New York, Chicago & St. Louis Railroad v. Frank

Mr. Chief Justice Stone:

I think the judgment should be reversed, but without prejudice to any right of appellee to recover under § 20 (a) (11) of the Interstate Commerce Act.

I am not now prepared to say that appellee could not have recovered under the provisions of § 20 (a) (11) had counsel seen fit to present the question for decision.1 But *375the only question which they have briefed and argued here is whether § 20 (a) (2) precludes the imposition of the asserted liability upon appellant where, as is the case here, its assumption by appellant has not been approved by order of the Commission as required by that section. The Court avoids decision of this question by declaring that the Commission has declined to give its approval because it has construed § 20 (a) (2) as inapplicable and that we are bound by that construction.

Examination of the Commission’s opinions and orders from which the Court draws its cryptic answer to the question before us makes it plain that the Commission has placed no such construction on the statute in any case, and that, in the cases cited relating to the Nickel Plate consolidation, it has never had any occasion to construe § 20 (a) (2). On the contrary, in several cases, the Commission has construed § 20 (a) (2) as applicable to obligations like the present, which “attach” by operation of state law to the acquisition by the carrier of the propérty of other roads, and in conformity to that section has approved the “assumption” of such liability by the carrier.

In the cases before the Commission on which the Court relies, it appears that the Commission was not asked to pass upon the question now before us and did not purport to pass upon it. The opinion of the Court thus rests on no more substantial basis than the circumstance that the Commission has acted favorably on an application of ap*376pellant to be permitted to operate the consolidated lines and to issue securities in conformity to the plan of consolidation, in a proceeding in which the Commission was neither asked to take, nor took, any action with respect to assumption of liabilities; and this under a statutory scheme of control which plainly contemplates that a consolidation may go into effect without adoption of its assumption of liability feature, which in any case can become operative only by order of the Commission approving it upon application and on findings that the public interest will be served. Rock Island System Consolidation, 193 I. C. C. 395, 403-04; Acquisition and Stock Issue by P., O. & D. R. R., 105 I. C. C. 189, 193. The Court infers the Commission’s refusal to approve the assumption of liability for want of jurisdiction from the silence and inaction of the Commission when it was not called upon to speak or to act, either by the statute or by any application pending before it.

Section 20 (a) (2) of the Interstate Commerce Act contains two prohibitions. One is imposed on the issuance of securities by railroads without approval of the Commission. The other makes it unlawful for such a carrier to assume any obligation in respect of securities issued by others, “even though permitted by the authority creating the carrier corporation, unless and until, and then only to the extent that, upon application by the carrier, and after investigation by the Commission of the purposes and uses of . . . the proposed assumption of obligation . . . the Commission by order authorizes such issue or assumption.” The statute commands with particularity that “The Commission shall make such order only if it finds that such issue or assumption: (a) is for some lawful object within its corporate purposes, and compatible with the public interest, which is necessary or appropriate for or consistent with the proper performance by the carrier of service to the public as a common carrier, and which will not impair *377its ability to perform that service, and (b) is reasonably necessary and appropriate for such purpose.”

It will be noted that there is no requirement of the statute that applications for the acquisition of other roads or for the approval of security issues, and applications for approval of the assumption of guarantee obligations, shall be united in a single proceeding. Indeed, it is clear that the statute leaves the Commission free to approve the one and reject an application for the other. And it appears that the uniform practice of the Commission has been, as the statute directs, to entertain neither, except on an application asking the desired approval. And where more than one is asked, the Commission has by its order separately dealt with those upon which it intended to act. E. g., Acquisition of C. & O. Northern Ry. Co. by C. & O. Ry., 701. C. C. 550; Gainesville Midland Reorganization, 1311. C. C. 355; Control of Greenbrier, Cheat & Elk R. R., 1311. C. C. 525; Chicago, M., St.-'P. & P. R. Co. Acquisition, 158 I. C. C. 770; Elmira & L. O. R. Co. Acquisition, 170 I. C. C. 127.

The Commission has pointed out that its action in passing on applications under each of the paragraphs 18 to 20 inclusive, of § 1, or under § 5 (2), of the Act, is limited to the particular provision of the Act on which the application is founded, and is not to be construed as a decision on any other provision. See Acquisition of Line by O. C. S. I. Ry., 86 I. C. C. 273, 274; Acquisition by A., T. & S. F. Ry., 138 I. C. C. 787, 789; Acquisition by St. L.-S. F. Ry., 145 I. C. C. 110, 114; Chicago, M. & St. P. Reorganization, 131 I. C. C. 673, 691-92; New York Central R. Co. Assumption, 158 I. C. C. 317, 320-23; Pacific Coast R. Co. Acquisition, 187 I. C. C. 563 and 189 I. C. C. 79. Cf. Keeshin Transcon. Freight Lines, Inc. — Debentures, 5 M. C. C. 349, 351. In fact, the Commission has said that § 20 (a) (2) “confers upon us power to grant or deny authority to issue securities or to assume obligation or liability . . . only upon ap*378plication by the carrier for such authority.” New York Central R. Co. Assumption, 158 I. C. C. 317, 322.

In the Commission’s view, authority to consolidate includes the authority to acquire and operate properties of other roads, but neither that authority nor the authority to issue securities upon consolidation includes authority to assume liabilities of the constituent companies. Rock Island System Consolidation, 193 I. C. C. 395, 403-04; Santa Fe Trail Transp. Co. — Merger, 5 M. C. C. 324, 328; cf. Illinois Terminal R. Co. Consolidation and Securities, 2211. C. C. 676. .The Court’s suggestion that this was not so before the Commission promulgated its general plan of consolidation under § 5, is contrary to the ruling in Acquisition & Stock Issue by P., 0. & D. R. R., 105 I. C. C. 189. In that case, before the promulgation of the plan, the Commission was at pains to warn (p. 193) that its approval of an issue of securities to carry out a consolidation under state law did not involve any decision on assumption of liability of the obligations of the consolidated company’s constituents. Assumption of Obligation by L. S. & I. R. R., 86 I. C. C. 640, and Grand Trunk W. R. Co. Unification and Securities, 158 I. C. C. 117, 138, 142-43, both decided before the: promulgation of the plan, granted permission to assume the obligations of the constituents and thus gives further proof that the Commission, when it intended to take any position with respect to the assumption of obligations in connection with a consolidation, did so by action affirmatively expressed rather than by silence.

The Commission has entertained applications for the approval, under § 1 of the Act, of the operation of acquired properties, or for approval of security issues upon consolidation, without any application for the approval of the assumption of the liabilities involved. See Acquisition and Stock Issue by N. Y., C. & St. L. R. Co., 79 I. C. C. 581; Pacific Coast R. Co. Acquisition, 187 *379I. C. C. 563; cf. Rock Island System Consolidation, 193 I. C. C. 395, 403-04. And in the case of this appellant, as of other roads, it has later entertained and disposed of separate applications for the approval of the assumption of the obligations involved. N. Y., C. & St. L. R. Co. Assumption of Obligation, 217 I. C. C. 598; N. Y., C. & St. L. R. Co. Bonds and Assumption, 221 I. C. C. 772; N. Y., C. & St. L. R. Co. Assumption of Obligation and Liability, 247 I. C. C. 71; St. Louis-S. F. Readjustment, 145 I. C. C. 218; Pacific Coast R. Co. Securities, 189 I. C. C. 79; Cincinnati Union Term. Co. Securities, 166 I. C. C. 419 and 499, and 184 I. C. C. 619; West Jersey & S. R. Co. Bonds, 217 I. C. C. 125; cf. Assumption of Obligation by N. O., T. & M. Ry., 94 I. C. C. 218.

Such action by the Commission plainly precludes any inference that, in approving an application for the operation of the consolidated lines or an issue of securities under a consolidation, it was doing more than responding to the petition presented to it or that it was undertaking to pass on the legality or propriety of the assumption by the consolidated road of guarantee obligations of its constituent companies. We are. pointed to nothing suggesting that the Commission has ever regarded such approvals as involving an unasked determination with respect to the assumption by the consolidated carrier of the obligation of its constituent companies.

There is thus no plausible ground for saying that there was lurking in the Commission’s decision in 79 I. C. C. 581 some implied ruling as to the construction of § 20 (a) (2) and some implied refusal to act because of that construction, in a situation in which it was not asked or expected to act and in which, for reasons already stated, it was under no duty to act. In none of the cases cited in the opinion of the Court as hinting at a possible construction by the Commission of § 20 (a) (2) was it asked to make any finding or order with respect to the assump*380tion by appellant of obligations of its constituent companies. In none did it make or decline to make any of the findings or the order required by § 20 (a) (2) with respect to such obligations. In none did it express any opinion whether obligations attaching to a consolidated carrier are within the prohibition of the statute, or as to its duty to approve or disapprove of their assumption.

In Operation of Lines and Issue of Capital Stock by the N. Y., C. & St. L. R. Co., 79 I. C. C. 581, the Commission was asked to, and did, specifically approve the operation by appellant of the consolidated line and the issuance of certain stock by appellant, pursuant to the consolidation plan, and nothing more. It made no mention of any assumption of obligation by appellant or of the assumption provisions of § 20 (a) (2). It neither took nor declined to take action affecting such assumption. For all that appears, the Commission, in its examination of the capital structure and the balance sheet of appellant, may have disregarded the guarantee obligation as one not affecting the consolidated company because its assumption had not been approved by the Commission.

It construed the consolidation provisions in § 5 of the Act as permitting carriers to consolidate under state law without first securing the Commission’s authorization for the consolidation itself. Whether or not this was the necessary interpretation of the consolidation provisions, cf. Snyder v. New York, C. & St. L. R. Co., 278 U. S. 578, nothing in the report of the Commission’s decision suggests that if it was essential, in order to carry out the consolidation under state law, that obligations be “assumed,” then the assumption could be accomplished without compliance with § 20 (a) (2). Its decision is in fact inconsistent with any such theory, and affords affirmative evidence that the Commission thought § 20 (a) (2) *381was operative notwithstanding the narrow interpretation which it gave to § 5.

The Commission authorized appellant to issue, under § 20 (a) (2), certain preferred and common stock, to be exchanged for the stock of its five constituent companies in carrying out the consolidation. If consolidations under state law could, in the Commission’s view, be effected at that time wholly without regard to § 20 (a) (2), then the granting of authority to issue the stock would have been superfluous. That the Commission deemed such authority necessary is persuasive that it regarded § 20 (a) (2) as applicable to all issues of securities, or assumptions of obligations, which occurred in connection with a consolidation. Freedom to consolidate, in the Commission’s view, plainly did not include freedom to make adjustments in capital structure without the authorization required by § 20 (a) (2). Hence, the only real question is whether an obligation assumed or attaching merely by operation of law is an “assumption” within the meaning of § 20 (a) (2) — a question which, as will presently appear, the Commission has consistently answered in the affirmative, whenever it has been called upon to give an answer.

Subsequent proceedings before the Commission affecting appellant, in the cases on which the Court relies, presented no question of its liability upon the guarantee obligations of its constituent companies, and are equally barren of any indication that the Commission considered the meaning and application of the assumption provisions of § 20 (a) (2) or that it had any occasion to do so. In N. Y., C. & St. L. R. R. Bonds, 82 I. C. C. 365, and in Pledge of Bonds by N. Y., C. & St. L. R. R., 86 I. C. C. 465, next cited by the Court as sustaining its decision, the questions presented to the Commission had not even a remote relation to any assumption by appellant of guarantee obligations, resulting from the consolidation, which the *382Commission had not by its order approved. In the one case the application was fpr authority to make a new bond issue; in the other for permission to pledge some of its own assets to secure a new note issue. Passing references by the Commission, in recounting the history of the consolidation, to the fact that appellant had acquired the properties of constituent companies “subject to all their debts, obligations and liabilities,” and that it “has assumed all obligations” of a different constituent company from that here involved, can hardly be accepted as evidence of an unasked administrative construction of a provision of a statute which it was not administering and with respect to which it expressed no opinion.

The Court gains no support for its conclusion from the supposed recognition by the Commission, in the Akron case, that the “resulting liability” from appellant’s consolidation had been “apparently admitted.” Akron, C. & Y. Ry. Co. & Northern O. Ry. Co. Reorganization, 228 I. C. C. 645, 647. The bankruptcy reorganization, whose approval by the Commission was there sought, was that of the Northern Ohio Railway, the guarantee of whose bonds is presently involved. What had “apparently” been “admitted” by the proposed reorganization was that, so far as appellant should perform or be compelled to perform the guarantee, it would become a creditor of the new company, entitled to participate in the new securities to be issued to creditors under the reorganization. The only action taken by the Commission with respect to the obligation was to approve (p. 673) the provision of the plan, which reserved new securities of the reorganized company for the satisfaction of appellant’s claim “pending performance,” if any, of the guarantee, by appellant, and to order (p. 684) the reorganized company to issue to appellant its proportion of the new securities upon “appropriate proof” by appellant “of loss sustained in the performance of its contract of guarantee.” The Commission thus had no oc*383casion to determine the question which appellant asks to have determined here, and pointedly left it undecided. Obviously, the approved plan gave appellant a powerful incentive to resist performance of the guarantee and manifestly did not purport to foreclose'appellant from securing the adjudication of the liability which it seeks here.

Not only do these cases fail to disclose any self-denying construction of § 20 (a) (2) by the Commission, but in others, where the Commission has been called on to consider the question, it has taken the position that the word “assumption” in § 20 (a) (2) includes an obligation placed upon the carrier merely by operation of the state law under which it had acquired property.

Three times since its decision in 79 I. C. C., the Commission has granted the application of appellant to be permitted to extend and also to assume obligations of its constituent companies. N. Y., C. & St. L. R. Co. Assumption of Obligation, 217 I. C. C. 598; N. Y., C. & St. L. R. Co. Bonds and Assumption, 221 I. C. C. 772; N. Y., C. & St. L. R. Co. Assumption of Obligation and Liability, 247 I. C. C. 71. In two of these cases, the Commission authorized appellant to assume obligations of the Lake Erie & Western — the same constituent company whose obligation is now said to have been assumed without the necessity of the Commission’s authorization. If appellant was already personally liable on the obligations, permission to assume them was unnecessary. And since the Commission does not entertain applications for authority to assume obligations where it is of the opinion that the obligation is not one to which § 20 (a) (2) applies, Southern Pacific Co. Assumption of Obligation, 189 I. C. C. 212, 213; Bonds of A. & M. Railway Bridge & Term. Co., 94 I. C. C. 79, 81; Missouri-K.-T. R. Co. Assumption of Obligation, 212 I. C. C. 217; Pittsburgh & Shawmut R. Co. Securities, 166 I. C. C. 503, 505, its action in authorizing the assumptions, in addition to the extensions, is inconsistent with any in*384ference on our part that it had previously ruled that the obligations assumed were not required to comply with §20 (a) (2).

On the contrary, the Commission applied that section to obligations like the present soon after enactment of the Transportation Act of 1920. In Assumption of Obligation by Hudson River Connecting R. R., 72 I. C. C. 595, decided nine months before its decision in 79 I. C. C., the Commission took jurisdiction of an application for approval of an assumption of obligation resulting by operation of New York law from a carrier’s acquisition of property. In granting the application and in authorizing the carrier to “assume” the attached obligation the Commission stated, page 596:

“While the applicant does not propose to make any indorsement on the bonds, or execute any agreement in respect of the payment of them, it appears that, under the laws of New York, the acceptance of a deed conveying land subject to a mortgage indebtedness, which the grantee agrees to assume, has the effect of making the land the primary fund for the payment of the mortgage indebtedness, so that the grantee becomes the principal debtor and the grantor a surety.”

The Commission made the findings prescribed by § 20 (a) (2) and ordered that the applicant be “authorized to assume obligation and liability” in respect of the mortgaged bonds, “said assumption of obligation and liability ... to be accomplished by the acceptance by the applicant of a deed of said lands.”

More recently, in Public Service Coordinated Transport — Assumption of Obligation, 15 M. C. C. 406, a motor carrier case under § 214 of the Interstate Commerce Act, which incorporates by reference § 20 (a) (2), the Commission reaffirmed its earlier construction of § 20 (a) (2) as applying to obligations like the present, saying (p. 408):

*385“Prior to consummation of the merger, applicant’s liability in respect of the bonds of said companies was of a contingent nature. Under the statutes of New Jersey all debts and liabilities of merged or consolidated corporations shall thenceforth attach to the consolidated corporation and may be enforced against it to the same extent as if said debts and liabilities had been incurred or contracted by it. Thus, through completion of said merger, applicant has, by operation of law, become the principal obligor in respect of these bonds, and, as such, has obligations and liabilities in respect thereof which differ from the contingent liability previously existent. In our opinion assumption of such obligations and liabilities as successor in title is a matter over which we have jurisdiction.” 2

While courts are not necessarily bound by the Commission’s construction of the Interstate Commerce Act, Mitchell v. United States, 313 U. S. 80; United States v. Chicago, M., St. P. & P. R. Co., 282 U. S. 311, they rightly pay deference to the Commission’s considered construction of it, especially when it is of long standing and has *386never been departed from. But it is novel doctrine that a provision of an act of Congress may be nullified by a construction of the Interstate Commerce Commission which can be inferred only from the fact that the Commission ignored the provision in a proceeding in which, by its settled practice, it was not called upon to construe or apply it. Certainly, the Commission does not appear ever to have acted upon any such view, nor has it come before us to advocate it. It seems plain that the rulings of the Commission that § 20 (a) (2) is applicable to those obligations which state law attaches to the carrier in consequence of its participation in a consolidation, as well as to those which attach to it by reason of its expressed promise, carry out the purposes of the statute and are consistent with its language. Section 20 (a) (2) was enacted to prevent the imposition on the railroads of the country, through consolidation or otherwise, personal liability for the obligations of other roads, such as had occurred in certain well known consolidations notorious for their disregard of the interests of security holders and the public. See 58 Cong. Rec. 8317-18. As the effective means of prevention it prescribed that all such obligations should be void, unless the Commission orders their approval as compatible with the public interest.

But even if we assume that the silence of the Commission in 79 I. C. C. can be taken to intimate a view of the meaning of § 20 (a) (2), with respect to which it took no action and made no order, it seems still more novel to say that such an inference must control our decision here, in the face of its explicit construction of the statute in other cases as applicable to situations like the present. Even sporadic and inconsistent administrative decisions, where the parties have relied upon them, may sometimes both be followed by courts when applied to those parties. But the -unarticulated intimations óf .opinion-of an administrative body, unacted upon, are too inconclusive *387to control judicial decision. Courts are not like weathercocks, changing with every administrative wind that blows. They cannot on the same day rightly decide that the same statute means different things in different cases, merely because the Commission may on different days have had shifting impressions which it has not thought sufficiently important to express in any ruling, opinion, decision or order.

United States v. Chicago North Shore R. Co., 288 U. S. 1, upon which the Court relies, has no significance here. It is one thing to accept judicially the Commission’s decision that a particular carrier is an “interurban electric railway,” a determination unquestionably within its power and peculiarly within its administrative competence. It is quite another to bind the courts by a construction of the statute which the Commission has never voiced, but which, on the contrary, it has consistently denied, namely, that obligations may be assumed without conscious and express permission of the Commission and in defiance of the declared will of Congress.

It is impossible to believe that the all-inclusive provisions of § 20 (a) (2), passed in response to a general and long-felt need for the federal regulation of railroad capitalization, were intended to exclude assumptions of obligations which attach by virtue of state law. The statute makes § 20 (a) (2) subject only to one exception — short-term notes maturing in not more than two years, § 20 (a) (9) — and even in that instance the carrier is required to file with the Commission a certificate of notification. No other exception was provided, and it is apparent that none was intended.3

*388We are not concerned here with doubts whether appellant is validly organized under New York law. No such issue is presented by the record. The only question before *389us is whether personal liability can be assumed by appellant without complying with the statute, which makes such an assumption void “even though permitted by the authority creating the carrier corporation” “unless and until, and then only to the extent that” the Commission has approved the assumption after making the prescribed findings.

The statute does not deprive the holders of obligations of the constituent companies of any rights against them or their property. It only prevents the acquisition by such holders, contrary to the public interest, of new rights against the consolidated carrier without the consent of the Commission, and by § 20 (a) (11) the statute gives a remedy to those who, like appellee, become innocent purchasers of such securities, after consolidation, for the loss of such rights through the operation of § 20 (a) (2). The application of the statute in this case no more involves enriching stockholder equities than in any other. The question in every case is whether the public, and railroad security holders, shall be burdened, through repeated reorganizations of railroads, with excessive indebtedness which it was the purpose -of the statute to prohibit. It is obvious that the statute would fail of its proclaimed purpose unless, as the Commission has ruled, its prohibitions extend to those obligations which the consolidated carrier assumes by virtue of its entering into a consolidation under state law, as well as those which it assumes by its expressed promise. The words of the statute neither compel nor persuade to the decision now given, which seems to rest on nothing more substantial than a far-fetched surmise. It defeats the Congressional purpose and conflicts with the legislative history and administrative construction of the statute.

Mr. Justice Reed, Mr. Justice Frankfurter and Mr. Justice Byrnes join in this opinion.

49 U. S. C. § 20 (a) (11), after providing that assumptions of obligations not approved by the Commission are void, declares:

“If . . . any security in respect to which the assumption of obligation or liability is so made void, is acquired by any person for value and in good faith and without notice that the . . . assumption is void, such person may in a suit or action in any court of competent jurisdiction, *375hold jointly and severally liable for the full amount of the damage sustained by him in respect thereof, the carrier which . . . assumed the obligation or liability so made void, and its directors, officers, attorneys, and other agents, who participated in any way ... in the authorizing of the assumption of the obligation or liability so made void.”

It appears from the record, in an affidavit upon which summary judgment was granted, that in 1936, after the consolidation, appellee purchased the bonds from a broker for value “without notice of any defense thereto or to the guarantee thereof.”

See also Elmira & L. O. R. Co. Acquisition, 170 I. C. C. 127, where the Commission approved an “assumption” of liability which was apparently to attach (see p. 128) solely by operation of the New York stock corporation laws. Cf. Assumption of Obligation by L. S. & I. R. R., 86 I. C. C. 640, where in authorizing an “assumption” the Commission stated: “Under the agreement and the laws of Michigan the debts, liabilities, and duties of the last two companies named attach to the applicant and are enforceable against it to the same extent and in the same manner as if originally incurred by it. The applicant accordingly seeks authority to assume obligation and liability in respect of the securities of these companies.” Cf. also Union R. Co. Assumption of Obligation and Liability, 217 I. C. C. 635, where, in authorizing an assumption the Commission stated: “Pursuant to the terms of the joint agreement of merger dated October 1, 1936, and the provisions of the laws of the Commonwealth of Pennsylvania, the applicant will assume all the debts and obligations of thé” constituent corporations,

Examination of the historical background of § 20 (a) can leave no genuine doubt that the financial provisions of § 20 (a) (2) were meant to be all-inclusive. Abuses in railroad financing had been a continuous subject of public concern. See the report of the Windom Committee in 1874, S. Rep. No. 307, 43rd Cong., 1st Sess., Vol. I, pp. 71-76; the *388report of the Cullom Committee in 1886, S. Rep. No. 46, 49th Cong., 1st Sess., part I, pp. 51-52. In 1907 the Interstate Commerce Commission, reporting upon its investigation of the Union Pacific and the Chicago & Alton railroads, recommended federal regulation of security issues. In re Consolidations and Combinations of Carriers, 12 I. C. C. 277; and see also the Commission’s Annual Report for 1907, p. 24. In 1910 President Taft urged upon Congress federal regulation of railroad securities, 45 Cong. Rec. 380, but the Senate’s opposition prevented the proposal from being included in the Mann-Elkins Act. In 1913 the Commission concluded its New England Investigation, 27 I. C. C. 560, 616, with the recommendation that “No interstate railroad should be permitted to lease or purchase any other railroad, nor to acquire the stocks or securities of any other railroad, nor to guarantee the same, directly or indirectly, without the approval of the federal government.” Senate opposition again proved too strong in 1914, as well as in 1916, but by the end of the war opposition to the regulation of railroad capitalization practically disappeared. See LocHin, Regulation of Security Issues by the Interstate Commerce Commission, pp. 12-22; Sharfman, The Interstate Commerce Commission, Vol. I, pp. 86-94, 189-93; and the Commission’s Annual Report for 1919, pp. 4-5.

Section 20 (a) when finally enacted was thus a thoroughgoing reform, long considered and at last virtually unopposed, designed to vest in the Commission “exclusive and plenary” jurisdiction, § 20 (a) (7), over changes in the capital structures of the railroads. Its enactment, see Sharfman, op. cit., supra, Vol. I, p. 190, “was not only a fulfilment of the Commission's repeated recommendations, but grew out of a practical unanimity of opinion among the numerous and diverse interests that sought to influence the character of the new legislation. While this extension of the Commission’s authority was designed, indirectly, to protect the investing public against the dissipation of railroad resources through faulty or dishonest financing, its dominant purpose was to maintain a sound structure for the rehabilitation and support of railroad credit, and for the consequent development of the transportation system. It aimed to render impossible the recurrence of the various financial scandals, with their destruction of confidence in railroad investment, which had become notorious, and to prevent the subordination of the carriers’ stake as transportation agencies to the financial advantage of alien interests.”