Petitioners Brief — Krauss Brothers Lumber Co. v. Mellon

SUBJECT INDEX.

PAGE

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TABLE OF STATUTES AND RULES..........-eeeeeees ii

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TABLE OF CASES.

Barber Asphalt Pav. Co. v. Standard A. & R. Co.,

OP Ci Ss. Me bes ctveeanedeens pesseserebense

Beuttell v. Magone, 157 U. 8S. 154.........eeeeeeee

Church v. Hubbard, 2 Cranch 187............-ee8:.

Illinois C. R. Co. v. I. C. C., 206 U. 8. 441..........-

Kelly v. Jackson, 31 U. 8. 622.........eceeccrcees

Kendall v. May, 10 Allen (Mass.) 59..............

Louisville d N. R. Co. v. Ohio Valley Tie Co., 242

Bie Wy AE a weve esos derrderodeddccnsevescsevsse

McDonald vy. Marwell, 47 8. Ct. 487..........-544.

Mills v. L. V. R. Co., 238 U. 8. 4738... 0. eee eee eee

Minneapolis & 8S. P. R. Co. v. Peoria & P. U. R. Co.,

Bee Oe BBB ic vcccccesscecsoveesesesvesvecs

ii

PAGE

Missouri K. & T. R. Co. v. Harriman Bros., 227 U. 8.

Ge | Sort ntardeasesndovenviedenbesrsreredene 13

Spiller vy. A. T. & 8S. F. R. Co., 253 U. 8. 117....... 11

Texas & P. R. Co. y. Abilene C. O. Co., 204 U. 8. 426. 12

Tilghman v. Proctor, 125 U. 8S. 136............0.06. 11

Vitelli & Son v. U. S., 20 U. 8. 355........cc00- 12

STATUTZS AND RULES.

ES TOE FO AD) vp wccckcvcavencvervevenesvisns 17

Interstate Commerce Act, Section 16.............. 14

Bupreme Court Rule 7.2... ccccccscccccccccccvcese 9

Supreme Court of the United States,

OCTOBER TERM, 1927.

No. 342.

>

ww

Krauss BrorHers LUMBER COMPANY,

Petitioner,

—against—

ANDREW W. MELLON, Director General of Railroads as

Agent under Section 206, Transportation Act of 1920;

Mosite & OnIO RaILRoAD CoMPANY and ALABAMA

GREAT SOUTHERN RAILROAD COMPANY,

Respondents.

”™

_

On Writ of Certiorari to the United States Circuit

Court of Appeals for the Fifth Circuit.

BRIEF FOR THE PETITIONER.

Statement of the Case.

A writ of certiorari was issued in this case under an

order containing, among other things, a requirement

“* * * that the argument be limited to the question

of practice in respect to the bill of exceptions upon

which the case in the Circuit Court of Appeals

was made to turn.”

2

The case below is reported at 18 F. (2d) 369.

The litigation in the present case started as a formal

reparation proceeding before the Interstate Commerce

Commission. Recovery of demurrage charges in the

amount of $10,356 was sought. These charges had been

collected because of delay or failure of the railroads

themselves in respect to carrying out duly-given recon-

signment instructions. There were no applicable tariff

provisions specifically authorizing imposition of demur-

rage charges on account of embargo delays, and the

Commission uniformly in such cases denied their legality.

The defense was based upon the single proposition that a

common-law right, superior to the Commission’s power,

had enabled the carriers to deny reconsignment until

embargoes were lifted, and, because of this common-law

right, the Commission had no power either to deny the

imposition of demurrage charges for the intervening

delay or to order their repayment.

The Commission’s findings show that the case was

narrowed down so that the only issue upon which the

Commission was asked to decide was the issue of law

concerning their power to order reparation, all other

points being admitted or waived. The findings and

order show that, upon the Commission’s decision of this

law point in petitioner’s favor, a voluntary stipulation

was filed showing the amounts recoverable if the Com-

mission were eventually sustained in its determination

of the law.

The case was carried from the Commission into the

United States District Court for the Northern District

of Alabama by a complaint filed pursuant to Section 16

of the Interstate Commerce Act. The findings and order

a —

3

were duly attached to the complaint as a part thereof,

and were as follows:*

REPORT OF THE COMMISSION.

Division 2, Commissioners Daniels, Esch and

Campbell. By Division 2:

Exceptions were filed by the complainant and

by the Director General of Railroads, as Agent,

to the report proposed by the examiner, and the

issues were orally argued.

Complanant is a corporation engaged in the

wholesale lumber business, with its principal office

at New Orleans, La. It alleges that defendants

unlawfully collected demurrage and reconsignment

charges on carload shipments of lumber, shipped

between November Ist, 1917, and January 12th,

1918, originally billed to Meridian, Miss., Jackson,

and Chattanooga, Tenn., and reconsigned at those

points to numerous destinations north and east

thereof. Reparation only is sought.

The lumber was loaded at mills with which

complainant had contracts, located at various

points in Mississippi, Alabama, Louisiana and

Texas. The shipments moved into Meridian and

Jackson over the Mobile & Ohio and into Chat-

tanooga over the Alabama Great Southern. Most

of them were placed in transit before being sold,

so that complainant did not know the ultimate

destination at the time they were started. Prior

or subsequent to arrival at the reconsigning points

the lumber was sold to purchasers at points in

Pennsylvania, Kentucky, New Jersey, West Vir-

ginia, Ohio, Indiana, and New York, and orders

* Headings omitted in this brief. Italics wherever used in this

brief, do not appear in the original text unless so indicated herein.

4

were transmitted to defendants directing recon-

signment to the latter points. These orders defend-

ants either refused to accept or in any event to

comply with immediately, because embargoes were

in effect against the points of destination from

the original points of shipment, and from the

reconsigning points when the shipments originated.

Demurrage was assessed for the resulting detention

of the cars. In some instances reconsignment

charges also were collected, which defendants admit

was done without tariff authority. Some of the

lumber was unloaded and stored at the reconsign-

ing points, but most of the shipments were held

in the cars and moved to destinations as the

embargoes were lifted from time to time. These

embargoes were brought about by severe congestion

of traffic throughout the east during the period

in question and were constantly being modified,

cancelled, and _ restored to meet particular

emergencies.

Complainant does not question the reasonable

ness or necessity of the embargoes, but contends

that as defendants’ tariffs contained no provision

against reconsignment to an embargoed point,

detention of the cars was due to defendants’

inability to fulfill the obligations imposed by the

tariffs, and that the charges were therefore illegal.

On January 13, 1918, rules became effective pro-

hibiting reconsignment when in conflict with

embargoes.

Defendants insist that complainant knew before

the shipments were tendered that embargoes were

in effect throughout the territory in question, and

as shipments could not have been made either from

the original points or locally from the points of

reconsignment, billing of the shipments to the

5

latter points was for the purpose of evading and

nullifying the embargoes. Complainant admits

that it knew that embargoes were in effect generally

throughout the territory in question, but states

that since the final destinations were not known

at the time shipments were started it could have

had no knowledge that they were under embargo.

It had been complainant’s practice for years to

reconsign at these same points, and it disclaims

any intention on its part to evade the embargoes.

We have repeatedly held that when tariffs con-

tain no restriction against reconsignment to em-

bargoed points, demurrage charges may not be

assessed for the car detention resulting therefrom.

Reconsignment Case, 47 I. C. C. 590, 634; Wood v.

N.Y. P. d& N. R. R. Co., 53 I. C. C. 183; Atlantic

Iumber Co, v. N. Y. P.& N. R. R. Co., 57 1. C. C.

129.

Defendants admit that demurrage should not

be assessed if the final destinations were not under

embargo when the shipments left the point of

origin, but contend that if the points of final

destination were under embargo at the time the

shipments started and at the time of reconsign-

ment the carriers are no more required to reconsign

to such points than to accept the shipments at

the points of origin. They argue that since the

right of reconsignment attaches as of the date of

shipment, even if the order be given subsequently,

and since there was no obligation to accept the

shipments at points of origin on account of the

embargoes, there was likewise no obligation to

reconsign. The obligation to accept articles ten-

dered for transportation is governed by general

principles of law, while the obligation to reconsign

is determined by rules lawfully on file with us.

6

The right to refuse shipments temporarily for good

cause by the establishment of embargoes, which

are not required to be filed with us, is recognized.

The right to reconsign depends entirely upon the

construction of rules, which are required to be

filed in the same manner as rates, and if the

carriers do not restrict such rules to the extent of

their capacity to perform the service, the shipper

can not be held liable for the detention of cars

when it is not directly responsible for such deten-

tion and can not abate the cause thereof, as in the

case of an embargo, which is a disability of the

carrier.

We find that the demurrage and reconsignment

charges assailed were illegal; that complainant

made the shipments as described and paid and bore

the charges thereon; that it has been damaged in

the amount of the charges found herein to have

been illegally collected; and that it is entitled to

reparation, with interest. Complainant should

comply with Rule V of the Rules of Practice.

ORDER

At a General Session of the INTERSTATE COMMERCE

CoMMISSION, held at its office in Washington,

D. C., on the 13th day of November, A. D. 1922.

It appearing, That on March 2nd, 1922, the

commission entered its report in the above-entitled

proceedings, which is hereby referred to and made

a part hereof, and these proceedings now coming

on for further consideration on the question of

reparation, and the parties having filed agreed

statements with respect to the shipments in ques-

—_—

7

tion we find that complainant is entitled to awards

of reparation from the defendants named in the

following table in the amounts set opposite their

respective names, with interest:

With In-

Defendants Amounts terest From

James C. Davis, Director

General of Railroads,

OD: BOB as ss Kcasvesn $2,894.00 June 1, 1918

Mobile & Ohio Railroad

Company, and James

C. Davis, Director

General of Railroads,

ere ee 4,530.00 July 1, 1918

Alabama Great Southern

Railroad, and James

C. Davis, Director

General of Railroads,

GR MBs cs cancces 2,932.00 March 20, 1918

It is therefore ordered, That the defendants

named in the above table be, and they are hereby,

authorized and directed to pay unto complainant,

Krauss Brothers Lumber Company, on or before

December 28th, 1922, the amounts set opposite

their respective names in said table, with interest

hereon at the rate of 6 per cent. per annum from

the dates therein set forth, as reparation on account

of illegal demurrage and reconsignment charges

assessed on numerous carload shipments of lumber

reconsigned at Meridian, Miss., Jackson and Chat-

tanooga, Tenn.

By the Commission.

GEORGE B. McGINTY,

Secretary.

(SEAL)

8

Upon the trial of the case in Court no objection was

made to introducing in evidence the findings and order

at their face value.

The findings and order having been put in evidence,

together with proof of non-payment, the petitioner closed

its case. Thereupon the respondents offered, and, over

petitioner’s due objection, there was admitted in evidence

certified copies of the records in several proceedings

before the Commission, including numerous very large

exhibits from the files of the Commission. Some of these

records set forth the proceeding in which the reparation

order there had been made which is here in suit. Others

dealt only with subsequent hearings which had arisen

out of an effort of the Commission, when the subject-

matter of the present suit had already been duly lodged

in the District Court, to reopen the case and consider

new theories of law concerning it.

No evidence other than the Commission records was

offered by respondents in the District Court, except an

oral stipulation that only $245.00 of the entire $10,356.00

ordered to be repaid, had ever been received by respondent

Mobile & Ohio Railroad Company and evidence that only

$180.00 of such total sum ever had been received by

respondent Alabama Great Southern Railroad Company

(R., 58).

Both sides moved for a directed verdict which was

given by the Court in favor of respondents, and due

exception was reserved by petitioner. Thereafter, by

writ of error, the action of the trial Court was duly

carried up for review by the United States Circuit Court

of Appeals for the Fifth Circuit. The errors set forth

were the directing of a verdict for respondents and refus-

ing to direct a verdict for petitioner.

The waiver before the Commission of all issues except

the issue concerning the Commission’s power to order

reparation, and the respondents’ refraining from timely

objection to the findings and order when offered in Court

as evidence, seemed to limit the case to the controversy

disclosed upon the face of the findings. Therefore, in

preparation of the bill of exceptions, the circumstances

seemed to require the application of those principles set

forth in Subsection 2 of Rule “7”, “Revised Rules of the

Supreme Court of the United States”, which, under the

heading, “BILLS or EXcrpTion * * * OmIssiION oF UN-

NECESSARY EVIDENCE”, provides that: “The Judges of

the district courts in allowing bills of exception shall

give effect to the following rules:

“2. Only so much of the evidence shall be

embraced in a bill of exceptions as may be neces-

sary to present clearly the questions of law involved

in the rulings to which exceptions are reserved,

and such evidence as is embraced therein shall be

set forth in condensed and narrative form, save as

a proper understanding of the questions presented

may require that parts of it be set forth otherwise.”

Obviously the prima facie case established by the find-

ings and orders must have prevented direction of a

verdict against petitioner on the evidence, for at least a

jury issue would have arisen out of any denial of the

findings.

Therefore, pursuant to the rule aforementioned, a bill

of exceptions was prepared, approved and filed which

fully recited all the evidence, showing the identity,

subject-matter and introduction of each and every exhibit

and containing the usual statement, “This was all the

10

evidence in the case”. The bill disclosed, however, that

some of the exhibits which had been thus mentioned, had

not been fully set out but had been omitted—namely

(R., 58):

1. The original pleadings before the Commission.

2. The testimony and all exhibits taken and filed in

the Commission proceedings. (These were exceedingly

voluminous. )

3. Petition for reopening the case. (Filed after the

subject-matter had been placed in the District Court by

the present suit.)

4. Correspondence of the Director General with the

Commission leading up to the attempted reopening.

5. Testimony and exhibits in proceedings subsequent

to the attempted reopening.

The Circuit Court of Appeals affirmed the judgment

of the lower Court purely on the arbitrary rule that

unless all the exhibits were shown to be embraced in the

bill of exceptions the Court would decline to consider the

merits of the case.

Believing such an unjust and wholly unnecessary

decision in violation of Rule 7 of the United States

Supreme Court, petitioner sought and obtained a writ

of certiorari.

Assigned Errors Which Will Be Urged.

This appeal is limited to the question of practice in

respect to the bill of exceptions upon which the case in

the Circuit Court of Appeals was made to turn.

The errors assigned in the Circuit Court of Appeals,

and there urged, were the directing of a verdict for

ll

respondents and the refusal to direct a verdict for

petitioner.

SUMMARY AND ARGUMENT.

1. The finding of facts and order constituted “prima

facie evidence”.

Interstate Commerce Act, Sec. 16.

2. The term, “prima facie evidence”, has in Federal

law a well-defined meaning.

Kelly v. Jackson, 31 U. 8. (6 Pet.) 622, 631.

3. Unless “prima facie evidence” is “contradicted or

disproved by controlling evidence on the part of the

defendant”, the plaintiff is entitled to recover.

Kelly v. Jackson, supra.

4. Furthermore, the conclusions of a commission

such as the Interstate Commerce Commission, “depending

upon the weighing of conflicting testimony, have every

reasonable presumption in their favor’.

Illinois Cent. R. Co. v. I. C. C., 206 U. 8. 441;

Tilghman v. Proctor, 125 U. 8. 136, 149.

5. The findings and order accordingly made out a

complete case, rebuttable only by controlling evidence.

Spiller v. A. T. & 8S. F. R. Co., 253 U. 8. 117,

127, 131-2;

Mills v. L. V. R. Co., 238 U. 8. 473;

Cases cited above.

—

12

6. Conflicting evidence could only have raised a jury

issue and could not under any circumstances have war-

ranted the direction of a verdict for respondents.

7. It is clear, therefore, that only some defect in the

legal theory of the case, and not insufficient evidence,

could have warranted the Court’s charge.

8. Failure to object to evidence constitutes a waiver

of defects and, in the case of documents, admits them at

their face value.

9. If the findings and order had not actually been

made by the Commission but only by members of the

Commission who were acting outside the scope of their

official powers, then the statutory provisions making

official findings of the Commission admissible would have

had no application.

Church v. Hubbart, 2 Cranch 187;

ef. Vitelli d Son v. U. 8., 250 U. 8. 355.

10. Whether the findings and order were genuine

and admissible might have been raised as a preliminary

question for the Judge; but, by electing to waive such a

preliminary inquiry, the respondents further showed

their intention to confine their defense to the single issue

apparent upon the face of the findings.

Kendall v. May, 10 Allen (Maas.) 59, 65.

11. Furthermore, only the issues actually contested

before the Commission were in litigation, all else having

been admitted or waived.

T. & P. Ry. v. Abilene Cotton Oil Co., 204

U. 8. 426, 435;

13

M. K. & T. R. Co. v. Harriman, 227 U. 8.

657, 668;

L. & N. R. Co. vy. Ohio Valley Tie Co., 242

U. 8. 288.

12. The bill of exceptions recites that it contains all

of the evidence in the case and is duly approved.

13. It was the duty of the District Judge to require

condensation of the record by eliminating therefrom

irrelevant matter.

Supreme Court Rule 7, subsection 2.

14. It is conclusively shown that no evidence which

would have cast any light upon any issue in the case

was omitted from the bill of exceptions.

15. The Supreme Court no longer favors purely

arbitrary requirements in respect to bills of exceptions.

McDonald v. Maawell, 47 8. Ct. 487;

Barber Asphalt Pav. Co. vy. Standard A. & R.

Co., 48 8. Ct. 183;

Supreme Court Rule 7, subsection 2;

ef. Equity Rule 75 (b).

16. All those proceedings in the Commission which

were based upon an effort to reopen the case were void

for want of jurisdiction inasmuch as the subject-matter

had previously become lodged exclusively in the District

Court by the filing of the present suit.

Minneapolis & 8S. P. R. Co. v. Peoria & P. U.

R. Co., 270 U. 8. 580, 586.

14

17. Even in the District Court the three parties

respondent openly agreed among themselves and with

petitioner concerning the division, among themselves, of

the wrongfully-acquired demurrage charges for the recov-

ery of which this suit is maintained, thereby further

admitting the facts in the case.

Bill of Exceptions (R., 57 and 77-78).

18. The parties having elected to rest their case upon

rulings of law, it would be proper for judgment to be

rendered against all of them in such amounts as the

Court deems proper.

Beuttell v. Magone, 157 U. S. 154;

Interstate Commerce Act, Sec. 16.

The Interstate Commerce Act (Section 16) provides

that the findings of fact and order in a reparation case

shall constitute “prima facie evidence”. In Federal law

the term, “prima facie evidence”, has been given a well-

recognized meaning. It is evidence which a jury may

not disregard and which is conclusive unless and until

controverted or disproved “by controlling evidence on

the part of the defendant’, as declared by the Court in

Kelly v. Jackson, 31 U. 8. (6 Pet.) 622, 631, wherein the

Court approved a charge “that the plaintiff had given

prima facie evidence in support of his case, and such as

was conclusive if uncontradicted and that this must be

contradicted or disproved by controlling evidence on the

part of the defendant, or the plaintiff is entitled to

recover’; while the Court disapproved a charge that

“the evidence upon the one side or the other should not

be submitted to the jury as prima facie or presumptive

>

15

evidence, either for or against a delivery; but the whole

evidence together, and from the whole, determine whether

or not the deed was delivered”. The Court in this con-

nection (Story, /.), said:

“What is prima facie evidence of a fact? It is

such as, in judgment of law, is sufficient to estab-

lish the fact; and, if not rebutted, remains suffi-

cient for the purpose. The jury are bound to

consider it in that light, unless they are invested

with authority to disregard the rules of evidence,

_ by which the liberty and estate of every citizen are

guarded and supported. No Judge would hesitate

to set aside their verdict and grant a new trial, if,

under such circumstances without any rebutting

evidence they disregard it.”

This Court, in Jllionis Central R. Co. y. Interstate

Commerce Commission, 206 U. 8. 441, declared as follows:

“The findings of the Commission are made by

law prima facie true, and this Court has ascribed

to them the strength due to the judgments of a

tribunal appointed by law and informed by experi-

ence.”

Furthermore, the waivers and admissions made in the

trial of this case before the Commission are binding.

(L. &d N. R. Co. v. Ohio Valley Tie Co., 242 U. S. 288;

T. & P. R. Co. v. Abilene Cotton Oil Co., 204 U. 8. 426,

435; M. K. & T. R. Co. v. Harriman Bros., 227 U. 8.

657, 668.)

The Commission declared that there was involved in

the case only the question of its power to regulate what

the carriers believed to be a practice absolutely within

their common-law rights. It found for the shipper and

16

requested that the amount of money involved in the case

be stipulated. When the stipulation was made it became

binding on the Director General.

In the District Court the defendants not only made

no resistance to the findings and order but actually

proved in open court what portion of the disputed money

had been received by each of them. This was, of course,

an admission that they had received the money concern-

ing which the Commission had rendered its findings and

order.

The effect of admitting “prima facie evidence” without

objection is discussed in Kendall v. May, 10 Allen ( Mass.)

59, 65, where the Court said as follows:

“The auditor having made his report, it is made

by statute prima facie evidence, and nothing more.

The finding as to this fact of the capacity of the

defendant to testify is not conclusive, but prima

facie only.

In respect to the other facts found by the

auditor, the report was to be submitted to the

jury, and the evidence to contradict the report

must be addressed to them. But it was not so as

to this fact; for the capacity of a witness to testify

is not a fact that is ever submitted to the jury,

but is always decided by the Court.

It would be impracticable to submit these col-

lateral issues to the jury. The auditor’s finding

on the point of capacity was to be affirmed or dis-

affirmed in this case by the Judge, upon evidence

to be presented to him. If it was affirmed, then

the report was to be sent to the jury * * *.”

Finally, the case of Barber Asphalt Paving Company

v. Standard Asphalt & Rubber Company, 48 8S. Ct. 183,

is believed to be controlling. Although it was an equity

a

17

case, nevertheless Rule 7, subsection 2, applicable to the

present case, and Equity Rule 75 (b), applicable to that

case, are almost exactly alike—so much alike that their

similarity cannot be merely accidental. Each such rule

requires that the evidence be “condensed” and set forth

in “narrative form”. The law rule says, “Only so much

of the evidence shall be embraced * * * as may be neces-

sary to present clearly the questions of law * * *”: while

the equity rule says, “The evidence shall not be set forth

in full * * * all parts not essential * * * being omitted.”

The general structure of the two rules is the same and in

meaning they are obviously identical.

In the Barber case a review of all the evidence was

sought by appeal from the final decree. Yet the Court

held that counsel had been guilty of bad practice in

embracing all of the exhibits in the statement.

In the case of McDonald vy. Marwell, 47 S. Ct. 487, it

appeared that the Appellate Court, as in the present case,

had declined to pass upon the merits because certain

facts had not been set out in a bill of exceptions, as

always theretofore required by the Appellate Court. The

action of the Appellate Court was reversed by the

Supreme Court on the ground that the record was ade-

quate for all practical purposes.

For the reasons aforestated, it is respectfully

asked that the judgment of the Circuit Court of

Appeals be reversed.

BRENTON K. FISK,

Attorney for Petitioner.

Harry 8. E.KIns,

J. P. Mupp,

Of Counsel.

IN THE

Supreme Court of the United States,

OCTOBER TERM, 1927.

Krauss Brorurrs LUMBER COMPANY,

Petitioner,

—against—

‘ANDREW W. MELLON, Director General of Railroads,

as Agent, and others,

Respondents.

i.

sa

BRIEF OF PETITIONER IN REBUTTAL,

SUPPORTING PETITION FOR CERTIORARI.

A brief in rebuttal is filed in this case for the purpose

of clarifying two of the issues. Petitioner states that a

well-recognized administrative practice, enforced by the

Interstate Commerce Commission, forbade the assess-

ment of demurrage charges for embargo delays except in

cases where applicable tariff provisions specifically stipu-

lated for such charges. The respondent questions the

accuracy of the statement. Brushing aside mere differ-

ences in terminology, the statement of the Commission

on this point contains its own corroboration, reading as

follows (R. 63):

“We have repeatedly held that when tariffs

contain no restriction against reconsignment to

embargoed points, demurrage charges may not be

assessed for the car detention resulting therefrom.

Reconsignment case, 47 I. C. C., 590, 634; Wood v.

—

2

N.Y. P. & N. R. R. Co., 53 1. ©. C., 183; Atlantic

Lumber Co. v. N. Y. P. & N. R. R. Co., 57 £

C. C., 129.”

Respondent further argues that there is no right to

reconsign freight—that reconsignment is a mere privilege.

To claim the benefit of a tariff provision is not to

claim a mere privilege. Under laws forbidding discrim-

ination, tariff provisions must be uniformly applied and

it is a shipper’s lawful right to require that he be given

the fullest benefit of any and every tariff provision.

It is clear that the only problem before the Commis-

sion in this case was to determine the extent and effect of

a certain general rule of tariff construction, The parties

were requested by the Commission to agree upon the

charges collected of shipper in violation of this rule,

which the Commission, in its formal opinion, had just

declared to be law. The opinion discloses that the Com-

mission had limited its consideration of the case to this

single question of tariff construction—namely, whether

the existence of an embargo will justify a refusal to

comply with the provisions of a reconsigning tariff when

no mention of embargoes as limitations upon reconsign-

ing rights is contained in the tariffs. The narrowing of

the case is pointedly disclosed by the following sentence

in the findings (R. 63):

“Defendants admit that demurrage should not

be assessed if the final destinations were not under

embargo when the shipments left the point of

origin, but contend that if the points of final desti-

nation were under embargo at the time the ship-

ments started and at the time of reconsignment the

carriers are no more required to reconsign to such

points than to accept the shipments at the points

of origin.”

—

3

Even if there were no such direct admission, there is

certainly an equivalent admission to be implied from the

stipulation that charges had been collected of shipper

contrary to the rule of tariff construction above stated.

In petitioner’s judgment, the mere existence of ap-

plicable reconsigning tariffs and the absence of any

mention of embargoes as limitations upon them is all

tha’; has to appear in the record concerning tariff provi-

sious., The case involves no fine shades of meaning in the

phraseology of the several tariffs or im any embargo

order, Anti-discrimination laws require that tariffs

receive certainty in construction and uniformity in appli-

cation, Even if some of the tariffs held out reconsign-

ment merely as a “favor” to be granted or refused at the

carrier's convenience or pleasure, nevertheless the domi-

nating influence of anti-discrimination laws, which impose

rules of definiteness and certainty, require that such

provisions be construed as creating tariff rights to which

all shippers may have equal benefit. It is not lawfully

within the power of a carrier to grant valuable privileges

to some and withhold them from others. It is for the

Commission to standardize by its rules and decisions the

exceptions which will legalize a refusal to comply with

the terms of a tariff,

One of the rules of certainty which were applicable to

the present case was, as petitioner maintains, the rule

which the Commission has always applied and which is

stated in the first of the foregoing quotations,

Petitioner believes that the record presents thé issues

adequate§for review on appeal.

BRENTON K. FISK,

Attorney for Petitioner.

¥ 7

.

;

+ 7

7 ie

s . x «

’ S ;

Supreme Court of the United States,

OCTOBER TERM, 1927—No. 342.

»

—

Krauss Brotiers LUMBER COMPANY,

Petitioner,

—against—

ANDREW W. MELLON, Director General of Railroads as

Agent under Section 206, Transportation Act of 1920;

MosiLe & Onto RAILROAD COMPANY and ALABAMA

GREAT SOUTHERN RAILROAD COMPANY,

Respondents.

Lp

a

ON WRIT OF CERTIORARI TO THE UNITED

STATES CIRCUIT COURT OF APPEALS FOR

THE FIFTH CIRCUIT.

BRIEF IN REBUTTAL FOR THE PETITIONER.

The respondents’ brief seems to call for a clarifying

statement on one or two points.

It has at all times been the petitioner’s contention that

the respondents’ exhibits were irrelevant and that they

had no proper place in the bill of exceptions. The re-

spondents held a contrary opinion. In the preparation of

the bill of exceptions the trial Judge, together with the

attorneys for the parties, put into effect the plan, em-

bodied in the record and recited in the respondents’ brief,

whereby these original exhibits were transmitted with the

record to the Court of Appeals. A prime motive which

2

animated the petitioner to resist the inclusion of these

exhibits in the bill of exceptions and printed record was,

as the respondents relate, the saving of expense in pre-

paring the record. The respondents endeavored to be fair

and there is no desire on the part of the petitioner to

derive a handicap from the omissions.

The petitioner rests its case upon the proposition that

the printed record shows itself to be fully adequate for a

decision of the present appeal.

The respondents jointly, and not severally, made the

successful motion on which a verdict for all defendants

was directed by the Court. Jointly, therefore, they must

show themselves entitled to prevail in the present appeal.

The sequence of some of the events in this case will

aid in showing, it is believed, the adequacy of the present

record. It is shown that the following steps have been

taken :

First, the petitioner complained to the Commis-

sion that on reconsigned shipments there had been

imposed upon him demurrage charges which were

unauthorized by the applicable reconsignment

tariffs.

Second, the respondents replied that no recon-

signment provisions of any tariff had been applic-

able for the reason that common-law authority, in

connection with existing embargoes, had been supe-

rior to the tariff provisions. Consequently the

case could not be decided upon tariff provisions.

Third, the case was expressly narrowed down

to this single question of law.

Fourth, the Commission found the case gov-

erned by the reconsignment tariff provisions and

requested the parties to agree upon the charges

3

which should be refunded if the, Commission’s views

were sustained.

Fifth, an agreement was reached, a stipulation

was filed and the Commission therefrom made its

reparation order.

Sirth, an appeal of the catgse has now reached

the Supreme Court.

Seventh, the respondents mow insist that the

case cannot be decided without: construing the pro-

visions of the several reconsiginment tariffs which

heretofore they have renounc@q and which may,

perhaps, be found somewhere ijn the Commission’s

record.

From the Commission’s report of the proceedings, if

the report may be deemed reliable, ijt is clear that the

respondents did not defend upon thiss additional ground

which they now assert.

BREIQNTON K. FISK,

Att@rney for Petitioner.

Harry 8. ELKINS,

J. P. Mupp,

Of Counsel.

Brief of argument

Argument ached

CITATIONS

American Paper & Pulp Assn. v. B. & O. R. R., 41 1. C. ©. 506. ~5,11

Atlantic Refining Co. v. Director General, 57 I. C. C. 627__.. 4,10

Brennan Packing Co. v. Director General, 77 I. C. C. 307__--.- 4,9

Cannon Mfg. Co. v. Sou. Rwy. Co., 56 1. C. C. 128_----.--_-__ 5,13

Carolina Portland Cement Co. v. Director General, 83 I. C. C.

388. oo aise 4,8

CAs Re Ve Ey, Feb Ue BB eee ie 5,11

0. & O. Ry. v. W. C. K. Co., 270 U. 8. 260 iat 5,12

Cedar Hill Coal & Coke Co. v. C. &@ 8. Ry., 17 1. C. C. 479___--- 4,7

Cleveland Cooperage Co. v. Director General, 57 I. C. C. 423.... 5,138

Davis v. Cornwell, 264 U. 8. 560 anal 5,11

Davis v. Henderson, 266 U. 8. 92 cs 5, 12

Dietz Lumber Co. v. A., T. @ 8. F. Ry., 22 1. C. C. 75_---------- 4,7

Du Pont v. Director General, 59 I. C. C. 659 « BD

Duvall vy. Director General, 59 I. C. C. 442 5,10

Kaw Boiler Co. vy. Director General, 83 I. C. C. 339_-_-___- 5,10

Lafayette Bor Board Co. v. Director General, 59 I. C. C. 105_.. 5,13

Murray v. Director General, 69 I. C. C. 477- 4,8

North Packing € Provision Co. v. Director General, 73 I. ©. C.

749. 5,12

Sou. Rwy. Co. v. St. Louis Hay & Grain Co., 214 U. S. 297--.. 4,7

Wood v. N. Y., P. € N. R. Co., 53 I. C. C. 183. 4,8

55003—27

(r)

Inthe Supreme Gourt of the Hnited States

OctToBER TERM, 1927

Krauss BrorHers LUMBER COMPANY, PETITIONER

v

ANpDREW W. MELLON, Director GENERAL OF RalIt-

roads, as Agent, etc., et al., respondents

BRIEF OF RESPONDENTS OPPOSING PETITION FOR WRIT

OF CERTIORARI

STATEMENT

This is a suit to enforce orders of the Interstate

Commerce Commission awarding reparation for

$10,356 with interest (Rec. p. 66.) The petitioner

between November 1, 1917, and January 11, 1918,

made numerous shipments of lumber from various

points in Mississippi, Alabama, Louisiana, and

Texas consigned to itself at Chattanooga, Tenn.,

Meridian, Miss., and Jackson, Tenn. (R. 61.)

Upon arrival, orders were given to reconsign the

shipments to various destinations in the East, the

principal market of the petitioner. (R. 61.)

Because these destinations were embargoed the

reconsignment instructions were refused by the re-

spondents and demurrage assessed for the detention

of the cars while awaiting further instructions. (R.

(1)

2

61.) The Commission held that there was no au-

thority to collect the demurrage charges* because

the tariffs publishing the reconsignment rules did

not have a rule prohibiting reconsignment to em-

bargoed destinations. The Commission, therefore,

ordered the demurrage refunded. (R. 64.)

The respondents contend that the demurrage was

properly assessed because reconsignment is a priy-

Tee ot ae) which, if availed of, attaches as

of the date of the original shipment, and therefore

is subject to all rights, privileges, and disabilities

pertaining to the original shipment, except such as

are specifically waived by the tariffs permitting

reconsignment. Consequently they may refuse to

reconsign to a destination which is embargoed

against shipments from the original point of origin

without so stating in their tariffs governng recon-

signment, and assess demurrage charges for deten-

tion of the cars while awaiting disposition, just as

they max refuse original shipments, if mied 00.40

embargoed destination, and collect demurrage

charges while the cars are awaiting instructions,

without publishing a rule in the tariffs governing

the original shipments that cars will not be accepted

to embargoed points.

The petitioner is in error in stating, on page 2,

that the respondents “ have disregarded a well-

The demurrage rules and charges applied to these ship-

ments were those published for general application, and were

contained in different tariffs from those publishing the recon-

signment rules and charges. The demurrage tariffs are not

in question here.

known and generally recognized administrative

practice upon which the Commission has uniformly

insisted.’’ See also pages 3 and 10. No “‘admin-

istrative practice’’ of the Commission is involved.

This is a question of the legal rights and obligations

of the respondents under general principles of law

and under their tariffs.

The following additional questions were raised

below. It was contended by respondent ‘Mellon’ :

(1) that even though the demurrage was illegally

assessed, he can not be held liable for that portion

which accrued for detention prior to Federal con-

trol, and which he collected for the railroad com-

panies and paid over to them in his final settlement

with them; and (2) that he, as a branch of the

United States government, is not liable for costs

and attorneys fees in the event the order of the

Commission should be held valid.

It was also contended by the Alabama Great

Southern Railroad Company that since it was not

a party defendant in the proceedings before the

Commission any order requiring it to pay any por-

tion of the reparation is null and void.

A discussion of these questions will not be of any

assistance in determining whether the petition for

certiorari should be granted, but they are stated

so that the Court may have before it a full state-

ment of the issues in the case.

A brief consideration of the merits will show that

the judgment of the District Court, that the orders

4

of the Commission are null and void, whith was

affirmed by the Court of Appeals is co The

reasons for the action of the Court of Appeals are

immaterial.

Petitioner states (pages 8, 9, 16, and 18) that

the portion of the record which was not printed, but

was sent up in the original form to the Court of

Appeals, is irrelevant and immaterial, That por-

tion of the record is material and relevant, and was

offered in evidence in the District Court to place

before the Court the entire record which was before

the Commission.

Demurrage charges were legally assessed, and the Com-

mission’s orders are void

Record 58, 61-63, Exhibit 8.

Dietz Lumber Co. v. A. T. & S. F. Ry., 22 1. C. C.

75.

Cedar Hill Coal & Coke Co. v. C. & S. Ry., 17 1.

C. C. 479.

Sou. Rwy. Co. v. St. Louis Hay & Grain Co., 214

U. 8. 297.

Wood v. N.Y. P. & N. R. Co., 53 I. C. C. 183.

Carolina Portland Cement Co. v. Director Gen-

eral, 83 I. C. C. 388.

Murray v. Director General, 69 I. C. C. 477.

Brennan Packing Co. v. Director General, T7

I. C. C. 307.

Atlantic Refining Co. v. Director General, 57 I.

C. C. 627.

5

Duvall v. Director General, 59 I. ©. O. 442.

Kaw Boiler Co. v. Director General, 83 I. ©. C.

339.

DuPont v. Director General, 59 I. ©. C. 659.

American Paper & Pulp Association v. B. &

O. R. R., 41 1. C. C. 506.

North Packing & Provision Co. v. Director Gen-

eral, 73 I. C. C. 749.

Cannon Mfg. Co. v. Sou. Rwy. Co., 56 1. C. C. 128.

C. & A. Ry. v. Kirby, 225 U. 8. 155.

Davis V. Cornwell, 264 U. 8. 560.

Davis v. Henderson, 266 U.S. 92

C. & O. Ry. v. W. C. K. Co., 270 U. 8. 260.

Cleveland Cooperage Co. v. Director General, 57

I. C. C. 423.

Lafayette Box Board Co. v. Director General,

59 I. C. C. 105.

ARGUMENT

Since it is admitted that the embargoes were rea-

sonable and necessary (R. 62), the only question is

the legality of the demurrage charges’ which were

collected for the detention of the cars at the recon-

signing points while they were being held for

further instructions or awaiting the lifting of the

embargoes.

The respondents contend that reconsignment is

a privilege (not a right) which if availed of at-

taches as of the date of the original shipment, and,

6

therefore, is subject to all rights, privileges, and

disabilities pertaining to the original shipment, ex-

cept such as are specifically waived by the tariffs

permitting this reconsignment. Consequently

they may refuse to reconsign to a destination which

is embargoed against shipments from the original

point of origin, without so stating in their tariffs

governing reconsignment, while awaiting disposi-

tion, just as they may refuse the original shipments

if billed to an embargoed destination, and collect

demurrage while the cars are held awaiting in-

structions, without any specific provisions in their ©

tariffs that shipments will not be accepted to em-

bargoed points.

The Commission held that the demurrage was

illegal because the obligation to accept original

shipments is governed by general principles of

law, while the obligation to reconsign is dependent

upon the construction of the rules in the tariffs

permitting the reconsignment, and that if the car-

riers do not restrict such rules to the extent of their

capacity to perform the service, the shipper can

not be held liable for the detention, since the em-

bargo is a disability of the carrier. (R. 63-64.)

In this case the embargoes were laid before re)

of the cars were offered for shipment at the orig-

inal shipping points. The petitioner knew when

it tendered the shipments at the original points of

origin that the entire eastern territory, where its

principal market was located, was embargoed.

|

7

The embargoes remained in effect all during the

transportation to the reconsigning points. They

were still in existence when the orders for recon-

signing were given, and they continued for some

time thereafter. Embargoes were also in force

against shipments from the reconsigning points as

original points of origin to the final destinations

in the East. In other words, the shipments could

not have been made either from the original points

of origin or locally from the points of reconsign-

ment to the final destinations. (R. 58, 61-62.)

These facts should be kept in mind in reading the

following discussion.

It is settled that reconsignment is not a right ve

which a shipper may demand but only a privilege | ae

that becomes available to him when extended by *

the carrier in its tariffs.

In Dietz Lumber Co. v. A., T. & S. F. Ry., 22

I. C. C. 75, 76, the Commission says:

The reconsigning privilege * * * is

not one to be demanded by the public as a

matter of right, but it is a concession volun-

tarily extended by the carriers * * *.

In Cedar Hill Coal & Coke Co. v. C. & S. Ry.,

17 I. C. C. 479, 487, it is said:

Reconsignment is a privilege—not a right

to be demanded by shippers—and can only

be required where necessary to correct un-

just discrimination.

See also Southern Ry. Co. v. St. Louis Hay &

Grain Co. 214 U. 8. 297.

8

The theory of this privilege of reconsignment is

Saal that the shipment is in fact one shipment from point

of origin to the ultimate destination, so that the

‘| _ privilege of reconsignment applies as of the date

pluf of the original shipment. Wood v.N.Y.,P & N.,

53 I. C. C. 183.

In Carolina Portland Cement Co. v. Director

General, 83 I. ©. C. 388, the following appears at

page 391:

As reconsigned, the shipments became

through shipments from the original ship-

ping points to final destinations, and the ap-

plicable rates are those in effect for the

through movements as of the dates of ship-

ment from point of origin, whether joint or

combination rates.

and on page 184 of the Wood case:

If the rate from point of origin to ulti-

mate destination applies as of the date of

the shipment, so, too, must the right of re-

consignment speak as of the date of ship-

ment, even if the order be given subsequent.

See also Murray v. Director General, 69 I. C. C.

477, 482.

Clearly, therefore, all of the rights, privileges,

and disabilities pertaining to the reconsignment at-

tach as of the date of the original shipment, and

must be determined under the facts and circum-

stances existing at the time the original shipment

was made, unless specifically restricted or extended

by the tariffs permitting the reconsignment.

—_ pgammeceppesaeee

9

It is settled that a carrier may refuse an original

shipment offered to an embargoed destination (R.

63) where, as is admitted here, the embargoes are

reasonable and necessary (R. 62). Ifa car is tor jue

dered for shipment from an original point of origin

to an embargoed destination, and is refused we Gi om.

the carrier, demurrage is properly assessed while “gee

the car is held under load at the original point of

origin.

In Brennan Packing Company v. Director Gen- buxrer

eral, 77 I. C. C. 307, the complainant had ordered *“4 baka

certain cars placed for loading without stating the

destination. One of the cars was actually loaded

and tendered for shipment, but refused because an

embargo had been placed against the destination.

That car and the others which had been actually

placed, but not loaded, were held under demurrage

awaiting instructions from the shipper. The ship-

per contended that the carrier should have removed

the empty cars, and that he was not liable for

demurrage on the car loaded because the shipment

was prevented by the embargo which was the car-

rier’s disability. The Commission Says, on page

308 :

The cars were ordered by complainant,

and the carrier was under 20 obligation to

remove them unless instrucied to do so by

complainant. No such instructions were

given, and during the time the cars were

held by complainant, they were subject to

demurrage.

10

See also Atlantic Refining Co. v. Director Gen-

Las eral, 57 I. C. C. 627; Duvall v. Director General, 59

I. C. OC. 442; Kaw Boiler Co. v. Director General,

G 83 I. C. C. 3389; Du Pont v. Director General, 59

I. C. C. 659.

Tariffs do not specifically provide that a carrier

will refuse to accept an original shipment to an

embargoed destination (page 73 of Exhibit 8—the

testimony before the Commission), for, as the Com-

mission says (R. 63), the carrier’s right to refuse

such a shipment is governed by general principles

of law well established.

Since the carrier, without any provision in its

tariff, has the right, by the placing of a necessary

and proper embargo, to relieve itself of its common-

carrier liability to transport shipments offered,

why has it not the same right with respect to a re-

consignment, which attaches as of the date of the

original shipment, especially as the reconsignment

is not a duty imposed upon it by law, but solely a

‘concession voluntarily extended’’ to the shipper?

In other words, in granting a privilege it has at

least an equal right to the protection which the law

gives it as when it is performing the duties imposed

upon it by law as a common carrier, except to the

extent it specifically by tariff waived those rights.

The embargoes themselves (Exhibit 11 to the

testimony before the Commission—Exhibit 8 in

the record in the District Court) by their terms | y

prohibit reconsigning to embargoes destinations. |"

, aa

11

For example, on the first page of Exhibit 11 the

embargo provides ‘‘account connecting lines em-

bargoes Southern Railway System Lines West will

not accept freight as follows for delivery to or

movement via the following road, ete.’’ This would

certainly apply to a reconsigned as well as an orig-

inal shipment.

Furthermore, a carrier is prohibited by law from

reconsigning to an embargoed destination unlegs

the tariff specifically permits it, because that is a

special service.

It is settled that a special service can not be

granted except by publication in the tariff.

In American Paper & Pulp Association v. B. &

0., 41 I. C. C. 506, the Commission condemned the

practice of the carriers in giving an unlimited

amount of free time for unloading at certain ports,

because it was operating as a discrimination against

consignees who could not avail themselves of it and

was detaining the carrier’s equipment unduly, stat-

ing, on page 512:

And by Section 6 [Interstate Commerce

Act] no carrier may extend ‘‘any privileges

or facilities,’’ save as these have been duly

specified. But the primary duty of a car-

rier, is to carry. And it is not the duty of a

carrier, as such, to furnish storage beyond

the reasonable time necessary for unloading

or remoyal.

See also the decisions of this Court in C. & A.

Ry. Co. v. Kirby, 225 U. 8. 155; Davis v. Cornwell,

12

264 U. 8. 560; Davis v. Henderson, 266 U. S. 92;

C. & O. Ry. v. W. C. K. Co., 270 U. 8. 260.

There is another point which must not be over-

looked, and that is that for practical purposes an

embargo has the effect of eliminating the embargoed

point_as_a destination, and the situation then is

just the same as if no such point of destination

is named in the tariff. This is made clear by the

Commission’s decisions dealing with routes which

have been embargoed. They are not available, and

for practical purposes do not exist. In North Pack-

ing & Provision Co. v. Director General, 73 I. C. C.

749, the shippers claimed that they had been de-

prived of the right to route their shipments by

reason of the permit system which was then in

use on account of embargoes at New York. The

Commission says, on page 752:

Common carriers have the right, in order

to prevent complete paralysis of their oper-

ating facilities, to protect themselves by em-

bargo against acceptance of freight over a

certain route or routes which may be con-

gested. That right was exercised by defend-

ants, and the embargo which affected com-

plainants’ shipments also affected all routes

serving the port of New York and all export

* traffic intended for shipment to that port,

except shipments for the United States Gov-

ernment and shipments as to which the em-

bargo was lifted by special permit. A route

that is embargoed against certain traffic

|

13

can not be said to be available to shippers

tendering such traffic. We have frequently

construed section 15 to impose upon common

carriers the duty, in the absence of contrary

routing by the shipper, to forward shipments

over the cheapest available route, and failing

to do so, carriers have been found liable to

the damaged shipper in the amount of the

difference between the rate charged and the

rate over the cheapest available route. But

where, as here, because of congestion or other

justifiable cause and consequent embargo, the

route is not available, the carrier does not

violate its duty if it refuses to accept the

shipment until after the shipper agrees to

a route that is available.

See also Cannon Mfg. Co. v. Southern Ry., 56

I. C. C, 128, 130.

- Consequently a destination is not available where

embargoes are in effect, and for practical purposes

it.does not exist.

Furthermore, the petitioner did nothing to abate

the demurrage, and hence can not recover. See

Cleveland Cooperage Co. v. Director General, 57

I. C. C. 423, 425; Lafayette Box Board Co. v. Di-

rector General, 59 I. C. C. 105, 107.

Since the respondents were not required to state |

in their tariffs they would not reconsign to em- |

bargoed destinations, and since they can not re-

consign to embargoed destinations in the absence of

specific tariff provision permitting such a practice,

the demurrage was legally collected during the

|

\

14

the Commission’s orders are unlawful and void. =~

It is respectfully submitted, therefore, that the ~

petition for a writ of certiorari should be denied. =

SToKE.Y, ScrIvNER, Dominick & SMITH,

Sipney P. Smira,

Sipney F’. ANDREWS,

Arex. M. BULL,

Attorneys for Respondents.

WasHinaton, D. C., July 11, 1927.

O

lic of detention at the reconsigning points, and ‘

INDEX

Statement_....... ahnESeeEeEE aE

EE

CITATION

ED ta tle at SUNN GIN. ccunmssenncindemmemncindiomemadinaes

89558—28

Page

1

Inthe Supreme Court of the Wnited States

Ocroser TERM, 1927

No. 342

Krauss Broruers LUMBER Co., PETITIONER

v

ANDREW MELLON, Director GENERAL OF RAILROADS,

as Agent, etc., et al., respondents

STATEMENT

A writ of certiorari was issued in this case, the

order requiring ‘‘ that the argument be limited to

the question of practice in respect to the Bill ef

Exceptions upon which the case in the Cireuii

Court of Appeals was made to turn.”’

We make our own statement because the state-

ment of the case in the brief for petitioner does not

sufficiently set forth the facts with regard to the

question now before this court and is inaccurate in

certain respects, particularly the statement on page

2 purporting to set out the position of respondents

in contesting the order of the Commission. It may

be briefly stated that our position is that on a recon-

signed shipment all of the rights, duties, and liabili-

(1)

2

ties of the carrier and the shipper date back as of

the date of the original shipment, and, hence, since

. the embargoes were in effect when the shipments

left the original point of origin and continued jin

effect while the shipments were held at the recon-

signing points, the carriers have the same right to

assess demurrage at such reconsigned points as they

would have had to assess demurrage at the original.

point of origin under like conditions. The Commis-

sion held the right to lay the embargoes and assess

demurrage at the original point of origir Is gov-

erned by well-settled principles of law, but that the

rights as to reconsignment are governed by the

rules in the tariffs and consequently the carriers

. forfeited anv rights whieh were not sndej feallv re-

servxl i the rceousigning tariffs. It 1s obvious,

'... therefore, that it was important that the court have

before it the tariff and other portions of the record

before ‘he Commission (see Rec. page 58 and opin-

~ jon, the Court of Appeals, Ree. 96) before the court

can intelligently pass upon the issues. These ques-

~ ." tions are fully discussed in our brief opposing the

- granting of the certiorari but are not repeated here

- because not relevant to the point now before the

court. |

This is a suit to enforce an award of the Inter-’

.state Commerce Commission. To the petition filed

in the District Court to enforce the order, the de-

fendants (respondents here) filed a ‘‘plea of general

issue pleaded in short by consent, with leave to give

ae

in evidence any matter which, if well pleaded, would

be admissible in defi nse of the action, and have

effect as if so pleaded * * *,”? (Ree. p. 54.)

The jury. found in favor of the def ayants under 4

a direeted verdict (f 4 79). % — . | ait

. The Bill of Exceptions shows that defendants

introduced, amongst other evidence, Exhibits 7, 8,

9, 10, and 11, which contain all of the record before

the Commission, each exhibit being described in the

Bill of Exceptions (58).

The concluding paragraph of the Bill of Excep-

tions (59) states in part:

By virtue of an order of the Presiding

Judge, ¥’. I. Grubb, plaintiff’s Exhibit No. 6

and defendants’ Exhibits Nos. 7, 8, 9, 10, and.

tl, respectively, are omitted from the bill of

exceptions in prder.that they may he sent by

the Cferk of the tower Court’ in ny i}xnee :

with the said order of the l’residing Judge,

direct to the Court of Appeals.

The Bill of Exceptions then ‘stated, ‘‘This was

all the evidence in the case’’ (59).

The order of the Court reads:

It appearing to the court that in this cause

it is necessary and proper in the opinion _

of the court .that certain original*papers and °

documents should be inspected in the Cireuit —

Court of Appeals upon writ of error by said

court: ’ ‘ .

it is therefore ordered that the following

papers to-wit: Exhibits 6 to 11, inclusive,

referred to and described in the bill of ex-

4

ceptions, be transmitted by the Clerk of this

court to the Clerk of the Circuit Court of

Appeals at New Orleans, La., and returned

after the disposition of the writ of error to

the Clerk of this Court.

The stipulation of the parties is as follows:

The parties to this cause by their respec-

tive counseldo hereby stipulate and agree as

follows: _

That the plaintiff’s exhibit No. 6 and that

the defendants’ exhibits 7, 8, 9, 10, and 11

may be omitted from the bill of exceptions,

and sent by the Clerk of the trial court direct

to the Court of Appeals in their original

form, and further that the exhibits need not

be printed in the record. This agreement

is made in conformity with an order of the

trial court by the presiding judge that said

exhibits, viz: 6, 7, 8, 9, 10, and 11 shall be

omitted from the record, and sent direct by

the Clerk of the trial court to the Court of

Appeals.

After quoting the concluding paragraph of the

Bill of Exceptions, above referred to, the order

of the Court, and the stipulation of the parties, the

Court states that Exhibits 6, 7, 8, 9, 19, and 11,

which were before the District Court, are not in-

eluded in the Bill of Exceptions and are not

printed in the transcript, but that the original

documents were sent up in compliance with the

order, but without anything to show that they were

made a part of the bill (97-98). The Court refers

to its Rule 14, Paragraph 4, with regard to the

ee :

5

transferring of original papers from the District

Court, which is similar to Pe~agraph 3 of Rule 9

of this Court, and says that the order transmitting

the originals should not have been granted, and

that Rule 14, Paragraph 4, ‘‘was never intended

to permit the sending up of a mass of original

documents that could have been copied in the

printed record, for the purpose of saving expense”’

(98).

The Court concludes that all of the evidence upon

which the case was tried is not in the Bill of Ex-

ceptions and consequently the exhibits sent up in

original form can not be considered, and holds

(99) :

Where instructions of the Court are as-

signed as error on a motion to direct a ver-

dict or otherwise, unless the entire evidence

pertinent to the question is in the bill, the

Appellate Court must presume that the

omitted evidence justified the instructions.

(Citing Authorities.)

The Court affirmed the judgment of the District

Court (18 F. (2d) 369) on the ground that it was

unable to review it because of the state of the

record (99).

ARGUMENT

As the Court of Appeals suggests, and as would

seem apparent from the record, the exhibits men-

tioned were sent up in the original form to save the

cost of printing, and it was so stated to respondents

6

when they were asked to sign the stipulation here-

tofore quoted.

Obviously, since exhibits 7, 8, 9, 10, and 11 consti-

tuted practically all the respondents’ testimony,

they would not have consented to any stipulation

which would have omitted them completely from the

Bill of Exceptions and from the consideration of

the Court. Furthermore, if they had not been pre-

sumed to have been incorporated, by reference at

least, in the Bill of Exceptions, there would have

been no purpose in sending them up in theiy origi-

nal or any other form because, as the Court points

out, they could not have been deemed to be before

the court.

The record is perhaps somewhat ambiguous on

the question of their inclusion in the Bill of Excep-

tions. Of course, they are not printed in the Bill

of Exceptions, and in that sense are omitted, but if

they were not to be presumed to have been incorpor-

ated by reference i the Bill of Exceptions, there

would have been no object whatever in sending them

up in the original form, nor of mentioning them,

and the stipulation, and the order of the Court

would have been useless.

Consequently, when the record is read in connec-

tion with the fact that the exhibits were actually

placed before the Court of Appeals it would seem

clear that the exhibits were included by reference

in the Bill of Exceptions, and the court should have

considered them.

7

The stipulation for sending up the exhibits in

original form was made in good faith by the part-

ies, respondents, at least, having understood that

this practice was } »per, and that the ecurt would

consider the exhivits, and the failure to print was

apparently due to an honest mistake for which the

petitioner ought not to be made to suffer. There-

fore, if that were the contention of petitioner, re-

spondents would interpose no objection to the

Court of Appeals or this court reviewing the entire

record, including the exhibits (the petitioner being

required to print them or the substance of them for

the record if the court deemed that necessary ).

However, the position which petitioner has taken

in his brief in this Court presents an entirely dif-

ferent question. He contends that the Exhibits

were irrelevant, and consequently under Section 2,

Rule 7, should have been and were omitted from the

Bill of Exceptions. That Rule requires that ‘‘only

so much of the evidence shall be embraced in a Bill

of Exceptions as may be necessary to present

elearly the questions of law involved in the ruling

to which exceptions are reserved * * *,” Tf

they were omitted because of that rule, sending

them up in the original form would have been as

much in violatior of Rule 7 as if they had been

printed in the record, and would have been a useless

proceedure.

The Bill of Exceptions shows (58) that when

the Exhibits were offered by the defendants (the

8

respondents here), they were objected to on the

ground that they were immaterial, irrelevant, and

incompetent, and the objection was overruled (59).

Obviously, therefore, respondents would never

have entered into any stipulation which would have

taken away from the consideration of the Appel-

late Court the Exhibits which constituted practi-

cally all of their evidence in the District Court.

Furthermore, the Bill of Exceptions refers to

and describes these Exhibits (58). It is manifest,

therefore, from the Bill of Exceptions that there

was evidence which the District Court at least

deemed material, because it was admitted over ob-

jection, and which was before the District Court,

but which was not before the Court of Appeals.

The burden was upon the petitioner to make the

record, but had the respondents not understood that

under the agreement and order of the Court the

Exhibits were incorporated in the Bill of Excep-

tions by reference, and would be considered by the

Appellate Court, it is clear that they would have

insisted that they be included in the Bill of Ex-

ceptions and printed, for they would never have

stipulated, because petitioners deemed it irrele-

vant, that their evidence admitted cver objection

should be left out.

In this case the District Court directed a vex

dict upon all of the evidence. Obviously, there-

fore, all cf the evidence is necessary in order that

the Appellate Court may intelligently pass upon

9

the action of the District Court, as the Court of

Appeals correctly states, citing authorities (99) :

Where instructions of the Court are as-

signed as error on a motion to direct a ver-

dict or otherwise, unless the entire evidence

pertinent to the question is in the bill the

Appellate Court must presume that the omit-

ted evidence justified the instruction.

Therefore, if the real reason for not printing the

exhibits was that now contended for by petitioner,

namely, that they were omitted in accordance with

the provisions of Paragraph 2 of Rule 7 of this

Court, this court must affirm the Court of Appeals

because the Bill of Exceptions describes them and

shows they were actually before the District Court

when it directed its verdict.

However, as stated before, responcents at the

request of petitioner signed the stipulation above

quoted upon the statement to them that it was for

the purpose of saving the cost of printing, and

they understood that the rules of the Court of

Appeals would permit it. They understood the

entire record, including the exhibits sent up in

original form, would be considered by the Court of

Appeals and the case determined upon its merits.

Consequently they do not now object to such action

by the Court of Appeals or this Court. Their only

concern is that those Exhibits should not now be

held to be not before the Court under Paragraph 2

of Rule 7. Such a ruling would penalize the re-

10

spondents by omitting substantially all of their evi-

dence from the record, because they had agreed to

a procedure which they were advised was taken to

save petitioner expense and place the entire testi-

mony before the Court. Otherwise would not have

consented.

Respectfully submitted.

StToke.y, ScrivNer, Dominick & Sirs,

Sipney P. Smrra,

Sipney F’. ANpREws,

Arex. M. Butt,

Attorneys for Respondents.

Wasurnaton, D. C. February 24, 1928.

U

Inthe Supreme Court of the Wnited States

OctToserR TERM 1927

No. 342

Krauss BrorHers LUMBER COMPANY, PETITIONER

v.

AnNpREW W. MELLON, Direcror GENERAL OF RalL-

roads, as Agent, etc., et ai., respondents

MOTION BY RESPONDENTS TO AMEND JUDGMENT AS TO

COSTS AND RETAX COSTS

Now come the respondents and, leave first having

been asked and obtained, move the Court to amend

the judgment in this case so as to tax the costs in

this Court against the petitioner instead of against

the respondents, for the reason that the Writ of

Certiorari was granted to consider a question of

practice which arose because of the manner in

which the record in the Circuit Court of Appeals

was prepared by petitioner and for which the peti-

tioner was solely and entirely responsible.

The opinion of this Court rendered April 9, 1928,

does not state that costs will be assessed against

respondents, but we understand that under para-

graph 3 of Rule 29 the costs will be assessed against

respondents in the absence of a ruling by the Court

9977428 (1)

2

to the contrary, the judgment of the Court of

Appeals having been reversed.

This case was brought in the District Court to

enforce an order of the Interstate Commerce Com-

mission against respondents’ for $10,365, demur-

rage charges, alleged to have been illegally collected.

The District Court directed a verdict in favor

of the respondents. (R. 79.) The duty of pre-

paring the record for the Court of Appeals, there-

fore, rested primarily upon petitioner. In order

to avoid the cost of printing certain exhibits (see

page 2 of the opinion of this Court, and the opin-

ion of the Court of Appeals, R. 98) petitioner re-

quested respondents to stipulate that certain ex-

hibits should be sent up to the Court of Appeals

in original form, which was done (R. 59, 80, 82).

One of those exhibits was a part of petitioner’s

evidence. At no time did petitioner ask respond-

ents to acquiesce in any other method of preparing

the record. Respondents have never questioned

this procedure nor sought bo take advantage of the

manner in which the record was made up.

‘The Circuit Court of Appeals, of its own mo-

tion, and not by request or consent of either party”’

‘The opening paragraph of the opinion of this Court

states that the Commission ordered the Mobile & Ohio Rail-

road and the Alabama Great Southern Railroad Gompany

to pay the reparation. The orders are against the Director

General of Railroads as well as the two railroad companies

wamed (Rec. pp. 65-69, 76), the greater portion of the

reparation being against the Director General of Railroads

(Ree., 57, 66, 76).

3

(see page 4 of this Court’s opinion), held that the

matter sent up in the original form was not a part

of the Bill of Exceptions and could not be con-

sidered by it, and consequently affirmed the judg-

ment of the District Court, applying the rule that

where the Bill of Exceptions does not contain all

the evidence, it will be presumed that the evidence

omitted was sufficient to justify the action of the

Court in directing the verdict.

Petitioner then applied to this Court for a Writ

of Certiorari, which was granted, with the order

that the argument be limited to the question of

practice in respect to the Bill of Exceptions upon

which the case in the Court of Appeals was made

to turn. (R. 102.) Reference to respondents’

brief opposing the Writ of Certiorari (pages 3 et

seq.) will show that objection to granting the Writ

was based solely on the merits of the case and not

upon the state of the record. Respondents’ brief

filed in this Court after the granting of the cer-

tiorari shows (pages 5, 7, 9) that again respond-

ents made no objection to the manner in which the

record was prepared, but opposed petitioner only

on his contention that the exhibits had been omit-

ted because irrelevant, and it was distinctly stated

by respondents that they did not oppose a review

by the Court of Appeals of the case on the merits

on the entire record, as they understood that the

exhibits had not been printed in order to save the

petitioner the cost of so doing.

4

At the oral argument in this Court respondents

again stated that they had no objection whatever

to the Court of Appeals considering the case on its

merits on the entire record; that they had briefed

and argued the case to the Court of Appeals upon

the entire record which they understood was before

it, and that the only opposition that respondents

made to the petitioner’s argument in this Court

was to the contention that the exhibits referred to

had been omitted from the Bill of Exceptions in

accordance with paragraph 2 of Rule 7 of this

Court, because irrelevant.

In other words, throughout this case respond-

ents not only have not opposed the method in which

petitioner prepared the record, but have actually

cooperated with him in every way, as far as they

have been requested, in the preparation of the

record in an effort to save the petitioner the cost

of printing evidence, some of which was his own,

and the remainder of which was introduced and

admitted by the Court over objection that it was

irrelevant.

It is manifestly unjust, therefore, that respond-

ents should now be penalized by being required to

pay the costs of bringing the case up to this Court

on certiorari on the question of practice which

arose entirely because of petitioner’s method of

preparing his record.

It is respectfully requested, therefore, that the

judgment rendered April 9, 1928, be amended so

as to tax against the petitioner, and not against

ae

respondents, the costs accruing in connection with

the Writ of Certiorari granted October 24, 1927.

Respectfully submitted.

SToKELY, Sortvner, Dominick & Smiru,

Sipney P. Smrra,

Smpney F’. ANDREws,

AtEx. M. Butt,

Attorneys for Respondents.

Wasuineron, D. C., April 18, 1928.

CERTIFICATE OF COUNSEL

I hereby certify that I have prepared the fore-

going Motion, and in my opinion it is well founded,

and it is not interposed for delay.

Arr. M. But,

Of Counsel for Respondents.

O