industry of its ownership of the tap line.98 In the latter part of Chapter IV these possibilities of the relation of industrial trackage to the line carrier were discussed," and it was found that it might be that of a plant facility, a tap line, a connecting carrier and what was still more difficult to deal with, a combination of these complications.1 § 744. Allowances for facilities closely scrutinized. With the rigorous enforcement of the law against all discrimination in late years, such arrangements as have been just described are being questioned, if not as amounting to discrimination in themselves, at least as a cover for discrimination. At all events, the whole facts will be gone into to discover whether too advantageous terms are being obtained. Thus in a recent case it was discovered that a car company was getting so much for the use of its cars. that the reduction was being made the basis for reduced rates to those who shipped in those cars. And in another case not charging certain shippers demurrage for cars, upon an apparently private siding found to be public, while others paid demurrage in regular yards, was held plain discrimination.3 However, the railroads are still allowed to make arrangements with customers furnishing 98 In re Divisions of Joint Rates on Coal, 22 I. C. C. 51. "See Tap Line Cases, 234 U. S. 29, 34 Sup. Ct. 41. 1 See Interstate Commerce Commission v. Atchison, T. & S. F. Ry., 234 U. S. 294, 34 Sup. Ct. 291. 2 Interstate Commerce Commission v. Reichman, 145 Fed. 235. To pay an allowance to one shipper while refusing to permit all shippers to take advantage of the privilege, unless justifying circumstances and conditions are shown, creates unjustifiable preference within the pro hibition of the Act. Southwestern Mo. M. C. v. St. L. & S. F., 26 I. C. C. 245. 3 Ohio Coal Co. v. Whitcomb, 123 Fed. 359. The Commission has consistently held to the doctrine that whatever allowances are made to shippers in return for services performed in connection with transportation must be just and reasonable in view of the cost of the service tendered, held free from discrimination and preference, in regard to others similarly situated. Sufferin Grain Co. v. I. C. R. R., 22 I. C. C. 178. their own facilities. Some difficulty is inseparable from this situation, but probably not enough to justify the radical remedy of forbidding such arrangements altogether. Those who get allowances which are not scheduled will, however, fall foul of the modern statutes against discriminations, even if the allowance made is proper enough in itself. Moreover, when the arrangement is in its nature an exclusive one, of which other patrons cannot take advantage, it would generally be condemned. § 745. Allowances for facilities still permissible. 4 It is not, however, considered by the courts to be desirable that there should be no way to give a proper allowance to shippers who employ their own property and devote their own labor to some of the work that the carrier must otherwise do for them. In one of the important Federal cases, this is insisted upon in setting aside a ruling of the Commission that no allowance should be made elevator men who deal with their own grain in their own elevators. "Pecuniary advantages derived by shippers from the ownership or use of such facilities of trade are attributable to that ownership, and not to the transportation of the articles shipped, and the consideration and regulation of these advantages are without the scope of the Commission's power. The truth is that trade advantages of this nature do not condition the question of reasonableness of rates, or rebates, or of discrimination. The shipper who owns warehouses, tipples, spur tracks, cars, mills, and by their use derives greater profit from the dealing in the articles which he ships over a railroad, is entitled to the same rate of charge for transportation and the same reasonable compensation for transportation services which 'Peavey & Co. v. Union Pac. R. Co., 176 Fed. 409. If $6 is a reasonable allowance to consignors at New Orleans for loading cars with bananas, it would seem prima facie that $10 per car allowance for loading at Galveston was too high. Rates on Bananas from Gulf Ports, 30 I. C. C. 510. he renders that the shipper who owns less or no such trade facilities and derived less profit is entitled to." 5 Citing Harp v. Choctaw, O. & G. Ry. Co., 125 Fed. 445, 61 C. C. A. 405. If elevation is not a transportation necessity at East St. Louis, the withdrawal of the allowance is justified, although still given at certain other points. Elevation Allowances at St. Louis, 30 I. C. C. 696. CHAPTER XVI DISCRIMINATION BETWEEN LOCALITIES 750. Provisions of the Act. 751. Scope of its principles. Topic A. Discrimination at Common Law and under Statute § 752. Locality has no right at common law to complain of rates. 753. Statutory regulation of discrimination between localities. 754. Lower rate as evidence of unreasonableness of higher. 755. Weight to be given to such evidence. 756. Higher rate not necessarily unreasonable. 757. Reasonableness of rate per se immaterial under statute. Topic B. General Principles of Statutory Regulation § 758. What discrimination is not unlawful. 759. Discrimination which is not undue. 760. Interdependence of rates to various localities. 761. No vested right in preferential rates. 762. Discrimination explained by local circumstances. 763. Distance as a factor in rate making. 764. Difference between through and local rates. 765. Railroad rates tend toward a cost basis. 766. Various systems of making distance rates. 767. Burden upon the railroad to defend discriminatory rates. Topic C. What Constitutes Undue Prejudice §768. Provisions against undue prejudice. 769. Discrimination resulting from intrastate rates-the Shreveport case. 770. Discrimination by means of rate adjustments. 771. Conditions which are not dissimilar. 772. Dissimilarity of condition is a question of fact. 773. Discrimination against points off the line. 774. What constitutes a through line. 775. Equalization of economic advantages-Economic theory. 776. Equalization of economic advantages-Legal practice. 777. Discrimination against the staple industry of a locality. 778. Equalization of values. 779. Disproportionate charges inconsistent with public duty. Topic D. Long and Short Haul § 780. Long and short haul at common law. 781. Legal justification of lower long-haul rate. 784. General principles governing the Fourth Section. 787. Application of the Fourth Section. 788. Principles governing deviation from the Fourth Section. 789. Recognition of carrier's right to relief. 790. Conditions justifying relief from the Fourth Section. 791. Competition as ground for relief from the Fourth Section. Topic E. Competition as a Factor in Rate Making § 792. Competition as a justification for discrimination. 793. Competition as a factor in rate making. 794. Incidents of competition. 795. Commodity and market competition. 796. How the Commission determines justifiable discrimination. 797. Competitive rates must be compensatory. 798. Non-competitive rates must be reasonable. 799. Potential competition. 800. Suppression of competition by agreement. 801. Suppression of competition by consolidation. 802. Carrier may refuse to make competitive rates. Topic F. What Circumstances Justify Preferential Rates § 803. Substantial differences of condition which justify discrimination. 804. Cost of service as a difference of condition. 805. Reconsignment arrangements and transit privileges. 806. Back freights may be lower than outward freights. 807. What differentials may be allowed. 808. Systems of rate-making based on differentials. 809. No obligation to make preferential rates. $750. Provisions of the Act. There are two clauses in the Act dealing with discrimination between localities, one general and the other specific. By the first paragraph of section 3 it is declared unlawful for any common carrier subject to the provisions of the Act to make or give any undue or unreasonable preference or advantage to any particular person, company, firm, corporation, or locality, or any particular description |