Northern Pacific Railway Co. v. United States, 330 U.S. 248 (1947)

Northern Pacific Railway Co. v. United States

No. 400

Argued January 13, 1947
Decided March 3, 1947
330 U.S. 248

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Syllabus

1. Section 321(a) of the Transportation Act of 1940 provides that commercial rates shall be applicable to transportation of property for the United States, excepting "military or naval property of the United States moving for military or naval and not for civil use."

Held: the property involved in each of the five classes hereinafter described, which, at the time of the shipments in 1941-1943, was property of the United States, was within the exception, and hence entitled to land-grant, rather than commercial, rates. Pp. 250-255.

(1) Copper cable consigned to a naval officer for use in the installation of degaussing equipment (a defense against magnetic mines) on a cargo vessel being built by a shipbuilding company under contract with the Maritime Commission according to plans whereby the vessel would be convertible into a military or naval auxiliary. The degaussing specifications were prepared by the Navy, which also furnished all material and bore the cost. The vessel was delivered in 1941, and was operated as directed by the Maritime Commission or the War Shipping Administration. Pp. 251, 255.

(2) Lumber for use in the construction of a munitions plant which was being constructed for the Government by contractors under Army supervision. Pp. 251, 255.

(3) Lumber for the construction of pontons by a contractor under a contract with the Marine Corps. The product was either shipped overseas in connection with military or naval operations or used in the training of combat engineers. Pp. 251, 255.

(4) Bowling alley equipment destined for a naval air base under construction on public land reserved for Navy use. The equipment was intended to be used for recreation by the civilian construction crew, and, upon completion of construction, by the Navy. In fact, it was used only by servicemen. Pp. 252, 255.

(5) Liquid paving asphalt consigned to the Civil Aeronautics Authority for use in constructing runways at an airport in Alaska under a program approved by a joint cabinet board as being necessary for the national defense. Work was commenced by a civilian contractor, and, after the shipment had moved, was taken over by the Army, which thereafter had full control of the field. Pp. 252, 255.

2. Although the shipment of asphalt was to a civilian agency (the Civil Aeronautics Authority), it was nevertheless "military or naval" property within the meaning of § 321(a). Pp. 252-253.

3. "Military or naval" property within the meaning of § 321(a) is not limited to property shipped by or under control of the Army or Navy, nor to property procured by those departments. P. 253.

4. The exception prescribed by § 321(a) is not confined to property for ultimate use directly by the armed forces. P. 253.

5. Within the meaning of § 321(a), an intermediate manufacturing phase cannot be said to have an essential "civil" aspect when the products or articles involved are destined to serve military or naval needs. It is the dominant purpose for which the manufacturing or processing activity is carried on that is controlling. P. 255.

6. Doubts as to the meaning of a statute which operates as a grant of public property, or as a relinquishment of a public interest, should be resolved in favor of the Government, and against the private claimant. P. 257.

7. Section 321(a), though enacted in the interests of the railroads, continues land-grant rates in a narrower category, and is to be construed in favor of the Government and against the railroads. Pp. 257-258.

156 F.2d 346, affirmed.

Petitioner brought suit against the United States under the Tucker Act to recover the difference between commercial rates and the land-grant rates which it received for the transportation of government property. The District Court gave judgment for the United States. 64 F.Supp. 1. The Circuit Court of Appeals affirmed. 156 F.2d 346. This Court granted certiorari. 329 U.S. 701. Affirmed, p. 258.