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and conditions, within the meaning of the interstate commerce law, so •as to make
it necessarily unlawful to furnish, without additional charge, an additional serv-
ice at the further city, by cartage from its depot to the places of business of the



consignees.



31



Competition. — The requirement of § 2 of the Interstate Commerce Act, that,
in order to constitute the offense of unjust discrimination, the transportation
must be "under substantially similar circumstances and conditions," refers to the
matter of carriage, and does not include competition, though it may be that the
same phrase found in § 4 of the act has a broader meaning.-^-

Justifying Long and Short Haul Charges. — The same evidence which war-
rants a finding that dissimilar circumstances and conditions exist which justify
a lower rate for a longer haul to one point than for a shorter haul to another
also establishes that the charging of such rates does not give one point an undue
preference and advantage over the other in violation of § 3 of the Interstate Com-
merce AcL^^

Nature of Goods Shipped. — Special distinctions may be made as to special
kinds of freight without violating the provision making it unlawful for any car-
rier to make or give any undue or unreasonable preference or advantage to any
particular person or any particular description of traffic. '''^

Live Stock and Dressed Meats. — The cost of carriage, the risk of injury,
and the larger amount which the railway companies are called upon to pay out in
damages for losses may excuse a higher freight rate on live stock than on dressed
meats and ])acking house products.'^ ^"^

Quantity of Goods Shipped. — Where common laundry soap in less than car-
load lots was assigned to the fourth class in the first classification made under
the Interstate Commerce Act, and was voluntarily maintained there by defendant
railroad companies for more than thirteen years, defendants were not justified
in reclassifying such freight so that it would pay twenty per cent less than third
class rates, without changing the car-load classification, on the mere claim that
the prior classifications had been inadequate to pay the cost of carriage in less
than car-load lots, there having been no general reclassification which would prox-

29. Cincinnati, etc., R. Co. v. Interstate reduction of freight rates for dressed
Commerce Comm., 206 U. S. 142, 51 L. meats and packing house products from
Ed. 995, 27 S. Ct. 648; Union Pac. R. Co. Missouri river points and other points
V. Updike Grain Co., 222 U. S. 215, 56 similarly situated to Chicago, which
L. Ed. 171, 32 S. Ct. 39. makes such rates lower than those

30. United States v. Tozer. 39 Fed. 369. charged for live stock, does not work an

31. Similar rates charged. — Detroit, etc., undue and unreasonable preference, where
R. Co. V. Interstate Commerce Comm., 21 the higher rate on live stock has not ma-
C. C. A. 103, 74 Fed. 803. terially affected any of the markets, prices,

32. Competition. — Wight v. United or shipments, being reasonably fair to
States, 167 U. S. 512, 42 L. Ed. 258, 17 S. Chicago and the shippers, and the ship-
Ct. 822. ments of live stock from the West to

33. justifying long and short haul Chicago are as great in proportion to the
charges. — Interstate Commerce Comm. v. bulk of the business as before the change
Nashville, etc., R. Co., 57 C. C. A. 224, of rates, and where the lower rate given
120 Fed. 934. to the packers was the result of competi-

34. Nature of goods shipped. — Southern tion, and does not directly influence or
Pac. Co. V. Interstate Commerce Comm., injure shippers of live stock. Judgment
200 U. S. 536, 50 L. Ed. 585, 26 S. Ct. 141 Fed. 1003, affirmed in Interstate Com-
330 merce Comm. v. Chicago, etc., R. Co., 209

35. Live stock and dressed meats.— A U. S. 108, 52 L. Ed. 705, 28 S. Ct. 493.



3635 INTERSTATi; COMMERCE ACT. § 4018

nnately apportion the cost of the service equally among the different articles of
traffic as between car loads and less than car-load lots.^*^ Unlawful preferences
and discriminations are created by fixing the freight rate for common soap in
less than car-load lots in a new classification adopted to govern in official classi-
fication territory at twenty per cent less than third class, but not less than fourth
class, at which that commodity had previously been rated, where the result of
applying this classification to the varying rates is to leave soap in less than car-
load' lots in the fourth class to a considerable extent in one of the subdivisions
of such classification territory, and in a higher class in the other subdivision.^'^
The fact that defendant's road received much more traffic from the first shipper
than from the second does not make the circumstances and conditions under
which the two services were rendered substantially dissimilar.^^

Custom and Usage. — The long existence, before the enactment of the inter-
state commerce law, of a custom to collect and deliver freight by cartage, in a
particular city, and not in others, may be one of the "circumstances" mentioned
in the act as elements entering into the question of unjust and unfair discrimina-
tion. ^^ Other circumstances and conditions of great importance _ may be that,
having long ago adopted such a plan of accessorial services by furnishing cartage,
and adapted its terminal facilities thereto, the carrier's station is located a great
distance from the traffic center of the city, and to now abandon such service, and
extend its road and appliances to the traffic centers, would entail enormous ex-
pense for rights of way, and for construction and reconstruction ; also, the fact
that rival and competing carriers have their stations near the traffic centers, so
that to abandon the cartage service would result in the annihilation of the com-
pany's business.-*"'

Difference in Population and Traffic in Cities. — Differences in population
and tonnage traffic may constitute a "circumstance" or "condition" of dissimi-
larity, within the meaning of the statute; and it can not be said that a railroad
company may not reasonably and without undue preference or advantage, or un-
lawful discrimination, collect and deliver, at its own expense, goods at one city,
and not at another when the difference in population and traffic is great.-* ^

Findings of Commission Conclusive. — The findings of the Interstate Com-
merce Commission that industrial spur tracks within switching limits in a city
were part of the carrier's terminals, and that the receipt and delivery on these
tracks of car load freight in interstate commerce was a like service as compared
with such receipt and delivery at team tracks and freight sheds within such
switching limits, are conclusive on the courts.-*-

36. Quantity of goods shipped. — Inter- 146 Fed. 559, affirmed in 206 U. S. 142,
state Commerce Comm. z\ Cincinnati, etc., 51 L. Ed. 995, 27 S. Ct. 648.

R. Co., 146 Fed. 559, decree affirmed in 33. United States v. Tozer, 39 Fed.

206 U. S. 142, 51 L. Ed. 995, 27 S. Ct. 648. 359.

37. The disturbance in the relations be- 39, Custom and usage. — Detroit, etc., R.
tween freight rates for soap in car load Qq. v. Interstate Commerce Comm., 21
and less than car-load lots created by Q Q a. 103, 74 Fed. 803.

advancing the former from class 6 to ^^ Detroit, etc., R. Co. v. Interstate

c ass 5, and the latter from class 4 to Commerce Comm., 21 C. C. A. 103. 74

class 3 m a new classincation adopted to p^^j ^^y^

govern in official classification territory, • ' _.' . . j ^ m

was not cured by classifying soap in less . 41. Difference in population and traffic

than car-load lots at twenty per cent less ^ cities.— Detroit etc., k Co. ^^ Inter-

than third class, l)ut not less than fourth state Commerce Comm., 21 C. C. A. 103,

class, where the result of applying this "^"i ^' •-"•'• ^*^•^•

modified percentage classification to the 42. Findings of commission conclusive.

varying rates is to leave soap in less than — Interstate Commerce . Comm. v. Atch-

car-loafl lots in the fourth class in portions ison, etc., R. Co., 234 U. S. 294, 34 S. Ct.

of the territory, and in a higher class in 814; Interstate Commerce Comm. v.

other portions. Decree, Interstate Com- Southern Pac. Co., 234 U. S. 315, 34 S.

merce Comm. v. Cincinnati, etc., R. Co., Ct. 820.

4 Car— 34



§§ 4019-4020 CARRIERS. 3636

§ 4019. Persons Discriminated against. — The wrong prohibited by the
section is a discrimination between shippers. It was designed to compel every
carrier to give equal rights to all shippers over its own road, and to forbid it by
any device to enforce higher charges against one than another.'*^ But the provi-
sions of Interstate Commerce Act, prohibiting unjust discriminations and undue
and unreasonable preferences, have reference to the service rendered, and not to
the sender or consignee.'* ■*

Identity of Situation and Circumstances. — To come within the inhibition
of the act, the positions of the respective persons or classes between whom dis-
criminations are made, must be compared with each other, and there must be
found to exist substantial identity of situation and circumstances, accompanied
by irregularity and partiality resulting in undue advantage to one or undue dis-
advantage to the other. -^-^

Shipper under Special Contract to Build Up Milk Business. — A railroad
company may enter into a contract with a person for a term of years to conduct
the business of the transportation of milk on the lines of the railroad, such per-
son to have full charge of the business and to receive as compensation a percen-
tage of the freights earned, provided such person should charge rates not in ex-
cess of those charged by competitive lines. In the execution of the contract the
rates were made by the railroad and such person was not given a monopoly of
the milk traffic. The contract was not violative of the Interstate Commerce Act
as giving an undue and unreasonable preference. The privileges granted to
such person were only those which were incident to the anomalous relations exist-
ing between him and the railroad created by the contract. It is quite inconceiv-
able that there were or could have been any shippers of milk who would have
been willing or able to undertake such duties and responsibilities. In consid-
eration of his assumption of peculiar obligations and hazards, the railroad gave
such person privileges appertaining to his relation as a manager of the traffic,
which was not an undue and unreasonable preference. ^"^

Shipper Engaged in Foreign Commerce. — Where the plaintiff sought to
establish his banana business in Central America, and expended considerable
money in his plant, it was engaged in foreign commerce when it began to move
men, material, and supplies to and from the United States and Central American
ports in furtherance of its business, and was therefore entitled to compel de-
fendant to furnish transportation facilities on the same terms that defendant
furnished to others.'*"

§ 4020. Determining Discrimination or Preference. — The interstate
commerce act does not attempt to define what particular acts shall constitute

43. Persons discriminated against.^ uf such business, and was to receive as
Delaware, etc., R. Co. v. Kutter, 147 Fed. compensation a percentage of the freights
51, 77 C. C. A. 315, citing Wight v. United earned therein. It was provided that he
States, 167 U. S. 512, 42 L. Ed. 258, 17 S. should charge rates not in excess of those
Ct 822 charged by the competitive roads, and

44. United States v. Wells, Fargo Exp. ^';°"^d ^^ granted the exclusive privilege
Co 161 Fed 60f oi transporting milk over defendant s lines

''_,.■ ■ . . , . "so far as it was permitted to do so by

45. Identity of situation and circum- i^w." In the execution of the contract
stances.— Interstate Commerce Comni..z;. all rates were made by defendant, -and
Baltimore, etc., R. Co., 145 U. S. 263, 36 plaintifif was not given a monopoly of the
L. Ed. 699 12 S. Ct. 844; Delaware, etc., mdi, traffic. Held, that such contract was
R. Co. V. Kutter, 147 Fed. 51, 77 C. C. A. not violative of § 3 of Interstate Coni-
^^^- merce Act Feb. 4, 1887, c. 104. 24 Stat.

46. Shipper under special contract to 380 [U. S. Comp. St. 1901, p. 3155], as
build up milk business. — Defendant rail- giving an undue and unreasonable prefer-
road company entered into a contract ence to plaintiff. Delaware, etc., R. Co. v.
with plaintiff for a term of years to build Kutter, 147 Fed. 51, 77 C. C. A. 315.

up, develop, and conduct the business of 47. Shipper engaged in foreign com-

the transportation of milk on its lines of merce. — American Banana Co. v. United
road. Plaintiff was to have full charge Fruit Co., 160 Fed. 184.



3637



INTERSTATE COMMERCE ACT.



S 4020



unlawful discrimination, but commits that to the Interstate Commerce Commis-



sion



48



Facts Considered. — That the surrounding circumstances and conditions are
to be considered in determining whether there has been an undue and unreason-
able preference in favor of another particular shipper is undoubtedly true ; but
in determining that question it necessarily follows that the circumstances and
conditions surrounding the shipper should be considered, and not those that may
happen to surround the carrier. Where the court is called upon to deal with the
question of rates as between rival lines, it would have to consider the peculiar
conditions and circumstances surrounding the carrier.**^

Competition. — In applying the provision of the third section of the act which
makes it unlawful for common carriers to make or give any undue or unreason-
able preference or advantage to any particular person or locality, competition
which affects rates is one of the matters to be considered,''*' for the Interstate
Commerce Act was not designed to prevent competition between different roads. ^^
In construing statutory provisions, forbidding railway companies from giving any
undue or unreasonable preference or advantage to or in favor of any particular
person or company, or any particular description of traffic, in any respect what-
ever, the English courts have held, after full consideration, that competition be-
tween rival lines is a fact to be considered, and that a preference or advantage
thence arising is not necessarily undue or unreasonable. •^-

But the mere fact of competition, no matter what its character or extent,
does not necessarily relieve the carrier from the restraints of the third and fourth
sections, but only that these sections are not so stringent and imperative as to
exclude in all cases the matter of competition from consideration in detemiining
the questions of "undue or unreasonable preference or advantage," or what are
"substantially similar circumstances and conditions." The competition may in
some cases be such as, having due regard to the interests of the public and of the
carrier, ought justly to have effect upon the rates, and in such cases there is no
absolute rule which prevents the commission or the courts from taking the matter
into consideration.^^



48. Determining discrimination or pref-
erence. — Puritan Coal Min. Co. 7'. Penn-
sylvania R. Co., 237 Pa. 420, 85 Atl. 426.

49. Facts considered. — Pitcairn Coal Co.
V. Baltimore, etc., R. Co., 165 Fed. 113.

50. Competition. — Interstate Commerce
Comm. V. Alabama Mid. R. Co., 168 U.
S. 144, 42 L. Ed. 414, 18 S. Ct. 45; Inter-
state Commerce Comm. v. Louisville, etc.,
R. Co., 190 U. S. 273, 47 L. 'Ed. 1047, 23
S. Ct. 687. See, also, Wight v. United
States, 167 U. S. 512, 42 L. Ed. 258, 17
S. Ct. 822; Interstate Commerce Comm. v.
Detroit, etc., R. Co., 167 U. S. 633, 42
L. Ed. 306. 17 S. Ct. 986; Interstate Com-
merce Comm. V. Baltimore, etc., R. Co.,
145 U. S. 263, 36 L. Ed. 699, 12 S. Ct.
844, and Texas, etc., R. Co. v. Interstate
Commerce Comm., 162 U. S. 197, 40 L. Ed.
940, 16 S. Ct. 666.

51. Interstate Commerce Comm. v.
Alabama Mid. R. Co., 168 U. S. 144, 42
L. Ed. 414, 18 S. Ct. 45; Interstate Com-
merce Comm. V. Baltimore, etc., R. Co.,
145 U. S. 263, 36 L. Ed. 699, 12 S. Ct.
844; Texas, etc., R. Co. v. Interstate
Commerce Comm., 162 U. S. 197, 40 L.
Ed. 940, ]6 S. Ct. 666; Interstate Com-
merce Comm. V. Chicago, etc., R. Co.,
141 Fed. 1003, affirmed in 28 S. Ct. 493,
209 U. S. 108, 52 L. Ed. 705.



It is not the purpose of the third sec-
tion of the act to prevent competition in
rates between different points on differ-
ent lines of road. Allen v. Oregon R.,
etc., Co., 98 Fed. 16.

Competition between carriers is not a
circumstance to be considered in apply-
ing the provisions of the second section,
which seeks to prevent discrimination be-
tween shippers over the same line of
road, and thus leaves no room for the
operation of competition. Interstate
Commerce Comm. v. Alabama Mid. R.
Co., 18 S. Ct. 45, 168 U. S. 144, 42 L.
Ed. 414, afiirming decree 74 Fed. 715, 21
C. C. A. 51.

For a carrier to protect itself against
the physical disadvantage it is under in
relation to its rivals is not an unlawful
discrimination, if it be not used as a
colorable device to evade the statute.
Detioit, etc., R. Co. v. Interstate Com-
merce Comm., 74 Fed. 803, 21 C. C. A.
lO.-J.

52. Interstate Commerce Comm. v. Ala-
bama Mid. R. Co., 168 U. S. 144, 42 L.
Va\. 414, 18 S. Ct. 45.

53. Interstate Commerce Comm. v. Ala-
I)ama Mid. R. Co., 168 U. S. 144, 42 h.
\'a\. 414, 18 S. Ct. 45.



§§ 4020-4022 CARRIERS. 3638

Ocean competition as constituting a dissimilar condition and as justifying a
difference in rates between import and domestic traffic is a proper circumstance
to be considered by the commission, which is not shut up by the terms of the
act of congress, to consider only such "circumstances and conditions" as pertained
to the articles after they had reached and been delivered at a port of the
United States or Canada.'"*

Competition between Other Cities.— Where there exists great competition
between two cities in trunk line territory and which are entered by a number of
rail and water carrying lines, the fact that the charge to a third city is greater
than that charge to the former cities, does not give such cities an undue or un-
reasonable preference or advantage, or subject the latter city to an undue or un-
reasonably prejudice or disadvantage, in violation of the Interstate Commerce
Act.55

§ 4021. In Charges. — See elsewhere.^*'

§ 4022. In Facilities. — Terminal and Wharfage Facilities.— An order
of the Interstate Commerce Commission forbidding a'carrier to give an undue pref-
erence in the use of its wharves at a seaport to an exporter of cotton seed prod-
ucts is not a regulation of purely intrastate or purely foreign commerce, which
would be beyond the power of the commission, where the cotton seed products
purchased by him, whether at points within or without the state, are all destined
for export, and the concentration and manufacture of cotton seed cake into meal
on the wharves are but incidents in the transshipment of the products in export
trade. ^"^ Where all shippers are in fact treated alike, the mere fact that a car-
rier leases a terminal from a shipper does not constitute a discrimination in such
shipper's favor. •"^^

Lease of Wharfage Facilities to Shipper. — A lease to a shipper of one of
the piers and improvements thereon, belonging to a terminal company, which
relieves hnn from the payment of all wharfage and storage charges other than
as the same may be included in the yearly rental, and has enabled him to acquire
practically a monopoly of the export of certain products from that port, consti-
tutes an unlawful or undue preference under the act to regulate commerce, where
other shippers are not and can not be afforded the same facilities on the same
conditions. •"••' A corporation created to carry on, conformably to a municipal

54. Illinois Cent. R. Co. v. Interstate trunk line territory, but in the southern
Commerce Comm., 206 U. S. 441, 51 L. territory, and has fewer lines of trans-
Ed. 1128, 27 S. Ct. 700; Texas, etc., R. portation, and less active competition,
Co. V. Interstate Commerce Comm., 162 resulting in higher through rates to the
U. S. 197, 40 L. Ed. 940, 16 S. Ct. 666. latter place, although the length of haul
See, also, Louisville, etc., R. Co. v. Behl- is substantially the same, does not op-
mer, 175 U. S. 648, 44 L. Ed. .309, 20 S. erate to give Norfolk and Richmond an
Ct. 209. undue or unreasonable preference or ad-

55. Competition between other cities. — vantage, or subject Wilmington to an un-
Conditions are such at Norfolk and Rich- due, or unreasonable prejudice or disad-
mond, Va., by reason of the large num- vantage, in violation of § 3 of the act
ber of carrying lines, both rail and water, to regulate commerce (24 Stat. 380 [U.
which enter such places, and the fact S. Comp. St. 1901, p. 3155]). Interstate
that they are in what is known as the Commerce Comm. v. Cincinnati, etc., R.
"trunk line territory," as to create a very Co., 124 Fed. 624.

active competition on shipments from 56. In charges. — See post, "Discrimina-

the West, and to justify the making of tion and Preference." §§ 4075-4096.

low rates on such shipments; and the 57. In facilities. — Southern Pac. Termi-

fact that such low rates are made on nal Co. v. Interstate Commerce Comm.,

through shipments from Chicago, St. 219 U. S. 498, 55 L. Ed. 310, 31 S. Ct.

Louis, and East St. Louis by a material 279.

reduction .from local tariff rates by the 58. United States v. Baltimore, etc., R.
connecting line west of the Ohio river, Co., 231 U. S. 374, 34 S. Ct. 75.
while substantially the local rates are 59. Lease of wharfae^e facilities to ship-
charged on the same lines on through per. — Southern Pac. Terminal Co. z\ In-
shipments from the same points to Wil- terstate Commerce Comm.. 219 U. S. 498,
mington, N. C, which is not within the 55 L. Ed. 310, 31 S. Ct. 279.



3639 INTERSTATE COMMERCE ACT. §§ 4022-4024

ordinance and a confirmatory statute intended to secure public shipping facilities,
a wharfage business at a seaport and to furnish terminal facilities for a railway
and steamship system of which it forms a part and by which it is controlled
through a holding company, is a common carrier, and as such is subject to the
jurisdiction of the Interstate Commerce Commission acting in the exercise of its
authority, under the act to regulate commerce, to prohibit undue preferences.^'*'

Establishing Station. — A railroad company may, in the exercise of its right
to private property, establish a station for the special accommodation of a partic-
ular customer, and refuse to establish a like station elsewhere for the accommo-
dation of others.*''^

Switch Service. — Under the Interstate Commerce Act a common carrier of
interstate freight can not lawfully deny switch connections or service to one
person, place, locality, or kind of traffic which it affords to others similarly situ-
ated; and one who has built a switch connection with the track of a railroad,
with the consent of the company, has an implied right to service at such switch,
and, unless such service is limited, either expressly or by implication, he may
lawfully insist that the carrier shall there receive and deliver all such freight as
it customarily carries, and for the receipt and delivery of which the switch is suit-
able and convenient.''- A contract between two railroad companies providing
for the construction of a spur track to a customer and the switching of cars
over the same for a specified charge does not violate the interstate commerce
law, unless it contemplates some discrimination against other customers seeking
or enjoying like privileges.*'"*

Grant of Right to Build Warehouse. — A railroad company may grant to
one person the right to erect a warehouse or elevator on its right of way, and
refuse to grant the same privilege to another, in the exercise of its right to private
property.*''^

§§ 4023-4035. In Distribution of Cars— § 4023. In General.— A

contract with a carrier to supply to an interstate shipper a specified number of
cars on certain dates is not a violation of the Interstate Commerce Act, unless
the contract, if performed, will extend to that shipper an undue performance
over other shippers. ^^ The refusal of an interstate carrier to furnish cars for
the shipment of complainant's crossties, while furnishing cars to others for in-
terstate shipment of other freight, constitutes an unjust discrimination in vio-



Online LibraryThomas Johnson MichieA treatise on the law of carriers (Volume 4) → online text (page 101 of 214)