Foster, for Richmond & Danville Railroad Co., Charlotte, Columbia & Augusta Railroad Co., and Columbia & Greenville Railroad Co. Sol. Haas, Traffic Manager, also for Associated Railways of Virginia and the Carolinas, including the Atlantic Coast Line and the Seaboard Air Line. G. S. Barnum, General Freight and Passenger Agent for Georgia Pacific R. R. Co. John C. Gault, General Manager, and Robert X. Ryan, General Freight Agent, for Cincinnati, New Orleans & Texas Pacific Railway Co., Vicksburg & Meridian Railroad Co. and other roads of the "Queen and Crescent" line. William M. Baxter, General Solicitor, and Edwin Fitzgerald, Traffic Manager, for East Tennessee, Virginia & Georgia Railway Co. and Memphis & Charleston Railroad Co. John W. Green, General Manager, and E. R. Dorsey, General Freight and Passenger Agent, for Georgia Railroad and Banking Co. Edward Baxter, Attorney, Milton H. Smith, Vice-President, E. B. Stahlman, Third Vice-President, Stuart R. Knott, Traffic Manager, and Basil W. Duke, for Louisville & Nashville Railroad Co., including the Mobile & Montgomery Railroad Co., and South & North Alabama Railroad Co. J. W. Thomas, President and General Manager for Nashville, Chattanooga & St. Louis Railway Co. Charles G. Eddy, Vice-President, Augustus Pope, General Freight Agent, W. B. Bevill, General Passenger Agent, for Norfolk & Western Railroad Co. F. W. Clark, General Freight and Passenger Agent for Seaboard & Roanoke Railroad Co. Joseph M. Brown, General Freight and Passenger Agent for Western & Atlantic Railroad Co. H. Walters, Vice-President, and T. M. Emerson, General Freight and Passenger Agent, for Atlantic Coast Line, including the Wilmington & Weldon Railroad Co., and Wilmington, Columbia & Augusta Railroad Co. William H. Halsey, Chief Rate Clerk for Southern Railway & Steamship Association. REPORT AND OPINION OF THE COMMISSION. WALKER, Commissioner: On the 22d of October, 1888, an order of notice was made by the Commission in the above-entitled matter as follows: "It appearing to the Commission upon an inspection of the tariffs and classifications published and filed by the carriers hereinafter named, which are associated for certain purposes under the name of the Southern Railway and Steamship Association, as well as by information and complaints received from time to time, that such carriers in many cases make a greater charge for the transportation of a like kind of property for a shorter than for a longer distance over the same line in the same direction upon interstate traffic; and that the disparity between the charges made at different points over the same line is in some instances apparently very great as related to distance; and that there is reason to believe that the requirements of section 6 of the Act to regulate commerce are not complied with in the filing and publishing of many of said tariffs, in this, among other things, that the rates actually charged to shippers are not the rates given upon said schedules, but so-called combination rates are made, different from the rates specified in the tariffs as published and filed, upon both local and joint interstate traffic; and that the classifications in use are complicated and involved, containing many exceptions and variations, different classifications being at times used upon the road of the same carrier for the shipment of the same commodities to neighboring points, and at times two or more classifications being employed upon the same shipment in fixing a so-called combination rate upon the line of a single carrier, or of two or more connecting carriers; and that the tariffs as filed, and without explanation, are apparently not in form sufficient for the information of the public in the transaction of business; and that special tariffs are issued upon single shipments, and are limited in time; and that said tariffs and classifications in other respects do not appear to conform to the provisions and requirements of the Act to regulate commerce; and that an investigation and inquiry should be had in respect to said matters; "It is thereupon ordered that the following-named carriers, to wit: Atlanta & West Point Railroad Company, Central Railroad & Banking Company of Georgia, Charlotte, Columbia & Augusta Railroad Company, pany, Columbia & Greenville Railroad Company, East Tennessee, Virginia & Georgia Railway Company, Port Royal & Augusta Railway Company, Rome Railroad Company, Savannah, Florida & Western Railway Company, Savannah, Griffin & North Alabama Railroad Company, Seaboard & Roanoke Railroad Company, South Carolina Railway Company, South & North Alabama Railroad Company, Wilmington, Columbia & Augusta Railroad Company, and such other carriers as may hereafter be named, operating in the same territory with those above enumerated, or connecting with them, appear before this Commission at Washington, D. C., on December 18, 1888, at 11 o'clock a. m., for the purpose of a general examination and investigation of their tariffs and classifications as on file in the office of the Commission, and as in use upon their lines, respectively; to the end that an opportunity may be then and there given to said common carriers to be heard concerning the same, and in respect to the method of constructing interstate rates therefrom as practiced upon said lines, respectively, or in connection with other lines; and that any changes may be made which shall be found necessary and proper in order to bring said tariffs and classifications, and the manner of transacting business thereunder, into more complete conformity with the provisions of the Act to regulate commerce." Pursuant to the notice so given, representatives of the various carriers named appeared before the Commission on December 18, 19 and 20, 1888, and an examination was made in respect to the matters recited in the Order. Reference has also been had to testimony previously given on various occasions, as well as to tariffs, classifications and other documents on file. Section fourteen of the Act to regulate commerce requires the Commission to make a report in writing, which shall include the findings of fact upon which its conclusions are based, together with its recommendations thereon. It will be observed that the roads named in the order embrace the principal lines operating in the territory south of the James and Ohio Rivers, in the States of Virginia, North Carolina, South Carolina, Georgia, Alabama and Tennessee, being the territory within which rates have heretofore been to a large extent controlled by the rail and water lines comprised in the Southern Railway and Steamship Association. Rates within that territory, however, are affected to such an extent by conditions existing upon other lines in its vicinity that it has been found necessary to somewhat extend the field of investigation. The status of the carriers engaged in the transportation of passengers and property to, from and among the States above named is so different from that of carriers in the Eastern, Middle, and Western States, and the methods employed are so variant from those of carriers in most other sections of the country, that a careful statement of facts is necessary, for the purpose of clearly exhibiting the principles applicable to the conditions which prevail in the Southern States, and of emphasizing the fact that conclusions reached in respect to this territory are not controlling everywhere. The chief differences will be found in the fact that the territory in question is substantially surrounded by the ocean and the mighty rivers which bound it on the North and West, while it is penetrated to a considerable extent by other navigable streams; and in the further fact that the traffic is relatively small in amount, the annual gross earnings per mile of road being considerably less than in most of the Eastern, Northern and Western States. In addition to these elements of diversity it is a characteristic of this section that many lines exist over which traffic to or from distant markets may be taken in either direction, with equal facility; and it is also peculiarly true that long-established usage has here created a system of so-called "trade-centers" which control the collection and distribution of commodities throughout the territory in their vicinity; a course of business which has become so firmly grounded that the territory surrounding these local centers is frequently spoken of as naturally tributary to them. Previous to the passage of the Act to regulate commerce it was the universal custom in this section of the country to establish rates to certain basing points, subject to fluctuations occasioned by competition and otherwise, while rates to and from all other points were obtained by adding the local charges of the various terminal or initial roads to the rates at the basing points. These points were selected by reason of their situation upon navigable streams, or at the junction of railroad lines, or as determined by other considerations; their number was large. The result of the system was that rates quite reasonable, and in some cases low, were given to and from the basing points; and that goods were thence distributed at high local charges in all directions. For example, the rates from New York or Chicago to Atlanta, plus the rate from Atlanta to local points north, east, south and west therefrom, were the rates charged from New York or Chicago to the latter points direct; and the latter rates were usually very much in excess of rates to distributing |