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UNITED STATES v. BALT. & OHIO R.R. CO., 225 U.S. 306 (1912)

U.S. Supreme Court

UNITED STATES v. BALT. & OHIO R.R. CO., 225 U.S. 306 (1912)

225 U.S. 306

UNITED STATES, the Interstate Commerce Commission, and the Federal Sugar Refining Company, Appts.,
BALTIMORE & OHIO RAILROAD COMPANY, the Central Railroad Company of New Jersey, et al.
No. 722.

Argued January 15 and 16, 1912.
Decided June 10, 1912.

[225 U.S. 306, 307]   Solicitor General Lehmann for the United States.

Mr. P. J. Farrell for the Interstate Commerce Commission.

[225 U.S. 306, 309]   Mr. Ernest A. Bigelow for the Federal Sugar Refining Company.

Messrs. George F. Brownell and Herbert A. Taylor for the Railroad Companies.

[225 U.S. 306, 311]   Mr. William N. Dykman for interveners.

[225 U.S. 306, 314]   Mr. H. B. Closson for Brooklyn Eastern District Terminal.

Mr. Chief Justice White delivered the opinion of the court:

This is a suit instituted in the commerce court to enjoin the enforcement of an order by the Interstate Commerce Commission.

The complainants in the bill are the Baltimore & Ohio Railroad Company, the Central Railroad Company of New Jersey, the Delaware, Lackawanna, & Western Railroad Company, the Erie Railroad Company, the Lehigh Valley Railroad Company, the New York, Ontario, & Western Railway Company, the Pennsylvania Railroad Company. The Brooklyn Eastern District Terminal and John Arbuckle and William A. Jamison, copartners, trading as the Jay Street Terminal, intervened and were made parties complainant, they being interested to defeat the order of the Commission.

The defendant named in the bill is the United States. The Interstate Commerce Commission appeared, and the Federal Sugar Refining Company intervened and was made a party defendant. [225 U.S. 306, 315]   The order which it was the purpose of the suit to enjoin was made in a proceeding commenced before the Commission on behalf of the Federal Sugar Refining Company, to compel the railroads above named to desist and abstain from paying to Arbuckle Brothers, claimed to be operating what is known as the Jay Street Terminal, certain so-called allowances for floatage, lighterage, and terminal services rendered by them to the complainants in connection with sugar transported by them in New York harbor to and for the complainants, while at the same time paying no such allowances to the said Federal Refining Company on its sugar.

We substantially adopt as accurate a summary statement made of the subject-matter of the controversy in the brief of counsel for the railroad companies:

This is the order the enforcement of which was the subject-matter of the controversy in the court below.

The United States, the Interstate Commerce Commission, and the Federal Sugar Refining Company promptly filed motions to dismiss the petition and the intervening petition of the Jay Street Terminal upon the ground of want of equity and because the order of the Commission was an adjudication of matters of fact as to which its judgment was conclusive. The petitioners, on the other hand, applied for an injunction pendente lite suspending the order of the Commission until the final determination of the action. The motions to dismiss were denied. On the same day, the motion for a temporary injunction-which had been heard upon the petition and intervening petitions and affidavits submitted by petitioners in support of the averments of the petition and intervening petition-was granted, and the assailed order 'and its force and effect' were suspended until the further order of the court. This appeal was then taken.

There was clearly a right in the court below to entertain jurisdiction of the petition, and to determine whether the affirmative order of the Commission was entitled to be enforced. There was clearly also power in the court to allow a preliminary injunction, since that authority is conferred in express terms by 3 (208 [36 Stat. at L. 1149, chap. 231, U. S. Comp. Stat. Supp. 1911, p. 217]) of the act [36 Stat. at L. 542, chap. 309]. And [225 U.S. 306, 321]   the right to appeal from such an order is also in express terms conferred by 2 (210) of the act.

It is urged on behalf of the United States and the Interstate Commerce Commission that, wholly irrespective of the merits of the petition, the order granting the interlocutory injunction must be reversed because of what is insisted to be the express requirements of the act imposing the duty on the commerce court or a judge of that court, if a restraining order is granted under the conditions in the statute, to state the facts from which it is found that irreparable injury would arise if a restraining order were not allowed. The section containing the provision relied upon is as follows:

Without ambiguity we think the statute contemplates three classes of orders: First, a temporary restraining order staying in whole or in part the operation of the order of the Interstate Commerce Commission for not more than sixty days from the date of the suspensive order, to be allowed by the court or a judge thereof; second, a preliminary injunction, that is, an injunction pendente lite, which, to quote the words of the statute, may be granted by the court to 'restrain or suspend, in whole or in part, the operation of the Commission's order pending the final hearing and determination of the suit;' third, in the nature of things a perpetual injunction upon the entry of the final decree. The order in this case, made after notice and hearing, suspending the force and effect of the order of the Commission until the further order of the court, was obviously an exercise of the power conferred to grant a preliminary injunction or injunction pendente lite, and not of the power to allow a temporary restraining order embraced in the first of the classes stated. As we think it clear that the requirements of the statute relied upon respecting the statement of facts as to irreparable damages relate only to the first class of cases, that is, the power to issue a temporary restraining order, we hold the objection to be without merit.

This brings us, to consider the scope of our reviewing authority under the right conferred by the statute to appeal from the allowance by the court below of a preliminary injunction or injunction pendente lite. To determine this question requires a consideration of the nature and character of the powers which the court had a right to [225 U.S. 306, 323]   exert over the subject-matter presented to it by petition filed to perpetually enjoin the enforcement of the order of the Commission.

We have determined in the Procter & Gamble Case, 225 U.S. 282 , 56 L. ed. --, 32 Sup. Ct. Rep. 761, that the commerce court was but endowed in considering whether an affirmative order of the Commission should be enforced, on the one hand, or set aside and declared nonenforceable on the other, with the jurisdiction and power existing at the time that act was passed in the circuit courts of the United States. And as, at that time, it was conclusively settled that the courts had only authority to re- examine the findings of the Commission as to subjects like the one here under consideration, for the purpose of ascertaining whether the action of the Commission was repugnant to the Constitution, in excess of the statutory powers conferred upon it, or manifested such an abuse as to be equivalent to an excess of authority, it clearly results that the court below was likewise limited in passing upon the petition before it in this case. This being true, it is also necessarily true that virtually the sole authority of the court below was in a sense confined to determining questions of law arising upon the case as presented on the fact of the pladings. Under the general principles of equity, where a court is called upon to decide whether it will allow a preliminary or pendente lite injunction, the duty arising requires it to be determined whether, on the face of the papers presented, there is such an equitable cause of action presented as justifies the issue of a preliminary injunction to preserve the status pending the suit; that is, to afford an opportunity for a trial of the issues presented. Necessarily it is true also that where an appeal is allowed from an order granting a preliminary injunction the reviewing court is put to the duty of determining whether, on the face of the papers, the court below erred as a matter of law in granting the preliminary injunction. Do these principles apply to the case before [225 U.S. 306, 324]   us is then the first consideration. The result of holding that they do will inevitably cause the expunging from the act of the express authority conferred to issue a preliminary injunction, since, viewed under the general principles of equity, the criteria by which to determine the rightfulness of such an order in view of the nature an character of the jurisdiction of the commerce court is exactly and exclusively the same criteria by which the rightfulness of a final decree of that court, issuing a perpetual injunction in conformity to such decree, would require to be tested. Our duty, however, is not to destroy the law, but to enforce it; and in doing so to seek to discover the intention of the lawmaker, the wrong intended to be prevented, and the remedy designed to be afforded by the enactment of the statute. Coming to consider the statute for this purpose, we have pointed out in the Proctor & Gamble Case that the great remedy intended to be accomplished was the concentration in a single court of the power to consider the rightfulness of enforcing or setting aside orders of the Commission; that, to prevent unnecessary delays, the limitations as to restraining orders and their duration, and the hearing which is commanded as to irreparable injury, were enacted. It must therefore in reason be that the power to issue a preliminary injunction was recognized and preserved so as to afford the court the proper time for deliberation and consideration of the questions to be decided by the Commission, instead of compelling that body virtually ieo instante upon th presentation of a petition to reach a final conclusion. And it would seem also to be the case that the right to appeal from such an order was given as a safeguard against a possible abuse of discretion by an unwarranted, arbitrary, and unreasonable exercise of the power conferred. In other words, we think that the enlightened purpose of Congress was that the court which it created, in the exercise of the important trusts confined to its authority, [225 U.S. 306, 325]   and where occasion required it as a consequence of the gravity and complexity of the legal questions which might arise, should be afforded ample opportunity for due consideration and ripe judgment, and that it was not intended to compel precipitate, and perhaps ill-considered, action.

Coming to consider the case presented in the light of these principles, in view of the doubt which existed as to the scope and effect of the powers conferred upon the Commission, as shown by the decision of the court in the Procter & Gamble Case, of the nature and character of the subject-matter here under consideration and its importance, of the action of the Commission had on that subject prior to the making of the order of the Commission which was assailed by the petition, and especially of f the diversity of opinion which existed among the members of the Commission on the subject, we think there i no room for saying that the preliminary injunction issued was in excess of the power conferred upon the court, because of the plain want of necessity for it, resulting from the obvious nature and character of the legal questions as to which the judgment of the court was invoked in consequence of the filing of the petition calling for the exertion of the authority conferred upon it by Congress.

It is not disputable that although the right to appeal to this court from an order like the one here in question is conferred, yet obviously the purpose which must have caused the creation of the commerce court must have been the desire to interpose between the action of the Commission and this court an intermediate tribunal, having the powers which the statute delegates to it. Our duty is to give that purpose effect and to uphold the lawful authority of the court without deviation, and yet without hesitancy, where there has been an abuse of discretion, to correct it in the completest way. But as this case manifests no such abuse, our duty is not to reverse the action of the court, but to remand the case, so that [225 U.S. 306, 326]   there may be an opportunity to dispose of it on the merits in the forum selected by Congress for that purpose. Of course, in saying this, we must not be understood as deciding or in any way implying that the duty would not exist to examine the merits of a preliminary order of the general character of the one before us in a case where it plainly, in our judgment, appeared that the granting of the preliminary order was in effect a decision by the court of the whole controversy on the merits, or where it was demonstrable that grave detriment to the public interest would result from not considering and finally disposing of the controversy without remanding to enable the court below to do so.


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