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be applied.

To illustrate: The city might | 1908, § 8 (Comp. St. § 9935), which, after making dumping within certain limits of New York Harbor illegal, and declaring penalties and punishment for persons connected with violating any provision of the act shall be liable such dumping, provides that any vessel used in to the pecuniary penalties imposed thereby, and may be proceeded against summarily by way of libel, conviction and fining of the persons is not a condition precedent to maintenance of the libel.

call on the railroad company to construct and maintain a viaduct over the crossing or a tunnel under it, or might lay on the company the duty of maintaining watchmen or flagmen at the crossing. What it actually does by the ordinance is to call on the company to remove the track from the crossing and avail itself of other accessible and fairly convenient means of getting cars to and from its track east of the crossing. No doubt in this the company will experience some disadvantages, but they will be far less burdensome than would be the construction and maintenance of a viaduct or tunnel, and not much more so than would be the keeping of watchmen or flagmen at the crossing.

The situation is unusual and the ordinance deals with it in a rather practical way. Giving effect to all that appears, we are unable to say that what is required is plainly unreasonable and arbitrary.

Counsel for the company manifest some concern lest the rates for switching cars to and from its track east of the crossing may not be satisfactory, but there hardly can be any real trouble along that line. The rates will be subject to investigation and supervision by public commissions just as are other railroad rates, and possible differences over them will be susceptible of ready adjustment.

[3] The objection that the ordinance offends against the commerce clause of the Constitution is not tenable. The ordinance makes no discrimination against interstate commerce, will not impede its movement in regular course, and will affect it only incidentally and indirectly. South Covington Ry. Co. v. Covington, 235 U. S. 537, 540, 35 Sup. Ct. 158, 59 L. Ed. 350, L. R. A. 1915F, 792; Sligh v. Kirkwood, 237 U. S. 52, 58, 60, 35 Sup. Ct. 501, 59 L. Ed. 835. The case of Kansas City Southern Ry. Co. v. Kaw Valley Drainage District, 233 U. S. 75, 34 Sup. Ct. 564, 58 L. Ed. 857, obviously is not to the contrary.

Judgment affirmed.

(250 U. S. 269)

THE 6 S.

P. SANFORD ROSS, Inc., v. UNITED

STATES.

2. ADMIRALTY 6-ILLEGAL DUMPING IN
NAVIGABLE WATERS-LIBEL AGAINST VES-
SEL-COURT "HAVING JURISDICTION THERE-
OF."

Act June 29, 1888, § 4 (Comp. St. § 9937),
providing that any vessel used in illegal dump-
ing in New York Harbor in violation of the act
may be proceeded against by way of libel in any
District Court of the United States "having
jurisdiction thereof," means any court within
whose jurisdiction she may be found.
3. ADMIRALTY
DATED FINE.

23-ASSESSING UNLIQUI

An unliquidated fine may be assessed in admiralty.

4. ADMIRALTY

23-LIBEL FOR PENALTIES. Jurisdiction of libel against vessel for penalties for illegal dumping in New York Harbor is conferred on a court of admiralty by Act June 29, 1888, § 4 (Comp. St. § 9937), even if not by Judicial Code, § 24, subd. 9 (Comp. St. § 991 [9]), as to enforcement of penalty or

forfeiture under a law of the United States.

Appeal from the District Court of the United States for the Southern District of New York.

Libel by the United States against the scow 6 S; P. Sanford Ross, Incorporated, claimant. Decree for penalty (247 Fed. 348), and claimant appeals. Affirmed.

*Mr. A. Leo Everett, of New York City, for appellant.

Mr. Assistant Attorney General Brown, for the United States.

Mr. Justice PITNEY delivered the opinion of the Court.

This was a libel in rem, brought against a scow under the Act of June 29, 1888, c. 496, 25 Stat. 209 (Comp. St. §§ 9933-9938), as amended by Act Aug. 18, 1894, c. 299, § 3, 28 Stat. 360 (Comp. St. § 9935), and Act May 28, 1908, c. 212, § 8, 35 Stat. 426 (Comp. St. § 9935), for illegal dumping in New York Harbor. Appellant, as claimant of the scow, denied the jurisdiction of the court to enter

(Argued April 24, 1919. Decided June 2, 1919.) tain the suit: First, on the ground that by

No. 301.

1. NAVIGABLE WATERS 26(1⁄2) — ILLEGAL

the statute the vessel was made liable only for such penalties as might be imposed in criminal proceedings upon the persons responsible for the illegal act, and there had Under Act June 29, 1888, §§ 1, 2, 4 (Comp. been in this case no conviction of such perSt. §§ 9933, 9934, 9937), as amended by Act sons or assessment of penalties; and, secondAug. 18, 1894, c. 299, § 3, and Act May 28, | ly, that the assessment of such penalties was

DUMPING-LIBEL AGAINST VESSEL.

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

•270

(39 Sup.Ct.)

not within the admiralty or maritime jurisdiction of the court. A motion to dismiss on this ground was overruled, the court gave judgment against the scow (247 Fed. 348), and the claimant appeals to this court upon the jurisdictional question under section 238, Judicial Code (Act March 3, 1911, c. 231, 36 Stat. 1157 [Comp. St. § 1215]).

"The amount of the several penalties imposed by the foregoing provisions regulating the carriage of passengers in merchant vessels shall be liens on the vessel violating those provisions, Circuit or District Court of the United States and such vessel shall be libeled therefor in any where such vessel shall arrive."

This court said (124 U. S. 580, 8 Sup. Ct. The statute forbids by section 1 the deposit 609, 31 L. Ed. 580) that the penalty recoverof mud, etc., in the tidal waters of New Yorkable against the vessel, and by section 4270 Harbor except within limits prescribed by the supervisor, and provides that

"Every such act is made a misdemeanor, and every person engaged in or who shall aid, abet, authorize, or instigate a violation of this section, shall, upon conviction. *be punishable by fine or imprisonment, or both, such fine to be not less than two hundred and fifty dollars nor more than two thousand five hundred dollars, and the imprisonment to be not less than thirty days nor more than one year, either or both united, as the judge before whom conviction is obtained shall decide."

Section 2 provides that the master, etc., of any vessel towing a scow loaded with prohibited matter to a place of deposit elsewhere than within the limits shall be punishable as provided in section 1, and in addition have his license revoked or suspended.

Section 4 contains provisions for disposal of dredged material, and a penalty for violation thereof, and concludes as follows:

"Any boat or vessel used or employed in violating any provision of this act, shall be liable to the pecuniary penalties imposed thereby, and may be proceeded against, summarily by way of libel in any District Court of the United States, having jurisdiction thereof."

made a lien upon it, was not an additional penalty, but the same which by section 4253 was to be adjudged against the master in the criminal prosecution.

We concur with the District Judge in the view that the case is distinguishable from the present one because of the substantial difference in the applicable provisions of law. The act of Congress here in question imposes a direct liability upon the vessel for clares that it may be proceeded against sumthe pecuniary penalties prescribed, and demarily by libel in any District Court of the United States having jurisdiction thereof. This precludes the idea that the proceeding by libel is to be deferred to await the possibly slow course of criminal proceedings against the persons individually responsible. treats the offending vessel as a guilty thing, upon the familiar principle of the maritime law, and permits a proceeding against her in any court of admiralty "having jurisdiction thereof" meaning any court within whose jurisdiction she may be found.

It

Libels of this character, without previous conviction of the responsible persons, have been entertained under this act from the time of its enactment, and dealt with upon the merits, without question as to the jurisdiction until now. United States v. The Sadie (C. C.) 41 Fed. 396; The G. L. Garlic (D. C.) 45 Fed. 380; The Anjer Head (D. C.) 46 Fed. 664; The Bombay (D. C.) 46 Fed. 665; The Emperor (D. C.) 49 Fed. 751; United States v. Various Tugs and Scows (D. C). 225 Fed. 505; The J. Rich Steers, 228 Fed. 319, 142 C. C. A. 611; The Columbia (C. C. A.) 255 Fed. 515.

[1, 2] The principal contention of appellant is that the purpose of the statute was to make the vessel responsible only for such pecuniary penalties as might be assessed against the offending persons in criminal proceedings, and hence that the conviction and fining of such persons is a condition precedent to the maintenance of a suit against the vessel. In support of this The Strathairly, [3, 4] There is no difficulty, on constitution124 U. S. 558, 8 Sup. Ct. 609, 31 L. Ed. 580, al or other grounds, about assessing an unis cited. That was a suit brought under sec-liquidated fine in the admiralty; and, if it tions 4252, 4253, 4255, 4266, and 4270, Rev. be not a proceeding for enforcement of a penSt., which contained provisions respecting the carriage of passengers on vessels entering or leaving ports of the United States, and prescribed fines and penalties against the master and owner of the vessel violating such provisions. Section 4270 provided:

alty or forfeiture incurred under a law of the United States within the meaning of the ninth subdivision of section 24, Judicial Code (Comp. St. § 991 [9]), the act of 1888 itself confers jurisdiction.

Judgment affirmed.

(250 U. S. 256) company having no monopoly, and its profits LINCOLN GAS & ELECTRIC LIGHT CO. v. not being virtually guaranteed.

CITY OF LINCOLN et al.

(Argued Oct. 5 and 8, 1917. Decided June 2,

1919.) No. 52.

1. EQUITY ~447(1) BILL OF REVIEWLEAVE TO FILE-GROUNDS FOR DENIAL.

Complainant's application to Supreme Court for leave to file bill of review in trial court in suit to enjoin as confiscatory enforcement of ordinance reducing complainant's gas rates from $1.20 to $1, application alleging test, by putting in effect the $1 rate, pending hearing on master's report, showed error in master's finding that increase of consumption would follow reduction in price, will be denied, rate having been put in effect under stipulation that company's act should not be used to influence action of court, whereby defendant was relieved of observing its effect and preparing to meet inferences therefrom; complainant having delayed a practical test for years after it had notice of Supreme Court's view of importance of practical test of prescribed rates before attacking them by suit, and the master's finding as to net return that would have been earned under prescribed rates being vitiated by inclusion as an operating expense of a large invalid

occupation tax.

2. COURTS 263-FEDERAL COURTS-FEDERAL AND NONFEDERAL QUESTIONS.

Even without diversity of citizenship, if a bill in federal court presents a substantial controversy under the Constitution of the United States, and the requisite amount is involved, the jurisdiction extends to the determination of all questions, including questions of state law, and irrespective of the disposition made of the federal questions.

3. COURTS 52-TRANSFER OF JURISDICTION -REVERSAL IN PART-REMAND-FINAL DECREE BELOW.

So much of decree of Circuit Court, in suit attacking gas rate ordinance and occupation tax ordinance, as adjudged occupation tax ordinance void and enjoined its enforcement, having been untouched on appeal by complainant to Supreme Court from the part of the decree dismissing bill as to rate ordinance, is to be considered part of the final decree of District Court, after reversal by Supreme Court and remand to District Court; the District Court's decree, while saying nothing on the subject of the occupation tax ordinance, not modifying the effect of the former decree thereon.

4. GAS 14(2) - RATES-ORDINANCE-REASONABLENESS-INCOME.

Finding that no gas rate prescribed by ordinance yielding as much as 6 per cent. on invested capital can be regarded as confiscatory cannot be approved in view of undisputed evidence that 8 per cent. was the lowest rate sought and generally obtained on investments in banking, merchandising, and other business in the vicinity, 7 per cent. being the legal rate of interest in the state, and the complainant gas

5. APPEAL AND ERROR 1018 REVIEWFINDINGS.

The court on appeal in suit to enjoin enforcement of ordinance fixing gas rates held, having regard for the entire period under investigation, unable to say that the master erred in holding that ordinance was not shown to have been confiscatory.

6. DISMISSAL AND NONSUIT 75-DISMISSAL WITHOUT PREJUDICE.

Decree dismissing bill to enjoin, as confiscatory, enforcement of ordinance fixing gas rates should be without prejudice to bringing new action, if as result of practical test of prescribed rate, or change in conditions, increased cost of labor and materials, and increased rates of return on capital, it appear that the rate has become confiscatory.

Appeal from the District Court of the United States for the District of Nebraska. Suit by the Lincoln Gas & Electric Light Company against the City of Lincoln and others. From an adverse decree, complainant appeals. Modified and affirmed.

*Messrs. Robert Burns, of New York City, E. C. Strode, of Lincoln, Neb., and Charles A. Frueauff, of New York City, for appellant.

Messrs. W. M. Morning, C. Petrus Peterson, and G. W. Berge, all of Lincoln, Neb., for appellees.

Mr. Justice PITNEY delivered the opinion of the Court.

This is an appeal from the final decree of the District Court dismissing the bill of complaint in a suit brought by the Lincoln Gas & Electric Light Company, a Nebraska corporation, against the city of Lincoln and *its officials, praying for an injunction to restrain enforcement of an ordinance of the

city adopted November 19, 1906, which had the effect of reducing complainant's charges for gas from $1.20 to $1 per 1,000 cubic feet, and an ordinance adopted December 10, 1906, assessing an annual occupation tax upon gas companies in the city.

The action was instituted in December, 1906, without previous test of the $1 rate, in the then Circuit Court of the United States for the District of Nebraska. Besides grounds not pressed, the rate ordinance was attacked upon the ground that its enforcement would deprive complainant of its property without due process of law, in contravention of the Fourteenth Amendment. The tax ordinance was attacked upon grounds of state law, and also upon the ground that it was violative of the "due process" and "equal protection" clauses of the Fourteenth Amendment. Upon final hearing the court, by decree entered April 6, 1909, dismissed the bill as to the rate ordi

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

#258

*260

(39 Sup.Ct.)

nance, without prejudice to the commence- Complainant brings the case to this court ment of a new action, but decreed that the by appeal, with about 120 assignments of ordinance levying an occupation tax violated error, one of which is that the District the Constitution of Nebraska and was for Court erred in not decreeing that the occupathis reason illegal, and granted a permanent tion tax ordinance was in violation of the injunction against its enforcement. 182 Fed. Fourteenth Amendment in that it amounted 926. to a denial of the equal protection of the laws.

Upon appeal by complainant to this court it was found that there was a great mass of conflicting evidence relating to the value of complainant's plant, the cost of operation, and the gross and net income; that the case had not been referred to a master, nor had specific findings of fact been made by the court below, but only general conclusions which were found not to be sufficient in view of errors assigned which opened up substantially the entire case. For this reason the decree was reversed, and the cause remanded to the District Court, with directions to refer it to a master with leave to both parties to take additional evidence. A temporary injunction *which had been granted in the court below and continued in force until final decree and afterwards pending the appeal, under a bond conditioned to account for overcharges if the rate ordinance should be sustained, was by the decree of reversal continued in force until final decree in the court below, upon condition that a new bond with sureties was given to account for overcharges to consumers since the original restraining order, in the event the ordinance should be sustained. 223 U. S. 349, 32 Sup. Ct. 271, 56 L. Ed. 466.

[1] Pending the hearing upon the master's report, and on or about May 1, 1915, complainant, notwithstanding the injunction pendente lite, put into effect a net rate of $1 per thousand feet for gas, and has maintained it since.

Upon the strength of this test, and before the argument of this, the second appeal, complainant presented to us a petition for leave to file a bill of review in the court below upon the ground that, according to the master's findings, complainant, in the year 1907, earned so small a return that the rate ordinance would have been confiscatory upon the valuation as found by him, but for this additional finding:

"All human experience has shown that increased consumption follows quickly a reduction in the price of commodities, and the evidence in this case satisfactorily shows that gas is no exception to the rule."

The petition averred that the experience of complainant in an actual test of the reduced rate during a considerable period since May 1, 1915, showed that the view of the master was erroneous, and in fact under actual operating conditions there was no increase of consumption.

The application for leave to file a bill of review will be denied, for the following reasons:

between the parties in the cause to the effect that the action of the company in so doing should not be construed as an acceptance of or compliance with the ordinance in controversy, and should not be "shown in evidence or presented to the court in the aboveentitled cause, or used in any way by either party to influence the action of the court in the disposition of the case." Hence defendant was not called upon *to observe the effect of the reduced rate, or prepare to meet in

Upon the going down of the mandate, the District Court referred the case (July, 1912) to a master, to take the proofs and report his findings of fact and of law. After a full hearing he made an elaborate report (September, 1914), to which complainant filed First, because the $1 rate was put into about 125 exceptions, with a motion to re-effect pursuant to a written stipulation made commit the case to the master for additional findings, which motion was denied. The master found the rate ordinance was not confiscatory, and (differing from the former decision of the Circuit Court) held that the occupation tax ordinance was valid, and included the tax as an operating expense. Upon the hearing of the exceptions the report of the master was confirmed by the District Court, and the bill dismissed as to the rate ordinance, by decree entered September 23, 1915; the judge filing a memorandumferences drawn therefrom. to the effect that he did not agree with the master as to the validity of the occupation tax ordinance, but deemed it unnecessary to pass upon this in the decree, since the result reached by the master would only be strengthened by adjudging the tax invalid, while, if the judge should agree with the master upon that question, he still would confirm the report. In other words, assum-subjecting prescribed rates to the test of ing the occupation tax ordinance to be valid, the addition of this tax to the annual outgoes of complainant would still leave the $1 rate compensatory.

Secondly, because complainant might have made a practical test of the ordinance rate before bringing this suit for an injunction, and certainly ought to have resorted to the test long before it did so. As early as the month of January, 1909, this court, in two notable rate cases, indicated its view of the importance, in any but a very clear case, of

practical experience before attacking them in the courts. Knoxville v. Water Co., 212 U. S. 1, 16, 18, 29 Sup. Ct. 148, 53 L. Ed. 371; Willcox v. Consolidated Gas Co., 212 U. S. 19,

#264

54, 29 Sup. Ct. 192, 53 L. Ed. 382, 15 Ann. ¡cation of the opinion and decree in this Cas. 1034, 48 L. R. A. (N. S.) 1134. When respect, on the ground that the invalidity of those decisions were announced this case the ordinance under the state laws and Conwas pending in the Circuit Court, and short-stitution was not charged in the bill. ly thereafter it was decided adversely to application was denied. complainant upon the question of the validity of the rate, the Knoxville and Willcox Cases being cited. 182 Fed. 926, 929. Then, if not before, complainant might have made a practical test of the sufficiency of the rate, instead of waiting six years longer before doing so. The litigation has been extremely tedious and burdensome to both sides, and it ought now to be brought to a conclusion upon the record as it stands.

This Neither the city nor any other defendant appealed from that part of the decree which adjudged the occupation tax ordinance void and granted an injunction against its enforcement. Complainant appealed only from that part which was adverse to it upon the question of the validity of the rate ordinance. | None of its assignments *of error touched upon the tax ordinance; but in its brief in this court upon the first appeal complainant declared that its bill had assailed the tax ordinance only upon the ground that it was in violation of the equal protection clause of the Fourteenth Amendment; that the bill was

And, thirdly, the argument based upon the master's finding as to the return that complainant would have earned in the year 1907 under the prescribed rates is vitiated by the fact that he included as an operating expense | drawn upon the theory that this ordinance, $4,466, the amount of the estimated occupation tax, which was not paid and (as we shall see) has been conclusively adjudged in this suit to be unenforceable. Eliminating this would increase the net return for the year approximately 1 per cent. upon the investment.

[2, 3] Coming to the merits, we will deal first with the occupation tax ordinance. This is important not only because considerable sums of unpaid taxes have accumulated pending the litigation, but because of the effect of the tax, if sustained, upon the question of the adequacy of the rate.

like the rate ordinance, could only be assailed in a court of the United States upon the ground "that it was violative of the Constitution of the United States," apparently overlooking that, even without diversity of citizenship (and there was none), if the bill presented a substantial controversy under the Constitution of the United States, and the requisite amount was involved, the jurisdiction extended to the determination of all questions, including questions of state law, and irrespective of the disposition made of the federal questions. Greene v. Louisville & Interurban R. R. Co., 244 U. S. 499, * The ordinance imposes an occupation tax 508, 37 Sup. Ct. 673, 61 L. Ed. 1280, Ann. upon all gas companies manufacturing and Cas. 1917E, 88. It was said in the brief that furnishing gas to the inhabitants of the city the decree of the Circuit Court against the of Lincoln equivalent to 21⁄2 per cent. of their validity of the occupation tax ordinance was gross receipts derived from that business. a nullity because the subject-matter was not It was attacked in the bill as being "partial, cognizable in a court of the United States discriminatory, unreasonable, and oppressive and the issue decided was not tendered by in this, it imposes upon your orator an oner- the bill. Upon the ground that the decree ous tax burden to which the business and oc- might constitute no bar to the collection of cupations of other persons within said city the occupation taxes, and the amount of are not subjected"; and the bill alleged, these, if collected, would reduce complainamong other things, that the Lincoln Trac- ant's returns and render the rate ordinance, tion Company held a franchise for furnishing if sustained, still more burdensome, appelelectricity to the public in said city, under | lant asked this court to pass upon the validwhich it was supplying light, heat, and ity of the tax ordinance upon the federal power in competition with complainant's gas grounds asserted in the bill. business, and that the city had not subjected this business of the traction company to any occupation tax; wherefore the ordinance "operates to deprive your orator of the equal protection of the laws, imposes a discriminatory burden upon your orator, and

deprives your orator of its franchise rights and privileges and of its properties without due process of law," thus being violative of the due process and equal protection provisions of the Fourteenth Amendment. The Circuit Court deemed that this raised the question of the invalidity of the ordinance under the uniformity provision of the state Constitution, and held it was invalid as being in contravention thereof. 182 Fed. 926, 927, 929. The city requested a modifi

Naturally this court ignored the suggestion, its jurisdiction over the question not having been invoked by an appeal, and so it happened that the occupation tax ordinance was not mentioned in the opinion or in the mandate.

There is nothing before us to show what decree, if any, was made by the District Court upon the going down of the mandate, beyond a mere order of reference to the master. The final decree made upon the confirmation of his report says nothing upon the subject of the occupation tax ordinance. Its language is:

"That the bill of complaint herein, so far as the same relates to the ordinance of the city of Lincoln establishing a rate of charges for

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