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ciples which must exist when there is such a science, it does not follow that an abrupt and radical alteration of these situations is justified. Existing conditions are facts which must be recognized in the application of all abstract economic principles, and, while such principles are not destroyed by such recognition, they may be inapplicable to a particular situation.

To determine what is a reasonable rate, the law must be applied, economics considered, and ethics invoked; and, while the facts to be weighed are multitudinous and the scientific principles few, we may say that it is not fanciful to anticipate that a system of rate-making will be evolved which will approach justice to all interests. Shippers and carriers, contending each with the other, sometimes selfishly, but not infrequently with an earnest desire for a right solution, presenting their theories to a disinterested and unbiased tribunal, "appointed by law and informed by experience," may furnish data which, being sifted, studied, and classified in its decisions, will enable that tribunal to solve the problem. The Transportation Act, 1920, Sec. 15a, adds "fair return" and defines the term, making such return a fact that must be considered in the determination of a reasonable system of rates. Prior to the passage of that Act, the Commission always, in a general system of rates, gave consideration to a fair return on the investment. The Amendment emphasizes this factor in rate-making.697

697 It has been the purpose of this chapter to give as comprehensively as possible the decisions both of the Interstate Commerce Commission and courts which show the principles which have been considered and applied in making rates. The principles stated herein illustrate the difficulty of the problem, but they furnish data from which some generalizations may be drawn. In recent volumes of the reports of the decisions of the Commission, there is, in the index, a title "Measure of

Rates.' Under this general title
may be found specific references to
the Commission's rulings relating to
the "adjustment of rates," "ad-
vantages and disadvantages," "basis
of rates,' "branch line through
thinly populated region," "burden
of transportation,'' 'capacity of
boats,"
'car earning," "categorical
answers,'' "channels, depth of,"
"charging what traffic will bear,"
"circumstances and conditions,"
"classification," "commercial and
economic conditions," "comparison

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of rates, ""competition," "competitive rates," "cost,' """cost of car

of

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"cost riage," construction, "cost of handling,' " "cost of maintenance," "cost of operation," "'cost of production," "'cost of transportation," "cost of service," "density of traffic," "distance," "division of rates,' "division of through rates," "earnings," "" "empty car movement, "equipment,' "'erroneous rates, """factor in through rates," "free movement of traffic, "harbor, condition of," "length of haul," "local rates," "" "long as well as short haul," "main line rates,"

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"nature of commodity," "navigation, condition of," "paper rates,' "past rates, "raw material," "relative rates," "return haul," "risk," "state rates,' " "three line haul,' """ton mile earnings,' """ton per mile rate," "tonnage, """train mile earnings," "transportation conditions, "trunk line rates," "two line haul," "use," "value of commodity," "value of service," "volume of traffic," "voluntary rates," "voluntary reductions," "weak line," and "wharf and dock facilities."

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$137. Scope of Chapter.

138.

EQUALITY IN RATES.

Common Law as to Equality in Rates by Carriers.

139. Damages under Common Law for Unjust Discriminations.

140.

Comparison of the English Railway and Canal Act with the Interstate
Commerce Act.

141. Unjust Discrimination Forbidden.

142.

Discrimination Against Individuals.

143. Same Subject-Construction by the Commission.

144. Same Subject-Independent Contributing Causes.

145. Same Subject-Allowances to Shippers.

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150.

151.

152.

153.

154.

Undue Preferences in Favor of Persons or Localities.

Same Subject-Application of Section made by the Commission.
Differentials.

Discrimination Against Traffic.

Same Subject-Competition Between Users of Related Rates. 155. Discrimination Beyond the Control of the Carrier.

156. Removal of Discriminations and Preferences in Rates Specifically Enjoined by the Hoch-Smith Resolution.

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

158. Same Subject-Statute.

159. Same Subject-Statute and Proviso.

160.

Through Routes and Joint Rates.

161. Discrimination by Charging More for a Shorter than a Longer Haul— Old Law.

162. Long and Short Haul-Old Law Construed-Definite Construction,

163. Long and Short Haul Clause under Act of 1910.

164. Long and Short Haul Clause under Act of 1920.

165. Fourth Section-Relation Between Through Rate and Intermediate Rates.

166.

Discrimination Between Carloads and Less-than-Carloads.

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182. Illegal for Carriers to Transport Commodities Produced or Owned by Them or in Which They Are Interested.

183.

184.

Commodities Clause of Act of 1906.

Cars Must Be Furnished without Discrimination.

185. Same Subject-Principles Applied by the Commission.

186. Freight Charges Must Be Collected without Discrimination.

187. Right of Carrier to Route Shipments Beyond Its Own Terminus. 188.

Discrimination in Billing.

189. Tariffs of Rates Must Be Printed, Posted and Maintained.

190. Misquoting Rates.

191.

192.

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

193. Basing Points, Group Rates and Zone Rates.

194.

How Far a Rate Made by a State Relieves a Carrier from the Duty to
Serve Communities and Transport All Traffic with Legal Equality.

195. Commutation, Mileage and Party Rate Tickets.

196. Rebates.

197. Corporation Punishable for Rebating.

198. Summary.

§ 137. 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 Interstate Commerce Act 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 possible, such rules as can be legally and properly applied. In doing so, it must not be forgotten that the facts to be considered are numerous and of constantly-varying force, that a definite formula for the determination of the legality of a rate has not been fixed, 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.

§ 138. Common Law as to Equality in Rates by Carriers.— The common-law requirement as to the reasonableness of rates we have seen, ante, 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:

"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,

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.

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