95 Vt. 343 | Vt. | 1921
Before the service of the writ in this case, the United States Railroad Administration, in charge of the Director General of Railroads, was indebted to the defendant, Raymond Cutting, on claims for loss of freight and freight overcharges aggregating $1,691.52, which accrued about March 1, 1918, and had become liquidated at the time of service. The plaintiff summoned the Director General of Railroads as trustee. The suit having been discontinued as to all of the defendants except Raymond Cutting, the plaintiff had judgment against him as principal defendant. On the question of the trustee’s liability, it was agreed that the right against him, if any, arose during the period of Federal control of railroads; and there was no dispute as to the amount due, except as to the matter of interest. The trustee seasonably objected to the jurisdiction of the court, but on disclosure and hearing it was. adjudged that the trustee was chargeable, and judgment was entered against him for $1,872.98 as of February 1, 1920, which included interest on the sums due the defendant. Briefly stated the trustee objected to the judgment (1) on the ground that the court had no power to allow interest after the date of the service of the writ; (2) because at the time of service the statutes of the United States and the proclamation of the President and orders of the Director General of Railroads made thereunder did not authorize, but, on the contrary, prohibited, the trusteeing of funds in the hands of the Director General. The case is here on exceptions by the trustee.
On March 21, 1918, an act, generally known as the Federal Control Act, was passed by Congress, which in detail recited how the control of transportation systems previously granted the President should be exercised. Differences of opinion had already arisen as to the status of the transportation systems, and
On September 5, 1918, the Director General of Railroads issued ‘ ‘ General Order No. 43, ’ ’ which, after certain recitations, provided: "It is therefore ordered that no moneys or property under Federal control or derived from the operation of carriers while under Federal control shall be subject to garnishment, attachment, or like process in the hands of such carriers or any of them, or in the hands of any employee or officer of the United States Railroad Administration. ’ ’ The recitals contained in the order show that its purpose was to safeguard the wages of employees from garnishee process while in the possession of the Federal Administrator, as such practice was prejudicial to the
We look to General Orders No. 50 and No. 50A for the interpretation put upon section 10 of the Federal Control Act by the Executive Department. General Order No. 50, issued October 28, 1918, by Mr. McAdoo, the then Director General, after referring to section 10 of the Act of March 21, 1918, recites: “Whereas since the Director General assumed control of said systems of transportation, suits are being brought and judgments and decrees rendered against carrier corporations on matters based on causes of action arising during Federal control for which the said carrier corporations are not responsible, and it is right and proper that the actions, suits, and proceedings hereinafter referred to, based on causes of action arising during or out of Federal control, should be brought directly against said Director General of Railroads, and not against said corporations: * * * It is therefore ordered that actions at law, suits in equity, and proceedings in admiralty hereafter brought in any court, based on contract, binding upon the Director General of Railroads, claim for death or injury to persons, or for loss and damages to property, arising since December 31, 1917, and growing out.of the possession, use, control, or operation of any railroad system of transportation by the Director General of Railroads, which action, suit, or proceeding, but for Federal control, might have been brought against the carrier company, shall be brought against William G. McAdoo, Director General of Railroads, and not otherwise; provided, however, that this order shall not apply to actions, suits, or proceedings for the recovery of fines, penalties, and forfeitures. Subject to the provisions of General Orders numbered 18, 18a, and 26, heretofore issued by the Director General of Railroads, service of process in any such action, suit, or proceeding may be made upon operating officials operating for the Director General of Railroads the railroad or other carrier in respect of which cause of action ¿rises, in the same way as service was heretofore made upon like operating officials for such railroad or other carrier company.”
General Order No., 50A, issued January 11, 1919, by the trustee as Director General, is similar in all material respects. The explanation of the purpose of the original order and its
At the time this case was argued considerable doubt existed as to the force and effect of section 10 of the Federal Control Act and the orders of the Director General respecting the subject-matter thereof. The cases, both state and Federal, involving these questions, were many, and were in hopeless disagreement. However, the decision by the Supreme Court of the United States in Missouri Pacific R. Co. v. Ault, 256 U. S. 554, 65 L. ed. 1087, 41 Sup. Ct. 593, handed down June 1, 1921, has set the more difficult questions at rest. . Some of the claims made by the trustee in his brief would not now be relied upon in view of this decision. The ease was in error to the Supreme Court of the state of Arkansas to review a judgment in favor of the plaintiff in an action to enforce a statutory penalty against a railway company and the Director General of Railroads. The statute in question provided that whenever a railroad company, or a re
Mr. Justice Brandéis, speaking for the Court, says: “The President had taken possession and control of the Missouri Pacific Railroad on December 28, 1917, pursuant to the Proclamation of December 26, 1917, 40 Stat. at L. 1733, under the Act of August 29, 1916, chap. 418, 39 Stat. at L. 619, 645, Comp. Stat. § 1974a. He was operating it through the Director General under the Federal Control Act (March 21, 1918, chap. 25, 40 Stat. at L. 451. Comp. Stat. § 3115%a, Fed. Stat. Anno. Supp. 1918, p. 757) when Ault was employed, when he was discharged, and when the judgment under review was entered. See Transportation Act 1920, Act of February 28, 1920, chap. 91, 41 Stat. at L. 456. The company had claimed seasonably that under the acts of Congress it could not be held liable either for the wages or the penalty; and that, if the state and Federal statutes should be construed as creating such liability, they were in that respect void as to it under the Federal Constitution. The Director General did not contest liability for wages actually due, but claimed that, under the legislation of Congress, he was not liable for the penalty, and that the state statute, as applied to him, was void under the Federal Constitution. The claims of both defendants having been denied by the highest court of the state, they brought the case here by writ of error.
“First. The company is clearly not answerable in the present action if the ordinary principles of common-law liability are to be applied. The Railroad administration established by the President in December, 1917, did not exercise its control through supervision of the owner-companies, but by means of a Director General, through ‘one control, one administration, one power for the accomplishment of the one purpose, the complete possession by governmental authority to replace for the period provided the private ownership theretofore existing.’ Northern P. R. Co. v. North Dakota, 250 U. S. 135, 148, 63 L. ed. 897, 902, P. U. R.
Referring to the contention that the provision of section 10 of the Federal Control Act made the company liable for the acts or omissions of the Director General in operating the Missouri Pacific Railroad, the opinion continues: “The plain purpose of the above provision was to preserve to the general public the rights and remedies against common carriers which it enjoyed at the time the railroads were taken over by the President, except in so far as such rights or remedies might interfere with the needs of Federal operation. The provision applies equally to cases where suits against the carrier'companies were pending in the courts on December 28, 1917, to cases where the cause of action arose before that date and the suit against the company was filed after it, and to cases where both cause of action and suit had arisen or might arise during Federal operation. The government was to operate the carriers, but the usual immunity of the sovereign from legal liability was not to prevent the enforcement of liabilities ordinarily incident to the operation of carriers. The situation was analogous to that which would exist if there were a general receivership of each transportation system. Operation was to be continued as theretofore, with the old personnel, subject to change by executive order. The courts were to go on entertaining suits and entering judgments under existing law, but the property in the hands of the President for war purposes was not to be disturbed. With that exception, the substantial
“As the Federal Control Act did not impose any liability upon the companies on any cause of action arising out of- the operation of their systems of transportation by the government, the provision in Order No. 50, authorizing the substitution, of the Director General as defendant in suits then pending, was within his power, the application of the Missouri Pacific Railroad Company, that it be dismissed from this action should have been granted, and the judgment against it should, therefore, be reversed. ’ ’
In disposing of the claim that the- Director General was liable for the penalty imposed by the Arkansas statute the Court says: “The contention * * * is rested specifically upon the clause in section 10, to the effect that the carriers ‘shall be subject to all laws and liabilities as common carriers, whether arising under state or Federal laws or at common law,’ and the provision in section 15, that the ‘lawful police regulations of the several states’ shall continue unimpaired. By these provisions the United States submitted itself to the various laws, state and Federal, which prescribed how the duty of a common carrier by railroad should be performed, and what should be the remedy for failure to perform. By these laws the validity and extent of claims against the United States arising out of the operation of the railroads were to be determined. But there is nothing, either in the purpose or the letter of .these clauses, to indicate that Congress intended-to authorize suit against the government for a penalty, if it should fail to perform the legal obligation imposed. The government undertook, as carrier, to observe all existing laws; it undertook to compensate any person injured through a departure by its agents or servants from their duty under such law; but it did not undertake to punish itself for any departure by the imposition upon itself of fines and penalties, or to permit any other sovereignty to punish it. * * * The.purpose for which the government permitted itself to be sued was compensation, not punishment. In issuing General Order No. 50, the Director General was careful to confine the order to the limits set by the act. * * * Wherever the law permitted compensatory damages, they may be collected against the carrier while under Federal control. * * * But double damages, penalties and for
The validity of General Order No. 43 while in force was assumed at the argument; but it may be doubted whether it could be upheld, at least so far as it undertook to forbid the bringing of trustee process on claims other than for employees’ wages. It is fundamental that the power and authority of the Director General of Railroads cannot exceed that which could lawfully be vested in him by proclamation or order of the President, and he in turn receives his power and authority over the subject-matter here concerned by and through the acts of Congress empowering him to take control of and operate the transportation systems of the United States. Whatever general language is used in the acts conferring authority upon the President must be construed as given for the purpose of enabling him to carry out their provisions, and not to enable him, either by himself or any appointee of his, to set aside any provision of the legislative will, or to take away any rights or privileges granted to or
As construed by the Court in the Ault Case, section 10 of the Federal Control Act preserved to the public the rights and remedies enjoyed at the time the railroads were taken over by the President, except in so far as they might interfere with the needs of Federal operation. This indicates clearly how far the President or his representative was authorized to go in curtailing by general orders the remedies previously enjoyed by a¡ creditor, which leaves the justification of General Order No. 43 to depend upon its necessity for carrying out the purposes for which the President was authorized to take over the railroad systems of the country. The reason assigned for making the order gave color of authority, if it had been confined to trustee process affecting employees’ wages; but it is not apparent how the use of the process in other cases could in any way interfere with the operation of the railroads under Federal control.
It is argued that payment to the defendant was prevented by the trustee process, and that to charge the trustee with interest while the suit was pending would be to penalize' him for obeying the process. As to this, it is enough to say that payment into court of the sum due at the time of service would have relieved the trustee from further accumulation of interest. While, as between the plaintiff and defendant, the trustee is a mere stake holder (Lyman v. Orr, 26 Vt. 119), the fact that he has been summoned as such does not change his liability respecting the payment of interest; nor should it, for the judgment against him as trustee is a discharge from a subsequent demand by the principal defendant. G. L. 2008. The attaching creditor takes the place of the principal defendant. Kettle v. Harvey, 21 Vt. 301. Whether a trustee is chargeable with interest depends upon whether the debt or claim attached is one on which the principal defendant could demand interest at the time of service of the trustee process. If it is then interest-bearing because overdue, the running of interest is not interrupted by the service of such
Judgment affirmed.