-

5073, Vol. 65, Congressional Record. We have printed as

an appendix to this brief the report of the House Commit-

tee, pp. 21-22, post. The bill was passed without debate

UU

19

or discussion other than the explanation made by the chair-

man of the committee. See Vol. 65, pp. 5061, 5072-5073.

(3) The rule, or rather the modification of the general

rule, in Sohn v. Waterson, 17 Wall. 596, is not applicable to

the present case.

In Sohn v. Waterson the facts were that Sohn had ob-

tained a judgment against Waterson in Ohio in 1854.

Shortly thereafter Waterson moved to Kansas and became

a citizen of that State. February 19, 1859, the legislature

of Kansas passed a statute which enacted that on certain

causes of action, including foreign judgments, action “shall

be commenced within two years next after the cause or

right of such action shall have accrued, and not after.’’ In

1870 Sohn filed his suit in the courts of Kansas on the Ohio

judgment. The question for decision was whether the

statute of limitations, enacted after Waterson had become

a resident of Kansas and after Sohn’s cause of action

against him in that State had accrued, applied at all to

such a cause of action. It was contended by the plaintiff

that the statute did not apply at all and that there was no

limitation on his right to sue (there being no statute of

limitation prior to the act of 1859). This court, applying

the general rules of construction that statutes are always to

be considered prospective and that any construction which

would render an act unconstitutional is to be avoided, held

that the act of the Kansas legislature should be construed

as effective from the date of its passage, and so construed

should apply to causes of action which had already accrued,

1. e., on such causes of action suit might be filed within two

years from that date. The reason for applying the statute

at all to causes of action which had already accrued at the

date of the passage of the act was that otherwise such

causes of action would have been left ‘‘ without any limita-

tion at all (which, it is preswmed, could not have been in-

tended).’’? See the opinion of Mr. Justice Bradley, 17 Wall.

599.

Thus the rule as applied in Sohn v. Waterson was a modi-

20

fication of the general rule necessary because the statute

under consideration was a new statute not taking the place

of a prior statute and because if the rule were not so modi-

fied and applied to causes of action which had already ac-

crued at the date of the passage of the act, such causes of

action would be left without any limitation at all, which, as

Justice Bradley said, presumably could not have been in-

tended.

In the present case, however, there is no such reason or

necessity, because if, as we contend, the amendment of

February 28, 1920, does not apply to causes of action which

had already accrued, they remain subject to the limitation

of six years provided in section 156 of the Judicial Code.

CONCLUSION.

The judgment of the Court of Claims should be affirmed,

either because (1) section 16 (3) of the Interstate Com-

merce Act, as amended, does not apply at all to claims in the

Court of Claims, or because (2) it is to be construed as pros-

pective and not applicable to claims or causes of action

which had already accrued.

Respectfully submitted,

Avex. Britton,

Lawrence H. Cake,

Counsel for Appellee.

21

APPENDIX.

Report.

[To accompany S. 2704. ]

The Committee on Interstate and Foreign Commerce, to

whom was referred the bill (S. 2704) to amend paragraph

(3), section 16, of the interstate commerce act, having con-

sidered the same, report thereon with a recommendation

that it pass.

Its provisions are the same as those in H. R. 8285 (in-

troduced by Mr. Newton of Minnesota), and it embodies

ideas somewhat similar to those contained in H. R. 6053

(introduced by Mr. Newton of Minnesota) and H. R. 5720

(introduced by Mr. Ayres of Kansas).

Paragraph 3 of section 16 of the interstate commerce act,

as amended, pertains to limiting of the right to bring causes

of actions by the carriers against shippers and by shippers

against the carriers. All actions at law by carriers for re-

covery of their charges shall be begun within three years

after the cause of action accrues. The shipper under exist-

ing law has two years in which to bring his action for the

recovery of damages from the carrier. The shipper can

proceed by two methods: He can complain to the Inter-

state Commerce Commission or he can bring suit for dam-

ages. In claims for reparation he makes complaint to the

Commission; and generally, in claims for straight over-

charges, he brings a court action in the first instance to re-

cover the amount due him for a charge which is in excess of

the published tariff.

The existing law is very clear that the limitation as to

proceedings on complaints before the Commission for the

recovery of damages is two years. It has been almost uni-

versally the practice of both carriers and shippers to regard

the statute of limitations of the State, where the cause of

action accrues, as controlling in the bringing of actions in

court for the recovery of straight overcharges.

About one year ago in the case of the Kansas City South-

ern Railway Co. v. Wolf, et al. (261 U.S. 133), the Supreme

Court of the United States held in an action at law to re-

cover straight overcharges that the statute of limitations

against the shipper was two years. This was a great sur-

prise to all the shippers and most of the carriers. The re-

sult was that a large number of claims were barred by the

22

statute as so construed in this decision. The court also

held, approving prior decision in Grand Trunk Western

Railway Co. (236 U. S. 662, 667), that the running of the

statute of limitations barred not only the remedy, but also

the liability; and that the carrier was bound to claim the

benefit of the statute.

Congress adjourned shortly after the decision was ren-

dered. The above measures were introduced for the pur-

pose of changing the law and of correcting the injustice en-

suing by the barring of these many claims.

Under its provisions the carriers still have the benefit

of the three-year limitation in the bringing of actions to re-

cover their charges. Shippers are still governed by a two-

year limitation for the recovery of damages not based on

overcharges.

For the recovery of overcharges in action at law, ship-

pers are given three years from the time the cause of action

accrues. Provision is made for an extension, providing

claim for the overcharge is presented in writing to the car-

rier within the three-year period. In this event the period

of limitation is extendd to include six months from the time

notice is given by the carrier to the shipper of disallow-

ance of the claim. In other words, the claimant will then

have six months in which to make up his mind whether to

bring suit or not.

The last paragraph (1), revives the claims that were

barred under existing law, following its interpretation in

the Wolf case. The revival period extends to within six

months following the going into effect of the provisions of

this bill.

The bill has the approval of the Interstate Commerce

Commission, as will appear by the letter attached and which

is made a part of this report.