United States v. Interstate Commerce Commission (337 U.S. 426)/Opinion of the Court

It is contended here that the United States as a shipper is barred from challenging in federal courts an Interstate Commerce Commission order which denies the Government a recovery in damages for exaction of an allegedly unlawful railroad rate. Other contentions if sustained would deny federal courts all power to entertain an action by any shipper challenging a Commission order denying damages to the shipper.

During the war, existing tariffs of many railroads embodied wharfage charges to compensate the railroads for moving goods from railroad cars to piers and from piers to railroad cars. When the United States took over certain piers at Norfolk, Virginia, it began to perform these wharfage services for itself and requested the railroads to make the United States an allowance for the expenses incurred in performing the services. The railroads refused to make an allowance. Upon this refusal the Government requested the railroads to perform the services themselves. The railroads refused to perform the services.

The United States filed with the Interstate Commerce Commission a complaint against the railroads charging that exaction of pay for unperformed services was unjust, unreasonable, discriminatory, excessive, and in violation of certain sections of the Interstate Commerce Act. The Complaint asked the Commission to find the charges unlawful. Further relief asked, under the Interstate Commerce Act, was that the Government be awarded damages (reparations) on account of the alleged unlawful exactions. The Commission found that the charges were not unjustly discriminatory, unreasonable, or otherwise in violation of the Act. Accordingly, the Commission denied reparations and ordered the complaint dismissed. United States v. Aberdeen & Rockfish R. Co., 269 I.C.C. 141 (1947).

The United States brought this action in a United States District Court to set aside the Commission order. The complaint charged that the Commission's conclusions were not supported by its findings, that the findings were not supported by any substantial evidence, that the order was based on a misapplication of law and was 'otherwise arbitrary, capricious and without support in and contrary to law and the evidence.' The Interstate Commerce Commission was made a defendant. The United States was also made a defendant because of a statutory requirement that any action to set aside an order of the Interstate Commerce Commission 'shall be brought * *  * against the United States.' 28 U.S.C. § 46. Railroads that collected the wharfage charges intervened as defendants under authority of 28 U.S.C. § 45a. The Attorney General appeared for the Government as both plaintiff and defendant. Without reaching the merits of the case, the District Court composed of three judges dismissed the cause on the theory that the Government could not maintain a suit against itself. The court also indicated its belief that a three-judge court was without jurisdiction of the suit. D.C., 78 F.Supp. 580. The case is here on direct appeal under 28 U.S.C. § 47a, as amended 28 U.S.C. § 1253, 28 U.S.C.A. § 1253.

In this Court the Commission and the railroad intervenor defendants support the District Court's dismissal for the reasons given by that court. Alternative reasons are also urged. We hold that the dismissal was error and that the case should have been considered on its merits.

First. There is much argument with citation of many cases to establish the long-recognized general principle that no person may sue himself. Properly understood the general principle is sound, for courts only adjudicate justiciable controversies. They do not engage in the academic pastime of rendering judgments in favor of persons against themselves. Thus a suit filed by John Smith against John Smith might present no case or controversy which courts could determine. But one person named John Smith might have a justiciable controversy with another John Smith. This illustrates that courts must look behind names that symbolize the parties to determine whether a justiciable case or controversy is presented.

While this case is United States v. United States, et al., it involves controversies of a type which are traditionally justiciable. The basis question is whether railroads have illegally exacted sums of money from the United States. Unless barred by statute, the Government is not less entitled than any other shipper to invoke administrative and judicial protection. To collect the alleged illegal exactions from the railroads the United States instituted proceedings before the Interstate Commerce Commission. In pursuit of the same objective the Government challenged the legality of the Commission's action. This suit therefore is a step in proceedings to settle who is legally entitled to sums of money, the Government or the railroads. The order if valid would defeat the Government's claim to that money. But the Government charged that the order was issued arbitrarily and without substantial evidence. This charge alone would be enough to present a justiciable controversy. Chicago Junction Case, 264 U.S. 258, 262-266, 44 S.Ct. 317, 318-320, 68 L.Ed. 667. Consequently, the established principle that a person cannot create a justiciable controversy against himself has no application here.

Second. It is contended that the provisions of the Act making the Government a statutory defendant in court actions challenging Commission orders, show a congressional purpose to bar the Government from challenging such orders. Legislative history is cited in support of this contention. If the contention be accepted, Congress by making the Government a statutory defendant in such cases has deprived the United States as a shipper of powers of self protection accorded all other shippers. We cannot agree that Congress intended to make it impossible for the Government to press a just claim which could be vindicated only by court challenge of a Commission order. See United States v. San Jacinto Tin Co., 125 U.S. 273, 279, 8 S.Ct. 850, 853, 31 L.Ed. 747.

In support of their contention that Congress did not intend for the Government to press its claims as a shipper, the Commission and railroads emphasize the anomaly of having the Attorney General appear on both sides of the same controversy. However anomalous, this situation results from the statutes defining the Attorney General's duties. The Interstate Commerce Act requires the Attorney General to appear for the Government as a statutory defendant in cases challenging Commission orders. 28 U.S.C. § 46. The Attorney General is also under a statutory duty 'to determine when the United States shall sue, to decide for what it shall sue, and to be responsible that such suits shall be brought in appropriate cases.' United States v. San Jacinto Tin Co., 125 U.S. 273, 279, 8 S.Ct. 850, 854. See also United States v. California, 332 U.S. 19, 26-29, 67 S.Ct. 1658, 1662-1663, 91 L.Ed. 1889. Nothing in the Interstate Commerce Act indicates a congressional purpose to amend prior statutes which had imposed primary responsibility on the Attorney General to seek judicial redress for the Government.

Although the formal appearance of the Attorney General for the Government as statutory defendant does create a surface anomaly, his representation of the Government as a shipper does not in any way prevent a full defense of the Commission's order. The Interstate Commerce Act contains adequate provisions for protection of Commission orders by the Commission and by the railroads when, as here, they are the real parties in interest. For, whether the Attorney General defends or not, the Commission and the r ilroads are authorized to interpose all defenses to the Government's charges and claims that can be interposed to charges and claims of other shippers. In this case the Commission and the railroads have availed themselves of this statutory authorization. They have vigorously defended the legality of the allowances and the validity of the Commission order at every stage of the litigation.

Third. 28 U.S.C. § 41(28) provides that 'The district courts shall have original jurisdiction * *  * Of cases brought to enjoin, set aside, annul, or suspend in whole or in part any order of the Interstate Commerce Commission.' The legal consequences of this order if upheld will finally relieve the railroad of any obligations to the Government on account of the alleged unlawful charges; the order thus falls squarely within the type made subject to judicial review by § 41(28). Rochester Telephone Corp. v. United States, 307 U.S. 125, 131-132, 142-143, 59 S.Ct. 754, 757, 762-763, 83 L.Ed. 1147; El Dorado Oil Works v. United States, 328 U.S. 12, 18-19, 66 S.Ct. 843, 846, 90 L.Ed. 1053.

The Commission and the railroads contend, however, that § 9 of the Interstate Commerce Act, 49 U.S.C. § 9, 49 U.S.C.A. § 9, bars the United States or any other shipper from judicial review of an order denying damages in reparation proceedings initiated before the Commission. Section 9 provides in part:

'Any person or persons claiming to be damaged by any common carrier * *  * may either make complaint to the commission *  *  * or may bring suit *  *  * for the recovery of the damages *  *  * in any district court of the United States of competent jurisdiction; but such person or persons shall not have the right to pursue both of said remedies, and must in each case elect which one of the two methods of procedure herein provided for he or they will adopt.'

The contention of the Commission and the railroads as to § 9 is this. A shipper has an alternative. He may bring his action before the Commission or before the courts. But he must make an election. If he elects to 'bring suit' in a court and is unsuccessful, he retains the customary right of appellate review. If he elects to 'make complaint to' the Commission, as the Government did, and relief is denied, he is said to be barred by the statutory language of § 9 from seeking any judicial review of the Commission order. Under the contention the order is final and not reviewable by any court even though entered arbitrarily, without substantial supporting evidence, and in defiance of law.

Such a sweeping contention for administrative finality is out of harmony with the general legislative pattern of administrative and judicial relationships. See, e.g., Shields v. Utah-Idaho Cent. R. Co., 305 U.S. 177, 181-185, 59 S.Ct. 160, 162 164, 83 L.Ed. 111; Stark v. Wickard, 321 U.S. 288, 307-310, 64 S.Ct. 559, 569-571, 88 L.Ed. 733. And this Court has consistently held Commission orders reviewable upon charges that the Commission had exceeded its lawful powers. See, e.g., Interstate Commerce Commission v. Louisville & N.R. Co., 227 U.S. 88, 91-93, 33 S.Ct. 185, 186-187, 57 L.Ed. 431; Chicago Junction Case, 264 U.S. 258, 266, 44 S.Ct. 317, 320, 68 L.Ed. 667. The language of § 9 does not suggest an abandonment of these consistent holdings. It does suggest that a shipper who elects either to 'make complaint to' the Commission or to 'bring suit' in a court is thereafter precluded from initiating a § 9 proceeding in the other. It may therefore be assumed that after a shipper has elected to initiate a Commission proceeding for damages, he could not later initiate an original district court action for the same damages. But forfeiture of the right to initiate his claim in the court under § 9 is one thing; forfeiture of his right under 28 U.S.C. § 41(28) to obtain judicial review of an unlawful Commission order is another. Section 9's language controls the forum in which reparation claims may be begun and tried to judgment or order; it does not purport to give complete finality to a court judgment or to a Commission order merely because a shipper elected to proceed in one forum rather than the other. So we can find nothing in the language of § 9 that bars a court from reviewing a reparation order upon allegations by a shipper that the order was entered in defiance of standards established by Congress to determine when reparations are due.

Furthermore, the section's careful provision for judicial protection of railroads against improper Commission awards argues against interpretation of the same section to deny to shippers any judicial review whatever. Under the suggested interpretation a shipper could recover nothing if the Commission decided against him. But a Commission award favorable to a shipper is not final or binding upon the railroad. Such an award 'only establishes a rebuttable presumption. It cuts off no defense, interposes no obstacle to a full contestation of all the issues, and takes no question of fact from either court or jury. * *  * Nor does it in any wise work a denial of due process of law.' Meeker v. Lehigh Valley R. Co., 236 U.S. 412, 430, 35 S.Ct. 328, 335, 59 L.Ed. 644, Ann.Cas.1916B, 691. And see Pennsylvania R. Co. v. Weber, 257 U.S. 85, 90-91, 42 S.Ct. 18, 20, 66 L.Ed. 141. It hardly seems possible to find from the language of § 9 a congressional intent to guarantee railroads complete judicial review of adverse reparation orders while denying shippers any judicial review at all.

What we have said would dispose of the § 9 contention but for the argument of the Commission and the railroads that their suggested interpretation of the section is required by this Court's holding in Standard Oil Co. v. United States, 283 U.S. 235, 51 S.Ct. 429, 75 L.Ed. 999, and other cases that followed it. In that case the Standard Oil Co., a shipper, was denied the right to judicial review of a Commission order denying reparations. Judicial review was denied on four grounds: (1) The order in the Standard Oil case denying reparations was 'negative' in form, and was therefore beyond judicial appraisal under the 'negative order' doctrine. This doctrine was wholly abandoned in Rochester Telephone Corp. v. United States, 307 U.S. 125, 59 S.Ct. 754, 83 L.Ed. 1147. (2) The decision in the Standard Oil case held that the Commission order was supported by substantial evidence and was not otherwise in violation of law. The Government's claim here is that this order cannot meet that test. (3) The third ground for denial of judicial review was that having elected to test its damage claim before the Commission, Standard was precluded from judicial review. (4) A three-judge court was an improper tribunal to adjudicate damage claims under § 9.

The Standard Oil interpretation of § 9 denying shippers any judicial review was made by a court usually careful to protect against arbitrary or unlawful administrative action. And, as shown, the court there first satisfied itself that the Commission order was not the product of an unlawful exercise of power by the Commission. Furthermore, the negative order philosophy, then at its peak, clearly barred review of all orders denying reparations. Consequently, the Standard Oil § 9 interpretation barred judicial review of no class of Commission orders except orders already immune from such review under the 'negative order' doctrine. The Standard Oil holding was thus clearly supported by and rooted in the now rejected 'negative order' doctrine.

Another reason for the Court's construction of § 9 in the Standard Oil case was that Standard's damage claim could have been adjudicated by a district court since it involved no question as to reasonableness of rates that called for exercise of the Commission's primary jurisdiction. The importance of this factor was emphasized by this Court in applying the Standard Oil construction of § 9 in Baltimore & O.R. Co. v. Brady, 288 U.S. 448, 458-459, 53 S.Ct. 441, 443, 77 L.Ed. 888. First pointing out that there was no question in that case 'requiring the exercise of the Commission's administrative powers,' the Court said:

'It is to be remembered that, by electing to call on the Commission for the determination of his damages, plaintiff waived his right to maintain an action at law upon his claim. But the carriers made no such election. Undoubtedly it was to the end that they be not denied the right of trial by jury that Congress saved their right to be heard in court upon the merits of claims asserted against them. The right of election given to a claimant reasonably may have been deemed an adequate ground for making the Commission's award final as to him.'

And see Terminal Warehouse Co. v. Pennsylvania R. Co., 297 U.S. 500, 507-508, 56 S.Ct. 546, 548-549, 80 L.Ed. 827.

Thus, a crucial support for the Court's holding in the Standard Oil and Brady cases was that the shippers in those cases could have commenced original § 9 actions in the district court. But it has been established doctrine since this Court's holding in Texas & P.R. Co. v. Abilene Cotton Oil Co., 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553, 9 Ann.Cas. 1075, that a shipper cannot file a § 9 proceeding in a district court where his claim for damages necessarily involves a question of 'reasonableness' calling for exercise of the Commission's primary jurisdiction. The Government's claim here does involve such a question of 'reasonableness.' For the allowances exacted from the Government were authorized in the railroads' published tariffs and were therefore not unlawful unless 'unreasonable.' Consequently the Government here had no 'right of election' between Commission and court that could be 'deemed an adequate ground for making the Commission's award final * *  * .' Baltimore & O.R. Co. v. Brady, supra, 288 U.S. at page 458, 53 S.Ct. at page 443, 77 L.Ed. 888.

Ashland Coal & Ice Co. v. United States, 325 U.S. 840, 65 S.Ct. 1573, 89 L.Ed. 1966, is the only case in this Court that relied on the Standard Oil decision after we had abandoned the negative order doctrine. And it is doubtful if the shipper in the Ashland Coal & Ice Co. case could have sought reparations in a district court under the primary jurisdiction doctrine. In affirming without argument the judgment of a three-judge court in the Ashland Coal & Ice Co. case, this Court's per curiam opinion cited two pages of the Standard Oil Opinion that support the interpretation of § 9 urged here by the Commission and railroads. It is a fair inference that the pages were cited for that interpretation although other grounds for the Court's decision also appear there. One such ground was that a three-judge court is an improper tribunal for the review of such Commission orders. Another ground was that there was 'nothing to suggest that the Commission acted arbitrarily or without evidence to support its conclusions, or that it transcended its constitutional of statutory powers.' The three-judge district court in the Ashland case in sustaining the Commission order had also held that a three-judge court was not a proper tribunal and that the Commission order was supported by substantial evidence and was in accordance with law. Ashland Coal & Ice Co. v. United States, D.C., 61 F.Supp. 708, 713.

We cannot accept the Ashland Coal Co. per curiam holding nor the Standard Oil case on which it rested as requiring the interpretation of § 9 which the railroads and Commission here urge. Our acceptance of that interpretation would mean that a shipper who submitted to the Commission only a question of the reasonableness of rates could have an adverse order reviewed by a court, Skinner & Eddy Corp. v. United States, 249 U.S. 557, 562 563, 39 S.Ct. 375, 377, 63 L.Ed. 772, while a shipper who asked for that administrative determination plus reparations could get no judicial review at all. Terminal Warehouse Co. v. Pennsylvania R. Co., supra, 297 U.S. at pages 507-508, 56 S.Ct. at pages 548 549, 80 L.Ed. 827. On any ground except the now discarded 'negative order' doctrine, this would appear to be an unsupportable and totally illogical limitation of the congressional command for judicial review. See Chicago Junction Case, 264 U.S. 258, 269-270, 44 S.Ct. 317, 321, 68 L.Ed. 667; Southern R. Co. v. Tift, 206 U.S. 428, 440, 27 S.Ct. 709, 712, 51 L.Ed. 1124, 11 Ann.Cas. 846. Accordingly we hold that § 9 does not impair the right of shippers to obtain judicial review of adverse Commission orders under § 41(28) merely because the order is sought as a basis for reparations.

Fourth. For reasons already stated we hold that a Commission order dismissing a shipper's claim for damages under 49 U.S.C. § 9, 49 U.S.C.A. § 9, is an 'order' subject to challenge under 28 U.S.C. § 41(28). The remaining question is whether a district court entertaining such a challenge shall be composed of one judge or three judges and whether the judgment of a district court in such a case can be appealed directly to this Court.

The Urgent Deficiencies Act from which § 41(28) was derived contains provisions for a three-judge district court to hear and determine suits brought to set aside a Commission 'order,' and authorizes judgments rendered in such cases to be appealed directly to this Court. For reasons now stated we hold that judicial review of an order denying reparations does not require a three-judge court.

The provisions of the Urgent Deficiencies Act here considered derive from a 1910 congressional enactment creating the Commerce Court, defining its powers and providing for review of its judgments. That court was given jurisdiction of all actions to enjoin, set aside and modify Commission orders. Section 2 provided for direct appeals from the Commerce Court to the Supreme Court. The purpose of cr ating the Commerce Court with such direct appeals was expedition of final determination of the validity of certain types of Commission orders. This expedition was sought for orders of national or widespread interest, such, for example, as railroad rate orders. Congress saw the necessity for an accelerated appellate procedure to prevent railroads from nullifying the effect of such orders in prolonged litigation. The Commerce Act itself indicated that the same expedition necessary in cases affecting the public generally was not necessary in other kinds of cases involving 'local and isolated questions which arise in the ordinary courts.' The Act's first section excluded from the Commerce Court's jurisdiction power to enforce 'any order of the Interstate Commerce Commission * *  * for the payment of money.'

Provisions of the Urgent Deficiencies Act of 1913 abolished the Commerce Court and transferred its jurisdiction to district courts composed of three judges. In considering this Act Congress was urged to bear in mind the necessity for providing a forum that could expeditiously review Commission orders of widespread importance. But in passing the 1913 Act Congress denied power to three-judge courts to enforce Commission orders for the payment of money. And in a case not involving reparations this Court held that orders relating merely to the payment of money are not likely to be of sufficient public importance to justify use of the three-judge procedure. See United States v. Griffin, 303 U.S. 226, 233, 234-237, 58 S.Ct. 601, 604, 605-607, 82 L.Ed. 764. But cf. El Dorado Oil Works v. United States, 328 U.S. 12, 18-19, 66 S.Ct. 843, 846, 90 L.Ed. 1053; United States v. Jones, 336 U.S. 641, 647, 69 S.Ct. 787, 791. The Urgent Deficiencies Act with 49 U.S.C. § 9, 49 U.S.C.A. § 9, which requires enforcement of Commission reparation awards in one-judge courts, indicates the belief of Congress that such orders are not of sufficient public importance to justify the accelerated judicial review procedure.

While the Government here does no seek enforcement of a Commission order for the payment of money, the root of the controversy concerns the payment of money damages under 49 U.S.C. §§ 8, 9, 49 U.S.C.A. §§ 8, 9. Had the Commission made an award to the Government it could have filed a civil suit to recover money damages under the provisions of 49 U.S.C. § 16(2), 49 U.S.C.A. § 16(2). That section provides that such a suit 'shall proceed in all respects like other civil suits for damages * *  * '-that is, before one district judge. And an appeal from a judgment in such a case goes to the Court of Appeals. The same one-judge trial and appeal procedure available for enforcement of an award order would appear to be an equally appropriate and adequate tribunal for adjudication of validity of a Commission order denying reparations. For actions to enforce Commission orders awarding reparation, and actions to challenge Commission orders denying reparations, basically involve the same parties, the same disputes, the same claims for money damages, and the same statutes. We think the orders in both instances should be reviewed in the same one-judge tribunal.

We have frequently pointed out the emportance of limiting the three-judge court procedure within its expressly stated confines. We are confident that in holding the one judge rather than three should entertain cases challenging Commission reparation orders we interpret the congressional expediting procedure and the Interstate Commerce Act in accordance with their basic purpose.

Fifth. There remains the question of the proper disposition of this case. Three judges heard it. This, however, is no reason for dismissal of the cause. See Stainback v. Mo Hock Ke Lok Po, 336 U.S. 368, 381, 69 S.Ct. 606, 613. If the allegations of the bill are true, the Commission's order cannot stand. Chicago Junction Case, 264 U.S. 258, 264-266, 44 S.Ct. 317, 319-320, 68 L.Ed. 667. Since the District Court did not pass on the merits of the allegations of the complaint, the cause is remanded to it for that purpose.

Reversed and remanded.

Mr. Justice FRANKFURTER, with whom Mr. Justice JACKSON and Mr. Justice BURTON join, dissenting.