delivered the opinion of the court.
This is a writ of error to the Circuit Court of the United States for the Southern District of New York, sued out by the New York Central and Hudson River Railroad Company, plaintiff in error. In the Circuit Court the railroad company and Fred L. Pomeroy, its assistant traffic manager, were convicted for the payment of rebates to the American Sugar Refining Company and others, upon shipments of sugar from the city of New York to the city of Detroit, Michigan. The indictment was upon seven counts and was returned against the company, its general -traffic manager 'and its -assistant traffic manager. The first count, covering the offering of a rebate, was withdrawn from the jury by the district attorney, and it is unnecessary to consider it. The second count charges the making and publishing of a through tariff rate upon sugar by certain railroad companies, including the plaintiff in error, fixing the rate at twenty-three cents per 100 pounds from New York city to. Detroit, and charges the railroad company’s general traffic manager and assistant traffic manager with enteriñg into an unlawful agreement and arrangement with the shippers, the American Sugar Refining Company of New York and the American Sugar Refining Company of New Jersey, and the consignees of the sugar, W. H. Edgar .& Son, of Detroit, whereby it was agreed that for sugar shipped over the line, the full tariff rate being paid thereon, the railroad company should give a rebate of five cents for each 160 pounds.' This count charges that during the months of April and May, 1904, shipments were made under this agreement and the regular tariff rates paid thereon. On July 14 of that year a claim for a rebate in the sum of $1,524.99 was presented by the agents of the shipper and consignees and paid on the thirty-first day of August to Lowell M. Palmer, agent of thé sugar company, for the benefit of the shippers and
Upon the trial there' was a conviction upon all of the six counts, two to seven inclusive. The assistant traffic manager was sentenced to pay a fine of $1,000 upon each of the counts; the present plaintiff in error to pay a fine of $18,000 on each count, making a fine of $108,000 in all.
The facts are practically undisputed. They are mainly established by stipulation, or by letters passing between the traffic managers and the .agent of the sugar refining companies. It was shown that the established, filed and published rate between New York and Detroit was 23 cents per 100 pounds on sugar, except during the month of June, 1904, when it was 21 cents per 100 pounds.
The sugar- refining companies were engaged in selling and shipping their products in Brooklyn and Jersey City, and W. H. Edgar & Son were engaged in business in Detroit, Michigan, where they were dealers in sugar. By letters between Palmer, in charge of the traffic of the sugar refining-companies and of procuring rates for the shipment of sugar, and the general and assistant traffic managers of the railroad company, it was agreed that Edgar & Son should receive a rate of 18 cents per 100 pounds from New York to Detroit. It' is unnecessary to quote from these letters, from which it is abundantly established that this concession was given to Edgar & Son to prevent them from resorting to transportation by the water route between New
Numerous objections and exceptions were taken at every stage of the trial to the validity of the indictment and the proceedings thereunder. The principal attack in this court is upon the constitutional validity of certain features of the Elkins act. 32 Stat. 847. That act, among other things, provides:
“ (1) That anything done or omitted to be done by a corporation common carrier subject to the act to regulate commerce, and the acts amendatory thereof, which, if done or omitted to be done by any director or officer thereof, or any receiver, trustee, lessee, agent or person acting for or employed by such corporation, would constitute a misdemeanor under said acts, or under this act, shall also be held to be a misdemeanor committed by such corporation, and upon conviction thereof it; shall be subject to like .penalties as are prescribed in said acts, or by this act, with reference to such persons, except as such penalties are herein changed.
“In construing and enforcing the provisions of this section, the act, omission or. failure of any officer, agent or other person acting for or employed by any common carrier, acting within the scope of his employment, shall in every case be also deemed
It is contended that these provisions of the law are unconstitutional because Congress has no authority to impute to a corporation the commission of criminal offenses, or to subject a corporation to a criminal -prosecution by reáson of the things charged. The argument is that to thus punish the corporation is in reality to punish the innocent stockholders, and to deprive them of their property without opportunity to be heard, consequently without due process of law. And it is further contended that these provisions of the statute deprive the corporation of the presumption of innocence, a presumption which is part of due process in criminal prosecutions. It is urged that as there is no authority shown by the board of directors or the stockholders for the criminal acts of the agents of the company, in contracting for and giving rebates, they could not be lawfully charged against the corporation. As no action of the board of directors could legally'authorize a crime, and as indeed the stockholders could not do so, the arguments come to this: that owing to the n’ature and character of its organization and the extent of its power and authority, a corporation cannot commit a crime of the nature charged in this case.
Some of the earlier writers on common law held the law to be that a corporation could not commit a crime. It is said to have been held by Lord Chief Justice Holt (Anonymous, 12 Modern, 559) that “a corporation is not indictable, although the particular members of it are.” In Blackstone’s Commentaries, chapter 18, § 12, we find it stated: “A corporation cannot commit treason, or felony, or other crime in its corporate capacity, though its members may in their distinct individual capacities.” The modem authority, universally, so far as we know', is the other way. In considering the subject, Bishop’s New Criminal Law, § 417, devotes a chapter to the capacity of corporations to commit crimé, and states the law to be: “Since á corporation acts by its officers and agents their purposes, motives, •and intent are just as much those- of the corporation as are the
It is now well established that in actions for tort the corporation may be held responsible for damages for the acts of its agent within the scope of his employment.
Lake Shore & Michigan Southern R. R.
v.
Prentice,
,. And this is the rule when the act is done by the agent in the course of his employment, although done wantonly or recklessly or against the express orders of the principal. In such cases the liability is not imputed because the principal actually participates in the malice or fraud, but because the act is done for the benefit of the principal, while the agent is acting within the scope of his employment in the business of the . principó!, and justice requires that the latter shall be held responsible for damages to the individual who has suffered by such conduct. Lothrop v. Adams, 133 Massachusetts, 471.
A corporation is held responsible for acts not within the agent’s corporate powers strictly construed, but which the
, In this case we are to consider the criminal responsibility of a corporation for an act done while an authorized agent of th’e company is exercising the authority conferred upon him. It was admitted by the defendant at the trial that at the time mentioned in the indictment,the general freight traffic manager. and-the assistant freight traffic manager were authorized to establish rates at which freight'should be carried over ’the line of the New York Central and Hudson River Company, ,and were authorized to unite with other companies in the establish- • ing,-filing and publishing of through rates, including the through rate or rates between New York and Detroit referred to in the indictment. Thus the subject-matter of making and fixing rates was within the scope of the authority and employment of the agents of the company, whose acts in this connection are sought to be charged upon the company. Thus clothed with authority, the agents were bound to respect the regulation of interstate commerce enacted by Congress, requiring the filing and publication of rates and punishing departures therefrom. Applying the principle governing civil, liability, we go only a step farther in holding that the act of the agent, while exercising the authority delegated to him to make rates for transportation, may be controlled, in the interest of public policy, by imputing his act to his employer and imposing penalties upon the corporation for which he is acting in the premises.
■ It is true, that there are some crimes, which in- their nature-cannot be committed by corporations. But there is a large class of offenses, of which rebating under the. Federal statutes is one, ‘wherein the crime consists- in purposely doing the things prohibited by statute. In that class of crimes we see no good reason why corporations may not be held responsible for and
It is a part of the public history of the times that statutes against rebates could not be effectually enforced so long as individuals only were subject to punishment for violation of the law, when the giving of rebates or concessions enured to the' benefit of the corporations of which the individuals, were but the instruments. This situation, developed in more' than one report of the Interstate Commerce Commission, was no doubt influential in bringing about the enactment of the Elkins Law, making corporations criminally liable.
;This statute does not embrace things impossible to be done by a corporation; its objects are to prevent favoritism, and to secure equal rights to all in interstate transportation, and one legal rate, to be published and posted and accessible to all alike.
New Haven Railroad Company
v.
Interstate Commerce Commission,
We see no valid objection in law, and every reason in public policy, why the corporation'which profits by the transaction, and can only act through its agents and officers, shall be held punishable by fine because of the knowledge and intent of its agents to whom it has intrusted authority to act in the subject-matter of making and fixing rates of transportation, and whose knowledge and purposes may well be attributed to the corporation for which the agents act. While the law should have regard to the rights of all, and to those of corporations no less than to those of individuals, it cannot shut its eyes to the fact that the great' majority of business transactions in modem times are conducted through these bodies, and particularly that interstate commerce is almost entirely in their hands, and to
There can be no question of the power of Congress to regulate interstate commerce, to prevent favoritism'and to secure equal rights to all engaged in interstate trade. It would be a distinct step backward to hold that Congress cannot control those who are conducting this interstate commerce by holding them responsible for the intent and purposes of the agents to Whom they have delegated the power to act in the premises.
It is contended that the Elkins Law is unconstitutional, in that it applies to individual carriers as well as those of a corporate character, and attributes the act of the agent to all common carriers, thereby making the crime of one person that of another, thus depriving the latter of due process of law and of the presumption of innocence which the law raises in his favor. This contention rests upon the last paragraph of § 1 of the Elkins-Act, which is as follows, 32 Stat. 847:
“In construing and enforcing the provisions of this section the act, omission, or failure of any officer, agent, or other person acting for or employed by any common carrier acting within the scope of his employment shall in every case be also deemed to be the act, omission, or failure of such carrier as well as that of the person.”
. We think the answer to this proposition is obvious; the plaintiff in error is a corporation, and the provision as to its responsibility for acts of its agents is specifically .stated in the first paragraph of the section. There is no individual in this case complaining of the unconstitutionally of the act, if objectionable on that ground, and the case does not come within .that •class of cases in which unconstitutional provisions are so interblended with valid ones that the whole act must fall, notwithstanding its constitutionality is challenged by one who' might be legally brought within its provisions.
Employers’ Liability
Cases,
It is. contended that the court should have sustained the objection to the indictment upon the ground that the corporation and its agents could not be legally joined therein, but we think a fair construction of the act permits both the corporation and the agent to be joined in one indictment for the commission of the offense. The purpose of the act was to make the act one of the corporation as well as of the agent, and to include both within the prohibitions and restrictions of the statute, and this seems to be the accepted practice. Thompson on Corporations, § 4495.
Objections were made as to the sufficiency of the indictment based upon its want of particularity in describing the offense intended to be charged. Section 1025 of the Revised Statutes of the United States provides that no judgment upon an indictment shall be affected by reason of any defect or-imperfection in matter of form which shall not tend to the prejudice- of the defendant, and, unless'the substantial rights of the accused were prejudiced by the refusal to require a more specific statement of the manner in which the offense was committed, there can be no reversal.
Connors
v.
United States,
It is insisted- that if any criminal offense was committed at all it was a single and continuing one against the railroad company, because of the agreement evidenced by the letters which
It is further contended that the court below erred in its reference to the absence of the witness Embleton, and the non-production of books in which entries were made concerning the transactions in question. It appears that Embleton was a clerk in the employ of Wilson, and had charge of the books in which these transactions were entered, that he did not appear at the trial, having left because of sickness, nor were the books produced. The comment objected to was made in connection with this paragraph of the charge:
■ “ On this question of intent also, gentlemen, it is competent for you to take into consideration the method in which these transactions were carried on. The letter from Palmer to Guilford was headed private and confidential. It will be proper for you to take into consideration the- fact, if you believe the evidence in the case, that the method of making these payments, instead of being by a direct check drawn at Buffalo by or on behalf of this defendant, was by purchasing a draft drawn by the Bank of Buffalo upon the Chemical Bank in favor of Mr. Palmer; and you may take into consideration’upon that question the evidence in this case that the original claims presented by Palmer to Pomeroy and sent by Pomeroy to Wilson
“Now it is for you to say, gentlemen, whether these occurrences and-these facts are consistent with innocence or with guilt, because if a man carries on an act, or any person does anything which upon.its face is apparently unlawful, and.he does it in a furtive and secret manner, showing that his intention while he does the act' is to do it in such a way as to conceal it, the jury may draw the inference from that fact, if they see fit — they.are not obliged to, but they may if they see fit— that the intention with which the act was done was to perform an illegal or a criminal act.” .
We do not perceive any prejudicial error in this charge. It simply amounted to permitting the jury to consider the circumstances enumerated as bearing upon the guilty purposes of the'parties charged in the indictment. It left to the jury to attach such weight as they saw fit to the circumstances of Embleton’s absence and the non-production of the books. It is to be noted in this .connection that the judge, in the latter portion of his charge, at the request of the defendant, said: “There is no evidence that the defendant corporation or those who controlled -its corporate action destroyed or failed to produce upon the trial any; paper for which the Government has asked.”
' We have noted all the.assignments-of error which involve questions of a substantial character.
We find no error in the. proceedings of the Circuit Court, and its judgment is
Affirmed.