unreasonable; evidence to prove the charges to be reasonable is immaterial."

11

excessive Under a

State statute, it was decided that, in order to recover penalties for unreasonable charges, it must be proved that the charges exceed the maximum rates fixed by the railroad commissioners.10 10 Charges so fixed cannot be increased by wrongfully diverting freight from its proper course." The constitutons of several of the American States confer upon the legislature authority to fix reasonable maximum freight and passenger rates." In California the same authority is conferred upon the railroad commissioners.13

1 Great Western R'y Co. v. Sutton, Law R. 4 Eng. & Ir. App. 226, 237; Angell on Carriers, § 121; Johnson v. Railroad Co. 15 Fla. 623; Baxendale v. Eastern Counties R'y, 4 Com. B. N. S. 63; Branley v. South Eastern Ry, 12 Com. B. N. S. 63; Fitchburg R. R. Co. v. Gage, 12 Gray, 333; Ex parte Benson, 185. C.38; Menachov. Ward, 27 Fed. Rep. 531; S. C. 23 Am. & Eng. R. R. Cas. 647; 31 Alb. Law J. 4; Messenger v. Penn. R. R. Co. 33 N. J. 407; McDuffie v. Railroad Co. 52 N. H. 430; Munn v. Illinois, 94 U. S. 113, 131; Sandford v. R. R. Co. 21 Pa. St. 378: Shipper v. Penn. R. R. Co. 47 Pa. St. 338, 341; Audenried v. P. & R. R. R. Co. 68 Pa. St. 370; Chicago B. & Q. R R. Co. v. Farks, 18 Ill. 460; Chicago & Alton R. R. Co. v. People, 67 Ill. 11; Scofield v. Lake Shore etc. R'y Co. 43 Ohio St. 571; New England Exp. Co. v. Maine Central R. R. Co. 57 Me. 183; Hays v. Pennsylvania Co. 12 Fed. Rep. 303; Hollister v. Nowlen, 19 Wend. 239; Smith v. Chicago etc. R. R. Co. 5 N.W. Rep. 242; Brown v. Adams Exp. Co. 15 W. Va. 821; "Relations which Railroad Corporations bear to the State," by Jas. McCartney (1885), 7 III. Bar Assoc. 89.

2 Killmer v. New York Central & Hudson Riv. R. R. Co. 100 N. Y. 395. 3 Gt. Western R'y Co. v. Sutton, Law R. 4 Eng. & Ir. App. 226, 237 (H. L.); Angell on Carriers, § 124: Johnson v. Railroad Co. 16 Fl. 623. See also, Killmer v. N. Y. C. & H. R. R. Co. 100 N. Y. 335; Legal Relations of Railroad Corporations to the Public," by John Mayo Palmer (1882), 4 Ill. St. Bar Assoc. 126.

4 Supra.

5 Railroad Comm'rs v. Portland etc. R. R. Co. 63 Me. 269, 277; State v. Republican V. R. R. Co. 17 Neb. 647; Louisville & N. R. R. Co. v. Railroad Comm'rs, 19 Fed. Rep. 679; "Power of Legislature to fix Rates of Carriers,' by O. W. Aldrich, 3 Ohio Law J. 614; "Legislative Power to Regulate Railroad Franchises," by G. B. Dantz, 12 Cent. Law J. 194.

6 Chicago etc. R. R. Co. v. Iowa, 94 U. S, 155; Munn v. Illinois, 94 U. S 113; Peik v. Chicago etc. R'y Co. 94 U. S. 164; Louisville & N. R. R. Co. v. Railroad Comm'rs, 19 Fed. Rep. 679; "Legislative Control of Railroads," by S. S. Wallace, 3 South. L. Rev. 656; "Railroad Legislation," by Chas. F. Adams Jr. 2 Am. Law Rev. 25.

7 Munn v. Illinois, 94 U. S. 113; Chicago etc. R. R. Co. v. Iowa, 94 U. S. 155; Peik v. Chicago R. R. Co. 94 U. S. 164; "Legislative Control of Railroads," by F. L. Wells, 12 West. Jur. 17.

8 Wabash etc. R'y Co. v. Illinois, 118 U. S. 557; "Legislation concerning Railroads," by B. W. Duke, of the Louisville bar, 1 Ky. Law J. 163, 211. 9 Heiserman v. Burlington etc. R'y Co. 63 Iowa, 732. See Ruggles v. Illinois, 91 Ill. 256; S. C. 108 U. S. 526; Stone v. Farmers' L. & T. Co. 116 U. S. 307.

10 Chicago, B. & Q. R. R Co. v. People, 77 Ill. 443; and see Moore v. Illinois Cent. R. R. Co. 68 111. 385.

11 Burlington etc. R. R. Co. v. Chicago Lumber Co. 15 Neb. 390.

12 Stimson's Am. Stat. Law (1886), § 462, citing the constitutions of Ill., Mich., Neb., W. Va., Mo., and Tex.

13 Cal. Const. (1873) Art. XII, § 22.

2

1025. Elements to be considered in determining reasonableness of rates.-Congress, in adopting this section, was legislating for the protection of the general public, and not for the protection of the carriers against the unreasonable action of their own officers, or against excessive competition.1, Under the English acts, the question whether a rate is a "reasonable facility in the interests of the public," is held to be one of fact. The length and character of the haul; the cost of the service; the volume of business; the conditions of competition; the storage capacity and the geographical situation at the different terminal points, are all elements of importance, bearing upon the relative reasonableness of the respective charges for transportation. In determining what is a just and reasonable rate for a particular commodity, the commission will take into consideration the earnings and expenses of operation, the rates charged upon the same commodity by other roads as nearly similarly situated as may be, the diversities between the railroad in question and such other railroads, the relative amount of through and local business, the proportion borne by the commodity in question to the remainder of the local traffic, the market value of the commodity and its

3

gradual reduction, the reductions made by the carrier upon other articles which are consumed and necessarily required by the producers of the article in question, and all other circumstances affecting the traffic of itself, and as related to other considerations entering i to the charges of the carrier.* In short, all the surrounding circumstances and conditions must be considered, as well as the rights of the shi, per, and it these circumstances and conditions exercise any controlling influence in the making of the rate, they cannot be disregarded.5 A full knowledge of all the facts concerning the particular traffic and its relations to the other traffic of the carrier is necessary to a proper decision in each case. The law requires uniformity and impartiality in the dealings of a carrier with all persons. Consideration should be had of consequences which might follow a modification of the principle upon which the rates complained of are constructed. So, where a change of rates would involve a reduction of rates on other competing lines not parties to a proceeding, and unsettle relative rates in a large extent of territory, such a change ought not to be made unless based upon adequate grounds. Where a system of rates is made by a number of carriers covering a widely extended territory, which seem to be reasonable in themselves and relatively fair, they will not be changed at one important point, thereby rendering other changes unavoidable at a large number of other points, and throwing the rates of the entire system into confusion, unless a case arises in which it is necessary that this should be done in order to enforce compliance with the law and to reach the

ends of substantial justice.10 The relative reasonableness of rates on shipments from western points in the United States to cities on the Atlantic seaboard, is to be determined by all the circumstances and conditions that affect the traffic to the respective points between which the rates are questioned, and not solely by any one standard of comparison."

1 In re Chicago, St. P. & R. C. R'y Co. 2 Inter. Com. C. 231.

2 Severn & Wye etc. R'y Co. v. Great Western R'y Co. 5 B. & Mac. 170; 13 Rep. R'y Com. 23.

3 Boston Chamber of Commerce v. Lake Shore & M. S. R. R. Co. et al. 1 Inter. Com. C. 436.

4 Evans v. Oregon R'y & Nav. Co. 1 Inter. Com. C. 325; Report of the Commission, 1 Inter. Com. C. 312.

5 Business Men's Ass'n v. Chicago etc. R'y Co. 2 Inter. Com. C. 52. 6 Howell v. New York, L. E. & W. R. R. Co. 2 Inter. Com. C. 272. 7 Hurlburt v. Lake Shore & M. S. R'y Co. 2 Inter. Com. C. 122.

8 Lincoln Board of Trade v. Missouri Pacific R'y Co. 2 Inter. Com. C. 155.

9 Rice et al. v. Western U. T. & P. R. R. Co. 2 Inter. Com. C. 389. 10 Detroit Board of Trade v. Grand Trunk R'y of Canada, 2 Inter. Com. C. 315.

11 Boston Chamber of Commerce v. Lake Shore & M. S. R. R. Co. et al. 1 Inter. Com. C. 436.

§ 1026. The same subject, continued-Discrimination between places and persons.-Rates must not only be reasonable in themselves, but they should be so relatively reasonable as to protect communities and business against unjust discrimination.1 Trade centers or large commercial towns are not as a matter of right entitled to have more favorable rates than the smaller towns for which they form distributing centers. Rates that are just and reasonable from selected manufacturing points, through an entire territory, are prima facie just and reasonable from all other points in the same territory." A former special and preferred

rate is not a fair test of the reasonableness of a present rate. There is nothing illegal or wrongful in a railroad company making a rate for immigrants as a class, and declining to give the same rate to others for whom different accommodations are furnished. When the same carrier operates parallel lines, and for any cause accepts low rates on one of them, it should provide sufficient corresponding advantages to the patrons of the other line to preserve the substantial equality contemplated by the statute. This section does not render rates that are unreasonably low illegal in a sense that will authorize the Commission to prohibit their being made.' The fact that an independent pipe line transports oil between certain points at lower rates than a railroad company, constitutes no just reason why the railroad company should be required to reduce its rates to those of the pipe line. In England allowance is made for the liability assumed by the carrier as an insurer. So, a contract relieving the carrier from liability for loss caused by delay in transit or by any other cause, in transporting perishable articles, in consideration of a reduced charge for the carriage, has been held to be reasonable." Where a railway company charged one rate for separate packages containing the same article, all of which were billed to the same person at the same place, and charged a higher rate upon similar packages addressed to different persons, it was held that such charges were not unreasonable, regard being had to the increased expense of handling the parcels."

1 Boards of Trade v. Chicago, M. & St. P. R'y Co. 1 Inter. Com. C. 215; "Railway Delinquencies," by W. L. Murfree Sr. 19 Am. Law Rev. 714.