[274 U.S. 564, 566] Mr. Blackburn Esterline, of Washington, D. C., for the United states.
Messrs. Francis I. Gowen and F. M. Rivinus, both of Philadelphia, Pa., for Akron, Canton & Y. Ry. Co.
Mr. Frederick H. Wood, of New York City, for Bethlehem Steel Co.
Mr. Walker D. Hines, of New York City, for Berwind-White Coal Mining Co.
Mr. R. Granville Curry, of Washington, D. C., for Interstate Commerce Commission.
Mr. Wayne Johnson, of New York City, for Pennsylvania Coal & Coke Co. [274 U.S. 564, 567] Messrs. Ralph J. Baker, of Harrisburg, Pa., and John Lord O'Brien, of New York City, for Rainey-Wood Coke Co.
Messrs. Frank Bergen and William H. Speer, both of Newark, N. J., and August Gutheim, of Washington, D. C., for Public Service Electric & Gas Co.
Mr. E. L. Greever, of Tazewell, Va., for Pocahontas Operators' Ass'n.
Mr. Justice BRANDEIS delivered the opinion of the Court.
These five suits were brought in the federal court for Eastern Pennsylvania under the Urgent Deficiencies Act October 22, 1913, c. 32, 38 Stat. 208, 219 (Comp. St. 994), to enjoin and annual an order of the Interstate Commerce Commission. The order, which was to become effective March 1, 1925, prescribes for all railroads subject to its jurisdiction a so-called 'assigned car rule' governing the distribution of cars among bituminous coal mines in times of car shortage. Assigned Cars for Bituminous Coal Mines, 80 Interst. Com. Com'n R. 520; Id., 93 Interst. Com. Com'n R. 701. Some of the plaintiffs are operators of coal mines, some distributors of coal, some large private consumers of coal, and some are railroads. All had been parties to the proceeding before the Commission in which the order was entered. The defendants in each case are the United States, the Interstate Commerce Commission, and various intervening mine operators. All the defendants answered. The cases were heard together on the evidence before three judges. A final decree granting the relief prayed for was entered in each case on December 15, 1925. Berwind-White Coal Mining Co. v. United States (D. C.) 9 F. (2d) 429. The cases are here on appeal under section 238 of the Judicial Code as amended (Comp. St. 1215).1 They were argued together. [274 U.S. 564, 568] The term 'assigned cars' is used in contradistinction to system cars. By assigned cars are meant those placed for use at a specified mine for a particular shipper. By system cars are meant those, from time to time on the line, which are being kept available for use at any mine for any shipper. Assigned cars are of two classes. One class of assigned cars consists of private cars. These are cars owned (or leased) by some shipper ( or subject to the control of a particular person not a rail carrier) who delivers them to the railroad for placement at designated mines for loading and transportation as desired by the owner of the cars. Assigned cars of the other class are called railroad fuel cars. These consist wholly of cars owned (or leased) by some carrier, which, instead of being left, like system cars for use indiscriminately in carrying coal from any mine for any consignor to any consignee, are assigned to a particular mine to carry coal to be used as fuel by a particular carrier.
Four of the suits were brought by private car owners. They illustrate different conditions under which, or different purposes for which, private cars are so used. The plaintiffs in No. 709 are coal merchants, who operate mines. The plaintiffs in No. 710 are integrated concerns, which operate mines solely in order to supply coal to their manufacturing plants. The plaintiffs in No. 711 are by-product coke concerns, which do not operate any mine. The plaintiff in No. 712 is a public utility, which does not operate any mine. In each of these four cases, the cars owned were acquired by the shipper, and are used, solely in order to assure transportation of an indispensable supply of coal. The number of coal cars used on the railroads of the United States is estimated as between [274 U.S. 564, 569] 900,000, and 950,000. Of these about 29,000 are private cars.
The fifth suit, No. 606, is brought by owners of railroad fuel cars. The plaintiffs in it are 35 railroads, including many of the leading bituminous coal carriers of the United States and representing each of the several classes of railroad fuel car owners. Railroad fuel cars are divided, according to ownership, into foreign fuel cars, that is, those which belong to, and are used for the fuel supply of, a carrier other than the one on whose lines the mine is located, and home line or system fuel cars, that is, those which are owned by, and are used to supply fuel to, the carrier on whose lines the mine is located. Railroad fuel cars are further classified according to the ownership, use, and character of the mine to which they are assigned; that is, whether the cars are used wholly in connection with a mine owned by the carrier which owns the cars, whether they are used in connection with a mine not owned by such carrier, but whose whole output is contracted for by it, or whether the mine at which the cars are to be placed is a 'commercial' one-that is, a mine which supplies coal also to the general public. About 28 per cent. of all bituminous coal mined is consumed by railroads. The number of the railroads to which the prescribed rule applies is 3,073. Of these, all except the 35 plaintiffs in No. 606 have acquiesced in the order.
The subject of discrimination in the distribution of coal cars in times of car shortage has occupied much of the time of the Commission ever since its establishment. 2 Some general investigations of the matter were under taken [274 U.S. 564, 570] by it pursuant to resolutions of Congress. 3 Many specific inquiries were made in passing upon complaints of individual shippers who charged unjust discrimination by individual carriers. 4 In two of these cases, Railroad Commission v. Hocking Valley Ry. Co., 12 Interst. Com. Com'n R. 398, and Traer v. Chicago & Alton R. R. Co., 13 Interst. Com. Com'n R. 451, a rule of practice was prescribed for individual carriers, in 1907 and 1908, which was approved by this court upon review in Interstate Commerce Commission v. Illinois Central R. R. Co., 215 U.S. 452 , 30 S. Ct. 155. That practice, which became known as the Hocking Valley-Traer rule, [274 U.S. 564, 571] was later adopted, either voluntarily or pursuant to orders of the Commission, by other carriers. 5 So far as concerned private cars, the rule was, in substance, adopted, during federal control, by the Railroad Administration. Car Service Circular 31-effective October 10, 1918; revised December 23, 1919. Upon the termination of federal control, the Commission issued a notice to carriers and shippers (dated March 2, 1920) recommending 'that until experience and careful study demonstrated that other rules would be more effective and beneficial,' the uniform rule contained in that circular should be continued in effect. Later (April 15, 1920) it recommended that the Hocking Valley-Traer rule be applied by the carriers also to railroad fuel cars. 6 But no uniform rule [274 U.S. 564, 572] concerning assigned cars applicable to all carriers had been prescribed by the Commission until the entry of the order here complained of; and much diversity in practice existed. Many of the railroads had secured their coal during periods of car shortage without resort to the use of assigned cars; and one, at least, of the leading bituminous coal carriers of the United States declines to permit the use of any assigned cars on its lines.
The rule here assailed was the fruit of an investigation commenced by the Commission of its own motion, in March, 1921, with a view to prescribing just and reasonable rules applicable to all carriers concerning the use of assigned cars for bituminous coal. Every carrier subject to its jurisdiction was made a respondent. Private coal car owners, coal mine operators, coal miners, coal distributors and large coal consumers became parties by intervention. The evidence introduced occupied nearly 6,000 pages. The investigation extended over four years. The reports of the Commission on the original hearing and the rehearing occupy 117 pages of the record. It concluded that the practices expressed in the Hocking Valley-Traer rule, and other existing regulations of carriers, resulted in unjust discrimination and were unreasonable. It ordered that the carriers cease and desist from such practices. And it prescribed the uniform rule which prohibits any carrier from placing for loading at any mine more than that mine's ratable share of all cars, including assigned cars, available for use in the district; unless the carrier is permitted to place more by an emergency order issued by the Commission pursuant to paragraph (15) of section 1 of the Interstate Commerce Act as amended by section 402 of the Transportation Act February 28, 1920, c. 91, 41 Stat. 456, 477 (Comp. St. 8563). This rule requires that in determining how many cars are available in the district, the carrier placing the cars shall count all cars; that is, it must include with those owned by it, all owned by foreign railroads and [274 U.S. 564, 573] assigned for their fuel service and likewise all owned by private shippers and assigned for their service. Thus, the prohibition embodied in the rule applies to all carriers, whatever the character of the consignor or consignee, and whatever the use to which the coal is to be put.
The operation of the uniform rule may be illustrated by the following example: Assume that there are in the district 10 mines each with the rating, or capacity, of 20 cars a day; that of the 200 cars needed to fill the district's requirement only 100 cars are available on a particular day; and that of the 100, only 85 are owned by the railroad, the remaining 15 being owned by mine A. Under the rule, the share of each mine would be 10 cars. Mine A would be permitted to have placed its own cars, buy only 10 of them. If, on the other hand, 95 of the 100 cars had been owned by the carrier, and only 5 by mine A, there would be placed at its mine, in addition to its own 5 cars, 5 of the carrier's so-called system cars. The rule does not divert the surplus of cars owned by one shipper to use by another. It merely puts a restriction upon the use of the private car by limiting the number of the so-called assigned cars which may be placed at a particular mine at a particular time. The owner may use the surplus elsewhere, or he may lease the surplus cars to the carrier or to another shipper. The operation of the rule upon assigned railroad fuel cars is precisely similar. The limitation is imposed in order to improve the service and to prevent any mine (including one operated by a railroad) from securing, at the particular time, more than its ratable share of the aggregate available coal transportation facilities.
The order here assailed differs from the Hocking Valley-Traer rule approved in Interstate Commerce Commission v. Illinois Central R. R. Co., supra, in two respects. Under the Hocking Valley-Traer rule the carrier was permitted to place at a mine all the cars (whether private or railway fuel cars) which had been assigned to it, even [274 U.S. 564, 574] if the number assigned exceeded its pro rata of all available cars. The prohibition formerly imposed was merely upon placing at a mine any system cars, if it had its full quota from assigned cars. Under the rule here assailed, the carrier is prohibited from placing at a mine more cars than its pro rata, even if all sought to be placed are assigned private cars or railway fuel cars. Moreover, the rule here assailed is a uniform rule governing all carriers without regard to their particular circumstances, whereas the Hocking Valley-Traer Cases prescribed a practice for the individual carrier after it had been found, upon specific inquiry, that the carrier had been guilty of undue discrimination. Thus, the earlier orders were in their nature largely judicial. The order here attacked is wholly legislative.
No question is here involved concerning those rules, regulations or practices of the carriers by which the ratings of the several mines are determined. See In re Rules Governing Ratings of Coal Mines, etc., 95 Interst. Com Com'n R. 309. No question is raised concerning the limits of the districts into which the carriers' lines are divided for the purpose of applying the rule. No question is raised concerning the adequacy of the supply of system cars. See Car Shortage, etc., 12 Interst. Com. Com'n R. 561; Car Supply Investigation, 42 Interst. Com. Com'n R. 657. Nor is any question presented here concerning the compensation of, or allowance to, private car owners for the use of their cars in performing the transportation under the tariffs. See Matter of Private Cars, 50 Interst. Com. Com'n R. 652. There was confessedly no irregularity in the method of proceeding pursued by the Commission. There is a faint contention that the only remedy for violation of the rule is prosecution for the penalty provided by the statute, and that the Commission exceeded its authority in enjoining the placing. The contention is clearly groundless. The order is in a form which, in other connections, has been approved by this [274 U.S. 564, 575] court. Baltimore & Ohio R. R. Co. v. Interstate Commerce Commission, 221 U.S. 612 , 31 S. Ct. 621; United States v. Union 57 L. Ed. 226; Pipe Line Cases, 234 U.S. 57 L. Ed. 226 Pipe Line Cases, 234 U.S. 548, 561 , 34 S. Ct. 956. The sole question requiring consideration is the validity of the requirement that, unless permission is given by the Commission, carriers shall, in placing assigned cars, be limited to the mine's quota, although the number of cars assigned to it exceeds the quota.
The order is challenged on several grounds. All of the plaintiffs insist that in prescribing a universal rule the Commission has exceeded the powers conferred by Congress. All of the plaintiffs appear to attack the rule also on the ground that it is inherently unreasonable. Some insist that the order is unsupported by the findings and the evidence. Some that the rule involves a taking of property without due process of law. The private car owners urge specifically that the rule is an arbitrary interference with the use of their own property. The railroads urge especially that the rule is an illegal interference with their right to manage their own affairs.
First. There is clearly no constitutional obstacle. The rule prescribed does not involve a taking of the property of the private car owner. Congress could exclude private cars from interstate railroads. Compare United States v. Delaware & Hudson Co., 213 U.S. 366, 405 , 406 S., 411, 415, 29 S. Ct. 527. And it may prescribe conditions on which alone they may be used. See Procter & Gamble Co. v. United States, 225 U.S. 282 , 32 S. Ct. 761; Swift & Co. v. Hocking Valley Ry. Co., 243 U.S. 281 , 37 S. Ct. 287. Limiting their use does not involve regulation of the coal mining industry. Likewise, Congress may prescribe how carrier-owned cars shall be used. The regulation prescribed does not invade the private business affairs of the carrier. It merely limits the use of certain interstate transportation facilities.
Second. The main question for decision is one of statutory construction. It is whether Congress has vested in [274 U.S. 564, 576] the Commission authority to prohibit a use of assigned cars by a general rule, which in its judgment is necessary to prevent unjust discrimination among mines or shippers and to provide reasonable service. The legislation to be construed is paragraphs 10 to 17, added to section 1 of the Interstate Commerce Act by section 402 of Transportation Act, 1920, February 28, 1920, c. 91, 41 Stat. 456, 476. The paragraphs more directly involved are:
Three widely divergent constructions of paragraph (12) are urged. The railroads contend that it prescribes a rule of distribution complete in itself; that the rule there prescribed is the Hocking Valley-Traer rule; and that the provision neither requires nor permits action by the Commission supplementary thereto. In support of this view [274 U.S. 564, 577] the congressional history of the provision is particularly relied upon. The United States contends also that paragraph (12) prescribes a complete rule of car distribution; but its insistence is that the statute abolished the Hocking Valley-Traer rule and substituted for it a rule identical with that ordered by the Commission. Support for its view is sought particularly in the penalty provision of paragraph (12), in the provision of paragraph (10) which defines car service, and in paragraph (11) which prohibits any unjust and unreasonable practice in respect to car service. The Commission contends that paragraph (12) does not prescribe a complete rule; that it does not require either pro rata distribution of cars or distribution according to the Hocking Valley-Traer rule; that it requires merely that all cars be counted as the basis for determining the pro rata share of each mine; and that it leaves to the Commission administrative discretion to determine how the cars shall be distributed. The Commission's contention is, in our opinion, the sound one. It gives effect to the command that all cars shall be counted; and it leaves full scope both to the duty imposed upon the carriers in paragraph (11), and to the authority conferred upon the Commission in paragraph (14), to establish reasonable rules with respect to car service. This construction is consistent also with the legislative history of the provision, including the action of the conference committee by which the differences between the Senate and House bills were reconciled. 7
[274 U.S. 564, 578] One other question of statutory construction is urged by the railroads. They deny the authority of the Commission to deal with the distribution of railroad fuel cars. They point to paragraph 10 of section 1, which defines 'car service' as including the distribution of cars 'used in the transportation of property.' The contention is that because of the phrase quoted, the Commission's authority to make reasonable regulations with respect to car service, conferred by paragraph (14), is limited to the supervision of the performance by railroads of their common carrier duties of transportation for the public, and does not extend to supervision of their activity in securing fuel for use by the carrier. The contention is, in our opinion, groundless. So far as concerns foreign railroad fuel cars, the owner is obviously in the same position as a private shipper. 8 Carrying coal by a railroad for its own use as fuel is likewise transportation. See Interstate Commerce Commission v. Ill. Cent. R. R. Co., 215 U.S. 452, 474 , 30 S. Ct. 155. It would require very explicit language to convince us that Congress intended to permit discrimination if effected by the use of railroad fuel cars. Moreover, the phrase in question appears also in paragraph (12), which provides that the carrier must count against the mine all cars used 'for transportation of coal.'
Third. It is contended that the rule prescribed is void because unreasonable. Most of the evidence and much of the briefs and arguments were directed to showing the hardships, waste and losses which would result from the prescribed restriction on the use of assigned cars. Private car owners urge that assigned car mines will be com- [274 U.S. 564, 579] pelled to reduce loadings to conform to the average of system car mines; that private coal cars, representing large investment and sorely needed by their owners, will stand idle on the tracks; that steel industries will be partially or completely shut down and thousands of steel workers will be thrown out of employment; that coke and by-product companies will be partially or completely shut down and their employees temporarily deprived of their means of livelihood; that public utility companies will be compelled to resort to the unsatisfactory and uneconomic spot market for coal; that the supply of gas and electricity to the public will be seriously curtailed; that coal burning steamships will be delayed in sailing; and that the further development and expansion of the important by-product coke process will cease. The railroads urge that the prescribed rule will deprive them of the only effective means of procuring at all times, in dependable volume, suitable coal essential to their operation; that it will increase the cost of coal to them by preventing their running at full capacity the mines owned by them or those whose product they contract for; that it will increase the cost of operation also by depriving them of coal of uniform and approved quality; that in times of greatest car shortage it will involve the nonuse by them of a larger number of unused private cars; and that it will otherwise prevent efficient transportation service.
There was much evidence that the practice which had been sanctioned in the Hocking Valley-Traer Cases did not operate satisfactorily. The Commission concluded that it was 'not the fruition of ripe experience.' Compare Hillsdale Coal & Coke Co. v. Pennsylvania R. R. Co., 19 Interst. Com. Com'n R. 356, 387. The effort to formulate a rule which would prevent discrimination was resumed. The Commission found that the existing assigned car practice reduces to a certain extent the supply of cars furnished to commercial mines; that the larger and steadier supply of [274 U.S. 564, 580] cars gives the assigned car mines a great advantage in steadiness of operation, and hence in cost of production, in the selling markets, and in the labor market; and that, apart from the discrimination inherent in the assigned car rule, the carriers have been guilty of other willful discriminatory practices, which, as a practical matter, it would be difficult to prevent as long as the rule prevailed. It found also that the use of private cars tends more and more to produce inequalities in the use of other facilities, such as locomotives, tracks, and terminals; and that many, at least, of the so-called car shortages have been due not to an absence of cars but to an inability to move them; i. e., to a shortage of such other facilities. It found, also, that the railroads could, by various devices, obviate most of the difficulty in securing fuel, which they anticipated would result from the order here attacked.
The argument most strongly urged is that, because the rule prescribes absolute uniformity, regardless of the necessities of the railroad or other consumer, regardless of the ownership of the mine or the cars, regardless of the character of the business done by the mine or its customer, it is necessarily unreasonable, and, hence, that the order is void. But the authority to establish reasonable rules conferred by paragraph (14) includes power to prescribe a rule of universal application. There was ample evidence to support the Commission's findings. It is not for courts to weigh the evidence introduced before the Commission, Western Paper Makers' Chemical Co. v. United States, 271 U.S. 268, 271 , 46 S. Ct. 500; or to inquire into the soundness of the reasoning by which its conclusions are reached, Interstate Commerce Commission v. Illinois Central R. R. Co., 215 U.S. 452, 471 , 30 S. Ct. 155; Skinner & Eddy Corporation v. United States, 249 U.S. 557, 562 , 39 S. Ct. 375; or to question the wisdom of regulations which it prescribes, United States v. New River Co., 265 U.S. 533, 542 , 44 S. Ct. 610. [274 U.S. 564, 581] These are matters left by Congress to the administrative 'tribunal appointed by law and informed by experience.' Illinois Central R. R. Co. v. Interstate Commerce Commission, 206 U.S. 441, 454 , 27 S. Ct. 700, 704 (51 L. Ed. 1128).
We cannot say that it was arbitrary and unreasonable for the Commission to conclude that good service could be secured by a uniform rule which might be departed from with its consent and that unjust discrimination could not be prevented without such a uniform rule. It acted in the light of a rich experience. It had learned by experience that the existing practices resulted in discrimination and unsatisfactory service. It had learned, also through experience, that the emergency powers conferred by the Transportation Act 1920, afforded adequate means of supplying the needs, and of averting the possible hardships and losses, of carriers and of private coal consumers, to which the evidence and arguments had been largely directed. 9 For the Commission had had much experience in applying these emergency powers in connection with the distribution of coal cars in times of car shortage, before it prescribed the rule here challenged. 10 Moreover, so [274 U.S. 564, 582] far as concerns railroad fuel cars, the operation of the rule as modified from time to time by emergency orders would resemble the practice of the Car Service Section of the Railroad Administration during federal control.