Louisville & Nash. R.R. Co. v. Behlmer, 175 U.S. 648 (1900)

It was averred that the defendants were carriers under a common control, management or arrangement, for continuous carriage, and were engaged in the transportation of passengers and property wholly by railroad, between Memphis in the State of Tennessee and Summerville in the State of South Carolina and through Summerville to Charleston. The distance [p. 650] between Memphis and Summerville was averred to be 748 miles as follows: Between Memphis and Chattanooga, 310 miles over the Memphis and Charleston Railroad ; between Chatta - nooga and Atlanta, Georgia, 152 miles over the East Tennessee, Virginia and Georgia Railroad; from Atlanta to Augusta, Georgia, 171 miles over the Georgia Railroad; and from Au - gusta, Georgia, to Summerville, South Carolina, 115 miles over the South Carolina Railway. The principal subject of com - plaint was that though Summerville was twenty-two miles west of Charleston and was that distance nearer to Memphis, where the hay and grain shipments originated, yet the defendants exacted from the petitioner and other merchants of Sum - merville a freight charge of twenty-eight cents per hundred pounds for hay, carried from Memphis to Summerville, while only nineteen cents per hundred pounds were charged for the same article when carried to Charleston, the longer distance. It was averred that the rate of twenty-eight cents to Summer - ville was made up of the through rate to Charleston, with the addition of the local rate from Charleston to Summerville of nine cents per hundred pounds. It was also alleged that the shipments of hay to Summerville were made over the same line, in the same direction as Charleston, and under substantially similar circumstances and conditions. The freight charges complained of were averred to be in violation of the fourth section of the Act to regulate Commerce, commonly referred to as the long and short haul clause. Besides, it was alleged that the local rate between Summerville and Charles - ton of nine cents per hundred pounds was excessive and unreasonable, and that such also was the case as regards the charge of twenty-eight cents from Memphis to Summerville, and hence such charges were in violation of the first section of the Act to regulate Commerce. It was also asserted that the discrimination and excessive rates against Summerville existed not only on hay, “ but on all articles of interstate com - merce coming to that place, much to the detriment and dis - advantage of the town and the business of its merchants. ” In their answers certain of the defendants conceded that they were subject to the Act to regulate Commerce, while [p. 651] others, though admitting that they were common carriers and engaged in the transportation of passengers, wholly by railroad between points in the States of Tennessee and South Carolina, averred that they had no joint through tariff from Memphis to Summerville, and therefore had no “ line ” from Memphis to Summerville, in the sense of the Act to regulate Commerce, and were in consequence not affected by the statute. All the defendants averred that the aggregate freight rate on hay carried from Memphis to Summerville, as well as the local rates from Charleston to Summerville, were just and reasonable. By some of the defendants it was alleged that the transportation of hay from Memphis to Summerville was not done under substantially similar circumstances and condi - tions as the transportation of like property from Memphis to Charleston, and hence the carriers were justified in making a lesser charge to Charleston than was made to Summerville, the shorter distance. The dissimilarity alleged was asserted to have been caused, first, by the existence between Memphis and Charleston of at least eight competing lines of railroad, and, second, by the competition by sea, on hay and grain, and freight of that class, originating in Chicago, New York and Eastern points, and destined to Charleston via the lakes, canal and ocean, and by part water and part rail. The exact condi - tions of the competition existing at Charleston because of its situation on the seaboard and consequent relations with many markets other than Memphis, was stated in the joint and several answers of the Louisville and Nashville Railroad Company and the Central Railroad and Banking Company as follows:

On the foregoing issues testimony was taken before the Commission, which entered an order requiring the defendants to desist on or before a date named from charging any greater sum in the aggregate for the transportation from Memphis to Summerville of hay, or other commodities carried by them, [p. 653] under circumstances and conditions similar to those appearing in the case, than was being charged for such transportation for the longer distance to Charleston. This order, however, stated that it was made without prejudice to the right of the defendants to apply to the Commission for relief under the fourth section of the Act to regulate Commerce. The order not having been obeyed, Behlmer, as authorized by section 5 of the act of March 2,1889, c. 382, 25 Stat. 855, 859, amending section 16 of the original act, filed his complaint in the Circuit Court of the United States for the Fourth Circuit, Eastern District of South Carolina, against the defendants in the pro - ceedings before the Commission and the purchasers, assignees and successors of some of them, praying that the court might enforce compliance with the order of the Commission. By stipulation the testimony taken before the Commission was used at the hearing in the Circuit Court, and by consent cer - tain documentary evidence (consisting of railway agreements, tariffs, reports, etc.) was filed as additional evidence on behalf of the defendants.

This determination of the Commission to restrict its exami - nation of the evidence solely to the extent necessary to enable it to ascertain the source and inherent character and not the materiality and substantiality of the competition, and therefore to exclude wholly from view the latter considerations, was predicated on the conclusion that, as a matter of law, no competition, however great might be its influence on carriage and rate making, could be by the carrier taken into considera - tion, of his own motion, in determining whether a lesser sum would be charged for the longer than for the shorter haul, if such competition arose from the sources or was wholly of [p. 655] the character which it was found by the Commission the proof established the competition relied on to be. That is to say, the Commission concluded, as a matter of law, that it was unnecessary to weigh the facts for the purpose of determining the materiality and extent of the competition, because, how - ever strongly the proof might demonstrate its potency upon traffic and rates, nevertheless it would be without efficacy to give rise to such substantial dissimilarity as would justify the carrier, of his own motion, to charge a lesser rate for the longer than for the shorter haul. Whilst this was held to be the law, at the same time it was decided that the charac - ter of competition, which from its very nature was decided to be inadequate to create such legal dissimilarity in the condi - tions as to justify the carrier, of his own motion, charging a lesser sum for the longer than that for the shorter haul, nevertheless might authorize the Commission to sanction the lesser charge if the facts were presented to the Commission and its previous sanction to making such charge was obtained. Therefore the right of the carrier to prefer to the Commission a request for authority to make the charge complained of, predicated upon the very grounds which were held insufficient to permit the carrier to do so, on his own motion, was fully reserved. The ruling was, then, this, that some kinds of com - petition, however material and substantial in their operation, were yet inadequate, for the purpose of creating dissimilarity in circumstance and condition, to justify the independent action of the carrier, although the identical conditions of competition might be sufficient to produce such dissimilarity as to justify the Commission, on application made to it for such purpose, to authorize the carrier to charge less for a longer than was exacted for a shorter distance. The Com - mission said in its report (4 Inters. Com. Rep. 520, 523):

“ There is no showing in this proceeding of competition by lines not subject to the Act to regulate Commerce for the car - riage of hay from Memphis to Charleston, and the fact that there may be competition for such traffic by lines which are subject to the act, or that hay may be carried to Charleston by various rail and water, or part rail and part water, routes [p. 656] from points other than Memphis, does not justify the defend - ant carriers in departing from the general rule of the fourth section upon their own motion. Such considerations may con - stitute reasons for applying to the Commission for relief under the proviso clause of that section, but for reasons stated in our decisions of the cases above cited they do not justify carriers in departing from the rule of the fourth section without such a relieving order. Water competition, to justify lower long-haul rates, must exist between the point of shipment and the longer distance point of destination. (James & M. Buggy Co. v. Cincinnati, JT. 0. & T. P. R. R. Co., supra.} One transportation line cannot be said to meet the competition of another transportation line for the carrying trade of any particular locality, unless the latter line could and would perform the service alone if the former did not undertake it. (Chattanooga Board of Trade v. Bast Tennessee, K & G. R. Co., supra.} The competition of markets, or the competition of carrying lines, subject to regulation under the Act to regulate Com - merce does not justify carriers in making greater short-haul or lower long-haul charges over the same line without an order issued by the Commission on application therefor and after investigation. (Ga. R. R. Com. v. Clyde 8. 8. Co., 4 Inters. Com. Rep. 120; 5 I. C. C. Rep. 324; and Gerke Brew. Co. n. Louisville & N. R. Co., 4 Inters. Com. Rep. 267; 5 I. C. C-Rep. 596.) ”

“ But if we assume, for the sake of argument, that all the defendants are affected by this charge, does it violate the fourth section of the act above quoted? Judge Cooley, in In re L. & N. R. R. Co., 1 Inters. Com. Rep, 57, says; ‘ The [p. 657] charging or receiving greater compensation for the shorter than for the longer haul is sure [seen] to be forbidden only where both are under substantially the same circumstances and conditions. And, therefore, if in any case the carrier, without first obtain - ing an order of relief, shall depart from the general rule, its so doing will not alone convict it of illegality, since if the cir - cumstances and conditions of the two hauls are dissimilar the statute is not violated. ’ This is quoted with approbation by the United States Circuit Court, Southern District California. {Interstate Commerce Commission v. A. T. & S. F. F. Co., 50 Fed. Rep. 295.)

cause had not been properly served, and that the Circuit Court had also fallen into error in deciding that the carriers in question were not, within the intendment of the Commerce Act, a continuous line for through transportation under a com - mon management and control. When it came to consider the conflicting conclusions of the Commission and the Circuit Court as to the meaning of the fourth section of the act, the court held that the interpretation adopted by the Commission was right, and that upheld by the Circuit Court was wrong. In other words, the Circuit Court of Appeals decided that no competition existing at the place of delivery, however far reaching, or arising at the initial point from the action of other [p. 659] carriers who were subject to the control of the act, could justify a carrier in making a greater charge for a shorter than for a longer haul, although such competitive conditions might empower the Commission, on application of the carrier to grant the right to make such charge. The reasons which impelled the Circuit Court of Appeals to the conclusion by it reached are very clearly stated in its opinion, from which a member of the court (Morris, District Judge) dissented. The court said (42 U. S. App. 594):

“ We adopt the conclusion heretofore announced by the Interstate Commerce Commission (4 Inters. Com. Rep. 520), which is, in substance, that in order to justify the greater charge for the shorter distance because of water competition, the transportation as to which such competition exists must be concerning freight to the longer distance point, which, if not carried to such point by the road giving the rate com - plained of, could reach that point by water transportation; and also that the competition of one transportation line can - not be said to meet that of another for the carriage of traffic [p. 660] from any particular locality, unless one line could perform the service if the other did not. Such, we believe, to be the true meaning of section 4, so far as the point we are now consid - ering is involved. We are also of opinion that the competi - tion claimed by the appellees to exist between the different markets — particularly those of Memphis, Chicago and the North Atlantic ports — to supply the trade of Charleston in the products mentioned, is not in reality the competition that affects rates from a particular locality, but is one that is regulated by the commercial circumstances existing at those points, applicable to business of that character and not con - nected with the usual conditions under which transportation is conducted, nor does such competition in our judgment create the dissimilar circumstances and conditions referred to in the fourth section of the act now under consideration. And we further hold that competition between carriers subject to the requirements of said act does not produce such substantial dis - similarity in the circumstances and conditions under which transportation is performed as will justify such carriers in making a greater charge for the shorter than for the longer haul, without an order to that effect from the Commission, granted by it as provided for in the proviso to the fourth section.”

The first two of the foregoing questions in effect solely involve propositions of law, for, although the essential predi - cate upon which they rest takes into consideration certain facts, they were not disputed below, and their existence was [p. 662] not denied in the argument at bar. They may be assumed therefore, as being unchallenged for the purpose of the legal questions presented. We come, then, to the immediate consideration of the propositions above referred to in the order stated.

2d. It is, as we have said, uncontroverted that all the com - petition relied on by the carriers, to establish that there was a dissimilarity of circumstance and condition, arose solely from two sources; either that originating at Memphis, the initial point of the traffic, from the presence there of carriers who were subject to the provisions of the Commerce Act, or competition based on the fact that Charleston was connected with or acces - sible to lines of rail and water communication which brought it in relation with many other places and markets other than Memphis, thereby creating competition between Memphis and Charleston, the claim being that Memphis would have been deprived of the benefits of the Charleston traffic, and [p. 663] Charleston would be also cut off from the Memphis supply if the rates from Memphis to Charleston had not been made lower to meet the competition at Charleston.

portation before the Interstate Commerce Commission, and the answer of said company to the petition of the Commis - sion filed in the Circuit Court, allege that rates for the transportation of commodities from Liverpool and London, England, to San Francisco, California, are in effect fixed and controlled hy the competition of sailing vessels for the entire distance; [p. 664] by steamships and sailing vessels in connection with railroads across the Isthmus of Panama; by steamships and sailing ves - sels from Europe to New Orleans, connecting there under through arrangements with the Southern Pacific Railway Company to San Francisco: That, unless the defendant com - pany charges substantially the rates specified in its answer, it would be prevented, by reason of the competition aforesaid, from engaging in the carrying and transportation of property and import traffic from Liverpool and London to San Francisco, and would lose the revenue derived by it therefrom, which is considerable, and important and valuable to said company: That the rates charged by it are not to the prejudice or disadvantage of New Orleans, and work no injury to that community, because, if said company is prevented from par - ticipating in said traffic, such traffic would move via the other routes and lines aforesaid without benefit to New Orleans, but, on the contrary, to its disadvantage: That the foreign or import traffic is upon orders by persons, firms and corpora - tions in San Francisco and vicinity buying direct of first hands in London, Liverpool and other European markets; and if the order of the Commission should be carried into effect it would not result in discontinuance of that practice or in inducing them to buy in New Orleans in any event: That the result of the order would be to injuriously affect the defendant company in the carriage of articles of foreign imports to Memphis, St. Louis, Kansas City and other Missouri River points. . . .”

44 The Commission justified its action wholly upon the con - struction put by it on the Act to regulate Commerce, as forbidding the Commission to consider the 4 circumstances and conditions ’ attendant upon the foreign traffic as such 4 [p. 665] circumstances and conditions ’ as they are directed in the act to con - sider. The Commission thought it was constrained by the act to regard foreign and domestic traffic as like kinds of traffic under substantially similar circumstances and conditions, and that the action of the defendant company in procuring through traffic that would, except for the through rates, not reach the port of New Orleans, and in taking its pro rata share of such rates, was an act of ‘ unjust discrimination, ’ within the meaning of the act.

“ Errors are likewise assigned to the action of the court in having failed and refused to affirm and enforce the report and opinion of the Commission, wherein it was found and decided, among other things, that the defendants, common carriers which participate in the transportation of class goods to Troy [p. 666] from Louisville, St. Louis and Cincinnati, and from New York, Baltimore and other Northeastern points, and the defendants, common carriers which participate in the transportation of phosphate rock from South Carolina and Florida to Troy, and the defendants, common carriers which participate in the transportation of cotton from Troy to the ports of New Or - leans, Brunswick, Savannah, Charleston, West Point or Nor - folk, as local shipments or for export, have made greater charges, under substantially similar circumstances and condi - tions, for the shorter distance to or from Troy than for longer distances over the same lines in the same direction, and have unjustly discriminated in rates against Troy, and subjected said place and dealers and shippers therein to undue and unreasonable prejudice and disadvantage in favor of Mont - gomery, Eufaula, Columbus and other places and localities and dealers and shippers therein, in violation of the provisions of the Act to regulate Commerce. ”

“ Whether competition between lines of transportation to Montgomery, Eufaula and Columbus justifies the giving of those cities a preference or advantage in rates over Troy, and, if so, whether such a state of facts justifies a departure from equality of rates without authority from the Interstate Commerce Commission under the proviso of the fourth section [p. 667] of the act, are questions of construction of the statute, and are to be determined before we reach the question of fact in this case. ”

It is to be remarked that among the cases approvingly cited in the passage just quoted will be found the opinion of the Circuit Court in the very case now before us, which opinion was opposed to the construction of the law taken by the Commission and to that announced by the Circuit Court of Appeals in this cause. Referring to the claim that under a correct interpretation of the proviso of the fourth section carriers were not allowed to avail themselves of dissimilar [p. 668] circumstances and conditions, arising from competition, with - out the previous assent of the Commission, the court again cited from an opinion of the Interstate Commerce Commission delivered by Judge Cooley, as follows (pp. 168-169):

It is then settled that the construction given in this cause by the Interstate Commerce Commission and the Circuit Court of Appeals to the fourth section of the Act to regulate Commerce was erroneous, and hence that both the Interstate Commerce Commission and the Circuit Court of Appeals mis - takenly considered, as a matter of law, that competition, how - ever material, arising from carriers who were subject to the Act to regulate Commerce could not be taken into consideration, and likewise that all competition, however substantial, not originating at the initial point of the traffic, was equally, as a matter of law, excluded from view. It follows that the decree of the Circuit Court must be reversed unless it be the duty of this court to examine the evidence, which was not passed on by the Commission or the Circuit Court of Appeals, for the purpose of ascertaining whether the competition relied on was so substantial and so controlling on traffic and rates as to cause it to produce a dissimilarity of circumstance and con - dition within the meaning- of the fourth section of the act. A consideration of this subject leads to a solution of the third question which we have previously stated was involved in the cause. In passing, however, it is well to say that both the opinions of this court, just referred to, were announced subsequently to the decision in this case by the Interstate Com - merce Commission and by the Circuit Court, and moreover that the opinion of this court in the last cause (the Midland case) was announced after the decision of the Circuit Court of Appeals of the case now here. Indeed, since the decision last referred to, it is not denied that the Interstate Commerce Commission have recognized that the interpretation previ - ously given by it to the fourth section had been decided to be unsound, hence in the practical application of the law, since [p. 670] the decision by this court in the Midland case, the construc - tion of the statute which was announced by the Commission in previous cases as well as in this has no longer been applied. 11 Ann. Rep. I. C. C. (1897), pp. 38, 43, 91; 7 I. C. C. Rep., pp. 456, 479, 480; Savannah Bureau of Freight d? Transpor - tation v. Charleston <& Savannah By. Co. et al.

Before determining the final question we notice certain contentions pressed in argument, whereby it is asserted that there is such a difference between the legal issues here arising and those which were presented in the cases referred to, that this case should not be controlled by them. In any event, it is argued, the action of the Commission and the Circuit Court of Appeals in this controversy was of such a nature as to render the previous rulings of this court inapposite, and hence it is unnecessary to apply them. Whilst, it is not denied as regards competition arising from other carriers at the place of origin of the traffic, who were subject to the control of the Act to regulate Commerce, that the decision here under review is not in accord with the rulings of this court, such it is claimed is not the case as to competition not originating at the initial point of carriage. From this premise it is argued that it was correctly decided below that substantial and mate - rial competition resulting from conditions existing at the point of delivery, such as accessibility of that place to other lines of transportation from other places by rail or water, or both, was, as a matter of law, correctly decided below to be with - out legal efficacy in producing dissimilarity of circumstances and conditions. In this regard, then, the decree below, it is insisted, was correct. But the facts which were presented in the records passed on by this court, in the cases to which we have referred, do not justify the premise from which this pre - sumed difference is deduced. We do not stop, however, to analyze those facts, because, granting, arguendo, the assump - tion upon which the suggested distinction is based, we think it is without merit. What was decided in the previous cases was that under the fourth section of the act substantial com - petition which materially affected transportation and rates might under the statute be competent to produce dissimilarity [p. 671] of circumstances and conditions, to be taken into consideration by the carrier in charging a greater sum for a lesser than for a longer haul. The meaning of the law was not decided to be that one kind of competition could be considered and not another kind, but that all competition, provided it possessed the attributes of producing a substantial and material effect upon traffic and rate making, was proper under the statute to be taken into consideration. Indeed, if the distinction con - tended for were sound it would follow that the greater and more material competition would be without weight in deter - mining whether a dissimilarity of circumstances and condi - tions existed, whilst the lesser competition would be potential for such purpose. Not only this, but if the distinction be applicable, only that competition which might deflect at the point of origin, the traffic from one carrier to another would be within the purview of that portion of the fourth section now under consideration, and competition which was so great as to absolutely prevent the movement of the traffic, unless the lesser rate was exacted, would be outside of its operation. This would lead to the construction that the statute, in empowering a carrier, under certain competitive conditions, of his own volition, to exact a lesser rate for the longer haul, contemplated only the interest of some particular carrier and not at all the public interest. Whilst the unsoundness of the proposition is thus shown, from the contradiction which inheres in it, the erroneous conception upon which it rests is fully demonstrated in the following excerpt from the opinion in Texas de Pacific Pailway v. Interstate Commerce Commis - sion, supra, 211:

Indeed, in the cases by which the controversy here before [p. 672] us is controlled, attention was pointedly called to the fact that in considering the power of the carrier, of his own motion, to charge a lesser sum for the longer haul, not only was the interest of the carrier to be taken into account, but also the interest of the public, especially at the place from which the traffic moved and the place to which it was to be delivered, and to these principles we shall before concluding again advert.

This failure to consider the evidence points to the distinc - tion between this cause and that of Cin., N\ 0. & Texas Pacific Railway n. Interstate Commerce Commission, 162 U. S. 184, upon which reliance is placed. In that case the court, from an examination of the whole record, considered that the result of the action of the Commission and the Cir - cuit Court of Appeals had been substantially to decide not that the character of competition relied on could not be taken [p. 673] into view, but that fully weighing and considering it, sufficient proof did not result to show that it was so substantial and so material as to justify deciding that there were dissimilar cir - cumstances and conditions. The judgment below was, because of this view as to such question, affirmed. The court said (p. 194): “ But the question was one of fact, peculiarly within the province of the Commission, whose conclusions have been accepted and approved by the Circuit Court of Appeals, and we find nothing in the record to make it our duty to draw a different conclusion. ” If it be again, arguendo, conceded that the state of the record in that case was such that an analysis of the action taken below might have well led the court to a dif - ferent opinion ; in other words, might have justified it in hold - ing that both the Commission and the Circuit Court of Appeals had rested their conclusions, not on the want of proof as to the claimed competition, but solely on the absence of legal power to assert competition of the character relied on, such conces - sion could have no influence upon the decision of this cause. This follows because the only deduction possible from the proposition would be that the particular case had been decided on a question of fact, when it should have been controlled by a question of law, which would afford no reason for the failure to apply sound principles of law to the facts of this record. It involves a complete non seguitur to assert that because legal principles may not have been applied to a given case, on the assumption that the facts did not render their application necessary, therefore, in future cases, where it was found that the facts brought the controversy within the principles, they should not be applied.

VOL. CLXXV — 43 [p. 674] and unsubstantial its influence on rates and traffic, would be sufficient to bring about dissimilarity of circumstances and conditions, the question would be easy of solution, for then to weigh the testimony would involve no serious duty. But this suggestion rests on an entire misconception of the adjudi - cations of this court. In considering the right of a carrier to act on competitive conditions, deemed by him to produce dis - similarity of circumstances and conditions, the court, in Interstate Commerce Commission v. Alabama & Midland Railway, 168 U. S. 173, said:

It follows that whilst the carrier may take into considera - tion the existence of competition as the producing cause of dissimilar circumstances and conditions, his right to do so is governed by the following principles: First. The absolute command of the statute that all rates shall be just and reasonable, and that no undue discrimination be brought about, though, in the nature of things, this latter consideration may [p. 675] in many cases be involved in the determination of whether competition was such as created a substantial dissimilarity of condition. Second. That the competition relied upon be, not artificial or merely conjectural, but material and substantial, thereby operating on the question of traffic and rate making the right in every event to be only enjoyed with a due regard to the interest of the public, after giving full weight to the benefits to be conferred on the place from whence the traffic moved as well as those to be derived by the locality to which it is to be delivered. If, then, we were to undertake the duty of weighing the evidence, in this record, we would be called upon, as a matter of original action, to investigate all these serious considerations which were shut out from view by the Commission, and were not weighed by the Circuit Court of Appeals, because both the Commission and the court errone - ously construed the statute. But the law attributes prima facie effect to the findings of fact made by the Commission, and that body, from the nature of its organization and the duties imposed upon it by the statute, is peculiarly competent to pass upon questions of fact of the character here arising. In Texas & Pacific Railway v. Interstate Commerce Commis - sion^ (ubi supra?) the court found the fact to be that the Com - mission had failed to consider and give weight to the proof in the record, affecting the question before it, on a mistaken view taken by it of the law, and that on review of the action of the Commission the Circuit Court of Appeals, whilst con - sidering that the legal conclusion of the Commission was wrong, nevertheless proceeded as a matter of original investigation to weigh the testimony and determine the facts flowing from it. The court said (p. 238):

“ If the Circuit Court of Appeals was of opinion that the Commission in making its order had misconceived the extent of its powers, and if the Circuit Court had erred in affirming the validity of an order made under such misconception, the duty of the Circuit Court of Appeals was to reverse the decree, set aside the order, and remand the cause to the Com - mission, in order that it might, if it saw fit, proceed therein according to law. The defendant was entitled to have its [p. 676] defence considered, in the first instance, at least, by the Com - mission upon a full consideration of all the circumstances and conditions upon which a legitimate order could be founded. The question whether certain charges were reasonable or otherwise, whether certain discriminations were due or un - due, were questions of fact, to be passed upon by the Com - mission in the light of all facts duly alleged and supported by competent evidence, and it did not comport with the true scheme of the statute that the Circuit Court of Appeals should undertake, of its own motion, to find and pass upon such questions of fact, in a case in the position in which the present one was. ”

The Paquete Habana was a sloop, 43 feet long on the keel, [p. 679] and of 25 tons burden, and had a crew of three Cubans, including the master, who had a fishing license from the Spanish Government, and no other commission or license. She left Havana March 25, 1898; sailed along the coast of Cuba to Cape San Antonio at the western end of the island, and there fished for twenty-five days, lying between the reefs off the cape, within the territorial waters of Spain; and then started back for Havana, with a cargo of about 40 quintals of live fish. On April, 25, 1898, about two miles off Mariel, and eleven miles from Havana, she was captured by the United States gunboat Castine.

It has been suggested, in behalf of the United States, that [p. 680] this court has no jurisdiction to hear and determine these appeals, because the matter in dispute in either case does not exceed the sum or value of $2000, and the District Judge has not certified that the adjudication involves a question of gen - eral importance.

As to cases of admiralty and maritime jurisdiction, including prize causes, the Judiciary Act of 1789, in § 9, vested the original jurisdiction in the District Courts, without regard to the sum or value in controversy; and in § 21, permitted an appeal from them to the Circuit Court where the mat - ter in dispute exceeded the sum or value of $300. 1 Stat. 77, 83; The Betsey, 3 Dall. 6, 16; The Amiable Nancy, 3 Wheat. 546 ; Stratton v. Jarvis, 8 Pet. 4, 11. By the act of March 3, 1803, c. 40, appeals to the Circuit Court were permitted from all final decrees of a District Court where [p. 681] the matter in dispute exceeded the sum or value of $50; and from the Circuit Courts to this court in all cases “ of admiralty and maritime jurisdiction, and of prize or no prize, ” in which the matter in dispute exceeded the sum or value of $2000. 2 Stat. 244; Jenks v. Lewis, 3 Mason, 503; Strat - ton n. Jarvis, above cited ; The Admiral, 3 Wall. 603, 612. The acts of March 3, 1863, c. 86, § 7, and June 30, 1864, c. 174, § 13, provided that appeals from the District Courts in prize causes should lie directly to this court, where the amount in controversy exceeded $2000, “ or on the certificate of the District Judge that the adjudication involves a question of general importance.” 12 Stat. 760; 13 Stat. 310. The provision of the act of 1803, omitting the words, “ and of prize or no prize, ” was reenacted in section 692 of the Re - vised Statutes; and the provision of the act of 1864, concerning prize causes, was substantially reenacted in section 695 of the Revised Statutes, already quoted.

Section 4 provides that no appeal, whether by writ of error or otherwise, shall hereafter be taken from a District Court [p. 682] to a Circuit Court; but that all appeals, by writ of error or otherwise, from the District Courts, “ shall only be subject to review ” in this court, or in the Circuit Court of Appeals, “ as is hereinafter provided, ” and “ the review, by appeal, by writ of error, or otherwise, ” from the Circuit Courts, “ shall be had only ” in this court, or in the Circuit Court of Appeals, “ according to the provisions of this act regulating the same. ” Section 5 provides that “ appeals or writs of error may be taken from the District Courts, or from the existing Circuit Courts, direct to the Supreme Court, in the following cases: ” First. “ In any case in which the jurisdiction of the court is in issue; in such cases the question of jurisdiction alone shall be certified to the Supreme Court from the court below for decision. ” This clause includes “ any case, ” without regard to amount, in which the jurisdiction of the court below is in issue; and differs in this respect from the act of 1889, above cited.

The act of 1891 nowhere imposes a pecuniary limit upon the appellate jurisdiction, either of this court or of the Cir - cuit Court of Appeals, from a District or Circuit Court of the United States. The only pecuniary limit imposed is one of [p. 684] $1000 upon the appeal to this court of a case which has been once decided on appeal in the Circuit Court of Appeals, and in which the judgment of that court is not made final by section 6 of the act.

The decision of this court in the recent case of United States v. Rider, 163 U. S. 132, affords an important, if not controlling precedent. From the beginning of this century until the pas - sage of the act of 1891, both in civil and in criminal cases, ques - tions of law, upon which two judges of the Circuit Court were divided in opinion, might be certified by them to this court for decision. Acts of: April 29, 1802, c. 31, § 6; 2 Stat. 159; June 1, 1872, c. 255, § 1; 17 Stat. 196; Rev. Stat. §§ 650-652, 693, 697; Insurance Co. n. Dunham, 11 Wall. 1, 21; United States n. Sanges, 144 U. S. 310, 320. But in United States v. Rider, it was adjudged by this court that the act of 1891 had superseded and repealed the earlier acts authorizing questions of law to be certified from the Circuit Court to this court; and the grounds of that adjudication sufficiently appear by [p. 685] the statement of the effect of the act of 1891 in two passages of the opinion: “ Appellate jurisdiction was given in all criminal cases by writ of error, either from this court or from the Circuit Courts of Appeals, and in all civil cases by appeal or error, without regard to the amount in controversy,, except as to appeals or writs of error to or from the Circuit Courts of Appeals in cases not made final, as specified in § 6. ” “ It is true that repeals by implication are not favored, but we can - not escape the conclusion that, tested by its scope, its obvious purpose and its terms, the act of March 3, 1891, covers the whole subject-matter under consideration, and furnishes the exclusive rule in respect of appellate jurisdiction on appeal, writ of error or certificate. ” 163 U. S. 138-140.

We are of opinion that the act of 1891, upon its face, read [p. 686] in the light of settled rules of statutory construction, and of the decisions of this court, clearly manifests the intention of Congress to cover the whole subject of the appellate jurisdiction from the District and Circuit Courts of the United States, so far as regards in what cases, as well as to what courts, appeals may be taken, and to supersede and repeal, to this extent, all the provisions of earlier acts of Congress, including those that imposed pecuniary limits upon such jurisdiction; and, as part of the new scheme, to confer upon this court jurisdiction of appeals from all final sentences and decrees in prize causes, without regard to the amount in dispute, and without any certificate of the District Judge as to the importance of the particular case.

The earliest acts of any government on the subject, men [p. 687] tioned in the books, either emanated from, or were approved by, a King of England.

sadors, recited that a great and fierce war had arisen between them, because of which there had been, both by land and by sea, frequent depredations and incursions on either side, to the grave detriment and intolerable injury of the innocent [p. 688] subjects of each; and that a suitable time for the herring fishery was at hand, and, by reason of the sea being beset by the enemy, the fishermen did not dare to go out, whereby the subject of their industry, bestowed by heaven to allay the hunger of the poor, would wholly fail for the year, unless it were otherwise provided — quo fit, ut piscaturm commoditas, ad pauperum levandam famem a codesti numine concessa, cessare hoc anno omnino debeat, nisi aliter provideatur. And it was therefore agreed that the subjects of each sovereign, fishing in the sea, or exercising the calling of fishermen, could and might, until the end of the next January, without incurring any attack, depredation, molestation, trouble or hindrance soever, safely and freely, everywhere in the sea, take herrings and every other kind of fish, the existing war by land and sea notwithstanding; and further that, during the time afore - said, no subject of either sovereign should commit, or attempt or presume to commit, any depredation, force, violence, moles - tation or vexation, to or upon such fishermen, or their vessels, supplies, equipments, nets and fish, or other goods soever truly appertaining to fishing. The treaty was made at Calais, then an English possession. It recites that the ambassadors of the two sovereigns met there at the earnest request of Henry VIII, and with his countenance, and in the presence of Cardinal Wolsey, his chancellor and representative. And towards the end of the treaty it is agreed that the said King and his said representative, “ by whose means the treaty stands concluded, shall be conservators of the agreements therein, as if thereto by both parties elected and chosen. ” 4 Dumont, Corps Di - plomatique, pt. 1, pp. 352, 353.

VOL. CLXXV — 44 [p. 690] which devoted itself to the trade of fishing, and had no other means of livelihood; that he had thought that the example which he should give to his enemies, and which could have no other source than the sentiments of humanity which inspired him, would determine them to allow to fishermen the same facilities which he should consent to grant; and that he had therefore given orders to the commanders of all his ships not to disturb English fishermen, nor to arrest their vessels laden with fresh fish, even if not caught by those vessels; provided they had no offensive arms, and were not proved to have made any signals creating a suspicion of intelligence with the enemy; and the admiral was directed to communicate the King’s intentions to all officers under his control. By a royal order in council of November 6,1780, the former orders were confirmed; and the capture and ransom, by a French cruiser, of The John and Sarah, an English vessel, coming from Holland, laden with fresh fish, were pro - nounced to be illegal. 2 Code des Prises, (ed. 1784) 721,

In the treaty of 1785 between the United States and Prussia, article 23, (which was proposed by the American Commissioners, John Adams, Benjamin Franklin and Thomas Jefferson, and is said to have been drawn up by Franklin,) provided that, if war should arise between the contracting parties, “ all women and children, scholars of every faculty, cultivators of the earth, artisans, manufacturers and fishermen, [p. 691] unarmed and inhabiting unfortified towns, villages or places, and in general all others whose occupations are for the com - mon subsistence and benefit of mankind, shall be allowed to continue their respective employments, and shall not be molested in their persons; nor shall their houses or goods be burnt or otherwise destroyed, nor their fields wasted, by the armed force of the enemy, into whose power, by the events of war, they may happen to fall; but if anything is necessary to be taken from them for the use of such armed force, the same shall be paid for at a reasonable price. ” 8 Stat. 96; 1 Kent Com. 91 note; Wheaton’s History of the Law of Nations, 306, 308. Here was the clearest exemption from hostile molestation or seizure of the persons, occupations, houses and goods of unarmed fishermen inhabiting unfortified places. The article was repeated in the later treaties between the United States and Prussia of 1799 and 1828. 8 Stat. 174, 384. And Dana, in a note to his edition of Wheaton’s International Law, says: “ In many treaties and decrees, fishermen catching fish as an article of food are added to the class of persons whose occupation is not to be disturbed in war. ” Wheaton’s International Law, (8th ed.) § 345, note 168.

For the year 1800, the orders of the English and French governments and the correspondence between them may be found in books already referred to. 6 Martens, 503-512; 6 Schoell, 118-120; 2 Ortolan, 53, 54. The doings for that year may be summed up as follows : On March 27, 1800, the French, government, unwilling to resort to reprisals, reenacted the orders given by Louis XVI in 1780, above mentioned, pro - hibiting any seizure by the French ships of English fishermen, unless armed, or proved to have made signals to the enemy. On May 30, 1800, the English government, having received notice of that action of the French government, revoked its order of January 24, 1798. But, soon afterwards, the English government complained that French fishing boats had been made into fireboats at Flushing, as well as that the French government had impressed, and had sent to Brest, to serve in its flotilla, French fishermen and their boats, even those whom the English had released on condition of their not serving; and on January 21, 1801, summarily revoked its last order, and again put in force its order of January 24, 1798. On February 16,1801, Napoleon Bonaparte, then First Consul, directed the French commissioner at London to return at once to France, first declaring to the English government that its conduct, “ contrary to all the usages of civilized nations, and to the common law which governs them, even in time of war, gave to the existing war a character of rage and bitterness which destroyed even the relations usual in a loyal war, ” and [p. 693] “ tended only to exasperate the two nations, and to put off the term of peace; ” and that the French government, having always made it “ a maxim to alleviate as much as possible the evils of war, could not think, on its part, of rendering wretched fishermen victims of a prolongation of hostilities, and would abstain from all reprisals.”

The French prize tribunals, both before and after Lord Stowell’s decision, took a wholly different view of the general question. In 1780, as already mentioned, an order in council of Louis XVI had declared illegal the capture by a French cruiser of The John and Sarah, an English vessel, coming from Holland, laden with fresh fish. And on May 17, 1801, where a Portuguese fishing vessel, with her cargo of fish, hav - ing no more crew than was needed for her management, and for serving the nets, on a trip of several days, had been [p. 695] captured in April, 1801, by a French cruiser, three leagues off the coast of Portugal, the Council of Prizes held that the capture was contrary to “ the principles of humanity, and the maxims of international law,” and decreed that the vessel, with the fish on board, or the net proceeds of any that had been sold, should be restored to her master. La Nostra Segnora de la Piedad, 25 Merlin, Jurisprudence, Prise Maritime, § 3, art. 1, 3; & C. 1 Pistoye et Duverdy, Prises Maritimes, 331; 2 De Cussy, Droit Maritime, 166.

Wheaton, in his Digest of the Law of Maritime Captures and Prizes, published in 1815, wrote: “ It has been usual [p. 696] in maritime wars to exempt from capture fishing boats and their cargoes, both from views of mutual accommodation be - tween neighboring countries, and from tenderness to a poor and industrious order of people. This custom, so honorable to the humanity of civilized nations, has fallen into disuse; and it is remarkable that both France and England mutually reproach each other with that breach of good faith which has finally abolished it.” Wheaton on Captures, c. 2, § 18.

Calvo says that in the Crimean War, “ notwithstanding her alliance with France and Italy, England did not follow the same line of conduct, and her cruisers in the Sea of Azof de - stroyed the fisheries, nets, fishing implements, provisions, boats, and even the cabins, of the inhabitants of the coast. ” Calvo, § 2372. And a Russian writer on Prize Law remarks that those depredations, “ having brought ruin on poor fishermen and inoffensive traders, could not but leave a painful impression on the minds of the population, without impairing in the least the resources of the Russian government. ” Katchenovsky, (Pratt’s ed.) 148. But the contemporaneous reports of the English naval officers put a different face on the matter, by stating that the destruction in question was part of a mili - tary measure, conducted with the cooperation of the French ships, and pursuant to instructions of the English admiral “ to clear the seaboard of all fish stores, all fisheries and mills, on a scale beyond the wants of the neighboring population, and indeed of all things destined to contribute to the maintenance of the enemy’s army in the Crimea; ” and that the property destroyed consisted of large fishing establishments and storehouses of the Russian government, numbers of heavy launches, and enormous quantities of nets and gear, salted fish, corn [p. 700] and other provisions, intended for the supply of the Russian army. United Service Journal of 1855, pt. 3, pp. 108-112.

De Cussy, in his work on the Phases and Leading Cases of the Maritime Law of Nations — Phases et Causes Celebres du Droit Naritime des Nations — published in 1856, affirms in the clearest language the exemption from capture of fishing boats, saying, in lib. 1, tit. 3, § 36, that “ in time of war the freedom of fishing is respected by belligerents; fishing boats are considered as neutral; in law, as in principle, they are not subject either to capture or to confiscation ; ” and that in lib. 2, c. 20, he will state “ several facts and several decisions [p. 702] which prove that the perfect freedom and neutrality of fishing boats are not illusory.” 1 De Cussy, p. 291. And in the chapter referred to, entitled De la Liberte et de la Neutrality Parfaite de la Peche, besides references to the edicts and deci - sions in France during the French Revolution, is this general statement: “ If one consulted only positive international law ” — Ie droit des gens positif — (by which is evidently meant international law expressed in treaties, decrees or other public acts, as distinguished from what may be implied from custom or usage,) “ fishing boats would be subject, like all other trading vessels, to the law of prize; a sort of tacit agreement among all European nations frees them from it, and several official declarations have confirmed this privilege in favor of ‘ a class of men whose hard and ill rewarded labor, commonly performed by feeble and aged hands, is so foreign to the operations of war. ’ ” 2 De Cussy, 164, 165.

Ortolan, in the fourth edition of his Regies Internationales et Diplomatie de la Mer, published in 1864, after stating the general rule that the vessels and cargoes of subjects of the enemy are lawful prize, says: “ Nevertheless, custom admits an exception in favor of boats engaged in the coast fishery; these boats, as well as their crews, are free from capture and exempt from all hostilities. The coast fishing industry is, in truth, wholly pacific, and of much less importance, in regard to the national wealth that it may produce, than maritime commerce or the great fisheries. Peaceful and wholly inoffensive, those who carry it on, among whom women are often seen, may be called the harvesters of the territorial seas, since they confine themselves to gathering in the products thereof; they are for the most part poor families who seek in this call - ing hardly more than the means of gaining their livelihood.” 2 Ortolan, 51. Again, after observing that there are very few solemn public treaties which make mention of the immunity of fishing boats in time of war, he says: “ From another point of view, the custom which sanctions this immunity is not so general that it can be considered as making an absolute international rule; but it has been so often put in practice, and, besides, it accords so well with the rule in use, in wars on [p. 703] land, in regard to peasants and husbandmen, to whom coast fishermen may be likened, that it will doubtless continue to be followed in maritime wars to come. ” 2 Ortolan, 55.

No international jurist of the present day has a wider or more deserved reputation than Calvo, who, though writing in French, is a citizen of the Argentine Republic, employed in its diplomatic service abroad. In the fifth edition of his great work on international law, published in 1896, he observes, in § 2366, that the international authority of decisions in particular cases by the prize courts of France, of England, and of the United States, is lessened by the fact that the principles on which they are based are largely derived from the internal legislation of each country ; and yet the peculiar character of maritime wars, with other considerations, gives to prize jurisprudence a force and importance reaching beyond the limits of the country in which it has prevailed. He therefore pro - poses here to group together a number of particular cases proper to serve as precedents for the solution of grave ques - tions of maritime law in regard to the capture of private property as prize of war. Immediately, in § 2367, he goes on to say: “ Notwithstanding the hardships to which maritime wars subject private property, notwithstanding the extent of the recognized rights of belligerents, there are generally exempted, from seizure and capture, fishing vessels. ” In the next section he adds: “ This exception is perfectly justiciable — Cette exception est parfaitement justiciable ” — that .is to say, belonging to judicial jurisdiction or cognizance. Littre, Diet. voc. Justiciable; Hans v. Louisiana^ 134 U. S. 1, 15. Calvo then quotes Ortolan’s description, above cited, of the nature of the coast fishing industry; and proceeds to refer, in detail, to some of the French precedents, to the acts of the French and English governments in the times of Louis XVI and of the French Revolution, to the position of the United States in the war with Mexico, and of France in later wars, and to the action of British cruisers in the Crimean War. And he concludes his discussion of the subject, in § 2373, by affirming the exemption of the coast fishery, and pointing out the distinction in this regard between the coast fishery and [p. 704] what he calls the great fishery, for cod, whales or seals, as follows: “ The privilege of exemption from capture, which is generally acquired by fishing vessels plying their industry near the coasts, is not extended in any country to ships employed on the high sea in what is called the great fishery, such as that for the cod, for the whale or the sperm whale, or for the seal or sea calf. These ships are, in effect, considered as devoted to operations which are at once commercial and industrial — Ces natives sont en effet consideres comme adonnes a des operations a la fois commerciales et industriellesJ The dis - tinction is generally recognized. 2 Ortolan, 54; De Boeck, § 196; Hall, § 148. See also The Susa, 2 0. Rob. 251; The Johan, Edw. Adm. 275, and appx. L.

VOL. CLXXV — 45 [p. 706] ture them so soon as any danger arose that they or their crews might be of military use to the enemy; and it is also likely that it is impossible to grant them a more distinct exemption. ” So T. J. Lawrence, in § 206 of his Principles of International Law, says: “ The difference between the English and the French view is more apparent than real; for no civilized bel - ligerent would now capture the boats of fishermen plying their avocation peaceably in the territorial waters of their own State; and no jurist would seriously argue that their immunity must be respected if they were used for warlike purposes, as were the smacks belonging to the northern ports of France when Great Britain gave the order to capture them in 1800. ”

No less clearly and decisively speaks the distinguished Italian jurist, Pasquale Fiore, in the enlarged edition of his exhaustive work on Public International Law, published at Paris in 1885-6, saying: “ The vessels of fishermen have been generally declared exempt from confiscation, because of the eminently peaceful object of their humble industry, and of the principles of equity and humanity. The exemption includes the vessel, the implements of fishing, and the cargo resulting from the fishery. This usage, eminently humane, goes back to very ancient times; and although the immunity of fishery along the coasts may not have been sanctioned by treaties, yet it is considered to-day as so definitely estab - lished, that the inviolability of vessels devoted to that fishery is proclaimed by the publicists as a positive rule of international law, and is generally respected by the nations. Con - sequently, we shall lay down the following rule : (a) Vessels belonging to citizens of the enemy State, and devoted to [p. 708] fishing along the coasts, cannot be subject to capture. (J) Such vessels, however, will lose all right of exemption, when em - ployed for a warlike purpose, (c) There may, nevertheless be subjected to capture vessels devoted to the great fishery in the ocean, such as those employed in the whale fishery, or in that for seals or sea calves. ” 3 Fiore, § 1421.

In 1861, during the War of the Rebellion, a similar decision was made, in the District Court of the United States for the Eastern District of Pennsylvania, in regard to two cases of books belonging and consigned to a university in North Carolina. Judge Cadwalader, in ordering these books to be liberated from the custody of the marshal, and restored to the agent of the university, said: “ Though this claimant, as the resident of a hostile district, would not be entitled to restitution of the subject of a commercial adventure in books, the purpose of the shipment in question gives to it a different [p. 710] character. The United States, in prosecuting hostilities for the restoration of their constitutional authority, are compelled incidentally to confiscate property captured at sea, of which the proceeds would otherwise increase the wealth of that dis - trict. But the United States are not at war with literature in that part of their territory.” He then referred to the deci - sion in Nova Scotia, and to the French decisions upon cases of fishing vessels, as precedents for the decree which he was about to pronounce; and he added that, without any such precedents, he should have had no difficulty in liberating these books. The Amelia, 4 Philadelphia, 417.

The Paquete Habana, as the record shows, was a fishing sloop of 25 tons burden, sailing under the Spanish flag, running in and out of Havana, and regularly engaged in fishing on the coast of Cuba. Her crew consisted of but three men, including the master; and, according to a common usage in coast fisheries, had no interest in the vessel, but were entitled to two thirds of her catch, the other third belonging to her Spanish owner, who, as well as the crew, resided in Havana. On her last voyage, she sailed from Havana along the coast of Cuba, about two hundred miles, and fished for twenty-five days off the cape at the west end of the island, within the territorial waters of Spain; and was going back to Havana, with her cargo of live fish, when she was captured by one of the blockading squadron, on April 25,1898. She had no arms or ammunition on board ; she had no knowledge of the blockade, or even of the war, until she was stopped by a blockading vessel; she made no attempt to run the blockade, and no resistance at the time of the capture; nor was there any [p. 714] evidence whatever of likelihood that she or her crew would aid the enemy.

The question in that case related to the confiscation of the property of the enemy on land within our own territory, and it was held that property so situated could not be confiscated without an act of Congress. The Chief Justice continued: “ Commercial nations, in the situation of the United States, have always a considerable quantity of property in the pos - session of their neighbors. When war breaks out, the question, what shall be done with enemy property in our country, is a [p. 716] 716 OCTOBER TERM, 1800.