"Interstate commerce commission," 62 64. Unreasonable rates, reparation for charging, see "Reparation," 40-49. (A) IN GENERAL. PROVISION FORBIDDING UNREASONABLE OF RATES. AN EXPRESS ADOPTION PRINCIPLES OF COMMON LAW, 1. INTERESTS TO BE CONSIDERED IN PASSING UPON LAWFULNESS OF RATES, 2-4. INTEREST OF PUBLIC IN COMPETI- INTERESTS OF CARRIERS IN SECUR- 1. The Interstate Commerce Act, in so far as it inhibits carriers from the imposition of unjust and unreasonable rates, is an express adoption by Congress of the principles of the common law.-Tift v. Southern Ry. Co. et al., (1903) 123 Fed. Rep. 789, 792. Interests to be considered in passing upon lawfulness of rates. -Interest of public in competition. 5. In judicial proceedings involving the question of rates, the court must keep in view the interest of the public in competition, with the more favorable prices which it brings, and the keeping open of the larger markets to all points of production and supply.-Interstate Commerce Commission v. Louisville & N. Rd. Co., (1896) 73 Fed. Rep. 409, 420. Interests of carriers in securing special forms of traffic. 6. In passing upon the question of the lawfulness of rates, the Commission should consider not only the wishes and interests of shippers and merchants in large cities, but also the desire and advantage of the carriers in securing special forms of traffic, as that from foreign ports, and the interest of the public that the carriers should secure it, rather than abandon it, or not attempt to secure it.-Texas & P. Ry. Co. v. Interstate Commerce Commission, (1896) 162 U. S. 197, 218, 16 Sup. Ct. R. 666, 40 L. Ed. 940. Questions pertaining to freight tariff must be treated broadly and practically. Commission v. Louisville & N. Rd. Co., (1896) 73 Fed. Rep. 409, 419. 7. Questions pertaining to the carrier's freight tariff must, because of the many considerations involved, be treated broad2. Some charges may be unjust to ship-ly and practically.-Interstate Commerce pers others may be unjust to carriers. The rights and interests of both must, under the terms of the Act, be regarded by the Commission in dealing with the question of rates.-Texas & P. Ry. Co. v. Interstate Commerce Commission (1896) 162 U. S. 197, 219, 16 Sup. Ct. R. 666, 40 L. Ed. 940. 3. In passing upon the question of the lawfulness of rates, the Commission should not confine itself to a consideration of the welfare of shippers, but should also consider the welfare of the carrier, and the welfare of consumers of the merchandise carried.—Texas & P. Ry. Co. v. Interstate Commerce Commission, (1896) 162 U. S. 197, 218, 16 Sup. Ct. R. 666, 40 L. Ed. 940. 8. The carrier's business is one which involves so many considerations, and the necessity of taking into account so many conditions, that questions pertaining to its freight tariff do not admit of any rigidly theoretical rules in their solution.--Interstate Commerce Commission v. Louisville & N. Rd. Co., (1896) 73 Fed. Rep. 409, 419. Strict uniformity not required. 9. The provisions of the Act that charges must be reasonable, that discrimination must not be unjust, and that pref|erence or advantage to any particular person, firm, corporation or locality must not 4. The carrier's business of transport- be undue or unreasonable, necessarily iming goods involves the interest of the seller ply that strict uniformity is not to be enat the point of departure, the rights of forced; but that all circumstances and conthe carrier, and the rights or interest of ditions which reasonable men would rethe trader or consumer at the point of gard as affecting the welfare of the carrydelivery. These elements are all concerned ing companies, and of the producers, shipin a given transaction, and must be duly pers and consumers, should be considered considered in the decision of any case in- by the Commission in enforcing the provolving the carrier's freight tariff.-Inter-visions of the Act.-Texas & P. Ry. Co. v. state Commerce Commission v. Louisville Interstate Commerce Commission, (1896) & N. Rd. Co., (1896) 73 Fed. Rep. 409, 162 U. S. 197, 219, 16 Sup. Ct. R. 666, 40 419. L. Ed. 940. (B) SERVICES COVERED BY PUB-| X. XI. XII. XIII. XIV. EMPTY-CAR MOVEMENT AS LOW-GRADE FREIGHT, LOW RATE XV. LESS THAN CARLOAD LOTS, FIX- XVI. WEIGHT, MAKING RATES ON BA- XVII. RATES ESTABLISHED BY, AS MEASURE OF INTERSTATE CHARGES, 139. 10. The published charges of a carrier cover not merely the carriage, but services rendered in receiving and delivering the property.-Phelps & Co. v. Texas & P. Ry. See "Classification." Co., (1893) 6 I. C. C. R. 36, 45, 4 I. C. R. | 363. 11. Where the carrier undertakes to carry freight at a given rate to a certain point, the presumption is that such rate includes adequate compensation for terminal services.-Interstate Commerce Commission v. Chicago, B. & Q. Rd. Co., (1902) 186 U. S. 320, 336, 22 Sup. Ct. R. 824, 46 L. Ed. 1182. Cartage service furnished by carrier. 12. A railroad company whose depot at Grand Rapids, Mich., was at some distance from the center of the city, furnished cartage to the merchants of that city. No charges were imposed other than the established rates in effect to and from Grand Rapids. Held, that compensation for the cartage would be considered as included in the established rates.-Detroit, G. H. & M. Ry. Co. v. Interstate Commerce Commission, (1896) 74 Fed. Rep. 803, 21 C. C. A. 103. Association of carriers to make rates, see Estimated weights, as rates, see "Weights," 24-30. Reasonableness of rates, see post, 140-360. PRINCIPAL METHODS OF MAKING RATES RATES FROM POINTS IN CENTRAL CARRIERS ENTITLED IN FIRST INSTANCE RIGHTS OF COMMUNITIES MUST BE OF AVOIDING INJURIOUS RATES SHOULD BE BASED, SO FAR AS BURDENS OF TRANSPORTATION SHOULD 13. There are four principal methods of making rates to localities: that prevailing in Trunk Line Territory, in practical compliance with section 4 of the Act; that in Southeastern territory, where basing points or trade centers are recognized to which through rates are made and the local rates added for rates to tributary territory. To the Pacific coast, water competition has brought about low rates, and a combination of these with the local rate back fixes the rates for interior mountain territory points. The blanket-rate system where all stations in a given territory take | upon permanently continuing, fixed facts the same rate. Each has its advantages and conditions.-Squire & Co. v. Michigan and each is open to some objections. Cent. Rd. Co. et al., (1891) 4 I. C. C. R. Kindel v. Boston & A. Rd. Co. et al., 611, 625, 3 I. C. R. 515. (1905) 11 I. C. C. R. 495. Rates from points in Central Freight Association Territory to Atlantic seaboard. 14. In making rates from points in Central Freight Association Territory to Atlantic seaboard points, Chicago is treated as a base. Other points take either the same rate as Chicago or one which is a certain percent above or below.-Re Differential Freight Rates, (1905) 11 I. C. C. R. 13. Carriers entitled in first instance to deter mine what rates are proper. 15. Carriers are entitled under the Act to determine for themselves in the first instance what rates are proper.-National Hay Assn. v. Lake Shore & M. S. Ry. Co. et al., (1902) 9 I. C. C. R. 264, 303. Just claims of public and relative rights of communities must be considered. 16. While, in making rates, railroad companies have a just right to insist that their interests and those of their stockholders shall be considered, the just claims of the public, and the relative rights of communities, must also be taken into account and protected.-Interstate Commerce Commission v. East Tennessee, V. & G. Ry. Co. et al., (1898) 85 Fed. Rep. 107, 112. 17. Carriers are not permitted in making their rates to regard only their own interests, but must respect the interests of those who may have occasion to employ their services, and subordinate their interests to the rules of relative equality and justice which the Act prescribes. -Freight Bureau of Cincinnati v. Cincinnati, N. O. & T. P. Ry. Co. et al., (1894) 6 I. C. C. R. 195, 245, 4 I. C. R. 592. Difficulty of avoiding injurious effect of rate adjustment in all cases. Burdens of transportation should be equitably distributed among all articles of traffic. 20. A fundamental rule of equity, as well as of the statute, is that all business done by a carrier must yield some profit, so that other business is not made to bear a burden that does not belong to it.Lehmann, Higginson & Co. v. Southern Pacific Co. et al., (1890) 4 I. C. C. R. 1, 21, 3 I. C. R. 80. 21. While carriers, under exceptional which pay anything in excess of operating conditions, are justified in accepting rates expenses, yet as a general rule all traffic should be made, if possible, to pay its due proportion of operating expenses, fixed of Trade v. Nashville, C. & St. L. Ry. Co. charges and reasonable dividends.-Board et al., (1900) 8 I. C. C. R. 503, 524. 22. A railroad company ought, when practicable, to so arrange its tariffs that the burden upon freights will be proportional on all portions of its line, and with a view to revenue sufficient to meet all the items of current expense, including the cost of keeping up the road, buildings, and equipment, and of returning a fair profit to its owners.-Re Petition of Louisville & N. Rd. Co., (1887) 1 I. C. C. R. 31, 79, 1 I. C. R. 278. II. ELEMENTS CONSIDERED. IN GENERAL, 23. DISTANCE OR MILEAGE AN IMPOR TANT BUT NOT CONTROLLING MENT, 24-26. ELE AS AFFORDING MEASURE OF COST OF TRANSPORTATION, 27. MILEAGE RATES NOT PRACTICABLE, 28-32. COST OF SERVICE AN IMPORTANT BUT NOT CONTROLLING ELEMENT, 3335. SHOULD BE APPORTIONED EQUALLY AMONG DIFFERENT ARTICLES OF TRAFFIC, 36. DECREASE OF COST AS DISTANCE INCREASES, 37-47. VALUE OF ARTICLE CARRIED, 48-50. VALUE OF SERVICE - MEANING OF, 51. 58. A VERY IMPORTANT ELEMENT, 52RISK, 59-61. 18. As classifications and rates must be general, an injurious effect in some cases and to some interests is unavoidable, but so long as in the main they are satisfactory, the rule applies that the good of the greater number is paramount.-Thurber et al. v. New York Cent. & H. R. Rd. Co. et al., (1890) 3 I. C. C. R. 473, 502, 2 I. C. R. 742. Rates should be based, so far as prac-In general. ticable, upon fixed conditions. 19. Transportation rates should be arrived at and based so far as practicable DENSITY OF TRAFFIC, 62-67. WEIGHT, 68. 23. Among the elements to be considered in fixing a rate are: (1) The value of the service to the shipper, including the value of the goods and the profit he can make out of them by shipment. This is considered an ideal method when not interfered with by competition or other factors. It includes the theory of making the finished product carry a higher rate than the raw material. (2) The cost of service to the carrier. This theory is not practical. Such cost can be reached approximately, but not accurately enough to make it controlling. (3) The weight and bulk of the goods and convenience of transportation. (4) The amount of the product or commodity in the hands of a few persons to ship or compete for, recognizing the principle of selling cheaper at wholesale than at retail. (5) General public good, including good to the shipper, the railroad company and the different localities. (6) Competition, which is a very important factor. No one of these elements alone is necessarily controlling. Neither are thev all controlling as a matter of law. Those which are controlling in a given case must be determined as a question of fact on the evidence adduced. -Interstate Commerce Commission v. Chicago G. W. Ry. Co., (1905) 141 Fed. Rep. 1003, 1015. 25. While distance may, under some circumstances, be properly disregarded in the making of rates, it ought, when possible, to be considered.-New York Produce Exchange v. Baltimore & O. Rd. Co. et al., (1898) 7 I. C. C. R. 612, 667. 26. While there are many instances in the making of tariffs in which the element of distance may be overcome by other considerations, distance is nevertheless an important element, and, in the absence of other influences, is a controlling element. Freight Bureau of Cincinnati v. Cincinnati, N. O. & T. P. Ry. Co., (1897) 7 I. C. C. R. 180, 191. - As affording measure of cost of transportation. | Mileage rates not practicable. 28. A rule of equal mileage rates over different roads would often prevent legitimate competition and frequently give a monopoly in transportation to the best and shortest road.-New Orleans Cotton Exchange v. Cincinnati, N. O. & T. P. Ry. Co., (1888) 2 I. C. C. R. 375, 2 I. C. R. 289; New Orleans Cotton Exchange v. Ill. Cent. Rd. Co. et al., (1890) 3 I. C. C. R. 534, 2 I. C. R. 777. 29. There is nothing in the Act which requires that rates shall be fixed on a mileage basis.-La Crosse M. & J.'s Union v. Chicago, M. & St. P. Ry. Co. et al., (1888) 1 I. C. C. R. 629, 2 I. C. R. 9. 30. It is not the purpose of the Act to compel the establishment of rates according to mileage. The public benefits, the greater volume of business to carriers warranting lower rates to all, and the forces of competition by other lines may furnish reasons that far outweigh a claim of right founded only on geographical lo cation.-Imperial Coal Co. v. Pittsburgh & L. E. Rd. Co. et al., (1889) 2 I. C. C. R. 618, 2 I. C. R. 436. 31. Mileage or cost of service, regardless of other conditions, cannot be made the controlling factor in determining the lawfulness of rates. An inflexible rule to the contrary would be disastrous to the transportation business of the country, and would be more injurious to the public than to the railroads. It is because of the widely varying conditions of the country that the statute allows the railroads to adjust their charges to orces that are compulsory in character.-Lehmann, Higginson & Co. v. Southern Pacific Co. et al., (1890) 4 I. C. C. R. 1, 17, 3 I. C. R. 80. 32. Rates on grain from points in Kansas to Kansas City, St. Louis, and Galveston cannot be adjusted upon the sole basis of rates per ton per mile, since such an attempt would be impracticable.-Railroad Commission of Kansas v. Atchison, T. & S. F. Ry. Co. et al., (1899) 8 I. C. C. R. 304. controlling element. 33. Cost of service, while an important element in classification and rates, is not alone controlling. On that basis some articles, on account of relation of commercial value to cost of service, though furnishing a large volume of traffic, would not 27. In dealing with the question of be carried at all, and others of high comrates, distance is important only in so far mercial value would have a very low rate as it affords a measure of the cost of trans-without increasing tonnage. Another eleportation.-Re Differential Freight Rates, (1905) 11 I. C. C. R. 13. ment of the highest importance is the value of the service to the article carried. -Thurber et al. v. New York Cent. & H. R. Rd. Co. et al., (1890) 3 I. C. C. R. 473, 505, 2 I. C. R. 742. et al., (1893) 6 I. C. C. R. 1, 23, 4 I. C. R. 349. 39. The rule is well settled that, under 34. In determining rates to be charged like conditions, freight can be profitably for transportation, cost of service is one carried long distances at rates proporof the principal elements to be considered; tionately lower than for short distances. but it is not and should not be consid--New Orleans Cotton Exchange v. Ill. ered as a controlling element.-Glade Coal Co. v. Baltimore & O. Rd. Co., (1904) 10 I. C. C. R. 226. 35. In fixing upon a rate or rate adjustment, the carrier may always properly consider the cost of service, and that factor should have great influence with the Commission in passing upon the reasonableness of the carrier's action.-Business Men's League of St. Louis v. Atchison, T. & S. F. Ry. Co. et al., (1902) 9 I. C. C. R. 318, 358. Should be apportioned equally among different articles of traffic. 36. Where classification and rates have never been adequate to the cost of handling and carrying freight in less than carload lots, there should be a general reclassification which would apportion the cost of service equally, or approximately so, among the different articles of traffic and between carload lots and less than carload lots.-Interstate Commerce Commission v. Cincinnati, H. & D. Ry. Co. et al., (1905) 146 Fed. Rep. 559, 562. Decrease of cost as distance increases. 37. The rule is well settled that under like conditions freight can be profitably carried long distances at rates proportion ately lower than for short distances. The movement of freight short distances is necessarily by local trains with frequent stops, and is much more expensive than movement by through trains over long lines. There are some items of cost such as loading and unloading, which are common to long and short hauls, and which make a considerable item in the cost of carrving short distances, but become very slight when apportioned on business over long lines.-New Orleans Cotton Exchange v. Cincinnati, N. O. & T. P. Ry. Co., (1888) 2 I. C. C. R. 375, 2 I. C. R. 289. 38. A local rate covers the expense of two terminals, but a division of a through rate allotted to either of the terminal carriers of the through line can only embrace the expense of one terminal. Because of this difference in expense, among other reasons, local rates are made as a general rule much higher in proportion to the length of haul than through rates or any division thereof.-Board of Trade of Troy, Ala., v. Alabama Midland Ry. Co. Cent. Rd. et al., (1890) 3 I. C. C. R. 534, 2 I. C. R. 777. 40. It is a familiar rule of transportation that while the aggregate charge is continually increasing the further freight is carried, the rate per ton per mile is constantly decreasing.-New Orleans Cotton Exchange v. Ill. Cent. Rd. Co. et al (1890) 3 I. C. C. R. 534, 2 I. C. R. 777. 41. Since rates per ton per mile ordinarily decrease as distance increases, the longer the distance the less should be the ton-mile rate.-Consolidated Forwarding Co. v. Southern Pacific Co. et al., (1905) 10 I. C. C. R. 590. 42. It is consistent with the law for a carrier, within reasonable limits, to accept less per ton per mile upon long hauls than upon short hauls, and to widen the disparity between such rates as the difference in distance increases.-Colorado Fuel & Iron Co. v. Southern Pacific Co. et al., (1895) 6 I. C. C. R. 488, 513. 43. It is not the purpose of the Act to disregard the principle that longer hauls involve less handling of the property transported than shorter hauls, and that rates per ton per mile for longer hauls may be inadequate for shorter hauls.-InMidland Ry. Co., (1895) 69 Fed. Rep. 227, terstate Commerce Commission v. Alabama 231. 44. It is a familiar rule in the transportation of freight, that while the aggregate charge is continually increasing the further the freight is carried, the rate per ton per mile is constantly growing less all the time, unless there be exceptional conditions modifying the rule.-Farrar & Co. v. East Tenn. V. & G. Ry. Co., (1888) 1 I. C. C. R. 480, 1 I. C. R. 764. 45. The rule that while the aggregate rate should increase with distance, the rate per ton per mile should decrease, is not one required by the Act, and is subject to qualifications and exceptions.-Hil. ton Lumber Co. v. Wilmington & W. Rd. Co. et al., (1901) 9 I. C. C. R. 17, 31. 46. The circumstance that with increase in distance the rate per ton per mile does not decrease, and may actually increase, is immaterial if the rate which yields it does not subject a shipper or a particular locality to undue hardship.— |