airlines, nor can consuming territory be
apportioned by straight lines. That Bir-
mingham is entitled to compete in the
widest markets cannot be questioned,
and a theory cannot be accepted which
limits the realms of commercial activity
of a producing point to a definite radius,
and excludes from that territory all
other producers. Alabama Coal Opera-
tors' Ass'n v. S. Ry. Co., 21 I. C. C. 230,
232.
(e) All markets cannot be opened to
every producing point. In Re Advances
in Rates Western Case, 20 I. C C. 307,
354.
(f) Each market has a right to insist
upon a -rate adjustment that is fair.
Board of Trade of Chicago v. A. C. R. R.
Co., 20 I. C. C. 504, 507.
(g) No jobbing point is entitled be-
cause of unfair adjustment of rates to
exclusive possession of, or complete su-
premacy in, a particular consuming terri-
tory. A carrier may not by the estab-
lishment and maintenance of unreason-
able rates give possession of a consum-
ing territory to the jobbers at a point
selected or favored by the carriers. Job-
bers are shippers and every shipper is
entitled to reasonable rates. Every lo-
cality is entitled to reasonable and non-
discriminatory rates, and the dealers at
any point are entitled to trade wherever
and as far as reasonable rates will per-
mit. Billings Chamber of Commerce v.
C. B. & Q. R. R. Co., 19 I. C. C. 71, 75.
(h) There is no good reason why de-
fendant's rates on lumber from Omaha
to certain points in Colorado, Kansas,
South Dakota and Wyoming should be so
adjusted that the Omaha dealers may
merchandise, sort and mix lumber at
Omaha and dispose of it in all this terri-
tory on combination rates that are no
higher than joint through rates from
points of production to the same points
of consumption. If Omaha is entitled to
such a rate adjustment it follows that
other places would have the same right,
and such a general adjustment would
apparently be possible only on the appli-
cation of the postage stamp theory of
rates. Commercial Club of Omaha v. C.
& N. W. Ry..Co., 19 I. C. C. 156, 159.
(i) The present rates from the east
to Spokane are the result of a deliberate
attempt to carve out a certain territory
in which the jobber of Spokane should
have the advantage in rates over his
competitors upon the coast or elsewhere.
While it is of great importance to Spo-
kane as a commercial center that it shall
control the wholesaling business into
surrounding territory, and while there is
great force in its claim that no schedule
of rates can be right which permits mer-
chandise to be hauled from the east over
the Cascade Mountains to Seattle and
back again to the consumer upon the
east of that mountain range, the right of
Spokane to control this territory should
depend upon a reasonable adjustment of
rates, which is open to Spokane and to
all corresponding territory, and not upon
a special arrangement peculiar to that
locality. City of Spokane v. N. P. Ry.
Co., 19 I. C. C. 162, 167.
EQUALIZATION OF RATES, 6 (j) (m)
307
(j) It is doubtful whether rates may
be constructed for the express purpose
of compelling the manufacture or mer-
chandising of a commodity at particular
points. City of Spqkane v. N. P Ry. Co.,
19 I. C. C. 162, 168.
(k) While general commercial condi-
tions should be considered, and while de-
fendants might properly decline to ap-
ply the same rate to the longer haul
from New York to Spokane which they
apply to the shorter haul from Chicago,
it may be doubted whether they should
be permitted to construct a tariff for the
express purpose of compelling the manu-
facture or the merchandising of a given
commodity at Chicago or upon the Mis-
souri River or at the Atlantic seaboard.
Some system of rates which on the
whole seem just and reasonable should
be established, and these different com-
munities should be permitted to do what-
ever business they can under that rate
system. City of Spokane v. N. P. Ry.
Co., 19 I. C. C. 162, 168.
(1) Complainant manufactured cement
plaster at Laramie, Wyo., and at Gypsum,
la., being in competition at the latter
point with other manufacturers, and also
with manufacturers at Rapid City, S. D.
Complainant attacked the reasonableness
of the rates from Gypsum to destina-
tions upon the C. M. & St. P. Ry. in South
Dakota and North Dakota and of the
rates from Council Bluffs, la., to the same
points, and alleged discrimination in favor
of Gypsum as against Council Bluffs, and
in favor of Rapid City as compared with
both Council Bluffs and Gypsum. Cement
plaster manufactured at Gypsum sold
f. o. b. that point at $3 per ton. It loads
easily to the marked capacity and suf-
fers no damage in transit. It is in uni-
versal use for building purposes. The
per ton mile yield on the rates from Gyp-
sum attacked ranged from 10 to 15 mills
over distances ranging from 150 to 550
miles. Charges from Gypsum were ma-
terially less than those applying to lum-
ber, somewhat less than those on wheat,
but little in excess of rates on brick,
and about one-half the rate on cattle.
While higher than the rates on the same
commodity in other territory, the rates
from Gypsum were not, with some ex-
ceptions, in excess of the general level
of rates in the territory involved. The
rate to Council Bluffs on the plaster
manufactured at Laramie was not com-
plained of. No joint rates were in effect
;o the destinations in question from
Laramie via Council Bluffs. Defendant
C. M. & St. P. Ry. claimed the right to
protect the mills which it served at
Gypsum and Rapid City, upon its
own line, by imposing higher charges
:han would otherwise be proper, from
Council Bluffs. The rates attacked from
Council Bluffs exceeded the rates on lum-
ber, were materially higher than those
upon wheat and brick, and were only
slightly lower than those upon cattle.
While cement plaster loads easily to a
minimum of 50,000 or 60,000 Ibs., the
vhite plaster manufactured at Gypsum
and Rapid City would deteriorate in the
hands of the dealer before carloads with
such a minimum could be disposed of,
^hereas the brown plaster made at Lara-
mie improved with age. The states of
Iowa, Minnesota and South Dakota estab-
ished a minimum of 30,000 Ibs. on cement
plaster. The minimum of defendants on
lumber was 30,000 Ibs., on cattle 22,000
Ibs., on brick and wheat 40,000 Ibs. To
certain of the destinations in question a
lower rate was accorded to Gypsum up-
on condition that a 60,000-lb. minimum
be loaded, while no similar concession
was made to Council Bluffs. HELD, the
rates attacked from Gypsum were not
greatly out of line with the rates gener-
ally prevailing in the territory in ques-
tion and were not unreasonable except
in certain instances. Schedules of lower
rates prescribed in these instances. De-
fendant had no right to impose unreason-
able rates from Council Bluffs in order
to protect the mills served by it at Gyp-
sum and Rapid City. Scfiedules of lower
rates from Council Bluffs prescribed to
correspond with the general level of
rates in the territory involved. A mini-
mum of 30,000 Ibs. should be put into
effect from all the points of origin in
question, and wherever a lower rate was
accorded to Gypsum on a minimum of
60,000 Ibs., the same reduction should be
given to Council Bluffs. Reparation de-
nied, since it was not made to appear
that the rates attacked were unreason-
able at the time shipments were made.
Acme Cement Plaster Co. v. C G. W Ry.
Co., 18 I. C. C. 19, 20-24.
(m) A carrier, may not, in order to
protect mills located on its line, exact
unreasonable rates on traffic originating
at mills located upon other lines. Acme
Cement Plaster Co. v. C. G. W. Ry Co ,
18 I. C. C. 19, 20-24.
308
EQUALIZATION OF RATES, 6 (n) (r)
(n) Complainant, flour millers in
Minnesota, North Dakota, South Dakota
and Wisconsin, attacked the rail-lake-and-
rail rate on flour of 23c from Minneapolis
as a typical point to New York via Du-
luth as discriminatory in favor of millers
at Buffalo, as compared with the rate of
about lOc on wheat from Minneapolis to
Buffalo, and of lOc on flour from Buffalo
to New York, and as compared with the
rate of 20.83c on wheat from Minneapolis
to New York, under the existing ex-lake
rate from Buffalo of 10.83c, which in-
cluded cost of elevation. From Minne-
apolis to Duluth the rates on wheat, 5c,
and on flour, 5.8c, were substantially on
a parity and likewise from Buffalo to
New York the local rate on flour was
lOc, the local rate on wheat, 10.83c. From
Duluth to Buffalo, however, the rates on
flour and wheat were not on a parity,
that on flour being 7.6c and on wheat
3.5c. The Buffalo miller was, therefore,
given an advantage over the Minneapolis
miller of some 3c per 100 Ibs. For a
number of years prior to 1898 the regular
or package lines of boats on the lakes
were independent of the railroads and a
differential of 5c under the all-rail rate
existed via rail-lake-and-rail. The rail-
roads gradually absorbed the lake lines
and in 1898 increased the rail-lake-and-
rail rate on flour 2c per 100 Ibs., and in
1902 increased it another Ic. At some
seasons of the year the rate on wheat
was made by the tramp boats and at
other seasons by the regular line boats
controlled by defendants. The 3.5c rate
on wheat by water from Duluth to Buf-
falo was admitted to be profitable. It
cost 2c less to carry wheat than to carry
flour on the lake. The independent boats
were unable to secure the flour business
because defendants controlled the ter-
minals and wharves and refused to per-
mit them to load or unload thereat and
refused to receive packages from inde-
pendent boats. Subsequent to the in-
crease in rail-lake-and-rail rates in 1898
and in 1902, and prior to Aug. 28, 1906,
the actual rate paid on flour from Minne-
apolis to New York rail-lake-and-rail did
not exceed 20c per 100 Ibs. The addi-
tional costs to the Buffalo miller for
handling wheat at Buffalo were offset
by similar costs to the Minneapolis
miller. Under the schedule of rates at-
tacked the Buffalo millers were steadily
gaining in the output and the Minne-
apolis millers steadily losing. HELD,
the rates on wheat and flour should be
on a parity along a given line of trans-
portation, so as to enable millers to dis-
tribute their mills at points along the
line and still remain on equal terms with
respect to competition; that the rate on
flour should be fixed above that on wheat
only to the extent of the additional cost
of transportation; and that the rail-lake-
and-rail rate on flour from Minneapolis.
as a typical point, to New York should
not exceed 21^c. Jennison Co. v. G. N.
Ry. Co., 18 I. C. C. 113, 123.
(o) The difference in profits and
ability to sell in common markets as be-
tween Buffalo and Minneapolis millers
is a purely commercial question in so far
as it goes beyond the question of trans-
portation costs and cannot enter into the
determination of rates. Jennison Co. v.
G. N. Ry. Co., 18 I. C. C. 113, 123.
(p) The Commission, in determining
whether a carrier and its connections
unduly discriminate in their transporta-
tion charges from competing coal mines
to a common market cannot undertake
to equalize differences in the cost of
production, whether natural or artificial.
Andy's Ridge Coal Co. v. So. Ry. Co.,
18 I. C. C. 405, 409.
(q) Neither the east nor the west has
any vested right to sell a certain amount
of goods in southern territory. Each
section is entitled to a reasonable rate
and to do what business it can under
that rate. Receivers and Shippers' Ass'n
of Cincinnati v. C. N. O. & T. P. Ry Co.,
18 I. C. C. 440, 459.
(r) Complainant attacked the rate of
23c on petroleum and its products from
Coffeyville, Kan., to Memphis, Tenn., 469
miles, and of 22c from Coffeyville, Kan.,
to Omaha, Neb., 362 miles. The rate
from Coffeyville to St. Louis, 418 miles,
was 17c. The Memphis rate of 23c was
based upon the rate to St. Louis plus a
6c rate down the river, although the traf-
fic from Coffeyville to Memphis moved
by direct route and not by St. Louis.
The rate from Coffeyville to Omaha was
based upon Kansas City, the differential
over the Kansas City rate being 9c. The
Standard Oil Co. of Sugar Creek, near
Kansas City, was given to Omaha a rate
of 13c, distance 205 miles. HELD, since
Sugar Creek was given the advantage of
her proximity to the markets of Omaha
on the north, Coffeyville should be given
the advantage of her proximity to the
markets of Memphis in the south, and
the rate to Memphis should not exceed
19c and to Omaha 17c, National Pe-
EQUALIZATION OP RATES, 6 (s) (bb)
309
troleum Ass'n v. M. P. Ry. Co., 18 I. C. C.
593, 595.
(s) Complainant was charged $1.85
per gross ton on crushed stone from
Cedar Bluff, Ky., to Baton Rouge, La.,
said rate yielding 2.84 mills per ton. The
rate from Cedar Bluff to New Orleans
was $1.50. Cedar Bluff was 580 miles
from Baton Rouge and 599 miles from
New Orleans. The rate to New Orleans
was established to permit the sale of
stone from Cedar Bluff in competition
with stone quarried in Alabama. HELD,
the rate attacked was not unreasonable
per se, or unduly discriminatory, as com-
pared with that to New Orleans. South-
prn Bitulithic Co. v. I. C. R. R. Co., 17
I. C. C. 300.
(t) The Commission cannot compel
rail carriers from Florida to markets for
pineapples to reduce their rates to meet
the lower and cheaper water charges
from Cuba. Florida Fruit & Vegetable
Ass'n v. A. C. L. R. R. Co., 17 I. C. C.
552, 562.
(u) Complainant jobbers at Atlanta
and other Georgia cities attacked the
rates on grain products and hay on ship-
ments from Ohio and Mississippi River
crossings and beyond to points in south-
eastern territory, on the ground that the
practice of extending the same rates to
less-than-carload as to carload shipments
was unreasonable, in view of the larger
expense to the carrier of delivering the
less-than-carload traffic. Under the rates
attacked the consumers and small deal-
ers at Georgia and surrounding points
were able to procure these commodities
from Ohio and Mississ'ppi River cross-
ings and from Nashville as cheaply as
the larger jobbers who brought in car-
load shipments. To establish less-than-
carload rates higher than carload rates
would have the effect of compelling con-
sumers and small dealers at Georgia and
southeastern points to purchase from and
pay middlemen's profits to the large
Georgia and southeastern jobbers, in-
stead of obtaining directly their supplies
at lower rates from Mississippi and Ohio
River crossings and from Nashville.
HELD, that a railroad could not be per-
mitted to adopt a system of rate making
which enabled a large dealer to drive
a small dealer out of the market; that
the Commission could not act on the
theory that the trade of a particular com-
munity was a vested right, belonging to
any particular class in that community,
especially when so to do would result
in the enjoyment of a privilege by that
class at the expense of the community
at large; and that since the effect of an
order prescribing differentials on less-
than-carload quantities would be to place
a tax on retailers and consumers in order
that jobbers in southeastern territory
might realize a profit in competition with
Nashville jobbers and at the expense of
the community, such an order should be
refused. Duncan & Co. v. N. C. & St. L.
Ry. Co., 1C I. C. C. 590, 595.
(v) While a carrier ought not and
should not be required to equalize ac-
cess to markets for all engaged in a com-
mon business, if the shippers are differ-
ently situated and are not entitled to the
same rates, it may be perfectly lawful
for it to give equal access to markets to
localities of dissimilar distances, where
such d'stances involve no material in-
crease in the transportation expense.
Avery Mfg. Co. v. A. T. & S. F. Ry. Co.,
16 I. C. C. 20, 24.
(w) No locality, manufacturer or
shipper has an exclusive right to supply
a market. Avery Mfg. Co. v. A. T. &
S. F. Ry. Co., 16 I. C. C. 20, 24.
(x) Carriers may not by arbitrary
adjustment of rates dictate or determine
where wheat shall be milled or flour
^hall be marketed. Valley Flour Mills
v. A. T. & S. F. Ry. Co., 16 I. C. C.
73, 78.
(y) Under no law, common or statute,
is a jobber entitled to distribute com-
modit'es under as low or lower total
freight rates as the through rates from
point of origin to point of consumption.
Williams Co. v. V. S. & P. Ry. Co., 16
r. C. C. 482, 486.
(z) Every locality competing in a
common market is entitled to rates which
are relatively reasonable and just in
compar'son with rates from other local-
ities served by the same carrier. Black
Mountain Coal Land Co. v. So. Ry. Co.,
15 I. C. C. 286, 294.
(aa) The duty imposed by law is to
give equal treatment to all shippers who
are in a position to demand it, and this
includes the right to reach competitive
markets on relatively equal terms. Black
M untain Coal Lpnd Co. v. So. Ry. Co.,
15 I, C. C. 286, 292.
(bb) The Commission has no author-
ity to order the same rates on flour for
export as on wheat for export for the
purpose of placing the American miller
310
EQUALIZATION OF RATES, 6 (cc) 8 (a)
on competitive equality with the foreign
miller, in the absence of legislation by
Congress adopting such a national policy.
Bulte Milling Co. v. C. & A. R. R. Co.,
15 I. C. C. 351, 364.
(cc) In claiming that as Chicago af-
fords as good a market for grain as
does Milwaukee, the defendant may,
therefore, lawfully so adjust its rates to
force the grain to Chicago, it overlooks
the right of the shipper to choose his
own market and to do business where he
prefers. Chamber of Commerce of Mil-
waukee v. C. R. I. & P. Ry. Co 15
I. C. C. 460, 464.
(dd) Where plants producing fertil-
izer and located at different points in
one state are shipping to different points
on a line in another state, a 1 'anket
rate from such producing points to the
selling points should not be adopted
with a view to equalize rates between
competing plants, but the fair way is
to establish from each plant r..tes to
selling points which are inherently rea-
sonable, without special reference to
competitive conditions, and to allow
plants to sell in whatever territory their
location and a reasonable rate will per-
mit. Montgomery Fre : ght Bureau v.
Western Ry. of Ala, 14 I. C. C. 150, 151.
(ee) No shipper is obliged to confine
himself to the nearest markets, but the
markets of the country are and should be
open to anyone who can reach thr \
under just and reasonable rates. It is
not possible to adjust rates so that every
town may be a jobbing and distributing
point and be on an equality with all job-
bers or manufacturers at other points.
Certain natural advantages of location
must be recognized, and often they are,
of necessity, controlling. Competitive
conditions between carriers, between
producing points, and in common mar-
kets, must be given due weight. Dis-
tance, while in no sense controlling,
must be taken into consideration. New
Albany Furniture Co. v. M. J. & K. C.
R. R. Co., 13 I. C. C. 594, 600.
7. Size of Community.
See Evidence, 33, 53.
(a) A community is not entitled to
advantages in the adjustment of freight
rates simply because it is larger than
some neighboring community. If a lo-
cality has natural advantages, it should
be allowed to enjoy them, but it ought
not to be given the additional artificial
advantage which arises from a discrimi-
nating railway tariff. Suffern Grain Co.
v. I. C. R. R. Co., 22 I. C. C. 178, 182;
Harbor City Wholesale Co. v. S. P. Co.,
19 I. C. C. 323, 331.
(b) Function of carrier not to pro-
mote growth of large shippers at ex-
pense of small. California Commercial
Ass'n v. Wells, Fargo & Co., 14 I. C C.
422, 432.
(c) Advantages of location, such as
proximity to a navigable stream or
strong competition between carriers,
naturally result in lower rates to a town
so situated, and it is not the province
of the Commission to disturb the result-
ing rate relations unless the discrepancy
is so great as to effect an unjust dis-
crimination against the non-competitive
points. But the mere fact that a given
town has been recognized as a trade
center and is enabled by its more favor-
able rate adjustment to distribute in a
certain territory, cannot, justify the con-
tinuance of relative rates which result
in undue preference. The law contem-
plates relatively fair rates as between
different places, and the dealer located
in a small town is entitled to a reason-
able adjustment which will enable him
to compete on an equitable basis with
dealers at trade centers enjoying the
benefit of competitive rates. Payne-
Gardner Co. v. L. & N. R. R. Co., 13 I.
C. C. 638, 643
III. EFFECT OF EQUALIZATION.
8. Adjustment of Related Rates.
See Relative Rates.
(a) Ordinarily, rates not involved in
an inquiry before the Commission will
adjust themselves to the conditions
brought about by the order of the Com-
mission, but even though the assumption
that they will adjust themselves is er-
roneous, and the basis for the assump-
tion involves a mistaken factor as to
such other rates, still it does not neces-
sarily lead to the conclusion that the
regulation of the rate directly involved
in the order is invalid, or that the order
fixing such a rate should be annulled by
judicial authority, provided always the
rate so directly involved is reasonable
and just for shippers and carriers, with
relation to the particular destinations
concerned. N. & W. Ry. Co. v. U. S. 195
Fed. 953, 959.
EQUALIZATION OF RATES, 8 (b) (h)
311
(b) The Commission is not prevented
from reducing an unreasonably high rate
between certain points by the fact that
through competitive conditions some
other rate will have to be made unrea-
sonably low. N. & W. Ry. Co. v. U. S.,
195 Fed. 953, 960.
(c) Where it appears obvious that to
"Tnic the prayer of a complaint to re-
duce the rates from Indianapolis to the
Mississippi River would involve the
equalization of rates in all the territory
between Chicago and Buffalo, it must be
assumed that the effect of such wide-
spread reductions would be not only
great but injurious and perhaps confis-
catory upon the revenues of the carriers.
Indianapolis Freight Bureau v. C. C. C.
& St. L. Ry. Co., 23 I. C. C. 195, 208.
(d) Relief against discrimination due
to a rate adjustment cannot be denied on
the ground that other points similarly
situated might thereby be induced to ask
for like relief. Chamber of Commerce
of Newport News v. S. Ry. Co., 23 I. C.
C. 345, 356.
(dd) The fact that a reduction of an
unreasonable rate or the correction of an
unjust discrimination will require reduc-
tions or corrections at other points can-
not be accepted as a valid defense of
an unreasonable rate or an unjust dis-
crimination. Milburn Wagon Co. v. L.
S. & M. S. Ry. Co., 22 I. C. C. 93, 101.
(e) A change in one of a series of
related rates changes the relation among
all of them. Boileau v. P. & L. E. R. R.
Co., 22 I. C. C. 640, 654.
(ee) Shippers from Atlantic seaboard
territory are entitled to reasonable rates,
and if the establishment of such reason-
able rates by the Commission develops
unjust discrimination or unreasonable
rates from intermediate or related points,
the law casts upon the carriers the obli-
gation of providing reasonable and non-
discriminatory rates from such inter-
mediate or related points. In Re Ad-
vances in Rates by Carriers Operating
Between the Mississippi and Missouri
Rivers, 21 I. C. C. 546, 549.
(f) North, S. C., is located on defend-
ant S. A. L. Ry., 247% miles from Wil-
mington, N. C.; while Olar, S. C., is
278 y 2 miles. From Sept. 12, 1900, to
Oct. 15, 1908, defendant's rate on cotton
from North was 36c and from Olar 32c.
On Oct. 15, 1908, defendant raised the
rates to 45c from North and 51c from
Olar, in order that its through rates
might not exceed the sum of its local
rates. Dec. 4, 1908, the old rates were
restored. In the interval complainant
shipped cotton from North and Olar and
was charged the increased rates of 45c
and 51c, respectively. The old rates, re-
stored Dec. 4, 1908, remained in effect
until Sept. 17, 1909, at which time the rate
[rom North was advanced to 40c and
from Olar to 37c. These rates, how-
ever, included compression and yielded
the net rate from North of 32 %c and
from Olar of 29 y 2 c. A lower rate from