§ 754. Lower rate as evidence of unreasonableness of higher. When a rate between two points is attacked by an individual shipper as unreasonable in itself, he may offer, as evidence in support of his complaint, to show that rates are lower for a similar haul between other points. 18 This view is well stated by Judge Severens, who said: "It is assumed in argument by counsel in making defense that the rates to Chattanooga are just and reasonable in themselves. This, it is said, is conceded, and upon the premises it is urged, in substance, that the public at Chattanooga has no right to complain if the respondents lower their rates to Nashville. In one sense, this is true. But the suggestion is fruitful of other considerations. The question whether the rates are just and reasonable in themselves is in some measure a relative one; that is to say, it may be tested by a comparison of the particular rates with those accepted elsewhere for a similar service, and whether the instances thus employed are or are not such as by their relation to the case in hand are subject to the operation of some other provision of the Commerce Act, is immaterial. Besides, I think the question of the justness and reasonableness of rates under the first section is colored by the other provisions of the law, and by the general policy of the whole enactment, which is to effect the equality of charges. And, at all events, it seems to me clear that the charges accepted for a longer haul may be referred to for the purpose of considering the reasonableness of the charges made for the shorter haul." 19 In that case, on appeal, the Supreme Court did not pass upon the reasonableness of the lower rate in itself on the ground that the Commission had not done so.20 18 State v. M. & S. L. Ry., 80 Minn. 191, 83 N. W. 60; Cordele Machine Shops v. L. & N. Ry., 6 I. C. C. Rep. 361; Johnson v. C., M. & St. P. Ry., 9 I. C. C. Rep. 221. 19 Interstate Commerce Commission v. E. T., V. & G. Ry., 85 Fed. 107. 20 East Tennessee, V. & G. Ry. v. Int. Com. Comm., 181 U. S. 1, 45 L. ed. 719, 21 Sup. Ct. 516. § 755. Weight to be given to such evidence. How much weight shall be given to such evidence must, of course, depend on the facts of each case. When rates to Danville were in question the court gave considerable weight to rates charged for similar hauls. "Whether or not the Danville rates are reasonable per se is a question that has given me no small amount of trouble. That the cost of transporting freight by wagons is not a proper test is very clear. The rates at Lynchburg cannot be alone used as a basis of comparison. The criteria to which I think the greatest weight should be given are as follows: The opinions of expert witnesses; the effect of the present rates on the growth and prosperity of Danville; the cost of transportation as compared with the rates charged; and the rates in force at numerous other cities, where the circumstances are as nearly similar as may be to those prevailing at Danville. The inconclusive and unsatisfactory results, and the inherent difficulties in applying the abovementioned tests, have led me to the conclusion that the most satisfactory test to be applied in this case is to compare the Danville rates with those in force at numerous other cities and towns in the South, where the circumstances are as nearly as may be similar to those at Danville. This has been done by numerous witnesses for the defense. The result of comparisons between these rates and the Danville rates is the conclusion that the latter compare favorably with the former." 21 The courts, however, recognize that the relation of rates is the incongruous outcome of previous adjustments and changes made with reference to places other than complainant, rather than the result of any consistent plan having care for the just and equal rights of all. 22 § 756. Higher rate not necessarily unreasonable. On the other hand, it has been held that a comparison 21 Quoted from McDowell, Dist. J., in Int. Com. Commission V. 22 Mayor & Council of Douglas v. A. B. & A. Ry., 28 I. C. C. 445. of rates between two places is not of itself enough to justify the conclusion that the higher rate is unreasonable, even if the difference is not explained by the carrier. "The bill in this case charges that the rates charged by the appellees on goods shipped from St. Louis and Tennessee points to Hampton, Fla., are unreasonably high in themselves, in violation of section 1 of the Act to Regulate Commerce. As we read the opinion of the Commission, filed as an exhibit to the bill, the Commission did not find that the Hampton rates were in and of themselves unreasonable, but found argumentatively that they were too high, not as based upon the matters to be considered in determining such questions, as pointed out in United States v. Freight Association, 23 and Smyth v. Ames, 24 but largely upon a consideration of rates and charges between St. Louis, Nashville and Chattanooga, and Jacksonville and Palatka, Fla. The evidence submitted to the Commission, supplemented by evidence taken in the Circuit Court, is not sufficient for us to find affirmatively that the Hampton rates were in and of themselves unreasonable. The Commission furnishes the authority for the proposition that with regard to the exaction of unreasonable rates the burden of proof is on the complainant.25 Certainly, the complainant has failed in this instance to prove that the Hampton rates were in violation of the first section of the Interstate Commerce Act." 26 Hence it follows that if the higher of two rates is not unreasonable per se, the carrier may remove a discrimination between two localities by charging the higher rates to both." 23 166 U. S. 331, 17 Sup. Ct. 540, 41 L. ed. 1007. 24 169 U. S. 546, 18 Sup. Ct. 418, 42 L. ed. 819. 25 See Harding v. C., St. P., M. & O. R. Co., 1 I. C. C. Rep. 104; Brewer v. L. & N. R. R. Co., 71 I. C. C. Rep. 234. 26 The quotation is from Pardee, J., 27 in Interstate Com. Comm. v. Nashville, C. & St. L. Ry., 120 Fed. 934. 27 In order to remove discrimination in rates on wool in favor of Lewiston, Me., against Skowhegan, Me., carriers advanced rates from Lawrence to Lewiston. Massachusetts-Maine Wool Rates, 28 I. C. C. 396. § 757. Reasonableness of rate per se immaterial under statute. Under the provisions of such a statute as the Interstate Commerce Act, the fact that a rate is per se reasonable does not disprove the charge that it is unlawful. A rate may be relatively unreasonable and yet contain none of the elements of absolute unreasonableness.28 If rates are relatively unjust, so that undue preference is afforded to one locality or undue prejudice results to another, the law is violated and its penalties incurred, although the higher rate is not in itself excessive. 29 The right of one locality in that regard is not increased, nor is the equal right of a competing locality diminished, by municipal subscriptions which were advanced for the building of the road. 30 Topic B. General Principles of Statutory Regulation § 758. What discrimination is not unlawful. It is impossible to have a rate adjustment which places all towns and cities upon an exact equality.31 The Act clearly recognizes that some discrimination, either slight in extent or the result of dissimilar conditions or circumstances beyond the carrier's control, may be permitted. Only such as is undue or unreasonable is forbidden and declared unlawful.32 Discriminations covered by sections B. & O. Ry., 7 I. C. C. Rep. 612; of rates between two places is not of itself enough to justify the conclusion that the higher rate is unreasonable, even if the difference is not explained by the carrier. "The bill in this case charges that the rates charged by the appellees on goods shipped from St. Louis and Tennessee points to Hampton, Fla., are unreasonably high in themselves, in violation of section 1 of the Act to Regulate Commerce. As we read the opinion of the Commission, filed as an exhibit to the bill, the Commission did not find that the Hampton rates were in and of themselves unreasonable, but found argumentatively that they were too high, not as based upon the matters to be considered in determining such questions, as pointed out in United States v. Freight Association, 23 and Smyth v. Ames, 24 but largely upon a consideration of rates and charges between St. Louis, Nashville and Chattanooga, and Jacksonville and Palatka, Fla. The evidence submitted to the Commission, supplemented by evidence taken in the Circuit Court, is not sufficient for us to find affirmatively that the Hampton rates were in and of themselves unreasonable. The Commission furnishes the authority for the proposition that with regard to the exaction of unreasonable rates the burden of proof is on the complainant.25 Certainly, the complainant has failed in this instance to prove that the Hampton rates were in violation of the first section of the Interstate Commerce Act." 26 Hence it follows that if the higher of two rates is not unreasonable per se, the carrier may remove a discrimination between two localities by charging the higher rates to both.27 23 166 U. S. 331, 17 Sup. Ct. 540, 41 L. ed. 1007. 24 169 U. S. 546, 18 Sup. Ct. 418, 42 L. ed. 819. 25 See Harding v. C., St. P., M. & O. R. Co., 1 I. C. C. Rep. 104; Brewer v. L. & N. R. R. Co., 71 I. C. C. Rep. 234. 26 The quotation is from Pardee, J., in Interstate Com. Comm. v. Nashville, C. & St. L. Ry., 120 Fed. 934. 27 In order to remove discrimination in rates on wool in favor of Lewiston, Me., against Skowhegan, Me., carriers advanced rates from Lawrence to Lewiston. Massachusetts-Maine Wool Rates, 28 I. C. C. 396. |