Chicago, Burlington & Quincy Railroad v. Cram

The legislature of a State, when so authorized, by its constitution, has power to impose a limitation of the time for transportation of livestock. " ' . The legislature of a State, when: so authorized by its constitution, has .power to provide a definite measüre of such damages as may be' difficult to estimate or prove for culpable violations of,a statute limiting the time for transportation of livestock. A contention that a statute is ‘unconstitutional under a particular provision of the Constitution cannot be made in this court if not made in the court below. Contracts made after the enaetment of a statute are subject to, and do not impair, it. , . The cattle train speed act of Nebraska establishing a rate of speed on branch lines within the State and imposing' a penalty of $10 per' car per hour, is not unconstitutional under the Fourteenth Amendment as depriving the railroad company of its property without due process of law because it. fixes an arbitrary amount as liquidated damages. '

ERROR TO THE SUPREME COURT OF THE STATE • OP NEBRASKA. The State of Nebraska enacted a law requiring railroads conveying livestock to convey the same at a rate of speed so that the time consumed im a journey from the initial point of receiving the stock to the point of feeding or destination should not exceed one hour for each eighteen miles travel, including the time of stops at stations or other points. It is provided that where the initial point is not a division station, and on all branch lines not exceeding 125 miles in length, the rafe of speed shall be such that' not more than , one hour shall be consumed in traversing each twelve miles of the distance, including stops at stations or other points, from the initial point to the first division station" or over said branches. The time consumed in picking, up and setting out, loading or unloading stock at stations, shall.not be' included in the time required. It. is further provided that upon branch lines, not exceeding 125 miles in length, livestock of less than six cars in one consignment the railroad company may designate three days, in each week as stock-shipping days and' publish and make public the days so designated. After notice of ten days of the days selected and designated the schedule provided in the act shall only apply to such stock-shipping days. It is provided that a carrier “violating any provisions of the' act shall pay to the owner of such livestock, the sum of ten dollars .for each hour for each car it extends or prolongs the time of transportation beyond the period- here limited as liquidated damages to be recovered in an ordinary action, as other debts are recovered:” . The act wás approved March 30, 1905. Nebraska Session Laws, 1905, p. 506, Chapter 107. Defendant in error brought an action against plaintiff in error in the District Court of Garfield County, for the sum of $1770, being the aggregate of twenty-five violations of the act for stock delivered to the railroad-July 14, 1905, and subsequent dates for transportation in full carloads, each violation being made a cause of action, the amount of each varying with the time of prolongation of the transportation of the stock. There was alleged in the cause of action no ground of recovery other than the statute- and the delay in the transportation of the stock. In other words, the time consumed in the transportation of the stock, such time being given and alleged to be “longer than permitted by the statutes of Nebraska, to the damage of the plaintiff ... . as provided for by statutes.” A demurrer was filed to the petition charging that the statute violated the due process and equality clauses of the Fourteenth Amendment of the Constitution of the United States; that the plaintiff (defendant in error) sought “to recover property or money from the defendant without its consent and for the private use of the plaintiff, without compensation, and which recovery, if had, would amount to confiscation of the property of the defendant in violation of the provisions of Article Fourteen of the amendments of the Constitution of the United States. The recovery sought by the plaintiff, if permitted, would be the recovery of a penalty under an act of the legislature which is penal in its character, and it is not such a right as the plaintiff can have, or enforce, in violation -of sec. 5, Art. 8 of the Constitution of Nebraska.” The demurrer was overruled and the defendant answered, alleging the following: The shipments were duly and properly made without unnecessary delay and the consignments carried were each and all duly delivered to the consignee in accordance with the contracts made for the shipment of the stock, and without any fault or negligence on the part of the defendant company. A written contract for each shipment was duly made and entered into by plaintiff and defendant by which it was contracted and agreed that the shipments would not be carried within any specified time, nor to arrive at' destination for any particular market. The damages sought to be recovered are in reality a penalty or forfeiture and that a recovery by plaintiff would be in' violation of the due process and equal protection clauses of the Fourteenth Amendment of the Constitution of the United States. The plaintiff’s cause of action is for the recovery óf a penalty sought to be imposed upon the defendant contrary to the provisions of article 8, § 5 of the constitution of Nebraska, and plaintiff had no right or authority under the law to prosecute the action or to recovery therein. An amended answer was filed which repeated the above and alleged that the stock was accepted and carried according to the laws, rules and usages that regulated and governed common carriers, and in accordance with the schedules for the movement of trains as established and in force at the times the shipments were made. The fine of the defendant’s railroad was alleged, the manner of conducting its business, the times of receiving the various shipments, their arrival at particular stations and at\ destination. A replication was filed to the answer denying its allegations. The case was tried by the court without a jury and judgment was rendered for. plaintiff in the sum of $1640 and costs. The Supreme Court decided that the judgment was excessive in the amounts of $250 and $170 and those sums,..in accordance with the-order of the court, were remitted by the plaintiff, and. with those reductions the judgment was affirmed: 84 Nebraska, 607. The Nebraska statute so far as it creates a determinate and measured pecuniary liability against railroad companies in favor of shippers of livestock in car load lots, of $10 per car per each hour consumed in transportation over a specified speed, schedule, is not a punitive measure, and cannot be upheld as an exercise of the, police power. The Supreme Court of the State construed the statute to be a mere legislative admeasurement and judgment, determining and liquidating'- the amount of pecuniary recovery by a stock shipper in car lots against railroads who failed to attain a. specified rate of speed during the whole course of transportation. The state court agreed that if the imposition was penal in character, it would be void , because forbidden by the state constitution. See Railway Co. v. Baty, 6 Nebraska, 37; Roose v. Perkins, 9 Nebraska, 315; Riewe v. McCormick, 11 Nebraska, 264. Punitive damages are not given in Nebraska in any class of cases between private parties. Compensation, under the rules of law, is all to which a plaintiff is entitled in a civil suit at law. Bolt v. Budwig, 19 Nebraska, 745; Grand Island & W. C. R. Co. v. Swinbank, 51 Nebraska, 525. In Graham v. Kibble, 9 Nebraska, 185, the act there in question was upheld, not as a.punitive imposition, but as a provision for liquidation of compensatory damages. And see Grand, Island & W. C. R. Co. v. Swinbank, supra. Imposition of damages, in favor, of the narrow.class of shippers specified in the act for failure to observe a severe and impractical speed schedule is the equivalent of a rebate.. The' legislatures of the States may not, consistently with the Federal guaranty of due process, determine and liquidate the amount of a pecuniary recovery in damages enforceable in favor of one private suitor .out of the property of another, in advance of the incident creating the right of recovery, and without notice, or opportunity of hearing, to either party. Determination of the amount of-the compensation or the quantum of damages suffered by a shipper of livestock in ear load lots by prolonging the period of transportation, is a judicial function. It reaches and transfers to the shipper the property of railroads; and to whatever department or forum it may be referred, this function can only be exercised by proceedings conformable to the due process clause of the Fourteenth Amendment and in this respect the Nebraska act is unconstitutional. Satterlee v. Matthewson, 2 Pet. 413; Vanhorn v. Dorrance, 2 Dall. 304; Loan Association v. Topeka, 20 Wall. 655, 667; Irrigation District v. Bradley, 164 U. S. 158, 159; Davidson v. New Orleans, 96 U. S. 107; Missouri P. R. Co. v. Nebraska, 164 U. S. 403, 417; Wilkinson v. Leland, 2 Pet. 656; Monongahela Nav. Co. v. United States, 148 U. S. 311, 345; Isom v. Mississippi C. R. Co., 30 Mississippi, 300, 315; C., B. & Q. R. Co. v. Chicago, 165 U. S. 233, 236. While thp property of railroads is employed to .perform the public service of transportation, it is, none the less, private property, under the dominion of private ownership, and within the protection of constitutional guaranties. Missouri P. R. Co. v. Nebraska, 164 U. S. 417; Smyth v. Ames, 169 U. S. 466; Missouri P. R. Co. v. Nebraska, 217 U. S. 196; Chicago, M. & St. P. R. Co. v. Minnesota, 134 U. S. 418, 466. And see also Ives v. South B. R. Co., 200 N. Y. 271. Domestic animals constitute a considerable portion of the national.wealth. The variations in value of different members of the, same species will show, in horses for example, divergencies between $25 and $100,000. Divergencies equally marked in the valuations of individual members exist in all the different species of domestic animals. In our system of government these animals are not subject to be valued by legislative act, any more than are lands or corporate franchises. If the legislature be unfettered in the exercise of this despotic power it may fix the sum or amount of the claim at any figure that suits its will or whim. North Dakota, more moderate than Nebraska, in an act, since held invalid as an undue burden on commerce, fixed $5 per car per each hour as the measure of the stock shipper’s claim for delay in transportation beyond a statutory speed schedule. Douglas v. Northern P. R. Co., 125 N. W. Rep. 475, and see C., R. I. & P. R. Co. v. Witte, 32 Nebraska, 383, 384. So also the legislature, if unfettered in its power to liquidate and measure damages, may supersede the functions of the court and jury by enacting legislation establishing damages in all other classes of cases. Sun Printing and Publishing Co. v. Moore, 183 U. S. 642, distinguished, as was a case enforcing liquidated damages stated by contract. Whether the difficulty in proving the amount of damages is sufficient to relieve the function of determining the amount of recovery from the reach of the.guaranty of due process, is a Federal question upon which the decision of the state court is not controlling. The holding of the state court, that proof of the amount of damages accruing from delay in transporting livestock in . cars is difficult or impossible, is palpably erroneous, contrary to common experience, ,and without any basis or foundation upon which to rest. Previous to the adjudications under review, the Nebraska court had .not found that there was any difficulty in proving the amount of damages actually sustained in such cases. Nelson v. C., B. & Q. R. Co., 78 Nebraska, 57; Denman v. C., B. & Q. R. Co., 52 Nebraska, 140; C., B. & Q. R. Co. v. Williams, 61 Nebraska, 608; Wente v. C., B. & Q. R. Co., 79 Nebraska, 179; Squires v. Elwood, 33 Nebraska, 126; Gillilan v. Rollins, 41 Nebraska, 540; Lee v. Carroll Normal School, 96 N. W. Rep. 65. While the Fourteenth Amendment may not prohibit the States from assigning judicial powers to their legislative assemblies, that judicial power can only be exercised, by any department of the state government, in conformity to the requirement of due process. Obviously the state court did not rest its decision either on the proposition that the state legislature could exercise judicial power, or that the imposition is penal. If this court interprets the imposition on railroad companies in favor of shippers of livestock in car load lots of $10 per car for each hour of delay to be a punishment in the nature of a fine, as it did the Missouri statute in Missouri Ry. Co: v. Humes, 115 U. S. 512, the statute must be held repugnant to the equal protection guaranty. The Constitution of the United States does not prohibit a state legislature from exercising judicial functions, and whether or not it has done so is not a Federal question. Saterlee v. Mathewson, 12 Pet. 380. See also Dryer v. Illinois, 187 U. S. 71, which has been cited, with approval, in Reitz v. Michigan, 188 U. S. 507; Carfer v. Caldwell, 200 U. S. 297; Prentis v. Atlantic Coast Lines, 211 U. S. 225; Soliah v. Heskin, 222 U. S. 522. The object of the-act in . question is the regulation of guasi-public corporations, in thé conduct of their business as- common carriers, and its provisions are clearly within the police power of the State. Every possible presumption is in favor of the validity of a statute, and this continues until the contrary is shown beyond a rational doubt. When a statute is susceptible of two constructions, one making it constitutional and the other unconstitutional, the former must be adopted. Black’s Const. Law, § 30; 8 Cyc. 801, 804; United States v. Delaware, 213 U. S. 407; Knights Templars Co. v. Jarman, 187 U. S. 197, 205; Harriman v. Int. Com. Comm., 211 U. S. 407; Hooper v. California, 155 U. S. 657; A., T. &c. R. R. Co. v. Matthews, 174 U. S. 104. In all of its relations to the public, a railroad company has the character of a public agent, is a gmssi-public corporation, and is subject to any reasonable legislative regulation or control. 2 Elliott on Railroads, §§ 662, 670; 7 Cyc. 447, 448; C., B. & Q. Ry. Co. v. Iowa, 94 U. S. 113; Gladsen v. State, 166 U. S. 427; Wisconsin &c. Ry. Co. v. Jacobson, 179 U. S. 287; Atlantic &c. Ry. Co. v. North Carolina Com., 206 U. S. 1. Legislative power to regulate and-control quasi-public corporations is not confined to railroad- companies alone, but extends to banks, elevator, insurance, gas, water, telephone and- telegraph companies, and all corporations engaged in business of a public nature. Munn v. Illinois, 94 U. S. 113; Orient Ins. Co. v. Daggs, 172 U. S. 557; German Alliance Ins. Co. v. Hale, 219 U. S. 307; Noble State Bank v. Haskell, 219 U. S. 104. The right of the legislature to regulate and control a business affected with a public interest is a part of the police power of the State. 9 Ency. of U. S. Sup. Ct. Dec. 483; Lake Shore. Ry. Co. v. Ohio, 173 U. S. 285; Lake Shore Ry. Co. v. Smith, 173 U. S. 684; Western Un. Tel. Co. v. Pendleton, 122 U. S. 347; C., B. & Q. R. Co. v. Drainage Com., 200 U. S. 561; Bacon v. Walker, 204 U. S. 311; Bank v. Haskell, 219 U. S. 104; German Alliance Ins. Co. v. Hale, 219 U. S. 307; Gladson v. Minnesota, 166 U. S. 427, The fact that the company, was organized under the laws of another State does not affect the right to regulate it. Stone v. Farmers L. & T. Co., 116 U. S. 334; Freund on Police Power, § 398; 33 Cyc. 648; New York &c. R. R. Co., v. New York, 165 U. S. 628; Harrington v. Georgia, 163 U. S. 299. The act -in question is therefore a police regulation. The object and purpose of § 2 are to enforce the regulations provided for in § 1, and to furnish a simple and expeditious remedy to a party injured by a violation thereof. This method of enforcement does not in any manner conflict with the Fourteenth Amendment, or any other provision of the Federal Constitution. Mo. Pac. Ry. Co. v. Hume, 115 U. S. 512; Minneapolis &c. Ry. Co. v. Emmons, 149 U. S. 312; Minneapolis &c. Ry. Co. v. Beckwith, 129 U. S. 31. If, therefore, §.2 provides for a penalty, it is not inimical to the Constitution of the United States. Illinois &c. R. Co. v. Illinois, 163 U. S. 152, distinguished, and see Atchison &c. R. Co. v. Matthews, 174 U. S. 96, 100; Huntington v. Attrill, 146 U. S. 657, 682. If, upon independent inquiry, this court shall determine that the recovery provided for by § 2 is in the nature of a penalty, then its former decisions are conclusive that it does not violate the Fourteenth Amendment. The construction placed upon this act and similar statutes by the Supreme Court of Nebraska does not affirm or deny that the statute is or is not a police regulation ; nor that it is or is not penal in its nature; nor that if it were penal it would or would not violate the state constitution. Counsels’ contention that the court held that it.was penal is based upon the fact that the recovery is termed “liquidated damages;” The statute would not necessarily be unconstitutional if it provided for anything more than compensatory damages, or was in any sense penal. For cases in which penal, or quasi-penal, statutes have been upheld, see Graham v. Kibble, 9 Nebraska, 184; Phœnix Ins. Co. v. Bohman, 28 Nebraska, 251; Phœnix Ins. Co. v. McEvony, 52 Nebraska, 566; Clearwater Bank v. Kurkonski, 45. Nebraska, 1; Deering v. Miller, 33 Nebraska, 655; Hier v. Hutchings, 58 Nebraska, 334. The common-law rule that, in cases showing wanton or malicious injury, punitive damages may'be allowed,— which is still recognized and adhered to by this court and the courts of many States, — has been abrogated in some jurisdictions, including Nebraska. Boyer v. Barr, 8 Nebraska, 68; A. & N. R. Co. v. Baty, 6 Nebraska, 37. This court has sustained punitive damage statutes under the Fourteenth Amendment. Minn. Ry. Co. v. Beckwith, 129 U. S. 27. A. state legislature has the power to fix,, by statute, the maximum, or even the exact amount recoverable by a person sustaining injury from the delinquency of a public, or gmsi-public, agent; and such a statute does not violate any of the provisions of the Fourteenth Amendment. Field’s Law of Damages, § 17. See cases involving the construction and enforcement of insurance statutes fixing penalties and damages. In several of said cases, it is expressly held that the statutory provisions in regard to the amount of the recovery amount to' a statutory liquidation of damages, which become a part of the contract, and must govern notwithstanding any conflicting provisions embodied therein by the parties. Lancashire Inv. Co. v. Bush, 60 Nebraska, 121; Oshkosh Gas Light Co. v. Ins. Co., 71 Wisconsin, 454; Havens v. Ins. Co., 123 Missouri, 403; Orient Insurance Company v. Daggs, 172 U. S. 557; Fidelity Mut. Assn. v. Mettler, 185 U. S. 226. The constitutional guaranties of due.process and equal protection • of law can have no greater force or effect when invoked by a railroad company than when claimed by an insurance corporation. Brady v. Daly, 175 XJ. S. 148. See also statute fixing liquidated damages for infringing patents. Pirkle v. Smith, 42 Fed. Rep. 410. See also for other liquidated damage statutes, Coover v. Walker, 31 Missouri, 574; Carroll v. M. P. Ry. Co., 88 Missouri, 239; Miller v. M. P. Ry. Co., 109 Missouri, 350; Lamphear v. Buckingham, 33 Connecticut, 238; Texas Cent. R. Co. v. Hannoy & Co., 130 S. W. Rep. 250; Orange County v. Harris, 97 California, 600.