. 1921. NEW YORK v. UNITED STATES. amendment. a contract, under an unlimited and in-, 833; Adams Exp. Co. v. South Dakota, terminable exercise of its war powers. 244 U. S. 617, 619, 620, 61 L. ed. 1352, Hepburn v. Griswold, 8 Wall. 603, 623, 1355, 1356, P.U.R.1917F, 45, 37 Sup. Ct. 19 L. ed. 513; Sinking Fund Cases, 99 Rep. 656; Illinois C. R. Co. v. State U. S. 700, 718, 719, 25 L. ed. 496, 501; Public Utilities Commission, 245 U. S. St. Anthony Falls Water Power Co. v. 493, 495, 496, 62 L. ed. 425, 427, P.U.R. The states, under the Constitution, St. Paul Water Comrs. 168 U. S. 372, 1918C, 1279, 38 Sup. Ct. Rep. 170. 42 L. ed. 505, 18 Sup. Ct. Rep. 157; Legal Tender Cases, 12 Wall. 457, 581, 20 L. have the right to regulate commerce ed. 287, 322; Citizens' Sav. & L. Asso. within their respective borders. Conit except by constitutional v. Topeka, 20 Wall. 655, 663, 664, 22 gress has not that right, and cannot L. ed. 455, 461; Fletcher v. Peck, 6 acquire Cranch, 87, 3 L. ed. 162; Planters' Bank v. Sharp, 6 How. 301, 319, 12 L. ed. 447, 455; Dakota Cent. Teleph. Co. v. South Dakota, 250 U. S. 163, 187, 63 L. ed. 910, 925, 4 A.L.R. 1623, P.U.R. 1919D, 717, 39 Sup. Ct. Rep. 507; Lake Shore & M. S. R. Co. v. Smith, 173 U. S. 685, 43 L. ed. 859, 19 Sup. Ct. Rep. 565; Baltimore & O. R. Co. v. Maryland. 21 Wall. 456, 22 L. ed. 678; Quimby v. Public Service Commission, 223 N. Y. 244, 3 A.L.R. 685, P.U.R.1918D, 30. 119 N. E. 433; Osborne v. Florida, 164 U. S. 650, 41 L. ed. 586, 17 Sup. Ct. Rep. 214; Pullman Co. v. Kansas, 216 U. S. 56, 54 L. ed. 378, 30 Sup. Ct. Rep. 232; Northern Securities Co. v. United States, 193 U. S. 197, 48 L. ed. 679, 24 Sup. Ct. Rep. 436; International Bridge Co. v. New York, 254 U. S. 126, 65 L. ed. 176, 41 Sup. Ct. Rep. 56; Erie R. Co. v. Board of Public Utility Comrs. 254 U. S. 394, 65 L. ed. 322, 41 Sup. Ct. Rep. 169. The order of the Interstate Commerce Illinois C. R. Co. v. Public Utilities Congress did not attempt to enlarge Interstate Commerce Commission v. The doctrine of the so-called Shreve- state commerce. Minnesota Rate Cases (Simpson v. 66 L. ed. Munn v. Illinois, 94 U. S. 113, 124, 24 L. ed. 77, 83; Gibbons v. Ogden, 9 Wheat. 1, 195, 6 L. ed. 23, 69; Passenger Cases, 7 How. 283, 394, 12 L. ed. 702, 748; Mobile County v. Kimball, 102 U. S. 691, 699, 26 L. ed. 238, 240; Railroad Commission Cases, 116 U. S. 307, 325, 29 L. ed. 636, 642, 6 Sup. Ct. Rep. 334, 388, 1191; Baltimore & O. R. Co. v. Maryland, 21 Wall. 456, 22 L. ed. 678; Chicago, B. & Q. R. Co. v. Iowa (Chicago B. & Q. R. Co. v. Cutts) 94 U. S. 155, 24 L. ed. 94; Peik v. Chicago & N. W. R. Co. 94 U. S. 164, 24 L. ed. 97; Winona & St. P. R. Co. v. Blake, 94 U. S. 180, 24 L. ed. 99; Ruggles v. Illinois, 108 U. S. 526, 531, 27 L. ed. 812, 815, 2 Sup. Ct. Rep. 832; Wabash, St. L. & P. R. Co. v. Illinois, 118 U. S. 557, 564, 565, 30 L. ed. 244, 246, 247, 1 Inters. Com. Rep. 31, 7 Sup. Ct. Rep. 4; Sands v. 288, 31 L. ed. 149, 8 Sup. Ct. Rep. 113; Manistee River Improv. Co. 123 U. S. Dow v. Beidelman, 125 U. S. 680, 31 Sup. Ct. Rep. 1028; Chicago, M. & St. L. ed. 841, 2 Inters. Com. Rep. 56, 8 P. R. Co. v. Minnesota, 134 U. S. 418, 33 L. ed. 970, 3 Inters. Com. Rep. 209, G. T. R. Co. v. Wellman, 143 U. S. 339, 10 Sup. Ct. Rep. 462, 702; Chicago & 36 L. ed. 176, 12 Sup. Ct. Rep. 400; Covington & C. Bridge Co. v. Kentucky, 154 U. S. 204, 38 L. ed. 962, 4 Inters. St. Louis & S. F. R. Co. v. Gill, 156 Com. Rep. 649, 14 Sup. Ct. Rep. 1087; U. S. 649, 39 L. ed. 567, 15 Sup. Ct. Rep. 484; Texas & P. R. Co. v. Interstate Commerce Commission, 162 U. S. 405, 16 Sup. Ct. Rep. 666; Smyth v. 197, 40 L. ed. 940, 5 Inters. Com. Rep. Ames, 169 U. S. 466, 42 L. ed. 819, 18 Sup. Ct. Rep. 418; Reid v. Colorado, 23 Sup. Ct. Rep. 92, 12 Am. Crim. Rep. 187 U. S. 137, 147, 47 L. ed. 108, 114, 506; Cummings v. Chicago, 188 U. S. 410, 427, 47 L. ed. 525, 530, 23 Sup. Ct. Rep. 472; Gulf, C. & S. F. R. Co. v. Texas, 204 U. S. 403, 413, 51 L. ed. 510, Co. v. United States, 222 U. S. 20, 26, 545, 27 Sup. Ct. Rep. 360; Southern R. 156 L. ed. 72, 74, 32 Sup. Ct. Rep. 2, 3 +387 L. ed. 1341, 34 Sup. Ct. Rep. 833; M'Culloch v. Maryland, 4 Wheat. 316, 420, 4 L. ed. 579, 605. N. C. C. A. 822; Chicago, M. & St. P., R. Co. v. Iowa, 233 U. S. 334, 343, 58 L. ed. 988, 992, 34 Sup. Ct. Rep. 592; Pennsylvania R. Co. v. Mitchell Coal & Coke Co. 238 U. S. 251, 253, 59 L. ed. P. Thom argued the cause, and, with Messrs. Walter C. Noyes and Alfred 1293, 1294, 35 Sup. Ct. Rep. 787; Arka- Messrs. George F. Brownell, W. S. Jendelphia Mill. Co. v. St. Louis Southwestern R. Co. 249 U. S. 134, 151, 152, J. Beattie, D. E. Minard, and William ney, C. L. Andrus, R. W. Barrett, John 63 L. ed. 517, 527, P.U.R.1919C, 710, 39 D. Waldron, filed a brief for the RailSup. Ct. Rep. 237; Public Utilities Com-road Companies: mission v. Landon, 249 U. S. 236, 245, 63 L. ed. 577, 586, P.U.R.1919C, 834, 39 Sup. Ct. Rep. 268; Southern P. Co. v. Arizona, 249 U. S. 472, 477, 63 L. ed. 713, 716, P.U.R.1919D, 462, 39 Sup. Ct. Rep. 313; South Covington & C. Street R. Co. v. Kentucky, 252 U. S. 399, 64 L. ed. 631, 40 Sup. Ct. Rep. 378; Cincinnati, C. &. E. R. Co. v. Kentucky, 252 U. S. 408, 64 L. ed. 637, 40 Sup. Ct. Rep. 381. Solicitor General Beck argued the cause for the United States. Mr. Patrick J. Farrell argued the cause and filed a brief for the Interstate Commerce Commission: In making the order here involved, the Commission did not act arbitrarily. Houston, E. & W. T. R. Co. v. United States, 234 U. S. 342, 351, 352, 58 L ed. 1341, 1348, 1349, 34 Sup. Ct. Rep. 833. In making said order the Commission acted in conformity with the authority conferred and the duties imposed upon it by the Interstate Commerce Act. Baltimore & O. R. Co. v. Interstate Commerce Commission, 221 U. S. 612, 618, 55 L. ed. 878, 882, 31 Sup. Ct. Rep. 621; Southern R. Co. v. United States, 222 U. S. 20, 26, 27, 56 L. ed. 72, 74, 75, 32 Sup. Ct. Rep. 2, 3 N. C. C. A. 822; Second Employers' Liability Cases (Mondou v. New York, N. H. & H. R. Co.) 223 U. S. 1, 48, 51, 56 L. ed. 327, 344, 346, 38 L.R.A.(N.S.) 44, 22 Sup. Ct. Rep. 169, 1 N. C. C. A. 875; Interstate Commerce Commission v. Goodrich Transit Co. 224 U. S. 194, 205, 213, 56 L. ed. 729, 733, 737, 32 Sup. Ct. Rep. 436; Minnesota Rate Cases (Simpson v. Shepard) 230 U. S. 352, 431, 57 L. ed. 1511, 1554, 48 L.R.A. (N.S.) 1151, 33 Sup. Ct. Rep. 729, Ann. Cas. 1916A, 18; Illinois C. R. Co. v. Behrens, 233 U. S. 473, 58 L. ed. 1051, 34 Sup. Ct. Rep. 646, Ann. Cas. 1914C, 163, 10 N. C. C. A. 153. The provisions of law involved are not in conflict with the Constitution of the United States. Gibbons v. Ogden, 9 Wheat. 1, 196, 6 L. ed. 23, 70; Houston, E. & W. T. R Co. v. United States, 234 U. S. 342, 58 The power of Congress to regulate commerce is plenary. It is a unitary Power, and is to prescribe the rules and all the rules by which commerce is to be governed. Minnesota Rate Cases (Simpson v. Shepard) 230 U. S. 352, 57 L. ed. 1511, 48 L.R.A.(N.S.) 1151, 33 Sup. Ct. Rep. 729, Ann. Cas. 1916A, 18; Houston, E. & W. T. R. Co. v. United States, 234 U. S. 342, 58 L. ed. 1341, 34 Sup. Ct. Rep. 833; Gulf, C. & S. F. R. Co. v. Hefley, 158 U. S. 98, 39 L. ed. 910. 15 Sup. Ct. Rep. 802; Northern P. R. Co. v. North Dakota, 250 U. S. 135, Ct. Rep. 502, 18 N. C. C. A. 878; Illi63 L. ed. 897, P.U.R.1919D, 705, 39 Sup. nois C. R. Co. v. Public Utilities Commission, 245 U. S. 493, 62 L. ed. 425, American Exp. Co. v. South Dakota, 244 P.U.R.1918C, 1279, 38 Sup. Ct. Rep. 170; U. S. 617, 61 L. ed. 1352, P.U.R.1917F, 45, 37 Sup. Ct. Rep. 656. trol of interstate commerce requires the The extent to which the adequate conregulation of intrastate commerce is for the determination of Congress. The ment of Congress in such matter. Transportation Act expresses the judg Shepard) 230 U. S. 352, 432, 57 L. ed. 1511, 1555, 48 L.R.A. (N.S.) 1151, 33 Sup. Ct. Rep. 729, Ann. Cas. 1916A, 18. Minnesota Rate Cases (Simpson v. The findings of the Commission, that discriminations between persons and places in intrastate commerce, on the one hand, and interstate commerce, on the other, existed, were based upon evidence before it and are conclusive. The order in question may be sustained on this account alone. Manufacturers R. Co. v. United States, 246 U. S. 457, 481, 62 L. ed. 831, 844, 38 Sup. Ct. Rep. 383; Seaboard Air Line R. Co. v. United States, 254 U. S. 57, 62, 65 L. ed. 129, 133, 41 Sup. Ct. Rep. 24; Los Angeles Switching Case (Interstate Commerce Commission v. Atchison, T. & S. F. R. Co.) 234 U. S. 294, 58 L. ed. 1319, 34 Sup. Ct. Rep. 814; Kansas City Southern R. Co. v. United States, 231 U. S. 423, 58 L. ed. 296, 52 L.R.A. (N.S.) 1, 34 Sup. Ct. Rep. 125; Skinner & E. 1921. NEW YORK v. UNITED STATES. Corp. v. United States, 249 U. S. 557, 63 The Transportation Act goes much further than to provide for the removal of discriminations against persons and places in interstate commerce. Its aim is the protection and development of interstate commerce itself, and it deals with discriminations against it. Shreveport Case (Houston, E. & W. T. R. Co. v. United States) 234 U. S. 342, 351, 58 L. ed. 1341, 1348, 34 Sup. Ct. Rep. 833; Willcox v. Consolidated Gas Co. 212 Ú. S. 19, 49, 53 L. ed. 382, 398, 48 L.R.A. (N.S.) 1134, 29 Sup. Ct. Rep. 192, 15 Ann. Cas. 1034; Lincoln Gas & E. L. Co. v. Lincoln, 250 U. S. 256, 63 L. ed. 968, 39 Sup. Ct. Rep. 454. The commerce power, standing alone, is adequate to support the regulation by Congress, contained in 3 and 4 of § 13 of the Interstate Commerce Act, of the state rates of carriers engaged in interstate commerce. Houston, E. & W. T. R. Co. v. United States, 234 U. S. 351, 352, 58 L. ed. 1348, 1349, 34 Sup. Ct. Rep. 833; American Exp. Co. v. South Dakota, 244 U. S. 617, 624, 625, 61 L. ed. 1352, 1357, 1358, P.U.R.1917F, 45, 37 Sup. Ct. Rep. 656; Illinois C. R. Co. v. Public Utilities Commission, 245 U. S. 506, 62 L. ed. 437, P.U.R.1918C, 1279, 38 Sup. Ct. Rep. 170; Louisville Bridge Co. v. United States, 242 U. S. 417, 61 L. ed. 400, 37 Sup. Ct. Rep. 158; Newport & C. Bridge Co. v. United States, 105 U. S. 480, 26 L. ed. 1147; California v. Central P. R. Co. 127 U. S. 39, 32 L. ed. 157, 2 Inters. Com. Rep. 153, 8 Sup. Ct. Rep. 1073; First Nat. Bank v. Fellows, 244 U. S. 420, 61 L. ed. 1237, L.R.A.1918C, 283, 37 Sup. Ct. Rep. 734, Ann. Cas. 1918D, 1169; M'Culloch v. Maryland, 4 Wheat. 316, 4 L. ed. 579; Osborn v. Bank of United States, 9 Wheat. 738, 6 L. ed. 204; Minnesota Rate Cases (Simpson v. Shepard) 230 U. S. 399, 411, 57 L. ed. 1541, 1546, 48 L.R.A. (N.S.) 1151, 33 Sup. Ct. Rep. 729, Ann. Cas. 1916A, 18; Hammer v. Dagenhart, 247 U. S. 269, 62 L. ed. 1104, 3 A.L.R. 649, 38 Sup. Ct. Rep. 529, Ann. Cas. 1918E, 724: Cook v. Pennsylvania, 97 U. S. 566, 24 L. ed. 1015. 878; Hamilton v. Kentucky Distilleries The power to establish postoffices and California v. Central P. R. Co. 127 Mr. John E. Benton, as amicus curia Mr. Chief Justice Taft delivered the opinion of the court: This was a bill in equity against the merce Commission and others, brought by United States and the Interstate Comthe state of New York and its attorney general, to annul and enjoin the enforcement of an order of the Interstate Commerce Commission, requiring the interstate railroads operating in intrastate commerce in the state of New York to charge in such commerce 3.6 cents a mile for all passengers, 20 per cent increase over the then excess baggage rates to intrastate passengers, a surcharge of 50 per cent of the charges for space in sleeping cars [598] to such passengers, and 20 per cent increase in intrastate rates on milk, all for the purpose of bringing the intrastate rates to the level of the intermission. The bill was filed under and by state rates previously fixed by the Comvirtue of the statute repealing the Commerce Court Act and conferring jurisdiction on the district court. October 22, 1913, 38 Stat. at L. 219, chap. 32. The application for an interlocutory injunetwo district judges. Then a final hearing tion was heard by a circuit judge and Northern P. R. Co. v. North Dakota, was had, and the court entered a final 250 U. S. 135, 63 L. ed. 897, P.U.R.1919D, | decree dismissing the complaint, from The war power, standing alone, is adequate to sustain the validity of the power exercised by Congress with reference to the state rates of carriers engaged in interstate commerce, by 3 and 4 of § 13 of the Interstate Commerce Act. 66 L. ed. 389 which this appeal has been taken. The, into intrastate journeys to Buffalo from railroad companies affected by the order were, on their petition, permitted to intervcne, and are here as appellees. It appears from the record that, in the proceeding by the Interstate Commerce Commission to fix interstate commerce rates, to comply with the requirements of § 15a of the Interstate Commerce Act, added by § 422 of the Transportation Act of February 28, 1920 (41 Stat. at L. 488, chap. 91), a proceeding known as Ex parte 74, Increased Rates, 58 Inters. Com. Rep. 220,-the Commission, after conference with a committee representing all the state commerce commissions and authorities, authorized the group of interstate railroads, of which the railroads operating in New York were a part, to raise their freight rates 40 per cent, their passenger rates and excess baggage charges 20 per cent, and to add a surcharge of 50 per cent for passengers on sleeping cars. As soon as the order in Ex parte 74 was made, the railroads concerned applied to the Public Service Commission of the State of New York for similar increases in intrastate rates. That commission granted the increase in freight rates, but denied it as to milk rates and passenger fares. The passenger intrastate fare were 3 cents a mile under the order of the President during the war control, but when that should become ineffective, a statute of New York, fixing passenger fares on the New York Central Railroad from Albany to Buffalo at 2 [599] cents a mile, would come into force and operation. As soon as the state commission made its ruling, the railroads applied to the Interstate Commerce Commission under § 13 of the act, of which proceeding notice was given to the state of New York, the attorney general, and the Public Service Commission, all of whom appeared, for an order directing the railroads to put intrastate passenger fares, excess baggage charges, sleeping car surtaxes, and milk rates on the same level with interstate rates. Proof was offered by the railways to show that conditions of operation in state and interstate passenger traffic were alike, and there was no showing otherwise. The record in Ex parte 74 was put in evidence. There was evidence also to show that at Buffalo and other border points the difference between the interstate and intrastate fares would divert business from the interstate lines between New York city and Buffalo to the New York Central lines, and that the same difference would break up interstate journeys to the West New York, and an interstate journey beyond, thus reducing interstate travel and discriminating against passengers carried therein. Evidence was adduced to show the injury to interstate business in the transportation of milk from the country to New York city from points outside of the state, in competition with intrastate traffic in this necessity of life. No investigation was made into suburban commuter travel, and it is excluded by the Commission from the scope of the order which it made. The order was state-wide in its effect, and required all interstate carriers to bring their intrastate milk rates, their intrastate passenger fares, except commuters' rates, excess baggage charges, and sleeping car surcharges to a level with interstate fares and rates, as ordered in Ex parte 74. The Commission introduced a saving clause in its findings by which the New York authorities or any other interested parties were given leave to apply for modification of its order or [600] findings as to any intrastate fares, charges, or rates included therein, on the ground that the latter were not related to interstate fares, charges, or rates in such a way as to contravene the provisions of the Interstate Commerce Act. Under this clause, at least one petition has been filed by a railroad, and the railroad excepted from the order. The district court dismissed the bill. This case differs from the Wisconsin Rate Case just decided [257 U. S. 563, ante, 371, 22 A.L.R. 1086, 42 Sup. Ct. Rep. 232], in that it is a direct proceeding to annul or set aside the order of the Interstate Commerce Commission complained of, brought against the United States and the Commission under the statute. Skinner & E. Corp. v. United States, 249 U. S. 557, 63 L. ed. 772, 39 Sup. Ct. Rep. 375. The Wisconsin Case was a suit by a railroad against the state authorities to prevent the latter from penalizing the railroad for complying with the order of the Commission. To this suit the United States and the Commission were not parties. The defense of the state authorities was a collateral attack upon the order, to prevail in which, they were obliged to show that the order was void on the face of the findings without regard to the evidence or the absence of it. In the case before us, the complainants are entitled to rely on the absence of any substantial evidence to sustain a material finding as a basis for attacking the order. The first objection of the appellants is that there was no sufficient evidence of discrimination against persons and localities under § 13, ¶ 4, § 416 of the Transportation Act of 1920, to justify a statewide order of the kind here made. We have considered this objection in the Wisconsin Case on a similar showing on the findings. Here we consider it on the evidence. We reach the same conclusion here and sustain the objection. Interstate Commerce Commission. If the lower level of intrastate fares and rates is to be maintained, it will discriminate against interstate commerce, in that it will require higher fares and rates in the interstate commerce of [602] the state to secure the income for which the Interstate Commerce Commission must attempt to provide by fixing rates under § 15a of the Interstate ComThe next objection is that the state merce Act, as amended by § 422 of has a charter contract with the New York the Transportation Act of 1920 (41 Central Railroad Company by [601] Stat. at L. 456, 488, chap. 91), in which the latter is bound not to charge carrying out the declared congressional more than 2 cents a mile for passenger purpose "to provide the people of the carriage between Albany and Buffalo, United States with adequate transportaand that if the Transportation Act tion." As we have just held in the Wispermits the Interstate Commerce Com-consin Case, this constitutes "undue, unmission, by such an order, to enable reasonable, and unjust discrimination the railroad company to violate its against interstate commerce," which is contract, it impairs the obligation of declared to be unlawful and prohibited by a contract, in violation of § 10, article § 13, ¶ 4, of the Interstate Commerce Act, 1, of the Federal Constitution. That as amended by § 416 of the Transportasection provides that "no state shall tion Act of 1920 (41 Stat. at L. 456, pass a law impairing 484, chap. 91), and which the Interstate the obligation of contracts," and does not Commerce Commission is authorized in terms restrict Congress or the United therein to remove by fixing intrastate States. But it is said that it deprives rates for the purpose. We need not New York and her people of property repeat our reasons for our ruling. Nor without due process of law. We said in need we consider and give again the Addyston Pipe & Steel Co. v. United grounds upon which we hold § 13, ¶ 4, States, 175 U. S. 211, 230, 44 L. ed. as thus construed, to be valid under the 136, 143, 20 Sup. Ct. Rep. 96: "Anything | Constitution of the United States. which directly obstructs and thus regulates that commerce which is carried on among the states, whether it is state legislation or private contracts between individuals or corporations, should be subject to the power of Congress in the regulation of that commerce." Louisville & N. R. Co. v. Mottley, 219 U. S. 467, 55 L. ed. 297, 34 L.R.A.(N.S.) 671, 31 Sup. Ct. Rep. 265. See also Scranton v. Wheeler, 179 U. S. 141, 162, 163, 45 L. ed. 126, 137, 21 Sup. Ct. Rep. 48; Union Bridge Co. v. United States, 204 U. S. 364, 400, 51 L. ed. 523, 539, 27 Sup. Ct. Rep. 367. The decree of the District Court, dismissing the bill of complaint, is affirmed JULIUS F. SMIETANKA, as Collector of Internal Revenue for the First District of Illinois, Petitioner, V. FIRST TRUST & SAVINGS BANK, Trus tee under the Last Will and Testament of Otto Young, Deceased, Respondent. (See S. C. Reporter's ed. 602–607.) Internal revenue - income tax -accumulations for unborn or unascertained beneficiaries. The main objections to the order are the same as those presented, considered, and overruled in the Wisconsin Rate Case, just decided. The evidence in this ease shows that if the passenger and other rates here in controversy were to continue in force as ruled by the Public Service Commission of New York, the annual gross revenues of the interstate railroad's operating in the state of New York from both interstate and intrastate passenger and milk business would be Argued January 19, 1922. less, by nearly twelve millions of dollars, than those revenues if the intrastate Income held and accumulated by a trustee for the benefit of unborn and unable by any language in the Income Tax Law of October 3, 1913, and such omission cannot be supplied by judicial construction. [For other cases, see Internal Revenue, III. b, in Digest Sup. Ct. 1908.] ascertained beneficiaries was not made tax [No. 540.] ruary 27, 1922. Decided Feb N Writ of Certiorari to the United fares and rates were on the same level Ottes Circuit Court of Appeals for as the interstate rates, as fixed by the |