Stanley Forman Reed

“ The appellants' argument that only carriers or shippers are covered is based on the clause stating the punishment to be applicable whether the alleged violator is 'carrier or shipper.' Such an argument assumes that the carrier and shipper clause restricts the ordinary meaning of 'any person.' No reason is advanced for such a restriction. As has been set out, there has been a well defined and continuous purpose to eliminate preferences to shippers from our system of transportation for reasons of fairness and to avoid rate wars, detrimental to the efficiency of the carriers. ”

“ We know that it is a common practice for chambers of commerce and city authorities to offer to manufacturing and business concerns lands and sites on favorable terms, such as low purchase price, reduced rentals, exemption from taxation for a given period, in an effort to induce such concerns to locate within the limits of a municipality.
We know that, in order to induce men to move their plants from one location to another, it is a practical necessity to offer them some recompense for the expense involved and for the loss which may result from doing business in a new location. ”

“ Appellants urge that the City's action in making rrangements for payments to dealers located in the Missouri city was taken solely in furtherance of its municipal interests and without intention to influence traffic and consequently not 'in respect to the transportation of any property.' It is pointed out that it is quite permissible and indeed desirable for a railroad, largely dependent as its prosperity is upon the prosperity of the communities reached by its tracks, to take part in furthering civic development. ”

“ It has always been understood that one of the purposes of the interstate commerce law was to prevent a carrier from giving, and a shipper from receiving, transportation services at less than the published tariff rates, and to preclude what is equivalent, namely, the furnishing of a service at tariff rates to one shipper which is withheld from others. ”

“ Certainly there can be no objection on the score of illegality under federal transportation acts for a city, anxious to make its market house profitable, to adopt business practices, normal for real estate operators, if the practices do not involve discriminations 'in respect to * * * transportation' by interstate carriers. Thus it is understandable that city and railroad might individually and even cooperatively work hand in hand to promote the city's economic welfare without violating the Elkins Act. ”

“ The concessions are none the less illegal, if made for non-transportation services, [17] as long as they result in lowering directly or indirectly transportation costs to a shipper. That other inducements may also have influenced the concessions is not important when a materially effective purpose is the securing of traffic for an interstate carrier. Where traffic is an object and discriminatory advantage the means employed in attempting to obtain or actually obtaining it, there is a violation of the section in respect to transportation. ”

“ If the market shifts from Missouri to Kansas, it is estimated that Union Pacific stands to gain traffic revenues of several hundred thousand dollars annually from the development of the market, due largely to the fact that a railroad on whose line a shipper is located enjoys a substantial advantage in soliciting competitive traffic, and comparable losses may be reasonably expected by the railroads now serving the Missouri market. ”

“ In Kansas City, Missouri, there was an existing wholesale produce market. This needed extensive alterations and additions and the expectation was that many of the tenants would move to the new and more convenient terminal in Kansas City, Kansas. All who were interested in the latter realized that tenants of the old one in Missouri might incur expense in giving up their quarters and moving to the new. They realized also that, in order promptly to fill the new building, some concessions in the amount of early-accruing rentals might have to be made. ”

“ The language seems too clear to be misunderstood. It is only the carrier, or someone acting in its behalf, who can give or grant a concession. It is only the shipper, or someone acting in his behalf, who can receive or solicit one. The section as originally enacted, 32 Stat. 847, goes on to provide: 'Every person or corporation who shall offer, grant, or give or solicit, accept or receive any such rebates, concession, or discrimination' shall be deemed guilty of a misdemeanor and punished by fine. ”

“ Violation of the commerce acts through receipt of advantages is to be tested by actual results not by intention. [9] Any and all means to accomplish the prohibited end are banned. [10] We recently said that under competitive conditions existing in the New York area the action of the Commission in attacking discrimination by an order against furnishing non-transportation services below cost to the carrier was valid, although there was no showing that the charges were below fair value. [11] Contribution to a shipper's construction cost is forbidden. ”

“ Fair rental value rather than a compensatory return upon full value of the market facilities is the standard by which the City's schedule of rates is to be judged. To determine fair rental value the going rates of rental for similar facilities in the community are significant, as are the rentals prospective tenants are willing to pay. ”

“ Money for the preliminary expenses was advanced by the Union Pacific. No objection was made to the use by the City of prepaid rents from the City Ice & Fuel Company to further the removal of the dealers in the manner 'conceived and devised,' in the words of a finding, by the Union Pacific. The railroad was the 'leading and dominant' influence in the entire transaction. If the City was not completely 'subservient to the competitive needs' of the carrier, as we said of the warehousing corporations in Baltimore & Ohio R. Co. ”

“ In order to fill the building promptly this lease provided that for the first three months the monthly rental should be one-third of the standard monthly rental. Thus a tenant who, after the three months, would pay $150 a unit would get the use of that unit for the first three months for $50. It is again common knowledge that, in a competitive situation, the owner often has to make rental concessions for a brief time at the beginning of the lease term. There is nothing unlawful about this and the decision of the Supreme Court of Kansas sanctions it. ”

“ Appellants DeOreo and Fean, before 1937, had promoted various metropolitan terminals with wholesale produce market and rail facilities. In December, 1936, they suggested to Union Pacific the feasibility of such a terminal to be served by its line at Greater Kansas City, and a plan was soon formulated for the construction of facilities on the Public Levee, property of Kansas City, Kansas; Union Pacific's aim was to increase its traffic and revenues from perishable food products. ”

“ Union Pacific became interested in the development in order to increase the volume of its traffic; for unlike the situation in the Missouri market it was, with a minor exception, the only railroad with tracks serving the proposed Kansas site. Because business in the Greater Kansas City area was believed insufficient to support a split market, partly in Kansas and partly in Missouri, the plan included taking steps to persuade dealers on the Missouri side to move to Kansas. ”

“ The terminal as completed consists of railroad facilities, owned by Union Pacific, for which it spent $603,000; and the City's wholesale produce market, with a cold storage plant, produce dealers' buildings, a farmers' market, and some terminal trackage, all constructed with funds derived from the PWA grant and the revenue bonds sold to Union Pacific. [4] The Food Terminal is a unitary enterprise, with the market and the railroad facilities integral parts of a unified whole. ”

“ The cost of furnishing the facilities, including the normal return on capital employed in like enterprises would have weight. Other pertinent factors would doubtless emerge in a controversy to have determined judicially, whether certain rentals received are or are not fair. When enough evidence is offered to justify a conclusion based upon judgment amd not guesswork, the requirements of the judicial process are met. ”

“ They have received considerable payments from Union Pacific for their efforts in connection with the establishment of the terminal.
De Oreo and Fean presented their plan to Union Pacific. That company took an interest, not eleemosynary but practical, in the project. Inasmuch as its tracks would serve the proposed terminal the railroad naturally desired that the plan go through so that it might get increased business and obtain a competitive advantage over other railroads serving the area known as Greater Kansas City and particularly the food terminal at Kansas City, Missouri. ”

“ In fact favoritism which destroys equality between shippers, however brought about, is not tolerated. Of course, no party to this appeal disputes this broad principle.
Difficulties in statutory construction arise upon further analysis of the statute. ”