Amp

to

rates to other Georgia points. See also on general subject of undue preference to localities, 8 I. C. C. R. 316, and 8 I. C. C. R. 290.

Where an existing relation of rates is found to be unduly preferential as between localities, the discrimination may be corrected by raising one rate or reducing the other, provided of course, the rate when adjusted is reasonable in itself. See 10 I. C. C. R. 456. In this case it was ruled that the existence of water competition between Buffalo and New York did not justify any wider difference in the rates from Saginaw and Buffalo to points on the New York and Long Branch Railroad than existed in the rates from those shipping points to New York.

These and other cases cited under the different topics of this section will illustrate the almost infinite variety of circumstances bearing upon the complex question of the adjustment of rates between localities.

§ 241 (184). Recognition of natural advantages of localities not an unjust preference.-The commission has repeatedly ruled that a town favorably situated for trade, possessing natural advantages therefor, is entitled to the benefits in rates naturally arising from such location. See 5 I. C. C. R. 571, 4 Int. Com. Rep. 230; 10 I. C. C. R. 148 (the Michigan Salt Case). The law requires the regulation of railroad charges according to the ascertained rights of persons and places, and it is not an agency for the regulation of trade by enabling shippers or communities to do business by putting them on even terms with. rivals more remote from competitive territory. 6 I. C. C. R. 458, 8 I. C. C. R. 409. The equal right of a competing locality is neither increased nor diminished by municipal subscriptions advanced for the building of a road. 2 I. C. C. R. 147 and 2 Int. Com. Rep. 95.

The refusal to give a through rate is not an unjust discrimination to a locality when the same rule is applied to all towns and the privilege accorded to none, although the refusal may operate prejudicially to one town and favorably to another, as the discrimination must consist in doing for or allowing to one party or place what is denied to another. 1 I. C. C. R. 401, and 1 Int. Com. Rep. 703.

Neither can a railroad be held to discriminate against a town which it does not reach and in whose carrying trade it does not participate. 5 I. C. C. R. 264, and 4 Int. Com. Rep. 65.

While the commission has conceded that the recognition of natural advantages of localities is not unjustly preferential, yet it has also ruled that the mere fact that one point is larger than another with more business does not justify a discrimination in its favor, 9 I. C. C. R. 42, and that one of the underlying principles of the act was equality between great and small. See also 2 I. C. C. R. 25 and 2 Int. Com. Rep. 32.

§ 242 (185). Competing cities on opposite banks of rivers.— The principle that a city is entitled to the benefits arising from its location, and that when it enjoys exceptional advantages in one respect it should not therefore be subjected to discrimination in other respects, has been applied in the case of cities situated on the banks of rivers, which railroads must cross by expensive bridges for which an arbitrary toll is charged, or which must be allowed for in an apportionment of through rates. Several such instances have been presented to the commission. Thus the cases of Omaha and Council Bluffs, St. Louis and East St. Louis, Cincinnati and Louisville were presented, though in the latter case the cities are situated on the opposite banks of the Ohio river some distance apart, but are competitors for the business of the same territory.

In the case of Cincinnati, 7 I. C. C. R. 180, complaint was made by the Freight Bureau of the Chamber of Commerce against the higher rates charged from Cincinnati than Louisville to southern points. The commission said that the location of Cincinnati upon the north bank of the Ohio river and the fact that the railroads leading south must cross that river by expensive bridge charges justified a higher differential from Cincinnati over rates from Louisville on the south bank of the river. As the commission had nothing before it except the fact of distance, it did not pass any opinion as to whether the existing differentials were just or excessive.

In the case of Omaha and Council Bluffs, 7 I. C. C. R. 386, it was ruled that there was no unjust discrimination against Omaha in the fact that rates to points in Iowa were higher for Omaha than for Council Bluffs by the amount of the bridge toll on an expensive bridge over the Missouri river. It was

V

said in the opinion that all like or group rates were frequently applied to cities considerably further apart than Omaha and Council Bluffs, but that the usage in this regard was not so uniform and well established as to make their application to those cities even prima facie unjust.

In 5 I. C. C. R. 57 and 3 Int. Com. Rep. 701, an East St. Louis miller was ruled entitled to the advantage of his location on the east side of the river as against his competitors on the other side of the river in St. Louis, and a railroad terminating in East St. Louis which allowed St. Louis millers a rebate for the cost of their teams across the bridge to the railroad station was unjustly discriminating against the East St. Louis miller, and the latter was therefore entitled to a reduction of six cents a barrel as to flour handled by him to the station on the rates in force, as long as the railroads bore that amount of the cost of carriage for the St. Louis shippers.

§ 243 (186). Differentials between competitive cities.-The intense competition of modern commerce is illustrated in the complaints made to the commission by the Boards of Trade or other commercial organizations of different cities against alleged discriminations in the relative railroad rates to competing localities. The differentials allowed by the trunk line associations, particularly on the grain traffic from the west to the seaboard, as between the different seaboard cities, have been very exhaustively investigated. Thus in the case of the alleged discriminations against Boston, 1 I. C. C. R. 436 and 1 Int. Com. Rep. 756, the commission ruled in 1888 that the then existing differentials between Boston and New York, being ten cents per hundred pounds on the first and second classes, and five cents per hundred on the four other classes, on traffic from west of Buffalo, were not unreasonable. The conclusion was based upon the greater cost of transportation to Boston, the greater volume of business to and from New York, the competition by water and through lakes and canal and Hudson river to New York, and the geographical and commercial advantages of New York.

Later however in 1892, the commission re-examined the subject and concluded that the differential was excessive and should be made, not by adding an arbitrary sum to the New

York rate, but by adding a percentage, ten per cent, to the New York rate. In this case the commission ruled that the doctrine of estoppel was not applicable, as the commission was not a court, and that the whole spirit and scope of the act made the report and order of the commission in no sense final, except in the sense that the parties may be impressed with the justice of the order and acquiesce therein. 5 I. C. C. R. 166, 3 Int. Com. Rep. 830.

In 1898 the commission, on the complaint of the New York Produce Exchange, investigated the differentials allowed by the railroads of two cents to Philadelphia and three cents to Baltimore below the New York rate on grain, flour and provisions. 7 I. C. C. R. 612. The commission made an exhaustive investigation of the commerce of the three ports, and concluded that the differentials were legitimately based upon the competitive relations of the carriers, and did not result in any unlawful preferences or advantage to Philadelphia or Baltimore over the city of New York. It was contended in this case that the rates were really made by the trunk line associations, but the commission ruled that, so far as the alleged violation of the third section was concerned, this was immaterial.

Still another application was made in 1904, and in an opinion in 11 I. C. C. R. 13, the differentials were again considered, this time relating only to export trade. The commission ordered a reduction of two cents on flour at Baltimore and one cent at Philadelphia, allowing the existing export differentials otherwise to remain in force. Commissioner Clemens dissented, saying that he did not think that competing carriers could lawfully effect though the agency of the commission a restraint of competition in trade between themselves and the ports, when such action on their own part would be unlawful.

On a complaint of the Saginaw Board of Trade (17 I. C. C. R. 128), it was ruled that the proximity of Detroit and Toledo to the great channels of through transportation and their location on direct through routes where the amount of traffic is very great and the general operating and traffic conditions are favorable, are elements that cannot be ignored by the rate maker and must necessarily tend to lower rates than can be accorded to communities that are removed from these great streams of traffic.

Cases of alleged discrimination in relative rates between competing cities have been investigated in different sections of the country. As in the case of alleged unreasonable rates, the conclusions of the commission are not adjudications, and as the commission observed in the case of the Boston differential, they do not preclude the commission itself from reinvestigation. A rate, which is relatively reasonable at one time, may become through changed conditions relatively unreasonable.

§ 244. Preference in demurrage charges.-Undue preference between competing cities, or between competitors in business, may be shown in the allowance of demurrage; that is, in allowing time unreasonably small in one place and unreasonably long in another, 8 I. C. C. Rep. 351. See also 7 I. C. C. Rep. 591. The commission may afford relief from the imposition of demurrage charges upon a showing that the complainant is so subject, either to unjust discrimination or to the payment of unreasonable charges, 13 I. C. C. Rep. 571. After allowing a reasonable time for unloading cars, the carrier may impose such charges for further detention as will afford a speedy relief to its equipment, 16 I. C. C. Rep. 116. Where a railroad extends the time of free. delivery at one place, they must treat alike all points similarly Situated, see 16 I. C. C. Rep. 497. The commission, however, has no jurisdiction over the question of whether the demurrage charges exacted by the carrier constitute a lawful lien upon the property, 13 I. C. C. Rep. 571. The right of a railroad to exact demurrage charges while the cars are standing on a siding owned and operated by the railroad, which was constructed for the use of complainant, is not affected by the fact that the cars are owned by the complainant.

§ 245. Uniform demurrage rules recommended. The commission in its 23rd annual report (1909) calls attention, p. 13, to the adoption of a uniform code of car demurrage rules by the National Association of Railway Commissions, an association comprising the membership of all the state railroad commissions of the United States. A report was made to this association showing that the transportation system of the country was very much embarrassed by the undue holding of cars by shippers and receivers of freight. A code of rules was prepared by this asso