US SUPREME COURT DECISIONS

ATLANTIC COAST LINE R. CO. V. FLORIDA, 295 U. S. 301 (1935)

Subscribe to Cases that cite 295 U. S. 301

U.S. Supreme Court

Atlantic Coast Line R. Co. v. Florida, 295 U.S. 301 (1935)

Atlantic Coast Line Railroad Co. v. Florida

No. 344

Argued January 17, 18, 1935

Reargued March 4, 5, 1935

Decided April 29, 1935*

295 U.S. 301

Syllabus

Higher intrastate rates were substituted for lower intrastate rates by an order of the Interstate Commerce Commission upon the ground that the lower ones were so low as to result in unjust discrimination against interstate commerce. The order was upheld chanrobles.com-red

Page 295 U. S. 302

by a decree of the federal District Court dismissing complaints of the State and interested shippers, seeking injunctions. This Court reversed the decree because the order was not supported by proper findings ( 282 U. S. 282 U.S. 194), whereupon the Commission after reinvestigation made a new order, upon the same ground as before, which reinstated the higher rates for the future and which, being supported by adequate findings, was sustained in further litigation ( 292 U. S. 292 U.S. 1). In the interim between the first order and the decree enjoining its execution, the carrier had collected the higher rates. The State and other plaintiffs in the original suit applied to the District Court for a supplementary decree requiring the carrier to return the excess of such collections over the lower rates.

Held:

1. That the claim of restitution was without equity as to all or any part of such excess. Pp. 295 U. S. 316-317.

2. A cause of action for restitution upon reversal of a judgment belongs to the class of actions for money had and received. The remedy is equitable in origin and function, and the claimant, to prevail, must show that the money was received in such circumstances that the possessor cannot in equity and good conscience retain it. The question is not whether the law would put the defendant in possession of the money if the transaction were a new one, but whether the law will take it out of his possession after he has been able to collect it. P. 295 U. S. 309.

3. Award of restitution after reversal of a judgment is ex gratia, resting in sound discretion, and will not be ordered where the justice of the case does not call for it. P. 295 U. S. 310.

4. The Interstate Commerce Commission has jurisdiction, exclusive of that of any court, to set aside intrastate rates which discriminate unduly against interstate commerce, but its order is prospective only, and it cannot in such case give reparation for the past. P. 295 U. S. 311.

5. The order that first substituted the higher rates in this case was voidable, not void, and the carrier was not at liberty to disobey it. P. 295 U. S. 311.

6. The absence of an equity to restitution in this case is apparent from the findings of the trial court confirming the reports and findings of the Interstate Commerce Commission whereby it appears that the lower rates were discriminatory against interstate commerce, and therefore forbidden and declared unlawful under § 13(4) of the Interstate Commerce Act, from the time of chanrobles.com-red

Page 295 U. S. 303

the Commission's first order, and that the higher rates ordered by it would have been the only lawful ones through the period in question but for a mere slip in procedure. P. 295 U. S. 312.

7. The carrier's equity is reinforced by the fact that the lower rates would be confiscatory if enforced by the State after suitable challenge by the carrier. P. 295 U. S. 313.

8. Assuming that the carrier's only remedy under the state law for escaping the lower rates, though they were voluntarily initiated, was by administrative proceedings, followed, if necessary, by action in court, it does not follow that their confiscatory character is not to be considered as bearing on the carrier's equity in this case. P. 295 U. S. 313.

9. In cases of this kind, the tests of conscience and fair dealing are the same whether the claim of restitution be based on contract or on statute. P. 295 U. S. 314.

10. The power of the District Court to compel restitution is ancillary to the power to determine whether the challenged orders of the Commission should be vacated or upheld. P. 295 U. S. 314.

11. In the exercise of this ancillary power, the court was not called upon to lend its aid to a forbidden practice, and, in the absence of any equities of the State or the shippers, it should stay its hand, leaving the parties where it finds them. P. 295 U. S. 314.

12. This mere inaction of the federal court is not an assumption of the ratemaking power, nor an encroachment upon the powers of the State. P. 295 U. S. 315.

13. Restitution in this case is denied in toto, since the determination of the Interstate Commerce Commission, though not res judicata in respect of past transactions, is entitled to great weight as evidence of the reasonableness of the rates collected, and the claimants have failed to prove them unreasonable. P. 295 U. S. 317.

Reversed.

Cross-appeals from a decree of the District Court of three judges requiring the Railroad Company to refund to shippers (but in part only) moneys collected by it in excess of the lawful state rates on intrastate consignments of lumber. The collections were made under color of an order of the Interstate Commerce Commission, sustained by the District Court, but adjudged invalid by this Court on appeal. 282 U. S. 282 U.S. 194. See also 292 U. S. 292 U.S. 1. After the case had been argued at this Term, the Court called for reargument upon the following questions:

(1) Whether the District Court had jurisdiction to award restitution, or should exercise such jurisdiction in a case of this character relating to intrastate rates. (2) If the District Court had such jurisdiction and should exercise it in a case of this character relating to the revenue needs of the carrier, what should be the measure of an award of restitution. And (3) in such an inquiry, what effect, evidentiary or otherwise, should be attributed to the proceedings before, and findings of, the Interstate Commerce Commission. chanrobles.com-red

Page 295 U. S. 305



























chanrobles.com



ChanRobles Legal Resources:

ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review : www.chanroblesbar.com

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line : www.chanroblesmcleonline.com