Mr. KNAPP. The typewritten memorandum that I brought with reference to the Townsend bill I am perfectly willing to leave with the committee.

The CHAIRMAN. Give it to the stenographer, and it will be incorporated in the hearing.

[Thereupon, at 11.45 o'clock a. m., the committee adjourned until to-morrow morning at 10 o'clock.]

Following is the memorandum submitted by Mr. Knapp:

Memorandum relating to House bill 17356, submitted to the House Committee on Interstate and Foreign Commerce February 18, 1910, on behalf of the Interstate Commerce Commission.

It is extremely gratifying to the commission that this measure embodies most, if not all, of the principal recommendations heretofore made to the Congress, except the valuation of railroad properties, and also contains provisions of great importance, which, in their general scope and purpose, are unanimously indorsed. There are, however, some features of the bill which do not receive our assent and to which we respectfully call your attention.

THE COURT OF COMMERCE.

1. The commission does not approve the manner in which a commerce court is to be created under this bill, but believes that such a court should be composed of judges appointed thereto by the President and remaining permanently therein. 2. Assuming, as we do, that it is so intended, and to remove any doubt that may hereafter arise, we strongly recommend that the bill be so amended as to contain the explicit statement that the commerce court shall have no jurisdiction or power over orders of the commission not now possessed by circuit courts of the United States as defined and limited by the Supreme Court in the "car distribution" cases, so called, which were recently decided. Therefore we desire to have the language of the bill expressly limit the jurisdiction of the court of commerce as the Supreme Court has in effect limited the jurisdiction of circuit courts under the present law, by holding in substance that orders of the commission involving the exercise of judgment and discretion are not open to review by the courts unless (a) the commission has acted without jurisdiction or (b) made an order which operates to deprive the carrier of its property without due process of law.

To this end we propose the following amendment: After the word "exclusive," in line 12, page 2, insert "but nothing in this act contained shall be construed to give the court of commerce in such cases any jurisdiction or authority not now possessed by circuit courts of the United States or the judges thereof." Strike out the words "but this act," in said line 12, and insert "this act, however."

3. We are of the opinion that a single judge of the commerce court should not be empowered to stay an order of the commission, and therefore recommend that the words "a judge of said court," in line 25, page 9, be stricken out and the words "said court, or a majority of the judges thereof," inserted.

SUSPENDING RATE CHANGES.

We are of opinion that the commission should have power to suspend rate changes for a longer period than sixty days, in order that there may be reasonable time for investigation, especially in view of the fact that no final order after hearing can take effect, under the present law, until at least thirty days after it is made.

We therefore recommend that the word "sixty," in line 1, page 18, be stricken out and the words "one hundred and twenty" inserted in lieu thereof.

THROUGH ROUTES AND JOINT RATES.

The authority of the commission to establish through routes under the present law is limited by a proviso which prevents such action when a "reasonable or satisfactory" through route already exists. This proviso is eliminated in the Townsend bill, as it should be, but a new limitation is introduced which we think should be stricken out or materially modified. In our judgment the commission should have power to compel through routes and joint rates whenever in its opinion they are required by public necessity or convenience, notwithstanding there may be a reasonable and satisfactory route in existence and although such additional route might include less than the

entire line of a road or system having an established route between the same termini. We therefore recommend that lines 24 and 25 on page 18, and the first 7 lines on page 19, be stricken out and the following inserted in lieu thereof: "And in establishing any such through route the commission shall embrace therein all of a carrier's line between the termini or so much thereof as in its opinion may be required by public necessity or convenience."

ROUTING OF TRAFFIC.

The right of the shipper to route traffic, as conferred by this bill, appears to be confined to a selection between routes over which joint rates have been established. If this is the meaning of the provision it would not apply in cases of through routes where the rates are locals or proportionals, particularly if the initial carrier is not a party to the tariff of connecting lines. If it is intended to give the shipper the right to choose between two or more routes, in whatever form the applicable rates are published, that intention should be plainly expressed.

We therefore recommend that the words "there are" be inserted after the word "shipment," in line 12, page 19, and that lines 13, 14, 15, except the word "the" at the end of line 15, be stricken out. Also that the word "said," at the end of line 3, page 20, and the words "bill of lading,'' in line 4, be stricken out and the words "such routing instructions" inserted in lieu thereof.

PURCHASE BY ONE ROAD OF ANOTHER ROAD.

We see no reason why the prohibition that one road shall not acquire any interest in a competing road should not be extended so as to prohibit the acquiring of any interest in a competing water line. We therefore recommend that the word "the," in line 21, page 25, be stricken out and the word "any" inserted in lieu thereof, and that the words "of any railroad corporation," in the same line, be stricken out and the words "or water line" inserted in lieu thereof; and that the word "of" be inserted after the word "stock," in line 20 of the same page.

We also recommend that all of line 1, page 29, after the word "States," and all of lines 2 and 3 be stricken out, because their retention would apparently limit or modify the prohibition in the first paragraph of section 12, page 25.

We also call attention to the fact that this prohibition is directed only against a railroad corporation subject to the act, and therefore does not prevent or effect the control of competing lines by a holding company.

SPECIAL REPORTS.

In order that there may be no doubt of the right of the commission to require special reports under laws which do not confer express authority to investigate, we recommend that the words "or which it is required to enforce" be inserted, in line 10, page 25, after the word "informed."

HEARINGS

BEFORE THE

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE OF THE HOUSE OF REPRESENTATIVES

ON BILLS AFFECTING

INTERSTATE COMMERCE

PART XXI

WASHINGTON

GOVERNMENT PRINTING OFFICE

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE,

HOUSE OF REPRESENTATIVES.

JAMES R. MANN, ILLINOIS, Chairman.

BILLS AFFECTING INTERSTATE COMMERCE.

COMMITTEE ON

INTERSTATE AND FOREIGN COMMERCE,

Saturday, February 19, 1910.

The committee this day met at 10 o'clock a. m., Hon. James R. Mann (chairman) presiding.

The CHAIRMAN. There may be inserted in the record letters from Mr. William A. Glasgow, jr., of Philadelphia, concerning appeals to the court by the shipper from the orders of the Interstate Commerce Commission.

(Following is the letter referred to:)

Mr. JAMES R. MANN,

PHILADELPHIA, February 17, 1910.

Chairman Committee on Interstate and Foreign Commerce,

House of Representatives, Washington, D. C. MY DEAR SIR: I have your letter of February 14. My view is that when a shipper files a complaint with the Interstate Commerce Commission, and the facts are found by the commission in accordance with the allegations of the complaint, and then the commission declines to grant the relief, that the shipper should have the right to present the case to the court for a review of the order of the commission. I do not intend by this to claim that the shipper should have the right to have the court review the findings of the commission as to the facts; but, where the relief is denied on the commission's conclusion as to the law, or where the commission arbitrarily exercises a discretion which leaves the shipper without relief, I think that the courts should have jurisdiction to pass upon the complainant's case. For illustration: Suppose a complaint is filed by a shipper and the commission finds the facts exactly as alleged, but holds that under the law it can grant the shipper no relief. My view is that the findings of fact by the commission should be conclusive, but that the shipper should have the right to have the conclusions of the commission as to the law reviewed by the courts, and I think the same rule should apply where the commission has the discretion as to granting relief, if it should appear that the commission had arbitrarily exercised this discretion in a manner not justified by the facts found by it.

This is briefly my view. I could go more into detail and I think could justify the position I indicate above.

I consider this a most important matter unless the commission is to be the final tribunal, so far as complaints filed by the shippers are concerned, both as to the law and the fact; and this is not true so far as a carrier is concerned, but it may have the courts pass upon its rights.

I shall be glad to answer any further inquiries you may make, or discuss the matter personally with you, if you so desire.

Very truly,

WM. A. GLASGOW, Jr.

PHILADELPHIA, February 19, 1910.

Hon. JAMES R. MANN,

Chairman Committee on Interstate and Foreign Commerce,

House of Representatives, Washington, D. C.

MY DEAR SIR: Referring further to your letter of a few days ago as to an appeal on behalf of the shipper from a decision of the Interstate Commerce Commission, my suggestion on this line is in accordance with the practice, as I understand it, under the English railway and canal traffic acts.

An appeal may be taken by a shipper from the decision of the railway and canal commissioners under the English act, whenever the railway commissioners in solving