CHAPTER IV.

EQUALITY IN RATES.

132. Scope of Chapter.

133.

134.

Common Law as to Equality in Rates by Carriers.

Same Subject. Damages.

135. Comparison of the English Railway and Canal Act with the Act to Regulate Commerce.

144.

Undue Preferences in Favor of Persons or Localities.

145. Same Subject. Application of Section made by the Com

mission.

145a. Differentials.

146.

Discrimination against Traffic.

146a. Same Subject.

147. Same Subject.

Carrier.

Competition between Users of Related Rates.
Discrimination Beyond the Control of the

148. Facilities for Interchange of Traffic and Rates and Charges to Connecting Lines Must Be without Undue or Unreasonable Preference.

152.

Haul.

Discrimination by Charging More for a Shorter than a Longer

153. Long and Short Haul. Old Law Construed.

struction.

154. Long and Short Haul Clause under Act of 1910. 154a. Long and Short Haul Clause under Act of 1920.

Definite Con

155. Fourth Section. Relationship between Through Rate and In

156.

157.

158.

termediate Rates.

Discrimination between Carloads and Less than Carloads.
Bulked Shipments.

Carloads, Ownership of.

159. Train Loads.

166.

Rebilling.

Rebilling-Found Illegal.

Rebilling Illegal Only When Unjustly Discriminatory.

167. Rebilling. Conclusion.

168. Payment of Elevator Allowances

169.

170.

171.

172.

173.

174.

175.

176.

Transit Privileges-Generally.

Allowances to Tap Line Railroads.

Allowances to Industrial Tracks.

Illegal for Carriers to Transport Commodities Produced or
Owned by Them or in Which They Are Interested.
Commodities Clause of Act of 1906.

Cars Must Be Furnished without Discrimination.
Same Subject. Principles Applied by the Commission.

Freight Charges Must Be Collected without Discrimination.

177. Right of Carrier to Route Shipments Beyond Its Own Terminus.

179. Tariffs of Rates Must Be Printed, Posted and Maintained. Same Subject. Misquoting Rates.

180.

181.

182.

Different Rates over the Same Line in Opposite Directions.
Discrimination by Granting Free Service.

183. Basing Points, Group Rates and Zone Rates.

184. How Far a Rate Made by a State Relieves a Carrier from the Duty to Serve Communities with Legal Equality. Commutation. Mileage and Party Rate Tickets. Rebates.

185.

186.

§ 132. Scope of Chapter. A rate may be reasonable, and yet, because of its relation to other rates, unlawful as violative of the provisions of the Act to Regulate Commerce which require a just equality in rates.

Many of the facts affecting the reasonableness of rates must be considered in determining whether or not a rate is unlawfully discriminatory or preferential. While this is true, there are certain principles which have been specially applied to the question of equality in rates. It is the purpose of this chapter to state these principles with the application thereof that has been made, and to deduce therefrom, to the extent that may be, such rules as can be legally and properly applied. In do

ing so, it must not be forgotten that the facts to be considered are numerous and of constantly varying force, that a definite measure for the determination of the legality of a rate has not been fixed and that a flexible judgment must be applied to situations as they arise, and that long established and generally accepted conditions cannot be abruptly changed, but that slow evolution is the concomitant of rate regulation.

§ 133. Common Law as to Equality in Rates by Carriers.— The common law requirement as to the reasonableness of rates we have seen supra, sec. 61, was undisputed. Equality in rates was not so definitely provided for in that system of laws, and it has been doubted whether or not a carrier was bound to charge equal rates to all its customers. Discussing this question Mr. Justice Brown said:1

"Prior to the enactment of the act of February 4, 1887 (24 Stat. at L. 379), to regulate commerce, commonly known as the Interstate Commerce Act, railway traffic in this country was regulated by the principles of the common law applicable to common carriers, which demanded little more than that they should carry for all persons who applied, in the order in which the goods were delivered at the particular station, and that their charges for transportation should be reasonable. It was even doubted whether they were bound to make the same charge to all persons for the same service: (Fitchburg R. Co. v. Gage, 12 Gray, 393; Baxendale v. Eastern Counties R. Co., 4 C. B. N. S. 63; Great Western R. Co. v. Sutton, L. R. 4 H. L. 226, 237; Ex parte Benson, 18 S. C. 38; Johnson v. Pensacola & P. R. Co., 16 Fla. 632); though the weight of authority in this country was in favor of an equality of charge to all persons for similar services."

That the common law required equality of service and charges under the same or similar circumstances more clearly appears from a subsequent decision of the Supreme Court in Western Union Tel. Co. v. Call Publishing Co.," where Mr. Justice Brewer said:

1. Int. Com. Com. v. Baltimore & O. R. Co., 145 U. S. 263, 36 L. Ed. 699, 703, 12 Sup. Ct. 844. See 3 Fed. Stat. Ann. 813.

2. Western Union Tel. Co. v. Call Publishing Co., 181 U. S. 92, 45 L. Ed. 765, 21 Sup. Ct. 561.

"Common carriers, whether engaged in interstate commerce or in that wholly within the state, are performing a public service. They are endowed by the state with some of its sovereign powers, such as the right of eminent domain, and so endowed by reason of the public service they render. As a consequence of this, all individuals have equal rights both in respect to service and charges. Of course, such equality of right does not prevent differences in the modes and kinds of service. and different charges based thereon. There is no cast iron line of uniformity which prevents a charge from being above or below a particular sum, or requires that the service shall be exactly along the same lines. But that principle of equality does forbid any difference in charge which is not based upon difference in service, and, even when based upon difference of service, must have some reasonable relation to the amount of difference, and cannot be so great as to produce an unjust discrimination. To affirm that a condition of things exists under which common carriers anywhere in the country, engaged in any form of transportation, are relieved from the burdens of these obligations, is a proposition which, to say the least, is startling."

Further in the opinion it was stated that "the principles of the common law are operative upon all interstate commercial transactions, except so far as they are modified by congressional action," and, we may conclude, that such principles required "equal rights both in respect to service and charges," when the circumstances and conditions were the same; and where the circumstances and conditions were different, the difference in services and charges should bear a reasonable relation thereto.

§ 134. Same Subject-Damages. In the Parsons case the question discussed was not the right to "equality of charge

for similar services," but that opinion had reference to plaintiff's right to recover damages under the special facts there involved. That inequality of charges for similar services was wrong was not questioned for, said the court: "Before any party can recover under the act he must show, not

3. Parsons v. Chicago & N. W. 231, 17 Sup. Ct. 887.

R. Co., 167 U. S. 447, 42 L. Ed.

merely the wrong of the carrier, but that that wrong has in fact operated to his injury. If he had shipped to New York and been charged local rates he might have recovered any excess thereon over through rates. He did not ship to New York and yet seeks to recover the extra sum he might have been charged if he had shipped."

The same comment applies to the decision in the Coal case. That case was based upon the fact that the carrier had given to certain shippers what was decided to be a rebate and had not given the same allowances to the plaintiff suing. In the District Court the plaintiff recovered, and the recovery was sustained by the Circuit Court of Appeals. In the Supreme Court the judgment of the Circuit Court of Appeals was reversed and a new trial ordered, not because the plaintiff did not have a right of action, but because it had not shown that it had suffered legal damages."

Neither of these cases denies that at common law a shipper had a right to equality of charges under similar circumstances, and in this respect neither conflicts with the statement of Mr. Justice Brown quoted in the preceding section. That equality of service from a public service company or corporation was a right at common law, seems to be, so far as the Supreme Court of the United States has spoken, undisputed. In order to recover damages for an invasion of this right proof of the fact of having suffered legal damages is necessary.

Where as under the Constitution of the United States, a schedule of rates may not be fixed less than will yield a fair return on the property employed in the public use, every customer of a public carrier is, to some extent, interested in what is charged every one else. It is true that an individual may not have a cause of action so long as what he pays is reasonable, unless the preference granted others damages him.

Neither under our statute nor under the common law is mere discrimination prohibited, but it will be found upon an

4. International Coal Mining Co. v. Pennsylvania R. Co., 162 Fed. 996.

5. Pennsylvania R. Co. v. International Coal Co., 173 Fed. 1, 97 C. C. A. 383.

6. Pennsylvania R. Co. v. International Coal Co., 230 U. S. 184, 57 L. Ed. 1446, 33 Sup. Ct. 893. See, following this case and citing authorities, New Orleans Board of Trade v. Illinois C. R. C., 29 I. C. C. 32.