Robert H. Jackson

“ The Court asserts that the existing all rail rates are lawful under the long and short haul clauses, while the existing barge-rail rates are unlawful. But there is nothing in the long and short haul clause which requires that shippers by rail to Chicago from points in Illinois, Iowa, Kansas, and Missouri must be granted a low rate for shipment beyond Chicago which is denied to those who ship into Chicago by barge. ”

“ The proposed schedules applied to grain, grain products and grain by-products, but for convenience we refer to them all as 'grain.' They dealt not only with grain coming by barge via the Illinois Waterways to Chicago, but also with grain so arriving at Peoria, Illinois, St. Louis, Missouri, and other related rate-break points. Chicago is illustrative of all, and for convenience we shall follow the practice employed by the parties in briefs and argument, and confine our discussion to it. ”

“ As the Commission correctly observed with reference to the first contention, 'to adopt protestants' premise would mean that all proportional rates lower than local rates and differing from each other according to the origin of the commodity would have to be condemned.'
Proportional rates so differing and lower than local rates for like outbound transportation have a long history, antedating the Interstate Commerce Act itself. Long hauls have generally been thought entitled to move at a rate less than the sum of the rates for local or short hauls between intermediate points. ”

“ True, the Commission stated that the railroads 'are justified under section 1 in treating the ex-barge traffic the same as local or ex-truck traffic,' and found that 'the proposed schedules are shown to be just and reasonable.' But this does not constitute a finding that the rates were lawful; they 'may lie within the zone of reasonableness and yet result in undue prejudice' or otherwise violate the Act. ”

“ The District Court, which held that the Interstate Commerce Commission's order 'discriminates against water competition by the users of barges,' understood the issue. [28] The railroads, which proposed the increase in the cost to barge shippers, also understood the issue as is shown by the frank statement of their representative at the Commission hearing: 'We made this proposal, as I have stated several times, and filed these tariffs with the hope that we could drive this business off of the water and back onto the rails where it belongs. ”

“ Here we have a rate revision which can serve no conceivable purpose except to force shippers to use railroads instead of barge lines. Reasonable persons may differ as to the wisdom of such a policy, but not as to the certainty of its result; and, as will be shown, Congress has made the policy judgment and has flatly forbidden the Commission to do what it has done. ”

“ Appellees make no better showing with respect to the effect of the injunction on the rate structure west of Chicago. To sustain the injunction would require a holding that grain originating 60 miles from Chicago must as matter of law be given the benefit of proportionals fixed with reference to grain from the Northwest Territory, embracing points in Canada and as far west in the United States as Washington and the Dakotas. ”

“ When a through rate is made by combination of rates for intermediate distances, the rate for the later link in the shipment is, when lower than the local, spoken of as a proportional rate.' Atchison, T. & S.F.R. v. ”

“ They required repeated assurance by the Chairman of the Interstate Commerce Committee of the Senate that the bill was written in such manner that the Commission could not if it desired permit discrimination against water carriers. At great length the Chairman of that Committee explained to apprehensive Senators that the bill contained provisions in three different places which imposed upon the Commission the imperative duty of standing in constant opposition to discrimination against shippers by water. ”

“ The practice of routing commodities such as grain to centers for marketing and processing has been widespread and often a necessary feature of the process of distribution. In many instances stopovers for marketing and processing have not been considered as disrupting the continuity of transportation to more distant points, and consequently the grain has been allowed to move on at a rate lower than the outbound rate on grain originating locally and not from a distance. ”

“ On September 18, 1940, the President approved the Transportation Act of 1940. [4] Thereafter the appellee Inland Waterways Corporation requested the Commission to dispose of the proceeding in the light of the new Act. On July 31, 1941, Division 2 of the Commission found that 'the proportional rates here in issue have never been applicable on this barge traffic moving on unfiled rates,' and that 'the schedules under suspension are not shown to be unlawful.' It announced that an order would be entered vacating the already expired order of suspension and discontinuing the proceedings. ”

“ It stated that further hearings could be useful only to establish the information of which the Commission took official notice, and suggested that the Commission avoid the necessity for them by taking such notice.↑ Even under the proposed schedules, the combination barge-rail rates are in many instances lower than the all-rail rates. Much grain that arrives at Chicago is consumed locally or is shipped out by lake. ”

“ The Commission is not bound by the technical procedures of the common law, and it should not strain to avoid the enforcement of congressional will because of the formal fashion in which questions are presented to it. In this proceeding it was the Commission's duty 'to protect and maintain a transportation system free from partiality to particular shippers. The Commission acted in its capacity as a public agency' and was obligated to carry out 'duties imposed upon it by Congress in the interest of shippers generally, the national transportation system and the public interest.' United States v. ”

“ As pointed out by the division, reshipping or proportional rates are in their essence balances of through rates. Such balances are, of course, determined by the measure of the in-bound and through rates and properly may vary according to the relative length and nature of the in-bound and through service. ”

“ Here the same effect is achieved under the Commission's other powers by a tariff aimed at shippe § who have previously used water transportation. For the background and nature of the 1940 Act see Eastman, The Transportation Problem, 30 Amer.Econ.Rev. 124; Stein, Federal Regulation of Water Carriers, 16 Jour. Land and Pub.Util. Econ. ”

“ Cf. Sen.Rept. No. 433, 76th Cong., 1st Sess., p. 10.↑ United States v. Illinois Cent. R. Co., 263 U.S. 515, 524, 44 S.Ct. 189, 193, 68 L.Ed. 417.↑ § 2, 49 U.S.C. § 2, 49 U.S.C.A. § 2, reads as follows:↑ Standard Packing Co. v. Union Pacific R. Co., 190 I.C.C. 433; Parkersburg Rig & Reel Co. v. Chicago & N.W. Ry. Co., 198 I.C.C. 709; William Kelly Milling Co. v. Atchison, T. & S.F. Ry. Co., 211 I.C.C. 53; Kansas City Ice Co. v. Atchison, T. & S.F. Ry. ”