Decision of the Railroad Co'mmission of Georgia { - - - - - I N THE CASE OF----,---- The Atlanta Chamber of Commerce IS. The Southern Railway and Steamship AssocIation. commer~e rule~ manires~s ---~-----------'----------,------,--- The chamber. of of Atl.an.ta pre-I ?er well defi!1ed an.a regulations, and by a i",ued by the companies, members of the sen ted a petitIOn to thiS commissIOn, m Just and equnable dIvisiOn of business ;snch which it is alleged that there cxists in the state of wili fnaturully ensne from the maintancc as of daS~ssotciInaetidOtnofoprOfirnet'sghattS ~hh"h,~ ~h~ shb~'ri~~dssfrfsmd\: Georgia an association of railway companies known rates, or by .ctual apportionment it is mutually vided by apportionment, such copies, to be for- altohsnatght .eatUoSsotau~ietdbr~eaSri~nlorcrola!li,~ldwt~icaOoyn,maapunaddnsittehesaatmitnshhetihpicsahsl.sseotfcaitoaebti.Jobened-; agreed as follows, e t c : ' The ment. n Mfolulcohwotfhe~hesevceornatlraccltaiuss es of devot th ed e agreeto pre- warded. at the time the shipments to which they appertam are made, and abstractsofallsuchmanifests shall be furnishcd to the auditor at the expira- ror !oifmsaeitdoastsio~CelactoiOnutraiscttso make and enforce a divisio.n of their from earn stch~nbmmagchtihneedryetafoilrs~oaf~rthyiengooroguatniztbateiopnurpporosevsidainndg tion of each month. The' tonnage books of everv company in the association shall be open at ail mgs. that lU commermal and railroad parlance objects of the aSSOCIatiOn, the election of a presi- times to the inspection of the auditor, or such these co!'tracts .are c";lIed poolin~ their. earnings; dent, a general commi~sioner, a secretary, three agents as he may from time to time appoint for the that petitIOner is ad Vised that thiS practICe of pool- arbitrators and an 'audltor, the appointment of cer- purpose of enabling him to get a complete' record ing their earnings by the railroads is in violation tain committees, the duties of these sevcral officers of all freights shipped too or from points at which of article 4, sec. 2, par. 4 of the constitntion of this and committees. the method of raising fnnds to business is divided by apportionment. state, and ofthe poticy of the state as declared by meet the expenses of the associations and many In apportioning busine.., cotton and any other the courts. and that such contracts are void under other similar provisions, not necessary for our freight which it may be practical to dinde in kind the paragraph ot the constitntion referred to: that present purpose to be set out in fnll. We shall di- shaU be so divided, and not by allotment of reve: the act of the general asscmbly of this state of rect the eutire agreement to be attached to this nue. Each c.ompany shalrbe required to carry Its 1879, in section 8 of said act, places all such contracts between railroad companies iu this state absolutely at the disposal of this commission; that the r ..tes fixed by said association and now being euforeed in Georgia are not only void decision and printed in our next semi-annual report to the governor. The contract provides that the executive committee shall havejllrisdiction overall matters relating- to the joint traffic. but shall act only by unanimous allotted pornon as nearly as possible: but settlec ments must be made monthv for any excess carried except when otherwise specially agreed betweei~ the parti~s interested: provided that no penalty shal~ be imposed npou a company or line whic.h under the constitution and laws. but they most un consent of all its members, that all the business c.arnes an txeess for th.e benefit of any company or justly and injuriously discriminate against the from or to local stations of the roads compos- hne that rcfuses, or wilfnlly neglects to carry its principal business centers of Georgia; that to in- ing the system is local bus carried by commission. that the aetings and doings of all the secnring the greatest amonnt of net revenue to all them. Companies or lines which. carry an excess varions railroad companies in Georgia in the compauies partie' to the agreement that what shall be allowed twenty (20) per cent of the reve- the matter of dividing their earnings and are termed western lines shall protect tbe revenue nue for tran'porting the same. Tne actual cost of preventing- competition under any fOfm derived from transportation of what are compressing not to be conHidered as revenue. of contract may be inquired into known as eastern lines, so far as can be done It is fnrther provided, That th.e executive com. to the end that the commission may pass snch or- by the exaction of local rates; and the eRstern miltee shalf organize such a system for the rendi- ders, and ta.ke such action as will euforce the laws lines sha11 in like manner luotect thD rQ\l'.eUUl:'!S of tioll of .1Hl&Z:e and revenue reports of the joint of the land and protect the rig-his of the people. The railroad companies of the state were fnr- the western lines. It is fnrther agreed that the general commission- I traffic lliroUgITllllTtne territory c1l\'erea nytlie asso Clation, as shall enable the general commissioner nished with a copy ofthis petition and cited to ap- er shall take charge of the Green Line car reports to be at all times fully in- pear and answer the same before the eommission- and claims aud appoint such crerks and claim informed of the. movemeuts there ers on the 6th da,y of August, 1885. A number ofthe agents. as may be necessary, R,nd charge up the ex- of, and the observauce of rates established there tor. compauies appeared by thelf eounsei and demur peuse to the roads interested in the Green Line in order that he may detect promptly any violation red to the pp:tition on the following gronnds: business on an eqnitable ba~is-managingthe bu~~ of rates, and keep the several companies or lines 1. Because the petition does not "et forth any iness for the benefit and at the cost of the compa- informed as to whether they are in excess or deficit, cause of complaint against them or either of them. ntes interested. at such freqnent iutervals as may be necessary to for a violation of the rules and regulations pro The board of arbitrators shall hear and determine effect a distribution of the business in accordance vided and prescri.bed by the commis,ioner~where- all qu~'tio.ns which may be submitted to the~ un-I with the agree? division. ther~of, and thns prevent by any wrong or mJury was done to the petitioners. der thiS agreement. or by consent of the partles- the accumulatiOn of bnsmess lU excess of the de- 2. B~cause the cnntract referred to in said peti members of the association, and the decision of -I po:-.its rnRde to Eecure the same. tion, whereby the South,rn steam'hip and rail way said board of arbitrators shall be final and coneln When by reason ot any actual difference in the association exist~ and doc8ociation ~ as produced and we have care- It is provided further, that when all the parties I It is fnrther provided in the agreement that fully examined it. intelested in the joint traffic at any point are will- I members of the association shall not enter imo It purports to be an agreement between cer- ing to maintain rates without an apportionment of ! any agreements relat.ive to joint traffic covered by taln railroad aud steamship aud steam the business. no apportionment shall be required; II this contract with transportation companies not bORt eompaoies, including a number of but if any of the initial roads insist upon an "P- members of the asso~ialion. except with the ap- the railroad companies of. Georgi", and portioumen~th" question shal~ be referrcd to the proval. of. the execu~lVe committee or the general recites, that whereas the estahlishment and main- board of abitratlOn to determme whether or not commiSSIOner, and m accordance With the rules teuance of tariff' of uniform rates, and the preven- such apportionment shall be m~de; provided noth- and reglllations ot the association, etO;. tion ofunjnst discrimination, such as arises from ing herein contained shall be construed to require Members of the association are forh!dden to re- the irregular and fluctuating rates which inevita- an apportionment between Nashville and Chatta duee the rates made. ':>y the rate committee on the bly attend the separate and independant action of nooga and points south, or of Atlanta busIness plea that they are ViOlated by otners. or because of transportation lines. is important for the protec- going west. This shall not affect the present agree- 8,ny violottion of agreements, or because of tion of the public; and whereas it is deemed to be ment pooling cotton at Atlanta. th':! actioll of any outside line. All such to the mutual advantage of the public and the On all bnsiness apportioned on the basis ofreve- violations shall be reported to the goenera! transportation companies that business in which nue there shall he deducted as an initial charg-e eommissio~er, w~ose duty it shall be to check sneh they have a common interest, shonld be so eon- and deposited to the credit of the general eommis violations if possible, and iu ease he ~annot do so, ducted as to secure a proper correlation of rates sioner by the company which receives the freight, he shall call the executive committee together, such as will protect the interests ofcompetinu mar- an amonnt equivalent to twenty per cent of the who shall use their infiuence to have such offend- kets without unjnst discrimination in favo'rof or revenue to be divided, such deposits to be made in ing member or mcmbers conform to the agreement against auy city or section; and whereas, these such bank or banks as the general commissioner and rules. objects can be attained only by eo-operation on shall designate, subject to his order. The amount Divisions or allotmen.ts?f business shall be to Ihe the part of the various transportation lines engag- so deposited shall be crentted hy the auditor to the end of the fiseRI aSSOC!aliOn year, and thereafter cd in the traffic of the territory south of the Po- companies or lines by whom they are contributed. until a new allotment 1.S made. tomae 8,nd Ohio rivers, and east of the Mississippi and shall constitute a fund which shall be applied The executive committee shall have author ty to river. Now, therefore, in order to secure snch co- atthe expiration of the month dnring which the mak.e from.time to !Ime S1!ch rules a operation among said transportation lines. by pro- same has been deposited to the pR,yment of any not mconsistent With thiS agr vioing means ior the prompt adjustment of the differences which .may arIse between them I ~blaelamennctesodfusne cbhybsaulcahncecso,~IpfathnieereR.b But e any rafetmera!~1nfdeet-r naet~f~~slsrasr?~fT~htfo? secnr.e ~ s~'ste assoclatlon, a by placing all of their traffic common to two or it sh.all be reiurned to the company to whom it be- which it is lormea. ., I r . " th ...... . BeAIQ LorJ:/ "~ more companies under the control of officers joint- lougs. We have Ihus tra!Jscrl d, 'I.lll' D~i!tl (;J: ly elected; by the general conduct of the same un The auditor shall be fllrnished with copies of all much of this volummous .grr of commerce and grant the and purposes are n.o~ to suppress contracts ''''hich enforce that provision of the constitution, then prayer ofthpir petition. : may le~seI1eOrnpctltlon or encourage monopoly, therd would be 1\0 ~nch power as the act evioengy. I 'l'he provj .. jllll of lIu' constitution of the state; but to regulate freight and pa~senger tariff..;, pn~ under whieh~is commission was established, is as vent unjust dis.crimination and proh ibit other than intended there shonld be to appr,we such COlllracts \Ve \\'olJld be compelled to disapprove thell} and follows: just and reasonable ratcs being charged. Our own order them to be submitted only to annul them. "Tbe freight pow,,,. Illld authority of and IIU.'i"icnger tririffs, prergevuelanttiinnggrauilnrjouasdt ,I supreme court say, "Thc tional prOVision (referring object of the consUtuto paragraph 1 sectIon Xeither the petition nor thc contraGt complained of ~how a case where discrimination is practiced di~criminati(lll and requiring reasonable and just! 2 article 4,) and the legi~lative enactment (refer~ or unreasonable rates'charged. It will s(~ar(~ely be rates of fn'igIJt and passenger tariffs, are hereby: ing to the act of 18i9) was to give proper protet-lion denied tbat the rates charged by the c"mpani<:, conferred 011 the general assembly, Wh08C duty it : 1.0 the citizen agaillbt unjust rates tor the transpor' com1Jo~ing this associatioll on freight brought into shall be to pa:.;s lltw~ from time to time to regulate "tariou of freights and passengers over the rRilroads or carried without the state are ItSS than thOse freight and passenger tariffs, to prohibit unju~t of the state, and to prevent UlljUSt discrimillations fixed by the commi~sion. aud the charges for pas- discriminations on the various rttilroads of this even thoug-h the rates might be just." Georgia rail~ sengers fares arc not greater than those allowed. state, and to prohibit said roads from chafl(ing road vs, railroad commissioners Pl'. 69i-,'. ,iOth .Ga. It is indeed stated in very general telms that thc other than just and reasonable rates, and enforce report:. rates of the association afe void under the consti~ the same by adequate penalties." Art. 4, sec. ~., Let us look for a moment to the till<' of the act tution, but it is not meant that the rates are greater par. 1 constitution of Georgia. of 18i9. It is enlitkd "An act than tho'e we have fixed. but tbat they are void The' clause of the cnnstitl1tion whieh petitioners fl)r the regulation of railroad freight under that clause of the constitution already f'O Claim is violated by the C{lIJtrtict above Fet out, and and passenger tari.t1:..: in this state, otten referred to, heca'lse they defeat or ]e~sen Which violation they claim this commission should to prevent unjuHt discriT1lllliition and extortion in competition, etc. We have already disposed of redress, is a-: follows: i the ratps chargpd fortrllllslJortation of pa~sellgers that poiut. The petition also charges tlutt the rates "The general ass.embly of this state shall have no! and freight, and to IlroJlibit railroad companies, of the assocIation operate to discriminate again8t power'to a!lthorize any corporation to bUy sharf'S corporations and k ..."c('~ in this state from charg- the mercantile interests of the prineipdl business or stock in any other .corporaUon in this state ing other than ju't and rea:-.:onable rates, and to centers of Georgia, nnd again.st every city in or el~\'\~'here, or to make any contract which I' furnish the same, Hlld prescribe a mode of proceed- Georgia; but it appears that the discrimination mav Jlave the efreet or be intended to have ure and rules of tV ideuce in relation thereto; and alh::ged is in favor of Nashville, in the stat.e tIlt: t'treet to defeat or lessen competition in their re to appoint comUli:,,~ionersand prescribe their pow of Tenne~see. It is quite clear that this ~pe('ti\'e businesses, or to enconrage monoply; and. ers and dutirs ill relation to the same." The not is a matter over which we can exercise no control. all ~llI'h contracts or agreements shall be illegal unusual words, "and for otbf:'r purposes" l:lre even VVe have no more authority to illterfere to prevent and v.enid." Art. 4. sec 2, par. 4, constitution of now not added, but perhaps this is not m.fterial. dbcrimination iu favor of Nashville, than we have Georg-ill.. The constitution oftbis state decLtres t11lft "no to interfere to preventdiscriminati()nagainstNnsh~ On tl", arg-lImcnt of t his question, the di'ting- law or ordinance shall pa,s which contains matter ville. No more than. we wonld have to iuterpose to uished ('oun~,el for the railroad companies pres>ed different from what is contaiued in the title there- prevent dbcrimination for or against Chicago. St. upon u ... with great earnestness and force the poin t of." Louis or San Fra.uci~co. thata.nv ,uch~nterferencewith the contract of this It would be very difficult, we think, to hold that ' When thc constitution and the act usc the a"'sociatioll as' \vas asked by petitioners would be a the langual{e of the title of this act could be so fX~ term discrimination, the)' mean discrimination in violation ofthat prllvision ofthe tederalconstitution t'mded as to inetude authorily to the comm.ssion- favor of one p"int in Georgia against anothcr point which re~crves to congress the right to Iegulate orB to anllul contnicts or agreements which in Georgia. commerce among the several states, and if the Act aTe :mpP08ed to le:-sen compelition or enconrHge The act estabH8hing the railroad comnlission is of the g-eneral as,embly of Georgia, ofOc.tober 14th, monopoly .unless sn~h contracts produced tbe cbarter of our powcrs. It prescribes the limit. 1879, establishing the railroad commission autho'r discriminatIon, or exacted other than jnst of our authortty, and we ('annut tran:--:cend those ized such interference, it was to I, and reasonable rates for freigl1t aud ptd"sengers. limits In the language of the cOlnmi~i;jonin the that extent unconstitutional and void Recurring therefore to the rule before laid down Cl'fi-le of Bitt we must not a,si-lume to exerche power~ We are not prepared to hold that tbe in respect to our duty to comider a constitutional withheld from us by law. Every power that the actifln on our p art invoked bS the petitioners I objection in construinR the act, we ought not, if aet conter!' on us Will, when the occasion arises, be would be an attempt to regulate ioterstate com- thc c.onstruction be doudtful, adopt the one in- fearlc-sly exerciscd, "nd every duty it enjoins will merce, but ill the view we taKc of our dutie' under 1 'isted on by counsel ti)r the pet.iti"ners be faithfully and imparti"lIy performed, and every the act referred to, we do not deem it neces,ary to' Bllt let us refer to the preamble to the act and effort will be m"de to accomplblt as far as we may decide that question. ascertain whether any light is thrown on the ob- be able tbe great objecls and purposes fm whicn '''e do not conceive that we are authorb:ed to I, ject of the ]egi~ltitl1rp, and what provision of the the commission wa~ established. pronounce this Bet or any part of it constitution that body considered it was carrying ,"Ve are 110t called on to expre:-,s any opinion as to unconstitutionaL Tbe constitution of the state de lout by the enactment of the law in que~tion. whether the con tract we lIlt-ve beell dbcnssing docs elares that all Jaws in violation of that,constH-ntion: This is the preamble: "Whereas. it is made tho or the con:o-titlltion (\1' "tit' United States Are void .. duty of t.he gpneru! a'3sembly ill art. 4, par. '2. and and the jll(lkinl'Y :-.hull ~o dC'(]arethen1. Thi:-;('Il111- !'!~{-Lion 1: of UI(' e(lll:-.litllqoll, to pa,:o; law,o; frOlll .u;.-..: .. " I'" nor til(' prop('r tril .... If.l t', IlI.-I'-IJlllllC I tllne to tlllle torcgllHtte fn:.'lg-ht ann pa~~l'ng('r tarl'iueh ti ljlll':'ljoll. II b 11111 a IJrallth of tilt' judi- iJl~; to pruhibit UIJjU~t diserimilJtitioll oil the vari du.ry of the ~tate_ It L-; nll HgClJey ereated by the flUS railroarlK of this statp, and to prohibit railroads leg,~lature to perform eertain dutIes whieh by the from charging other 1.han jUSL and reasonable ~trict ltlngua.ge of the constitution was df!volved rates, and enforce the saIne by adequate peHalties, upon the legislature it~elf, but which it would be therefore, be it enacted, etc." There is not oue inconvenient if not \.vholly impracticable for that word in it that refers to par. 4, sec. 2 and art. 4, or "'T or does not violate the prOVision of the constitution in res~IPct to competition RIHl monopoly. e sim- ply dedde that we !lan- 110 jllrL..dil'lioIl ov('r the ('nlilraeai 011 these points. and if thl're be a. wr('ug. we are nut authorizel1 to redress it. Jnnuary 29th, 1886. ALEX. D. ERWIN. I concur iu the above decision. L. N. TRAMMELL. The paper filed \vith the commis~ion by the rail- road companies doing bu~illt'ss in thi::- Etate and body to perform, and the courts have, therefwc, to contracts defeating competition and encourag- now under eonsideration clearly evid{:'llces that. in held thht the creation of s11cb agency to perlorD1 ing monopoly. its maiu features it is a contract or agreement for these dutieswa, proper and legal. See iOt1l Ga. Let lIS110W go to section 8 of the act it,elf, the the appo'tionment of ton age and divi,ion of earn reports, page tW4, and deci~ion of l\Ir. Justice oue relied on and see whf'ther it is in harmony ings, thereby lessening cOlnpetition and as sucll is 'Vood~ in the Tilley case, in United States circuit with the title, the preamDle and the g-encral scope in my jl]d~ment, a violation of l1rticle fourth, :-,ec- conrt at Savallnah. and object of the entire act_ It has aJready been tion second, paragraph fuurth of tne constitution For one purpose, however, we are at liberty to qnott'd in full, but we reproduce tbe latter clause which b a:-s follows: con~ider a eOIiHitntiollal objection to an act, viz: of the ~ectiolJ. The tir:-.t clause of the section rcfer~ "l'he general as!':embly of this state ~ball have ' for the purp().'(' of cowtruction If an act or part to rates in terms, and clearly has no bearing on the no power to authorize any corporation to buy of an act is ~u."{('ptible of two reasonable construc- question bf:'fore us and the second Hi the one on shares, or stock, in any other corporation in thi."'i tions, 011(' of wl1ich appears to be which the able and ingenious counsel for petitioners ~tate, or elsewhere, or to ll1ake any contract, or a violatioll of the paramount law plauted his right to the redress he seeks. "And an agreement whatever, with allY such corporation, and the 0111/'r IJOt, it ,"vould be our dutJ.' arrangements and agreemt'Dts whatever ai-l to the whL:h may have the effect, or be intended to huyc to presume thu f the legislature did TJot intend to division of earnings (d' any kind by c'Jmpetingrail- the effect, to defeat or lebsen competition :in tl1eir violate the COli "I JtUtiOIl a.nd to adopt the constrac- road cOlnpanies doing bm. inessin this stHte shan be re:-:pective business, or to encourage monopoly; tion conhiRtell1 \ri~h that view_ But if the act is submitted to said commbsioners for inspec1.ionand and all fo'ueh COlltracts and agreements shall be il. plain and unll Jnhig-IlOus in its terms, admitting of approved,iu so far as they affect rules aud regUla legal and void." and is also in violation of section bnt one reasoli'ihle constructioll, it would b~ our tious made by said commissioners to secure to all 8th of the act of the legislatnre creating the com- duty to endeHYij to enforce it as we found it plain- persons doing business with said companies just Ini!o':-ion, approved October 14th, 1879, \vhieh is as Iy written, alld 11'flve its constitutionality to be de an~ rea~onab10 raies of freight and pM~senger follows: cided by the e""1 t,. tariff,." Arc these contracts to be submitted to the '-That all contracts and agreements bctween It is claimed:ly Ihe able coun~el for the chamber commissiOlJers for geueral approval or rf'jecti\Ill'? railroad companies doing bll~iness in thi.~ of commerce tlia -' we have jurisdiction to grant the praytr of the P('i llifln under the clause of the con stitution last qll',il'd relating- 10 contract8 defeating, or lf2s:-enill~ '(Impetitioll anressly declares that they are to be submitted f?r inspection Rlld approval, in so far as they eilect rules alld reglllatiou~ made by said cornmissioner~ to .secure to all persons doing bU~iness with said companicR just and reasont.tble rates of freight and passenger tariffs. It is fo~ this pl1rpo~e onl? that thi:, section confers authorIty on the commIssioners to lipprove or dbapprove them. The general view to the division ofeuTuings ofauy kind by compet- illg railruad companies doing bu:-,ine~s in this ~tate, shall be foiubrnitted to said conlmissioners for inspection Hnd approvnl~ in so far as they affect rules anrl regulation ... made: by said comInissioneri-=, to ~eeure to all persons doing business with said companies just and rea~onable rates of freight and pas~enger taritl:'~; and said commis~ioners nULy make ~nlch kind by competing ra.ilroad companies doing busi ness in thi~ statl', ~lJan be submitted to ~aid ConI n~i."}li()n(~rs for iTlfo'(>eetion and approval, ill FO tar as' hi':.' n l'feet full'S and regUlations made by said COnt~lll.:-;'1(j.n~rsto secu~c t~ an persons doing busi-. bere ta.ken i1'\ !->trengthened by the conclusion of the section. "And ::-airl eomInissioners may make such rilles and regulatiOlls as may be then deemed necessary and proper, and any sueh ag-recrnents not approved by said commis~iollers,or by virtue rule:.; and regulations as to such contracts and agr~ements as nlay be then deemed neeefo:Rury and spurocphecro, mamnldS.~alI?O-YI1seurSc,hoar.gbryeeVm~Irnttuse n()~ ot approved by which rates shlill he charged exceeding the rates fixed for ne" WIth o.f freight 'llld illHl pcao~msepnagmere'taJruif,fts;a nd reasonable rates and said commis- of whicb rates shall be charged exceeding the 1 frcight and pas'eng-ers, shall be deemed beld and rates fixed for freight and passengers shall be! tliken to be, violations of artlcle 4, section 1, para- stone Ruch rsCOmllatynHn~tms k es or nch agr Tules and regUl eements it" nla at y ions be as to then held and deemed a violation of Art. 4, Sec. 2, Para- I graph 4, of the constitution and shall be illegal graph 4 of the constituion, and .shall beillegalalld adn void." deemed nece:-::-ary a.nd proper, and f1nysuch agree void." _ I Conseqnently, I am constrained to consider it ments not appro\'<;d by sueh COUllllis