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Wabash, St. Louis & Pacific Railway Co. v. Illinois

Supreme Court of the United States · 1886 · Constitutional Law
Constitutional LawCommerce ClauseInterstate CommerceState Regulation of RailroadsCommerce Clauseinterstate commercerailroad ratesstate regulation

Facts

The railroad charged one shipper 15 cents per hundred pounds to transport a carload of freight from Peoria, Illinois, to New York City, and on the same day charged another shipper 25 cents per hundred pounds to transport the same class and quantity of freight from Gilman, Illinois, to New York City. The Peoria shipment traveled 86 miles farther within Illinois than the Gilman shipment, yet cost less overall. Both charges were made under through rates for carriage from Illinois to New York under entire contracts, and no separate intrastate portion of the charge was apportioned. Illinois sought to apply its statute forbidding charging as much or more for a shorter haul within the state than for a longer haul on the same road.

Issue

May Illinois, consistent with the Commerce Clause, apply its railroad anti-discrimination rate statute to a through shipment transported under an entire contract from a point in Illinois to New York, by treating part of the total charge as a charge for the intrastate segment of that interstate transportation?

Rule

A state statute regulating railroad charges is valid when applied only to transportation that begins and ends within the state and is wholly intrastate. But when applied to charges made under an entire contract for continuous transportation from one state to another, the statute regulates interstate commerce and is therefore invalid because that subject is reserved to Congress.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.
Lake Prairie Rail, a railroad operating in Missouri, agrees to carry Maya Ortiz's furniture from St. Louis to Springfield, Missouri for a single rate. Missouri's railroad commission later applies a state statute limiting discriminatory rates on hauls that begin and end within Missouri.

Under the governing rule, is Missouri's application of the statute constitutional?

Explanation. A state may regulate charges for transportation that begins and ends within the state and is exclusively confined there. The key distinction is between commerce wholly within a state and continuous transportation from one state to another. Here, the shipment is entirely within Missouri, so the state regulation is valid. (Derived from Wabash, St. Louis & Pacific Railway Co. v. Illinois (1886).)