## Facts

- Shippers’ organizations complained that rail and steamship carriers charged unreasonable and discriminatory rates on traffic from Cincinnati and Chicago to southern destinations.
- The Interstate Commerce Commission (ICC) investigated and, on May 29, 1894, issued an order setting maximum rates it deemed reasonable and directing the carriers to “cease and desist” from charging higher rates.
- The ICC sought judicial enforcement of its order in federal court to compel the carriers’ future compliance with the ICC-prescribed rates.
- The United States Court of Appeals for the Sixth Circuit certified to the Supreme Court a question asking whether the ICC had jurisdictional power under the Interstate Commerce Act to make a rate-prescribing order.
- Justice Brewer wrote the Court’s opinion; Justice Harlan dissented without a written opinion.

## Issues

1. Whether the Interstate Commerce Act of 1887 authorized the ICC to prescribe specific freight rates (maximum, minimum, or absolute) and obtain judicial decrees enforcing those rates prospectively.

## Decision

- The Court answered the certified question in the negative and held that the ICC lacked statutory power to prescribe binding freight rates.
- The Court ruled that the Act’s requirement that charges be “reasonable and just” did not grant the ICC legislative authority to substitute its own rate schedule for carriers’ rates.
- The Court rejected the ICC’s attempt to secure indirectly, through judicial enforcement of the ICC’s reasonableness determinations, a power to impose future rates that Congress did not expressly grant.
- Justice Harlan dissented without opinion.

## Legal Principles

- Federal administrative agencies possess only the powers Congress confers by statute; legislative powers are not inferred from general statutory purposes or broad language.
- A statutory command that rates be “reasonable and just” establishes a legal standard for identifying unlawful rates, not an implicit delegation to an agency to promulgate binding numeric rates for future conduct.
- Rate prescription is a legislative function; absent clear statutory authorization, an agency’s remedial authority to stop unlawful practices does not include setting compulsory rate schedules.
- An agency cannot convert case-specific findings about past unreasonableness into binding prospective rules by obtaining court orders enforcing the agency’s preferred rate levels.

## Conclusion

The Supreme Court held that the Interstate Commerce Act did not grant the ICC authority to make binding freight rates, limiting the Commission to condemning unlawful rates and practices rather than legislating rate schedules for future enforcement.


Interstate Com. Comm’n v. Cincinnati, New Orleans & Tex. Pac. Ry. Co., 167 U.S. 479 (1897)