really exists, it may affect transportation in ways which do not always show in the rate schedules. Competition may properly be considered in determining the correct classification of an article, 32 but its effect is not to be extended to articles to which it does not apply by merely classing them with articles to which it does apply.33 Railways may be forced to establish any-quantity rates on commodities because of competition with any-quantity water rates on those commodities. 34 Water competition may also justify a difference in the right of combining different commodities at the carload rate, 35 or of loading C. L. freight at one station and not at another.36 Even the minimum weight of the carload may vary at different points because of competition. The fixing of the minimum weight at 20,000 pounds on shipments of bananas from New Orleans and Mobile to points west of the Mississippi River, while assessing a minimum weight of 18,000 pounds to Chicago and points east of the river, did not result in undue discrimination, as it appeared that such difference in minima was made to meet competition through Baltimore, and that cars of bananas from New Orleans and Mobile were usually loaded from 2,000 to 4,000 pounds in excess of the 20,000 pound minimum.37 The privileges enjoyed by shippers will depend at many points on whether those points are competitive. The granting of a longer free time for unloading at New York than at Baltimore; the granting of a milling-in-transit privilege to Minneapolis and St. Paul which is denied to Janesville; 39 the absorption of a terminal charge in favor of one locality or com 32 Metropolitan Paving Brick Co. v. Ann Arbor Ry., 17 I. C. C. 197; Western Classification Case, 25 I. C. C. 442. 33 In re Advances in Rates on Locomotives and Tenders, 21 I. C. C. 103. 34 Schmidt & Peters, Inc., v. A., T. & S. F. Ry., 28 I. C. C. 376. 38 35 City of Spokane v. No. Pac. Ry., 15 I. C. C. 376. 36 Utica Traffic Bureau v. N. Y. C. & H. R. Ry., 18 I. C. C. 271. 37 Topeka Banana Dealers' Ass'n v. St. L. & S. F. Ry., 11 I. C. C. 620. 38 Brey v. Pennsylvania Ry., 16 I. C. C. 497. 39 Blodgett Milling Co. v. C., M. & St. P. Ry., 23 I. C. C. 448. boat, 24 or by wagon, 25 or by a trolley car.26 It has even been held that water competition is created by floating ties down a river, 27 and that circumstances are dissimilar at a city served by break-bulk boats and by car ferry as compared with a city not so served. 28 Within certain limits express rates and freight rates compete, and to that extent express rates should be established with reference to freight rates.29 Express rates in turn are affected by the competition of the post office, which shows itself in the disproportionate charges for large and small packages.30 Whether the competing carrier is subject to the Act is immaterial.31 $794. Incidents of competition. When it is once established that substantial competition 259; Philadelphia Veneer Lumber Co. v. C. Ry. of N. J., 25 I. C. C. 653; Coke Producers Ass'n of Connellsville v. B. & O. Ry., 27 I. C. C. 125; Indianapolis Freight Bureau v. C., C., C. & St. L. Ry., 28 I. C. C. 53; Omaha Grain Exchange v. C., R. I. & P. Ry., 28 I. C. C. 680. 24 Enterprise Mfg. Co. v. Georgia Ry., 12 I. C. C. 130; Montgomery Freight Bureau v. L. & N. Ry., 17 I. C. C. 521; Receivers' & Shippers' Ass'n of Cincinnati v. C., N. O. & T. P. Ry., 18 I. C. C. 440; Industrial Lumber Co. v. St. L., W. & G. Ry., 19 I. C. C. 50; Truck Growers' Ass'n v. A. C. L. Ry., 20 I. C. C. 190; Georgetown Ry. & Light Co. v. N. & W. Ry., 22 I. C. C. 144; South Atlantic Waste Co. v. So. Ry., 22 I. C. C. 293; Escanaba Business Men's Ass'n v. A. A. Ry., 24 I. C. C. 11; In re Advances on Flaxseed, 25 I. C. C. 337; Rates on Knittingfactory Products, 25 I. C. C. 634; Arkansas Fertilizer Co. v. St. L., I. M. & S. Ry., 25 I. C. C. 645; Merchants Freight Bureau of Little Rock v. A., T. & S. F. Ry., 26 I. C. C. 543; Texarkana Freight Bureau v. St. L., I. M. & S. Ry., 28 I. C. C. 569; LaGrange Chamber of Commerce v. A. & W. P. Ry., 28 I. C. C. 178; Meridian Board of Trade v. A. G. S. Ry., 28 I. C. C. 360; Wausau Advancement Ass'n v. C. & N. W. Ry., 28 I. C. C. 459. 25 Santa Rosa Traffic Ass'n v. So. Pac. Ry., 24 I. C. C. 46; Baker Commercial Club v. O. W. R. R. & N. Co., 25 I. C. C. 281. 26 Elgin Commercial Club v. B. & M. Ry., 28 I. C. C. 380. 27 Preston v. C. & O. Ry., 19 I. C. C. 406. 28 Escanaba Business Men's Ass'n v. Ann Arbor Ry., 24 I. C. C. 11. 29 Kindel v. Adams Express Co., 11 I. C. C. 475. 30 Sandford v. Western Express Co., 16 I. C. C. 32; In re Express Rates, 24 I. C. C. 380. 31 Pittsburg Plate Glass Co. v. P., C., C. & St. L. Ry., 13 I. C. C. 87; In re Investigation of Advances in Rates on Grain, 21 I. C. C. 22; Commercial Club of Superior v. G. N. Ry., 24 I. C. C. 96. really exists, it may affect transportation in ways which do not always show in the rate schedules. Competition may properly be considered in determining the correct classification of an article, 32 but its effect is not to be extended to articles to which it does not apply by merely classing them with articles to which it does apply.33 Railways may be forced to establish any-quantity rates on commodities because of competition with any-quantity water rates on those commodities.34 Water competition may also justify a difference in the right of combining different commodities at the carload rate,35 or of loading C. L. freight at one station and not at another.36 Even the minimum weight of the carload may vary at different points because of competition. The fixing of the minimum weight at 20,000 pounds on shipments of bananas from New Orleans and Mobile to points west of the Mississippi River, while assessing a minimum weight of 18,000 pounds to Chicago and points east of the river, did not result in undue discrimination, as it appeared that such difference in minima was made to meet competition through Baltimore, and that cars of bananas from New Orleans and Mobile were usually loaded from 2,000 to 4,000 pounds in excess of the 20,000 pound minimum.37 The privileges enjoyed by shippers will depend at many points on whether those points are competitive. The granting of a longer free time for unloading at New York than at Baltimore; 38 the granting of a milling-in-transit privilege to Minneapolis and St. Paul which is denied to Janesville; 39 the absorption of a terminal charge in favor of one locality or com 32 Metropolitan Paving Brick Co. v. Ann Arbor Ry., 17 I. C. C. 197; Western Classification Case, 25 I. C. C. 442. 33 In re Advances in Rates on Locomotives and Tenders, 21 I. C. C. 103. 34 Schmidt & Peters, Inc., v. A., T. & S. F. Ry., 28 I. C. C. 376. 35 City of Spokane v. No. Pac. Ry., 15 I. C. C. 376. 36 Utica Traffic Bureau v. N. Y. C. & H. R. Ry., 18 I. C. C. 271. 37 Topeka Banana Dealers' Ass'n v. St. L. & S. F. Ry., 11 I. C. C. 620. 38 Brey v. Pennsylvania Ry., 16 I. C. C. 497. 39 Blodgett Milling Co. v. C., M. & St. P. Ry., 23 I. C. C. 448. modity to the prejudice of another; 40 the giving of free store-door pick-up and delivery to one section of a city while denying it to others; the giving of an icing privilege at one point which is refused at others; 42 the granting of an elevator allowance at one point and not at another; 43 the maintenance of proportional rates on grain at Omaha while denying them at Sioux City; 44-all these have been upheld because of the existence of competition at the favored point. But on the other hand the fact that the market for a commodity is better at the long-distance point than at the intermediate point does not justify a lower rate to the former; 45 nor does water competition justify charging different export rates merely by reason of the fact that beyond the port of transshipment the traffic is to be carried to different destinations. 46 It should be noted that even though a carrier be entitled to reduce its rates to a low margin at competitive points, it does not thereby free itself from the obligation to grant reasonable rates to intermediate or non-competitive points. To determine what is a reasonable rate is difficult, but obviously a rate which has been forced upon the carrier by competition cannot be taken as the standard of measurement. § 795. Commodity and market competition. The competition which may be considered in proper cases includes not only that between carriers with its usual incidents, but also that of a commodity produced 40 Cattle Raisers' Ass'n v. F. W. & D. C. Ry., 7 I. C. C. 513. 41 Anacostia Citizens' Ass'n v. B. & O. Ry., 25 I. C. C. 411. 42 Kenner Truck Farmers' Ass'n v. Ill. Cent. Ry., 32 I. C. C. 1. 43 Ryley v. W. Ry., 25 I. C. C. 210; Gund & Co. v. C., B. & Q. Ry., 25 I. C. C. 326. The payment of an elevator charge by a railroad company when compelled by competition is lawful. Interstate Commerce Commission v. Diffenbaugh, 222 U. S. 42, 56 L. ed. 83, 32 Sup. Ct. 22. 44 Sioux City Terminal Elevator Co. v. C. N. & St. P. Ry., 23 I. C. C. 98. 45 Fewell v. R. & D. Ry., 7 I. C. C. Rep. 354. 46 New Orleans Board of Trade v. I. C. Ry., 23 I. C. C. 465. in one section of the country with the same commodity produced in another section, and sometimes even the competition of one kind of traffic with another. 47 But competition in commodities alone is not a circumstance or condition that will entitle a selling point to have an already low rate made still lower in order to equal one at a more distant point, the latter having been made to meet the competition of carriers and of rates as well as of markets and of products.48 The competition between carriers each serving a district in which a given commodity is produced to place that commodity on the market at great centers-what is known as market competition-has been viewed by the Commission in different ways at different times, and it is impossible to reconcile its decisions on the subject. In one line of cases it has held that market competition is to be encouraged, even when it necessitates a rate unreasonably low and which does not yield a fair return for the service rendered. 50 The consumer should be given an opportunity to buy in all competing fields in so far as that can be fairly accomplished. Market competition is held to be so important a factor in rate making that it may justify discrimination.52 No case of market competition, however, may safely be made a precedent for any other. On the other hand, the Commission has held that the ability of competing points of production to sell in a common market, in so far as it goes beyond the question of cost of transportation, is purely a commercial question and cannot enter into 51 47 Metropolitan Paving Brick Co. v. Ann Arbor Ry., 17 I. C. C. 197. 48 Bovaird Supply Co. v. A., T. & S. F. Ry., 13 I. C. C. 56. 49 Andy's Ridge Coal Co. v. So. Ry., 18 I. C. C. 405; Massee & Felton Lumber Co. v. So. Ry., 23 I. C. C. 110. 50 Edgar & Son v. L. & N. Ry., I. C. C. 181. 26 51 Andy's Ridge Coal Co. v. So. Ry., 18 I. C. C. 405. 52 Southern Bitulithic Co. v. I. C. Ry., 17 I. C. C. 300. The differential between Omaha and Kansas City to Arkansas is fixed as a result of competition with Illinois and Iowa grain. Omaha Grain Exchange v. C., R. I. & P. Ry., 28 I. C. C. 680. 53 Andy's Ridge Coal Co. v. So. Ry., 18 I. C. C. 405. |