U. S. v. LOUISVILLE & N. R. CO.(1915)
[236 U.S. 318, 319] Solicitor General Davis and Mr. Theodor Megaarden for the United states.
Mr. Joseph W. Folk for the Interstate Commerce Commission.
Mr. Justice Day delivered the opinion of the court:
This is an appeal from and writ of error to the district court of the United States for the western district of Kentucky, refusing a writ of mandamus which the United States undertook to obtain under authority of 20 of the act to regulate commerce [24 Stat. at L. 386, chap. 104], as amended, 34 Stat. at L. 584, 594, 595, chap. 3591, Comp. Stat. 1913, 8563, 8592. In view of the character of an action in mandamus, we are of opinion that the review is by writ of error. Columbian Ins. Co. v. Wheelright, 7 Wheat. 534, 5 L. ed. 516; Kentucky v. Dennison, 24 How. 66, 97, 16 L. ed. 717, 725; [236 U.S. 318, 324] High, Extr. Leg. Rem. 6, 557. The appeal is therefore dismissed.
The petition sets forth the authority conferred upon the Commission by 20 of the act, and also 12, and embodies a copy of a resolution passed by the Senate of the United States, which is given in the margin. 1 It further [236 U.S. 318, 325] states that for the purpose of enabling the Commission to perform its duties, it appointed two special agents and duly authorized them to inspect and examine the accounts, records, and memoranda of the defendant railway company; that on February 4, 1914, one of said agents demanded of the vice president of the defendant, the officer [236 U.S. 318, 326] in charge and control of the accounts, records, and memoranda of the company, and to and of other officers, access to and opportunity to examine the accounts, records, and memoranda kept by the defendant prior to August 28, 1906 [the Hepburn act took effect August 29, 1906], and that the same was refused by the officers of the company; that on February 4, 1914, a demand was made for an opportunity to examine the accounts, records, and memoranda of the defendant on and subsequent to August 28th, 1906, which was refused; and a writ of mandamus was asked against the company, requiring it to give access to its accounts, records, and memoranda, and its correspondence and copies of correspondence, and indexes thereto, and to afford opportunity to examine the same to the commission and its agents and examiners, and to give such access to and opportunity to examine the said accounts, records, and memoranda made and kept by and for said [236 U.S. 318, 327] defendant both before, on, and subsequent to August 28, 1906, including correspondence, copies of correspondence, and indexes thereto, and other indexes to said accounts, records, and memoranda.
To this petition the defendant answered, setting out that it did, prior to the beginning of the suit, give the examiners access to the correspondence other than privileged communications, and that after this suit it did refuse and does now refuse to give to said commission or to said agent access to or opportunity to examine correspondence received by it before, on, or subsequent to August 28, 1906, or copies of correspondence sent out by defendant before, on, or subsequent to that date, or the indexes kept with respect to said outgoing and incoming correspondence by defendant (except correspondence as to passes issued since January 1, 1911), and the defendant set up that its correspondence contains private communications between its various officers and agents regarding various matters which did not in any way pertain to the provisions of the act to regulate commerce, nor to any act of Congress, the provisions of which it is made the duty of the Interstate Commerce Commission to enforce, and avers that said correspondence contains communications of a private and confidential nature between the president of the railway company and the heads of the various departments, relative to its internal affairs, to its proposed constructions and extensions in the future, to its policies with competing and rival roads, to its relations with labor organizations represented in its operating department, and to a variety of other subjects of a private and confidential nature, and that do not relate to the provisions of the act to regulate commerce and acts amendatory thereto, or to any other act of Congress as to the enforcement of which any duty has been imposed upon the Interstate Commerce Commission, and that said correspondence also contains confidential, private, and privileged communications between [236 U.S. 318, 328] defendant and its attorneys. The answer further sets up that under the provisions of 20 of the commerce act a uniform system of accounting has been prescribed by the Commission, and that defendant has fully complied with all such requirements, and that the Commission's examiners have full and complete access to the same; that if the act to regulate commerce can be construed as to give the said Commission or its examiners a right of access to, and the right to examine or inspect at will, any or all accounts, records, and memoranda, and all correspondence received, and all copies of correspondence sent out by the defendant or its officials in the manner and as set out and claimed in the petition, then the exercise of such alleged right in this respect will amount to and operate as an unreasonable search and seizure of the private papers of the defendant, in violation of the 4th Amendent to the Constitution of the United States.
The answer further sets out a copy of the Senate resolution, and the order of the Interstate Commerce Commission ordering the investigation and inquiry concerning the matters and things set forth in the resolution, and providing that the proceeding be set for hearing at such times and places, and that such persons be required to appear and testify, or to produce books, documents, and papers, as the Commission may direct, and that a copy be served upon certain railways, including the defendant. The answer also sets up that the subject-matter of the first twelve paragraphs of the Senate resolution was not within the authority of the Interstate Commerce Commission, and avers that as to the subject-matter of the thirteenth paragraph, which relates to free passes, since January 1, 1911, defendant permitted the Commission and its examiners and agents, on their request, to have access to and to examine and inspect all accounts, records, and memoranda, relating to such passes, whether interstate or intrastate, and also all correspondence relating to such passes (although [236 U.S. 318, 329] defendant claims that the Commission had no legal right to examine any of said correspondence, nor to examine any intrastate passes, or any accounts, records, and memoranda pertaining thereto).
Motion was made for the writ of mandamus to issue as prayed for in the petition, certain testimony was taken, showing the demand of the agent and the refusal of the company. Upon hearing, the motion was denied.
The testimony shows that the refusal withheld from the inspection of the agents making the demand all accounts, records, and memoranda kept prior to the 28th of August, 1906; all accounts, records, and memoranda subsequent to that date, except such as to which the form had been subsequently prescribed by the Commission; all correspondence and the indexes thereto upon any subject other than the issue of passes subsequent to January 1, 1911, and all certificates of destruction, if any, relating to papers antedating August 28, 1906
The discussion in this case has taken a wide range, and much has been said of the constitutional rights of the defendant and the authority of the Commission to carry out the purpose of the interstate commerce act, and to make investigations which shall be the basis of the discharge of duties imposed upon it by the law. But, as we view the case, the real questions may be determined by a consideration of certain provisions of the act to regulate commerce. We may at the beginning put aside any question of authority derivable from the resolution passed by the Senate. The resolution was passed by only one branch of the legislative body, and it is not contended by the government or the Commission that any authority is derivable from it.
To authorize the government to demand the writ of mandamus in this case two sections of the interstate commerce act are invoked,-12 and 20. It is enough to say of 12 that the record discloses that the proceedings [236 U.S. 318, 330] and the demands for inspection in this case were not conducted under its authority. See Harriman Case, 211 U.S. 407 , 53 L. ed. 253, 29 Sup. Ct. Rep. 115.
Section 12 deals with the production of evidence in certain cases; it does not make provision for inspection by examiners duly authorized by the Commission. That feature of the law was added by the amendment to 20, of June 29, 1906.
The substantial question in the case is: Was the right of inspection of the accounts, records, and memoranda of the defendant in the manner attempted by the agents who represented the Commission in this respect, authorized by 20 of the act, as the same is amended by the Hepburn act of June, 1906?
That section as amended provides in part:
This section, it will be observed, gives authority to the Commission to employ special agents or examiners, who shall have authority under the order of the Commission to inspect and examine any and all accounts, records, and memoranda kept by such carriers. The copy of the authority issued by the Commission to the special agent or [236 U.S. 318, 332] examiner who made the demand for inspection in this case shows that he was clothed with authority to examine any and all 'accounts, records, and memoranda' kept by carriers subject to the act to regulate commerce. The language here used, taken from 20, shows that the Commission acted under authority of that section, and the examiner was thereby authorized to make the demand, the refusal to comply with which was the basis for the petition for the writ of mandamus in this case.
This part of the amended section, as the report of the Interstate Commerce Commission, 1905, page 11, shows, was framed by the Commission and became a part of the law upon its recommendation. The appendix to the report (p. 182) shows the amendment in the form in which it became a law. In commending the passage of such an act, the Commission, in its report to Congress, said:
Responding to this recommendation, and acting upon the bill in the form proposed by the Commission, it was adopted as an amendment and became amended 20 of the act to regulate commerce.
Of course, this act, like other acts, may be read in the light of the purpose it was intended to subserve and the history of its origin. We find, then, that in this section Congress has authorized the Commission to prescribe the forms of accounts, records, and memoranda, which shall include accounts, records, and memoranda of the movements of traffic, as well as the receipts and expenditures of money, to which accounts, records, and memoranda the Commission is given access at all times. The railroads are not allowed to keep any other than those prescribed by the Commission. The Commission is empowered to appoint agents or examiners with authority to inspect and examine such accounts, records, and memoranda, and provision is made, penalizing the failure to comply with the orders of the Commission concerning such accounts, records, and memoranda, or the falsification thereof, or the wilful destruction or mutilation thereof, or the failure to make full, true, and correct entries in such accounts, records, and memoranda of all facts and transactions pertaining to the carrier's business, or keeping any other accounts, records, and memoranda. [236 U.S. 318, 334] Reading these provisions of the act, there is nothing to suggest that they were intended to include correspondence relative to the railroad's business. In recommending the passage of the act, the Commission did not suggest that it was essential to its purpose to have an inspection of the correspondence of the railroad. And, with its expert consideration of the questions involved, and having clearly in mind the authority it was intended to secure, it can scarcely be supposed that the Commission would have confined its proposed amendment to the carefully chosen words 'accounts, records, or memoranda,' and would have omitted the word 'correspondence,' if it had intended to include the latter. If we apply the rule of construction,-noscitur a sociis,-we find that all the provisions of the act as to the inspection of accounts have relation to such as are kept in the system of bookkeeping to be prescribed by the Commission. It would be a great stretch of the meaning of the term as here used, to make 'memoranda' include correspondence. The 'records' of a corporation import the transcript of its charter and by-laws, the minutes of its meetings-the books containing the accounts of its official doings and the written evidence of its contracts and business transactions. Certainly it was not intended that the Commission should prescribe the forms of correspondence, although it was given the power to prescribe the forms of all accounts, records, and memoranda subject to the provisions of the act.
It is urged that the amendment to 20 of February 25, 1909, adding a proviso to paragraph 7, shows the intention of Congress to provide for accounts, records, and memoranda, including more than those as to which the form may be prescribed by the Commission, and in the word 'document' making this section broad enough to include correspondence. The language of this proviso is as follows:
It may be that the section is broad enough, particularly when read in the light of this proviso, to authorize an inspection of accounts, records, and memoranda for which no form has been prescribed by the Commission, but we do not find in this proviso anything to indicate that Congress in the original act or the amendment intended to provide for the compulsory inspection spection of correspondence.
There is nothing from the beginning to the end of the section to indicate that Congress had in mind that it was making any provisions concerning the correspondence received or sent by the railroad companies. The primary object to be accomplished was to establish a uniform system of accounting and bookeeping, and to have an inspection thereof. If it intended to permit the Commission [236 U.S. 318, 336] to authorize examiners to seize and examine all correspondence of every nature, Congress would have used language adequate to that purpose. A sweeping provision of that nature, attended with such consequences, would not be likely to have been enacted without probable exceptions as to some lines of correspondence required to be kept open and subject to inspection upon demand of the agents of the government.
In the brief filed on behalf of the United States, it is frankly admitted that there is much force in the objection that Congress did not intend in this grant of authority to include the confidential correspondence of the railroad companies between itself and its counsel, and it is admitted that in this respect the demand of the agent of the Commission may be too broad. The desirability of protecting confidential communications between attorney and client as a matter of public policy is too well known and has been too often recognized by textbooks and courts to need extended comment now. If such communications were required to be made the subject of examination and publication, such enactment would be a practical prohibition upon professional advice and assistance. Connecticut Mut. L. Ins. Co. v. Schaefer, 94 U.S. 457, 458 , 24 S. L. ed. 251, 252. And see the comments of this court in Blackburn v. Crawford, 3 Wall. 175, 192, 18 L. ed. 186, 193.
How far such a demand as embodied in this petition can be permitted within the constitutional rights set up by the defendant, we do not need to consider, as we do not think that the section of the act of Congress under which the demand was made authorizes the compulsory submission of the correspondence of the company to inspection. It is true that correspondence may contain a record, and it may be the only record of business transactions, but that fact does not authorize a judicial interpretation of this statute which shall include clude a right to inspection which Congress did not intend to authorize. [236 U.S. 318, 337] The court below held that the right to demand inspection of documents before August 29, 1906, the date when the Hepburn act went into effect, was of such a doubtful character that the writ ought not to issue. We think the right of inspection and examination given by the interstate commerce act by the amendment to 20 was not intended to be limited to such accounts, records, and memoranda only as were made after the passage of the act, but is intended to permit an examination of all such accounts, records, and memoranda, for the purpose of carrying out the provisions of the act. It is not contended that Congress might not do this within its constitutional authority, and the argument is that it had no such right in contemplation, and did not intend to authorize it; but we think it is clear from the terms of the act, read in the light of its purpose, that Congress did not intend to draw the line of inspection at pre-existing accounts, records, and memoranda.
The government argues that if it be held that the prayer for the writ of mandamus and the accompanying motion were too broad in requiring the production of confidential communications between attorney and client which were contained in this correspondence, nevertheless the court should have issued its writ of mandamus in so far as the relator showed it was entitled thereto, and the case of West Virginia Northern R. Co. v. United States, 67 C. C. A. 220, 134 Fed. 198, 203, is cited to the effect such practice is permissible. The case shows, however, an amendment was permitted so as to make the writ conform to the rights which could be properly granted. And that course might have been pursued in this case.
Whether the Commission would desire an inspection of the accounts, records, and memoranda as we have construed the terms of the act, without the right to examine the correspondence, we are not advised. As the petition in this case was dismissed by the court below [236 U.S. 318, 338] without prejudice, and a new proceeding may be started, asking for such inspection as the law allows, we think the order of the court refusing to grant the writ of mandamus in the broad terms prayed for in the petition and the motion for the writ should not be reversed to permit a grant of relief within the limits which the law allows as we interpret it.
It follows that the judgment of the District Court, refusing the writ and dismissing the petition, should be affirmed.
Mr. Justice McReynolds took no part in the consideration and decision of this case.
[ Footnote 1 ] 'Resolution.
further relations between the Louisville & Nashville Railroad, the Nashville & Decatur Railroad, and the Lewisburg & Northern Railroad, and any fact or facts showing, or tending to show, whether these relations restrict competition and maintain and fix rates;
the ownership by such holding company of a majority of stock in both of the aforesaid railroads tends to restrict competition and maintain and fix rates;