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PENNSYLVANIA R. CO. v. UNITED STATES

DISTRICT COURT, D. NEW JERSEY


December 8, 1943

PENNSYLVANIA R. CO. et al.
v.
UNITED STATES (INTERSTATE COMMERCE COMMISSION et al., Interveners)

On Argument in Respect to Form of Final Decree.

In our original opinion we stated that the conclusions reached by us rendered it unnecessary to discuss the last point raised by the petitioners; the question of whether the compensation fixed by the Commission for the use of the petitioners' cars is confiscatory. Counsel for Seatrain has now suggested the possibility, however impractical, that Seatrain might be able to maintain routes from Hoboken to Belle Chasse entirely within the United States and its territorial waters. *fn1" If this be the case, the issue of whether the compensation fixed by the Commission for the use by Seatrain of the petitioners' cars is confiscatory is not moot. There is also the consideration that if on appeal our decision that the Commission was without authority to compel the petitioners to interchange their cars with Seatrain for transportation beyond the United States and its territorial waters should be reversed, a remand would be necessary to permit this court to decide the issue of confiscation. We feel, therefore, that we should decide it now.

The order of the Commission imposes on Seatrain an obligation to pay to the petitioners $1 per day for each car supplied by them to Seatrain but provides also that this rate shall be paid by Seatrain only for the period in which the car is in the actual possession of Seatrain. The Commission thus has relieved Seatrain of the obligation to compensate the petitioners for the period of time during which a car may be held by Seatrain's connecting railroad carriers because there is no ship immediately available to receive the car at Hoboken or at Belle Chasse. The nature of this exception in Seatrain's favor is made plain by an examination of Rule 15 of the Car Service and Per Diem Agreement of the trunk line carriers. The rule is set out below." *fn2"

As the Commission states, there are two faces to the problem. See Hoboken Mfrs. R. Co. v. Abilene & S. Ry. Co., 248 I.C.C. 109, 117-119. The Commission points out that the period of detention of cars before acceptance by Seatrain, longer in fact than the period of detention required by carriers by railroad, is the consequence of the nature of Seatrain's operation, ships sailing less frequently than trains run. Seatrain might well be obliged to assume the obligations imposed by its method of operation. But, as the Commission says, Seatrain's position in respect to car-detention is analogous to that of the break-bulk carriers by water. The disability of the break-bulk water carriers to accept merchandise promptly in all instances is reflected in the demurrage rates and presumably also in the rail rates and divisions applicable to traffic between them and the railroads. The Commission concludes that Seatrain's cardetentions are properly a matter for consideration in connection with the rates and divisions to be made between Seatrain and the petitioners rather than in determining the per diem rate which Seatrain should pay. The result, as the Commission points out, will be, or should be, much the same in either event for if the railroads are relieved by per diem payments by Seatrain of the burden of car detention which they bear on traffic interchanged with the break-bulk lines, the railroads will "* * * be entitled to relatively lower divisions of through rail-water rates with Seatrain than with the break-bulk lines, or to relatively lower local or proportional rates to or from the ports where the through rates are made on combination". The Commission goes on to state that; "Considerable difficulty, however, would be encountered in making any such adjustment. From a practical point of view, therefore, the simple and desirable way of handling the matter is to leave the burden of car detention with * * * [the petitioners] when traffic is interchanged with Seatrain just as when it is interchanged with the break-bulk lines." The finding set out below followed. *fn3"

 A careful consideration of the record and the briefs of the parties convinces us that the determination of the per diem rate and of its method of application rested with the Commission in the exercise of its expert administrative judgment. We conclude that the per diem rate and the condition of its application are not confiscatory or even unreasonable. The rate and the condition of its application as ordered by the Commission in fact are not confiscatory even if petitioners' cars be carried from Hoboken to Belle Chasse via Havana. The per diem rate is applicable throughout the whole of the time that the cars are upon the Seatrain ships. The non-payment of the per diem rate during detention periods at Hoboken and Belle Chasse forms the substance of the petitioners' complaint. *fn4" We think that the findings and conclusions of the Commission have an adequate basis in the facts and in the law.


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