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tain rate is discriminatory, to prescribe in detail regulations and practices which
are not necessary to remove the discrimination, but which may become neces-
sary for the protection of the carrier, and it may properly authorize or permit
the carrier to make such regulations if necessary.''

Provision in Order for Benefit of Carrier. — The interstate commerce com-
mission in inserting in an order commanding carriers to desist from a discrimi-
nation a condition for the carriers' benefit acted within its province, even though
the subject-matter of the condition be regarded as something subsequent to trans-
portation.*

Damages. — In an action to recover damages for discrimination in rates, plain-
tiff is entitled only to recover for such discrimination as gave his competitor an
unfair advantage in the same market.'' The measure of damages is the difference
between the amount paid by plaintiff and the amount it would have paid at the
lowest rate charged on any other shipments carried under substantially the same
circumstances and conditions during the same time, and not the difference be-
tween the rates paid by it and the average rate paid by any other shipper.i^ in
an action to recover damages for unlawful discrimination in rates on coal shipped
between plaintiff' and other shippers, where the statement of claim alleged dam-
ages in certain sums per ton on shipments from its diff'erent mines, its recovery
is limited to such sums.^^

§§ 4097-4110. Long and Short Haul— § 4097. Statutory Provision.

— Section 4 of the interstate commerce act provides that it shall be unlawful for

3. Sufficiency of petition.-Kinnavey v. ^7. New York, etc R. Co. t; Interstate
..,„;„.! T? A.e'„ «i V^A «n9. Commerce Comm., 168 Fed. 131.



Terminal R. Ass'n, 81 Fed. 802



8. Provision in order for benefit of



4. Kmnavey v. Termmal R. Ass n, 81 carrier.— New York, etc., R. Co. v. In
I^ed. 802. terstate Commerce Comm., 168 Fed. 131.

5. Sufficiency of order. — New York, 9. Damages. — Mitchell Coal, etc., Co.
etc., R. Co. V. Interstate Commerce j,_ Pennsylvania R. Co., 181 Fed. 403.
Comm., 168 Fed. 131. 10. Pennsylvania R. Co. v. Interna-

6 Act Feb. 4, 1887, c. 104, § 15, 24 tional Coal Min. Co., 97 C. C. A. 383,

Stat. 384 [U. S. Comp. St 1901, p. 3165]), 173 Fed. 1.

as amended by the Hepburn Act (Act 11. Mitchell Coal, etc., Co. v. Pennsyl-

June 29, 1906, c. 3591, § 4, 34 Stat. 589 vania R. Co., 181 Fed. 403. dismissed for

lU. S. Comp. St. Supp. 1907, p. 900]). want of jurisdiction 183 Fed. 908.



3711



INTERSTATE COMMERCE ACT.



§§ 4097-4098



any common carrier subject to the provisions of the act to charge or receive any-
greater compensation in the aggregate for the transportation of passengers or of
like kind of property, under substantially similar circumstances and conditions,
for a shorter than for a longer distance over the same line, in the same direction,
the shorter being included within the longer distance, but this shall not be con-
strued as authorizing any common carrier within the terms of the act to charge
and receive as great compensation for a shorter as for a longer distance.^^ A
proviso in this section provides that upon application to the interstate com-
merce commission, any common carrier subject to the provisions of the act may,
in special cases, after investigation by the commission, be authorized to charge
less for longer than for shorter distances for the transportation of passengers or
property, and that the commission may from time to time prescribe the extent to
which such designated common carrier may be relieved from the operation of this
section of the act.^^

English Traffic Act. — The English traffic acts do not appear to be as com-
prehensive as our own, and may justify contracts which with us would be ob-
noxious to the long and short haul clause of the act.^*

§ 4098. Similar Circumstances and Conditions. — Substantial dissimi-
larity of circumstances and conditions may justify common carriers in charging
greater compensation for the transportation of like kinds of property for a
shorter than for a longer distance over the same line.^^ In order to entitle a per-
son discriminated against to recover from a carrier it must appear that the higher
rate which he has been charged for the shorter distance was for like services and
under similar circumstances.^ "^ It seems that, where the circumstances and con-
ditions are dissimilar, there is no prohibition; where the circumstances and con-
ditions are similar, the prohibition attaches ; and that, where it is difficult to point
out clearly the circumstance or condition which produces dissimilarity, the doubt



12. Long and short haul. — Interstate

Commerce Comm. v. Brimson, 154: U. S.
447, 38 L. Ed. 1047, 12 S. Ct. 1125; Inter-
state Commerce Comm. v. Cincinnati, etc.,
R. Co., 167 U. S. 479, 42 L. Ed. 243, 17
S. Ct. 896; Savannah, etc., R. Co. v. Flor-
ida Fruit Exch., 167 U. S. 512, 42 L.
Ed. 257, 17 S. Ct. 998; 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 Com-
merce Comm., 162 U. S. 197, 40 L. Ed.
940, 16 S. Ct. 666; Interstate Commerce
Comm. V. Alabama Mid. R. Co., 168 U.
S. 144, 42 L. Ed. 414, 18 S. Ct. 45; United
States f. Trans-Missouri Freight Ass'n,
166 U. S. 290, 41 L. Ed. 1007, 17 S. Ct.
540; Parsons v. Chicago, etc., R. Co., 167
U. S. 447, 42 L. Ed. 231, 17 S. Ct. 887;
Wight V. United States, 167 U. S. 512, 42
L. Ed. 258, 17 S. Ct. 822; Interstate Com-
merce Comm. V. Detroit, etc., R. Co., 167
U. S. 633, 42 L._ Ed. 306, 17 S. Ct. 986.

The imperative enforcement of Act
Feb. 4, 1887, § 4, as amended by Act June
18, 1910, § S, forbidding carriers to charge
a lesser rate for a longer than for a
shorter haul, when the interstate com-
merce commission has refused an appli-
cation for relief from such long and short
haul clause, does not render the statute
repugnant to Const. Amend. 5. United
States V. Atchison, etc., R. Co., 234 U.
S. 476, 34 S. Ct. 986; United States v.



Union Pac. R. Co., 234 U. S. 495, 34 S.
Ct 995.

13. Interstate Commerce Comm. v.
Brimson, 154 U. S. 447, 38 L. Ed. 1047,
12 S. Ct. 1125; Texas, etc., R. Co. v. In-
terstate Commerce Comm., 162 U. S. 197,
40 L. Ed. 940, 16 S. Ct. 666; Interstate
Commerce Comm. v. Detroit, etc., R. Co.,
167 U. S. 633, 42 L. Ed. 306, 17 S. Ct.
986; Interstate Commerce Comm. v. Al-
abama Mid. R. Co., 168 U. S. 144, 42 L.
Ed. 414, 18 S. Ct. 45.

14. English Traffic Act— Interstate
Commerce Comm. v. Baltimore, etc., R.
Co., 145 U. S. 263, 36 L. Ed. 699, 12 S.
Ct. 844.

15. Similar circumstances. — Interstate
Commerce Comm. v. Alabama Mid. R.
Co., 168 U. S. 144, 42 L. Ed. 414, 18 S.
Ct. 45; Interstate Commerce Comm. v.
Louisville, etc., R. Co., 190 U. S. 273, 47
L. Ed. 1047, 23 S. Ct. 687; Texas, etc.,
R. Co. V. Interstate Commerce Comm.,
162 U. S. 197, 40 L. Ed. 940, 16 S. Ct.
666, where it is said that "the same ob-
servations (applical)le to the second and
tliird sections) are applicable to the
fourth section, or tlie so-called long and
short haul provision." Interstate Com-
merce Comm. V. Western, etc., R. Co., 88
Fed. 186.

16. Junod V. Chicago, etc., R. Co., 47
Fed. 290.



§ 4098 CARRIERS. 3712

should go in favor of the object of the law, and the circumstances and conditions
should be taken as substantially similar-^"^

Meaning of Terms as Used in Other Sections of Act. — The purpose of
the second section of the act is to enforce equality between shippers over the
same line, and to prohibit any rebate or other device by which two shippers, ship-
ping over the same line, the same distance, under the same circumstances of car-
riage, are compelled to pay diiTerent prices therefor; and it was there held that
the phrase "under substantially similar circumstances and conditions," as used
in the second section, refers to the matter of carriage, and does not include com-
petition between rival routes. This view is not open to the criticism that different
meanings are attributed to the same words when found in ditferent sections of the
act; for what is held is that, as the purposes of the several sections are different,
the phrase under consideration must be read, in the second section, as restricted
to the case of shippers over the same road, thus leaving no room for the operation
of competition, but that in the other sections, which cover the entire tract of inter-
state and foreign commerce, a meaning must be given to the phrase wide enough
to include all the facts that have a legitimate bearing on the situation— among
which is the fact of competition when it affects rates. ^'"^

Sufficient Dissimilarity. — Where the circumstances and conditions under
which a lower rate is made for a long than for a short haul are substantially dis-
similar, § 4 of the interstate commerce law does not apply, and the courts can
not enter into the question whether the dissimilarity is sufficient to justify the
difference in rates. ^'-^ But § 4 of the interstate commerce law is to be applied
upon a scale of comparison between the dissimilarity of conditions and the dispar-
ity of rates, and a greater charge for a shorter than for a longer haul may be en-
joined, though there may be dissimilarity of conditions, provided the dissimilarity
is not so great as to justify the discriminating rate.-" In an action by a car-
rier to recover a greater rate for a shorter than for a longer haul, an answer alleg-
ing that there existed no reason, by way of the peculiar geographical position,
competition, or trade or other conditions why a greater charge should be made
for the shorter haul, showed that the rate was illegal and not recoverable.^^

Question of Fact. — Whether, in particular instances, the circumstances and
conditions of the carriage have been substantially similar or otherwise, is a
Question of fact depending on the matters proved in each case. - It has been
forcibly argued that, in the present case, the commission did not give due weight
to the facts that tended to show that the circumstances and conditions were so
dissimilar as to justify the rates charged. But the question was one of fact, pecul-
iarly within the province of the commission, whose conclusions have been ac-
cepted and auproved by the circuit court of appeals, and there is nothing in the
record to make it the court's duty to draw a different conclusion.-^ The incjuiry

17 Missouri Pac. R. Co. v. Texas, etc., merce Comm., 162 U. S. 184, 40 L. Ed. 935,

R Co 31 Fed 862. 16 S. Ct. 700, 4 Am. & Eng. R. Cas., N.

18. Meaning of terms as used in other S., 223; Texas, etc., R. Co. v. Interstate

sections of act.— Interstate Commerce Commerce Comm., 162 U. S. 197, 40 L.

Comm. V. Alabama Mid. R. Co., 168 U. Ed. 940, 16 S. Ct. 666; Illmois Cent. R.

S 144 42 L Ed 414, 18 S. Ct. 45; Wight Co. v. Interstate Commerce Comm., 206

V. United States, 167 U. S. 512, 42 L. U. S. 441, 51 L. Ed. 1128, 27 S. Ct 700.
Ed 258, 17 S. Ct. 822. Whether the "circumstances and condi-

19 Sufficient dissimilarity. — Interstate tions" under which a railroad company
Commerce Comm. v. Western, etc., R. has charged a greater compensation for
Co., 88 Fed. 186. a shorter than for a longer haul oyer the

20 Interstate Commerce Comm. v. East same line were "suljstantially similar,"
Tennessee, etc., R. Co., 85 Fed. 107. within the meaning of the fourth section

21. Great Northern R. Co. v. Loonan of the interstate commerce law, is a ques-
Lumber Co., 25 S. Dak. 155, 125 N. W. tion for the jury. Osborne v. Chicago,



644.



etc., R. Co., 48 Fed. 49.



22. Question of fact.— Interstate Com- 23. Cincinnati, etc., R. Co. ^;. Interstate

merce Comm. v. Alabama Mid. R. Co., Commerce Comm., 162 U. S. 184 40 L.

168 U. S. 144, 42 L. Ed. 414, 18 S. Ct. 45; Ed. 935, 16 S. Ct. 700, 4 Am. & Eng. R-

Cincinnati, etc., R. Co. ?;. Interstate Com- Cas., N. S., 223.



3713



INTERSTATE^ COMMERCE ACT.



j§ 4098-4099



being essentially one of fact, the attempt to make competition an inference of law
and dominating against the findings of the commission and their affirmance by
the circuit court can not prevail.-^

Admissions by Carrier. — Where a railroad company groups together two
cities as stations to which freight rates from eastern cities may properly be made
the same, it is a conclusive admission that transportation from the east to the
warehouses of the company at the two places is under substantially similar con-
ditions.-^'^'

Actual Similarity. — Where the carrier fixes an equality of compensation, in
the aggregate, for two places some distance apart, on the same line, there must
be an ecjuality in fact as well as in form; but equality in form will be accepted
as equahty in fact, until it is shown to be colorable by him who challenges it.-'^

Determining Similar Circumstances and Conditions. — The omission of
the substantially similar circumstances and conditions clause from the long and
short haul provisions of § 8 of Act of June 18, 1910, takes from carriers their
power to determine whether conditions are substantially dissimilar so as to jus-
tify the charge of a lesser rate for a longer than for a shorter haul, and vests in
the interstate commerce commission the power to determine, in view of the pref-
erence and discrimination clauses of § 2 and 3 of the Act of Feb. 4, 1887,,
whether a petitioning carrier shall be relieved from the operation of the long
and short haul clause.-'^

§ 4099. Competition.— Competition is a factor to be considered in deter-
mining whether shipments of freight to diflferent points on the same line of rail-
road are made under substantially similar circumstances and conditions, so as to
come within the long and short haul provision of the fourth section of the act
to regulate commerce;-** and if such competition is real and controlling as to the



24. Illinois Cent. R. Co. v. Interstate
Commerce Comm., 206 U. S. 441, 51 L.
Ed. 1128, 27 S. Ct. 700.

25. Admissions by carrier. — Interstate
Commerce Comm. v. Detroit, etc., R. Co.,
57 Fed. 1005.

26. Actual similarity. — Detroit, etc., R.
Co. V. Interstate Commerce Comm., 21 C.
C. A. 103, 74 Fed. 803.

27. Determining similar circumstances
and conditions. — United States v. Atchi-
son, etc., R. Co., 234 U. S. 476, 34 S. Ct.
986; United States v. Union Pac. R. Co.,
234 U. S. 495, 34 S. Ct. 995.

28. Competition. — Ex parte Koehler, 31
Fed. 315, 12 Sawy. 446; Interstate Com-
merce Comm. V. Clyde Steamship Co., 21
S. Ct. 512, 181 U. S. 29, 45 L. Ed. 729,
modifying decree 93 Fed. 83, 35 C. C.
A. 217; East Tennessee, etc., R. Co. v.
Interstate Commerce Comm., 21 S. Ct.
516, 181 U. S. 1, 45 L. Ed. 719, reversing
decree, 99 Fed. 52, 39 C. C. A. 413; Louis-
ville, etc., R. Co. V. Behlmer, 20 S. Ct.
209, 175 U. S. 648, 44 L. Ed. 309; Inter-
state Commerce Comm. v. Western, etc.,
R. Co., 88 Fed. 186; Interstate Commerce
Comm. V. Southern R. Co., 117 Fed. 741,
judgment affirmed in 122 Fed. 800, 60 C.
C. A. 540; Interstate Commerce Comm.
V. Alabama Mid. R. Co., 18 S. Ct. 45,
168 U. S. 144, 42 L. Ed. 414; Brewer v.
Central, etc., R. Co., 84 Fed. 258.

In determining what are substantially
dissimilar circumstances and conditions,



such as will justify a greater charge for
a shorter than for a longer haul, under
the fourth section, the fact of competition
between carriers which affects rates is to
be taken into consideration. Judgment,
21 C. C. A. 51, 74 Fed. 715, affirmed in
interstate Commerce Comm. v. Alabama
Mid. R. Co., 18 S. Ct. 45, 168 U. S. 144,
42 L. Ed. 414.

A greater charge for a shorter than for
a longer haul is not unlawful, when the
rate for the shorter distance is not in
itself unreasonable, and the more distant
point is a commercial center and large
distributing point, where strong compe-
tition exists both by land and water, none
of which conditions are present at the
other point. Brewer v. Central, etc., R.
Co., 84 Fed. 258; Interstate Commerce
Comm. V. Western, etc., R. Co., 88 Fed.
186.

Where a lower rate charged for the car-
riage of freight to a longer-distance point
results solely from the controlling intlu-
tnce of competition at such point, which
renders the circumstances and conditions
substantially dissimilar from those exist-
ing at an intermediate point, so as to ex-
clude the application to the case of the
fourth section of the act (24 Stat. 379),
and such competitive rate is not so low
as to be unremunerative to the carrier,
it can not cfford basis for a claim of
undue and unreasonable preference or
advantage in favor of the competitive



§ 4099



CARRIERS.



3714



rate charged to one point, while it does not afifect rates to another, it creates sub-
stantially different circumstances and conditions, as between the two, and such
section has no application. -^ Competition is one of the most obvious and effective
circumstances that make the conditions, under which a long and short haul is
performed, substantially dissimilar, and as must have been in the contemplation
of congress in the passage of the act to regulate commerce.-^*' While a carrier
may take into consideration the existence of competition as the producing cause
of dissimilar circumstances and conditions, his right to do so is governed by the
following principles : First. The absolute command of the statute that all rates
shall be just and reasonable, and that no undue discrimination be brought about,
though, in the nature of things, this latter consideration may in many cases be
involved in the determination of whether competition was such as created a sub-
stantial dissimilarity of condition. Second. That the competition relied upon
be not artificial or merely conjectural, but material and substantial thereby operat-
ing on the question of traffic and rate making, the right in every event to be only
enjoyed with a due regard to the interest of the public, after giving full weight
to the benefits to be conferred on the place from whence the traffic moved as
well as those to be derived by the locality to which it is to be delivered/'^



point, or of unreasonable prejudice or dis-
advantage against the intermediate point,
Avithin tlie inhibition of the third section.
Interstate Commerce Comm. v. Western,
etc., R. Co., 93 Fed. 83, 35 C. C. A. 217.
"Freight carried to or from a competi-
tive point is always carried under sub-
stantially dissimilar circumstances and
conditions from that carried to or from
noncompetitive points. In the latter case,
the railway makes its own rates, and
there is no good reason why it should
"be allowed to charge less for a long haul
than a short one. When each haul is
made to or from a noncompetitive point,
the effect of such discrimination is to
"build up one place at the expense of the
other. Such action is willfully unjust,
and has no justification or excuse in the
exigencies or conditions of the business
of the corporation. In the former case,
the circumstances are altogether differ-
ent. The power of a corporation to make
a rate is limited by the necessities of the
situation. Competition controls the
•charge. It must take what it can get, or
abandon the field, and let its road go to
rust." "Competition may not be the only
circumstance that makes the condition
under which a long and short haul are
performed substantially dissimilar, but
•certainly it is the most obvious and ef-
fective one, and must have been in con-
templation of congress in the passage of
the act to regulate commerce." Case
<]UOted: Ex parte Koehler, 31 Fed. 315,
12 Sawy. 446. Interstate Commerce
Comm. V. Cincinnati, etc., R. Co., 56 Fed.
■925.

"That competition, the life of trade,
•cuts an important figure in the condition
and circumstances attendant upon trans-
portation of passengers and property, can
not be well overlooked nor denied. Nor
can it be well denied that, as between the
short and long haul, competition may ex-
ist to that extent that what would other-



wise be similar circumstances and condi-
tions will be dissimilar circumstances and
conditions." Case quoted: Missouri Pac.
R. Co. V. Texas, etc., R. Co., 31 Fed. 862.
Interstate Commerce Comm. v. Cincin-
nati, etc., R. Co., 56 Fed. 925.

29. Interstate Commerce Comm. v.
Western, etc., R. Co., 35 C. C. A. 217,
93 Fed. 83.

Transportation of hay between Mem-
phis, Tenn., and Charleston, S. C, _ be-
tween which points there is competitive
transportation by rail, by water and rail,
and by water alone, is not performed un-
der substantially similar conditions with
transportation between Memphis and an
interior town in South Carolina, which
is reached only by one railroad. Behlmer
V. Louisville, etc., R. Co., 71 Fed. 835.

Los Angeles, Cal., is a competing point
in certain kinds of freight, between sev-
eral transcontinental railway lines, direct,
or by water, via Vancouver and San
Francisco, also by ocean freights; and a
through rate on the same kind of freight,
lower than that to San Bernardino, an
intermediate noncompetitive point. 60
miles from Los Angeles, on one of the
competing rail lines, is not prohibited by
the act, since the circumstances and con-
ditions are substantially dissimilar. _ In-
terstate Commerce Comm. v. Atchison,
etc., R. Co., 50 Fed. 295.

30. Interstate Commerce Comm. v. Ala-
bama Mid. R. Co., 168 U. S. 144, 42 L.
Ed. 414, 18 S. Ct. 45: Interstate Com-
merce Comm. V. Louisville, etc., R. Co.,
190 U. S. 273, 47 L. Ed. 1047, 23 S. Ct.
687; Texas, etc., R. Co. v. Interstate Com-
merce Comm., 162 U. S. 197, 40 L. Ed.
940, 16 S. Ct. 666; Louisville, etc., R. Co.
V. Behlmer, 175 U. S. 648. 44 L. Ed. 309,
20 S. Ct. 209; East Tennessee, etc., R.
Co. V. Interstate Commerce Comm., 181
U. S. 1. 45 L. Ed. 719, 21 S. Ct. 516.

31. Louisville, etc.. R. Co. v. Behlmer,
175 U. S. 648. 44 L. Ed. 309, 20 S. Ct. 209.



3715 INTERSTATE COMMERCE ACT. § 4099

Must Be Actual and Material. — The mere fact of competition, without re-
gard to its character or extent, does not necessarily relieve the carrier from the
provisions of these sections.-''*- Competition which is real and substantial, and ex-
ercises a potential influence on rates to a particular point, brings into play the
dissimilarity of circumstance and condition provided for by § 4 of the Interstate
Commerce Act, and may justify a lesser charge for the longer than the shorter
haul. 23 fhe substantial dissimilarity of circumstances and conditions provided
for by the act to regulate commerce, depends, as has been repeatedly held, upon
a real and substantial competition at a particular point afl'ecting rates, not upon
the mere possibility of the arising of such competition. ^^ What was decided
in the previous cases was that under the fourth section of the act substantial
competition which materially affects transportation and rates might under the
statute be competent to produce dissimilarity of circumstances and conditions, to
be taken into consideration by the carrier in charging a greater sum for a lesser
than for a longer haul. The meaning of the law was not decided to be that one
kind of competition could be considered and not another kind, but that all com-
petition, provided it possessed the attributes of producing a substantial and ma-
terial effect upon traffic and rate making, was proper under the statute to be taken
into consideration. 2'"'

Under Construction of Act by Commission.— The settled construction of
the interstate commerce act allows carriers to charge the lesser rate for the longer
than for the shorter distance, if at the further point the lesser rate is justified
by a substantial dissimilarity of circumstances and conditions there prevailing,
consequent upon real competition.-''''^

What Are Competing- Carriers. — This rule applies to competition between
rival carriers, both subject to the interstate commerce law.^''' Competition be-
tween rival railroads, and not merely between rail and water carriers, is a factor
to be considered in determining the substantial similarity or dissimilarity of cir-
cumstances and conditions under the fourth section of the interstate commerce
law.^s Competition of river lines of transportation is a factor to be considered
when determining whether property transported over the same line is carried
under "substantially similar circumstances and conditions," as that phrase is
found in the fourth section of the interstate commerce act."^ The fact of compe-
tition at Nashville by the Cumberland River, in addition to that between railroads,



Online LibraryThomas Johnson MichieA treatise on the law of carriers (Volume 4) → online text (page 115 of 214)