Investigation, supra, and that no grounds were given for the denial of this relief. In our first decision in that case at 100 I. C. C. at page 687 we said:

That coastwise water service is materially cheaper than rail service admits of no doubt. This is so mainly because there is no expense for construction or upkeep of roadway and track and the freight is carried in great units without the switching expense which enters so largely into rail haul cost. This is particularly true of less-than-carload freight which is carried by boat in practically the same manner as carload freight.

In arriving at the rates to be applied on this traffic we said at page 700:

We are of the opinion that the interterritorial class rates applicable to such traffic should be determined with regard both to the reasonably direct routes wholly by rail and to the reasonably direct routes partly by water, Since we have taken into joint consideration both classes of routes, those wholly by rail and those partly by rail, these maximum rates are not so high in certain cases nor so low in others as they would be if the routes were independently considered. Where, for example, from an eastern port to a certain southern group the water-rail route is clearly more and the rail route clearly less economical the water-rail rate has been made somewhat higher and the all-rail rate somewhat lower than would be the case if they were separately determined. In reverse situations a reverse process has been followed, the result in all cases, however, being a certain narrowing of the spread between the two classes of rates.

In setting forth the factors taken into consideration in arriving at the basis of rates fixed we plainly showed that one of the factors was the avoidance of fourth-section departures over reasonably direct routes, whether all-rail, water-rail, or rail-water-rail routes.

With respect to the fourth-section relief requested in connection with that case we said at page 708:

No relief to meet water competition was sought by any of the carriers except the Seaboard Air Line, which asks for relief to continue lower rates for this reason at Tampa, Fla., than at intermediate points. The evidence presented by that carrier is insufficient to justify the granting of this relief, particularly in view of the fact that no other carrier is seeking similar relief.

In our decision in the Southern Class Rate Case we were attempting to follow the declared policy of Congress to foster and preserve in full vigor both rail and water transportation, and as shown from the quoted portions of that decision we fixed a basis of rates which would further that policy. As the rates were based upon a compliance with the fourth section by all participating routes the situation here presented by the Seaboard Air Line and other applicants does not appear to demand any different treatment than other similar carriers. We are of the opinion and find that the evidence here presented is insufficient to warrant the granting of the relief requested. The application will be denied.

No. 19970

OWOSSO MANUFACTURING COMPANY ET AL. v. ASHERTON & GULF RAILWAY COMPANY ET AL.

Submitted January 5, 1929. Decided September 9, 1929

Rates on collapsible wooden fruit and vegetable crates, in carloads, from Benton and Camden, Ark., to destinations in Texas found applicable and not unreasonable or unjustly discriminatory but unduly prejudicial. Undue prejudice directed to be removed. Reparation denied.

J. C. Murray for complainants.

Monte Gordon for Cummer Manufacturing Company of Texas, intervener.

A. B. Enoch, Wallace Hughes, H. H. Larimore, B. F. Batts, and A. H. Kiskaddon for defendants.

REPORT OF THE COMMISSION

DIVISION 3, COMMISSIONERS AITCHISON, TAYLOR, AND PORTER BY DIVISION 3:

Exceptions were filed by complainants and defendants to the report proposed by the examiner. Our conclusions differ somewhat from those recommended by him.

Complainants are the Owosso Manufacturing Company and the Rockwell Manufacturing Company, corporations manufacturing wooden crates at Benton and Camden, Ark., respectively. They allege by complaint filed August 1, 1927, that the rates charged on wooden crates, in carloads, from Benton and Camden to destinations in Texas were and are inapplicable, unreasonable, unjustly discriminatory, and unduly prejudicial in violation of sections 3 and 13 of the interstate commerce act. We are asked to prescribe reasonable rates for the future and to award reparation. Informal complaints were filed August 5 and November 22, 1926, alleging that the rates charged on various shipments were inapplicable. On February 19, 1927, complainants were notified that the complaints could not be disposed of informally. These informal complaints brought in issue only the applicability of the rates charged, and the claims with respect to shipments delivered more than two years prior to the filing of the formal complaint are barred except for consideration under section 6 of the act. Rates will be stated in amounts per 100 pounds. The Cummer Manufacturing Company of Texas, manufacturing

fruit and vegetable crates at Paris, Tex., intervened, but introduced no evidence. By our order of November 10, 1927, the St. Louis-San Francisco was dismissed as a party defendant hereto.

Benton and Camden, on the Chicago, Rock Island & Pacific and the Missouri Pacific, are approximately 25 and 110 miles, respectively, southwest of Little Rock, Ark. Camden is also served by the St. Louis Southwestern. The destinations are mainly in the Rio Grande Valley of Texas. The crates here considered are used principally for the shipment of onions. Their bodies, i. e., the sides and ends, are made of gum or oak strips, alternately placed one above the other, the corners being permanently held together by inserting a perpendicular wire or rod about 13 inches long and inch in diameter in holes bored in the strips. The top and bottom, which are made of strips of gum wood about 0.25 inch thick and 3 or 4 inches wide, nailed together by crosspieces, are interchangeable, and when removed the bodies are folded or collapsed and shipped in bundles of 10, the tops and bottoms being shipped in bundles of 20. When ready for shipment, the crates occupy approximately one-fifth as much space as when set up. A complete crate weighs between 6.5 and 6.75 pounds, 5,000 generally being shipped in a car, although in some instances a car will contain 7,000 crates. The approximate value of a car of crates is $875, f. o. b. Benton. The principal markets for these crates are in Texas and California.

Charges were collected at commodity rates, minimum 30,000 pounds, applicable to folding fruit and vegetable crates. A rate of 52 cents was and is applicable from St. Louis, Mo., to Texas common points. Benton and Camden, in Little Rock-Fort Smith, Ark., territory, take a rate of 40 cents to Texas common points, made a differential of 12 cents under the rate from St. Louis to Texas common points. The rates to Texas differential territory range from 2 to 20.5 cents higher.

Complainants contend that their product is not a folding or collapsible crate but is knocked down within the purview of the tariff providing lumber rates on boxes or crates, knocked down, in bundles. Their contention in this respect is without merit. The crates here considered are folding or collapsible, and regardless of whether or not they may be considered knocked down when prepared for shipment, the tariff specifically states that the lumber rates will not apply on folding or collapsible fruit and vegetable packages. In Cum mer Mfg. Co. v. Atchison, T. & S. F. Ry. Co., 152 I. C. C. 601, decided March 8, 1929, it was found that like crates manufactured by the present intervener were collapsible.

Paris is approximately 173 miles west of Camden. The present rates on collapsible crates from Benton and Camden to 38 repre

sentative destinations in Texas average 44.8 cents, and on lumber 28.9 cents, whereas from Paris to the same destinations they average 30.7 and 27.5 cents, respectively. Prior to November 15, 1927, the rates on lumber from Benton and Camden were approximately 3 cents higher than the present rates on lumber, and from Paris 1 to 6 cents higher. The reduction in the lumber rates was a compromise adjustment made by the carriers. Since that date the rates on collapsible crates from Paris to the destinations referred to, except those nearby Paris, were about 10 per cent higher than the contemporaneous lumber rates. Prior thereto they were on approximately the same basis as lumber. From Benton and Camden the average rates on crates are approximately 52 per cent higher than the contemporaneous lumber rates. The latter rates from Benton, Camden, and Paris were and are substantially the same, although the distances from Paris to the destinations considered are much less.

The following table, prepared from exhibits of record, compares the rates and earnings on collapsible crates from Benton, Camden, and Paris, to representative destinations in Texas in effect on and after November 15, 1927, with the contemporaneous rates on lumber including gum and oak:

Based on 35,884 pounds, average loading of 100 cars shipped by complainants. 1 Based on 52,800 pounds, average loading of lumber shipments on the St. Louis Southwestern for 1926.

The majority of the shipments here considered moved to destinations to which rates of 47.5 and 48 cents applied. Complainants compare the 40-cent rate on crates from Benton and Camden to

Texas common points with the rates contemporaneously in effect on lumber and forest products. Thus, a rate of 26.5 cents applies on lumber, flooring, and common molding, and a rate of 31 cents on baluster, blinds, and screen doors, although screen doors are valued at $2,000 per carload, more than twice as much as these crates. This comparison is of little evidentiary value, due to the lack of showing as to similarity in transportation conditions and other essential details. They cite Texas Chamber of Commerce v. Director General, 83 I. C. C. 538, wherein a rate of $1.015, minimum 40,000 pounds, on collapsible wooden fruit and vegetable crates similar to those here considered, from Paris and Mineola, Tex., to certain destinations in California was found unreasonable to the extent that it exceeded a rate of 96 cents, minimum 40,000 pounds, contemporaneously in effect on lumber. For an average short-line distance of 1,428 miles, the rate prescribed yields a car-mile earning of 26.8 cents and ton-mile earning of 13.4 mills.

Complainants also cite Rates on Lumber and Lumber Products, 52 I. C. C. 598, wherein it was determined that—

box and crate material (other than cigar-box material), knocked down flat, including wire bound, consisting of ends, sides, tops, and bottoms of boxes, crates, egg cases, and beehives, stenciled or unstenciled, of solid or built-up wood, with or without cleats, loose or in bundles

should take the same basis as lumber of the same species. But there is very little, if any, similarity between the completely manufactured crates here considered and crate material; further, that case dealt with the relationship of the rates and not with their intrinsic reasonableness. Some of the rates here assailed yield lower earnings than the rates found reasonable in Texas Chamber of Commerce v. Director General, supra, would produce, and for much longer hauls. Many of the lumber rates sought would yield still lower earnings.

Defendants urge that the lumber basis should not be applied to these crates, contending that the lumber rates are depressed by circumstances and conditions which do not affect this crate traffic, and, therefore, are not a proper gage by which to measure the reasonableness of the rates assailed. They compare the revenue per car on both commodities, lumber loading more heavily and moving generally in greater volume.

Crates, wooden, n. o. i. b. n., new, folded flat or in flat sections, are rated class B, minimum 30,000 pounds, in western classification. Class B rates from and to the points here considered under the scale prescribed in the recent southwestern revision are higher than the rates assailed. Lumber, native wood, is also rated class B in western classification. In that revision lumber and crates were not dealt with, but the following percentages of first class were