RULE VIII.-The defendant may, within the time required in the summons to answer, object to the complaint upon the following grounds:

1. That it does not state facts sufficient to authorize the proceedings.

2. That it does not conform to the requirements of Section 9, Chapter 59, Statutes of 1880. RULE IX.—If the objection be sustained, the complainant may amend his complaint. If the objection be overruled, the defendant may answer the complaint.

RULE X.-The answer of the defendant may contain:

1. A general or specific denial of the allegations of the complaint controverted by him. 2. A statement of any new matter of defense or in mitigation or explanation of the charges made in the complaint.

RULE XI. The complainant may, upon service of the answer, object to the same as insufficient, and if the objection is sustained the defendant may amend his answer. RULE XII.-The complaint, answer, and demurrer must be subscribed by the party, his authorized agent, or attorney. The complaint and answer must be verified as required by the Code of Civil Procedure in civil cases.

RULE XIII.—Upon the appearance, answer, or default of defendant, the Commissioners shall promptly hear and determine the cause of complaint, and upon the law and the facts shall render and file in their office a decision in writing, signed by the Commissioners concurring therein. Within ten days thereafter, upon a petition by either party based upon the record in the case, such decision may be modified or changed by order of the Commissioners, setting forth the reasons therefor.

RULE XIV. The Secretary of the Commissioners must keep a calendar of cases pending before them, in their chronological order; and in a suitable book, properly indexed, shall enter all orders and decisions of the Board.

RULE XV.--The provisions of Part IV of the Code of Civil Procedure, relating to the general principles, kinds, and degrees, production and effect of evidence, and of the rights and duties of witnesses, shall be applicable to proceedings before these Commissioners. RULE XVI. These rules may be amended at any regular meeting of the Commissioners, and amendments so made shall go into effect in ten days thereafter. RULE XVII. These rules shall be in force from and after the first day of March, 1883.

The following self-explanatory order was introduced on the fifth and adopted on the fifteenth day of September, 1883:

BOARD OF RAILROAD COMMISSIONERS OF THE STATE OF CALIFORNIA. WHEREAS, By Section 11, Chapter 59, of the Statutes of 1880, entitled "An Act to organize and define the powers of the Board of Railroad Commissioners," it is provided that: "Whenever said Board, in the discharge of its duties, shall establish or adopt rates of charges for transportation of passengers or freight, pursuant to the provisions of the Constitution, said Board shall serve a printed schedule of such rates and of any changes that may be made in such rates, upon the person, copartnership, company, or corporation affected thereby; and upon such service it shall be the duty of such person, copartnership, company, or corporation to immediately cause copies of the same to be posted in all of its offices, station houses, warehouses, and landing offices affected by such rates, in such manner as to be accessible to public inspection during usual business hours. And whereas, it is further provided in said section and Act that the rates of charges established or adopted by said Board pursuant to the Constitution and this Act shall go into force and effect the twentieth day after service of said schedule of rates or changes of rates upon the person, copartnership, company, or corporation affected thereby, as herein provided." And whereas, unless waived by the party to be affected thereby, as aforesaid, the mode and time prescribed exclude all others. And whereas, it is optional with such party to waive said time, and also service of printed copy of said schedule; and whereas, it is competent and proper for this Commission, when it shall "establish or adopt rates of charges, as aforesaid, to consult the convenience and preference of such party as to the form and clerical preparation of the schedule it is required to copy and post for inspection and use as aforesaid:

Now, therefore, it is hereby ordered, That in pursuance of said section of said Act, this Commission can and will establish or adopt rates of charges for the transportation of passengers and freight only by schedule; and that in the preparation thereof, in the usual form for convenient use as aforesaid, the Secretary of the Commission is hereby authorized and directed to avail himself of such form or draft of such schedule as may be most conveniently copied and used by the party to be affected thereby.

And it is further ordered, That upon the completion of any schedule of rates and charges, so drafted and prepared as aforesaid, the same shall be submitted to the Commission, and it shall be "established and adopted," as aforesaid. A certified copy of the

order adopting the same shall be served by said Secretary upon the party to be affected thereby; and in case such party shall prefer for its own convenience, and to simplify the duties of all concerned, to make its own copy of all such schedules, and shall consent to put the same in operation within twenty days from and after the service of said order, and in accordance therewith, it may do so without further preliminary process or proceeding to enforce the same; provided, that said party, or its general manager, shall, within three days from and after the service of saft order, acknowledge the service of said schedule by printed copy, expressly waiving all other service or notice thereof, in writing, addressed to said Commission, and to be filed and remain of record in its office. And it is further ordered, That if such acknowledgment and waiver, as aforesaid, shall not be filed in said office within three days from and after the service of such order as aforesaid, then, and in that case, said Secretary shall immediately proceed to print such schedule and order, and to serve printed copies thereof on the parties to be affected thereby, and shall keep a record of his action in the minutes of said Commission. PRINCIPLES AND RULES OF DECISION IN THE ABSTRACT, AND IN THEIR EXPERI— MENTAL AND PRACTICAL APPLICATION BY THE COMMISSION.

"A common carrier is entitled to reasonable compensation and no more. If payment thereof be refused he may refuse to carry." (Civil Code, Sec. 2173.) As construed by all the Courts, in innumerable decisions, the language of this section means: "Reasonable compensation,” and “for similar equal services" the "same compensation." To the same effect, and distinctly recognizing the equity of the rule, our immediate predecessors in this office unanimously adopted and entered of record the circumstantial declaration that in fixing "fares and freights on the various lines and portions of lines of transportation within this State," and in "determining what is a just and reasonable rate," they would consider the value of the services performed, distance of carriage, volume and direction of traffic, the general character thereof, to be fixed by classification as to volume, weight, value, the liability to accident, climatic influences, competition, grades, curvatures, and cost of maintenance."

"It is to be supposed that a common carrier can afford to carry at much the same rate of hire as that which is exacted universally by carriers similarly situated, and which, if it has been found to remunerate them, may, upon the best grounds, be called reasonable. The word reasonable, therefore, is to be the criterion of the price which a common carrier has a right to demand." (All the books, and Browne on the Law of Carriers, p. 82.) "Like circumstances" construed to mean and include cases where the labor, liability, and expense of the carriage are the same. (Great Western Railway Company vs. Sutton, H. of Lords, 38; J. L. Exch. 184; Browne on the Law of Carriers, p. 258; Walf. Sum. Law of Rys., p. 317; Ransome vs. Eastern Co.'s Ry., 4 Č. B. [N. S.] 63.)

GOVERNMENT DONATIONS AND LOANS OF CREDIT FOR THE CONSTRUCTION OF RAILROADS NOT OFFSETS TO CHARGES FOR SERVICE THEREON—THE GOVERNMENT AND PRIVATE PARTIES PASSENGERS ON THE SAME TRAIN.

Opposed to these principles and conclusions of law, there is only the unreconciled afterthought that government loans and donations for the construction of the Central Pacific, and other overland roads, were or might have been intended as offsets to charges for their operation. But the granting Acts, as ratified by the Legislature of the State, provide that such roads shall perform government service, "at fair and reasonable rates of compensation, not to exceed the amounts paid by private parties for the same kind of service." Here again is the common law rule of service, and "for the same kind of service," the same compensation. This would be plain enough without the express limitation to "amounts paid to private parties," whose rights are not affected by anything in the contract. And

in an opinion upon the clause quoted, and directly to the point, the Supreme Court of the United States has said: "The compensation at fair and reasonable rates, must be considered upon all the facts material to the issue, not to exceed the amount paid to private parties for the same kind of service." (The Union Pacific Railroad Company vs. United States, 14 Otto, 667.) Nothing, therefore, can be more evident than that the brilliant conception of reversionary bounties, and loans payable to the Government, but due to everybody, and subsidies that are a perpetual surcharge of fares and freights, was inspired by the "wisdom that comes after the fact."

CONCLUSIONS OF LAW UPON PRINCIPLES OF ADJUDGED CASES.

For obvious reasons, the Commission has given due precedence and prominence to the law by which it was created and must be governed. In doing so it has endeavored to outline its own legal status and sphere of action, and to solve the puzzling and irrelevant problems into which its powers and duties are too often resolved. Generally and briefly, its conclusions are as follows:

First-It is a constitutional tribunal, with well defined official functions, to be exercised, subject only to the requirements of law, with becoming independence and impartiality in the interest of all concerned.

Second-Its judicial power to hear and determine complaints presupposes parties of record to be heard and specific issues between them to be determined, and is to be exercised "in the same manner and to the same extent as by Courts of record."

Third-Its remedial powers and duties relate exclusively to rates of charge for fares and freights, and when regularly exercised in the mode prescribed, its decisions are prima facie "just and reasonable.

Fourth-To make them in fact what they are presumed to be, they must, without preference of person or corporation, be based upon the varying conditions of the service, and be a reasonable recompense therefor. Fifth-This is the rule of compensation for Government service incorporated in the Acts of Congress to aid the construction of the Central Pacific and other overland roads, and estops the Government, and a fortiori all other parties, from discriminating against them in payments for transportation thereon.

Sixth-The circumstantial and conditional factors of transportation are the admitted and necessary criterions of its cost and value, and are each and all of them inconsistent with any theory of unconditional uniform rates of fare and freight.

Seventh-To impose such rates upon the Central Pacific Company and leased lines under its management, at rentals ranging from $100 to $5,194 per mile, would be to make some of them bankrupt pensioners upon others; to convert relations beneficial to all into penalties upon such as have the least to gain by them; to substitute for reasonable compensation a rule of rank injustice, subject to which not one of them could have been constructed, and to arrest their extension to districts in squalid want of them, upon the mere pretense of favoring those who have them.

Statistical and financial exhibits will be found in the appendix hereunto attached, as follows:

"Exhibit A," page 43, shows the number of meetings held by the Commission in each year of the term which closes with this report, and the members present.

"Exhibit B," page 46, is a financial statement for the year 1886, showing amounts and purposes of expenditure.

"Exhibit C," page 46, is a statement in detail, showing the miles of trunk and branch lines operated by the Southern Pacific Company within the State to be 1,990.81 miles, and within the State of Nevada and the Territories of Utah, New Mexico, and Arizona, 1,158.17, making a total of 3,148.98 miles. It also shows the separate and aggregate mileage of the narrow-gauge roads in the State.

"Exhibit D," page 48, is a synopsis of such annual returns as are filed in the office of the Commission, showing volume of business, highest, lowest, and average charges for fare and freight, and such other facts and figures as were deemed of special interest and importance.

Exhibit E," page 51, is a reprint of correspondence and orders of a date prior to the present year, and relating to the pending controversy between the Commission and the Atlantic and Pacific Railroad Company. Following the appendix will be found the annual returns made by the several railroad companies of this State for the year ending December 31, 1885, and filed in this office, setting forth facts responsive to questions appearing in the blank forms of report furnished them by the Board of Railroad Commissioners.

The orders, correspondence, and proceedings of the Commission for the year last past will explain themselves, and are as follows:

Order No. 27 was introduced by Commissioner Carpenter, and unanimously adopted, as follows:

OFFICE STATE BOARD OF RAILROAD COMMISSIONERS,
SAN FRANCISCO, CAL, March 23, 1886.

Having examined and considered the amended tariff and joint western classification of grain and lumber submitted by the Southern Pacific Company, and filed in this office on the eleventh day of March, 1886, and finding that said tariff and classifications conform to the lowest current rates on the roads in this State to which they relate, and are in accordance with the previous orders of this Commission; now, therefore, it is hereby ordered that said tariff and classification be, and the same are hereby, approved and established for and upon said roads, and each of them, subject to the further order of this Commission.

SOUTHERN PACIFIC COMPANY (PACIFIC SYSTEM),

OFFICE GENERAL PASSENGER AGENT, SAN FRANCISCO, March 25, 1886.}

MR. W. R. ANDRUS, Secretary State Board Railroad Commissioners, 14 Dupont Street, City: DEAR SIR: I have the honor to acknowledge receipt of your communication, dated March twenty-third, transmitting to me Resolution No. 28, as passed by the State Board of Railroad Commissioners of that date.

In reply, I beg to say there have been no reductions in the passenger rates which were approved by the honorable Board of State Railroad Commissioners on April 19, 1883, but, as your honorable Board must be aware (it being a matter of public knowledge), for several weeks past there has been no stability to rates between points in California and points on or east of the Missouri River, the rate having gone for a time as low as $1. The "rate war" on through business has affected, more or less, our local traffic, local passengers buying through tickets and "scalping" them. To prevent this, between the first and sixteenth instant, during which time we were perfecting the "rebate" plan, a limited second-class rate of $12 50, and between the sixth and sixteenth instant a limited first-class rate of $15 was made between Los Angeles and San Francisco. These temporary special rates were withdrawn on the sixteenth instant.

Order No. 29 was introduced by Commissioner Humphreys, as follows:

OFFICE STATE BOARD OF RAILROAD COMMISSIONERS,
SAN FRANCISCO, CAL., March 31, 1886.

It is hereby ordered that the office of Secretary of this Commission be and the same is hereby declared vacant, and to fill such vacancy Stafford Parker, of the City and County of San Francisco, be and he is hereby nominated and appointed to fill such vacancy, and be the Secretary of the Commission from and after the first day of April, 1886, subject to its further order in the premises.

Any act or proceeding of this Commission inconsistent with this order is hereby rescinded.

Before voting upon this order, Resolution No. 30 was introduced by Commissioner Foote, as follows:

Resolved, That before the election of a Secretary is proceeded with, the members of this Board are requested to give any reasons which they may have for the dismissal of the present Secretary, W. R. Andrus.

On motion, the resolution was lost, Commissioners Carpenter and Humphreys voting against, and Commissioner Foote for.

Order No. 29 was then put upon its final passage, and adopted, Commissioners Carpenter and Humphreys voting for, and Commissioner Foote against.

WATSONVILLE, March 18, 1886.

To the Board of Railroad Commissioners of the State of California:

GENTLEMEN: The S. P. R. R. Co. has a station and depot at Watsonville, Santa Cruz County, where it receives and from which it transports ordinary freight, but refuses, for some reason I suppose best known to itself, to ship strawberries and other like fruit from said depot. The raising and shipping of strawberries and other berries and fruits in the vicinity of said Watsonville depot, has been and is an important and extensive industry, but has been and is greatly crippled and inconvenienced by reason of the company's refusal to ship from said depot at Watsonville, the fruit and berry raisers, who are quite numerous, being thus compelled to haul all their fruit and berries in wagons to the Pajaro depot, in Monterey County, an additional distance of about a mile and a half, over a rather rough road, thus making an additional expense of hauling; but the chief ground of complaint is that the berries are greatly bruised and injured by being hauled so far in wagons, and cannot be put in market in that fresh and sound condition they otherwise could be, and thereby great loss and damage are sustained.

The company has been appealed to, but they slight and reject our petitions, without, as we conceive, any good reason.

Now, in behalf of said fruit raisers generally, as well as myself, I would like to inquire for information if your honorable body has any power or jurisdiction in the premises to intercede for us, or compel said company to ship our fruit and berries from Watsonville depot? Yours, etc., (Signed :) G. H. BREWINGTON,

SOUTHERN PACIFIC COMPANY (NORTHERN DIVISION), }

SAN FRANCISco, April 2, 1886.

To the honorable Board of Railroad Commissioners, State of California: GENTLEMEN: Acknowledging the receipt of yours of March twenty-third, inclosing communication from Mr. G. H. Brewington of Watsonville, complaining that this company refuses to ship strawberries and other like fruit from its Watsonville station, I would state that this company has never refused to receive any freight at Watsonville. On the contrary, it is recognized by our tariff as a freight station, and rates are provided for freight of all kinds from said station to all other points on the line. For many years (and prior to this company leasing the Santa Cruz line) the shipping point for Watsonville was Pajaro, a station on the opposite side of the river, less than one mile distant, where every convenience for the shipment of all kinds of freight is provided, and where nine tenths of the business of the Pajaro Valley is still handled. The business of the Santa Cruz line does not warrant the running of as frequent trains as are run on the

Mr. G. H. Brewington's communication returned herewith. Order No. 31 was introduced by Commissioner Carpenter, and unanimously adopted, as follows:

OFFICE STATE BOARD RAILROAD COMMISSIONERS,
SAN FRANCISCO, CAL., April 27, 1886.

The San Joaquin Valley and Yosemite Railroad Company, having completed its road from Berenda to Raymond, in this State, a distance of twenty-one miles, and having waived time and service of printed schedule for the purpose of opening said road on the twenty-eighth instant; and it appearing that said road connects at Raymond with a line of stage coaches for the transportation of passengers, chiefly pleasure-seekers and tourists, to and from Yosemite Valley, and must derive its receipts mainly from the same class of business during the season to which it is confined; and it appearing, also, from the exceptional class and conditions of service on said road, that a charge of two dollars per passenger for the whole distance between said termini, and of ten cents per mile to and from intermediate points, is no more than just and reasonable compensation for such service;

Now, therefore, it is hereby ordered that such charge and rate per mile shall be the established maximums for the transportation of passengers on said road, subject to the further order of this Commission.

This order to take effect and be in force from and after the twenty-seventh day of April, 1886.

A schedule of rates for the transportation of freight on the San Joaquin Valley and Yosemite Railroad, from Berenda to Raymond, having been prepared and submitted with an express waiver of statutory notice to this Commission, and it appearing and being found that said road is leased and operated by said company as a branch of its system of roads in this State, and it appearing, also, that said schedule, now on file in this office, is to be used with the local classification of the Central Pacific Railroad, and corresponds with the rates for the same service south of the junction at Berenda of said roads, and that it is just and reasonable;

It is, therefore, ordered that the rates of freight and classifications aforesaid, at and between all the stations on said San Joaquin Valley and Yosemite Railroad, be and the same are hereby approved and established, subject to the further order of this Commission.

Order No. 33 was introduced by Commissioner Carpenter and unanimously adopted, as follows: OFFICE STATE BOARD RAILROAD COMMISSIONERS, SAN FRANCISCO, CAL., August 16, 1886. }

The Southern Pacific Company (Pacific system) having submitted for the consideration and approval of this Commission a "special merchandise tariff, No. 4 G," together with special instructions, and the "joint western classification" as revised to July 1, 1886; and it appearing from comparison and examination of said tariff that it reduces existing charges for carload lots and smaller quantities from San Francisco, Sacramento, San José, Stockton, Marysville, Oakland (Sixteenth Street), Oakland Wharf, and Lathrop to Los Angeles and more distant southern points on said system of roads; and it appearing further, that said reduced charges are for the purpose of competing with other common carriers at said points, and are made in conformity with article twelve, section twenty of the Constitution;

Now, therefore, it is hereby ordered that said tariff, classifications, and instructions be and the same are hereby approved and established at said points, subject to the further order of this Commission.

2* 26

Order No. 34 was introduced by Commissioner Carpenter and unanimously adopted, as follows:

OFFICE STATE BOARD RAILROAD COMMISSIONERS,
SAN FRANCISCO, CAL., August 19, 1886.

The Southern Pacific Company (Pacific system), and the Atlantic and Pacific Railroad, having filed and submitted for the consideration and approval of this Commission, a joint merchandise tariff of freights from San Francisco, Sacramento, San José, Stockton, Oakland (Sixteenth Street), Oakland Wharf, Marysville, and Port Costa, to points in Arizona and New Mexico, to be used with and governed by rules and regulations of joint western classification as amended on the sixteenth day of August, 1886; and it being found by examination and comparison that said tariff and classification reduces rates of charge from said terminals to points on the Atlantic and Pacific Railroad in said Territories, and that they are just and reasonable;

Now, therefore, it is hereby ordered that said tariff and classification be and the same are hereby approved and established, subject to the further order of this Commission.

KINGMAN, MOJAVE COUNTY, A. T., August 26, 1886.

State Board of Railroad Commissioners, San Francisco, California:

GENTLEMEN: Some months ago we discovered that the Southern Pacific Railroad Company had been overcharging us on freight shipped from San Francisco to Mojave, and Los Angeles to Mojave, or in other words, they were charging us a higher rate of freight from San Francisco to Mojave than they were charging from San Francisco to Los Angeles for same class freight. Messrs. Monaghan & Murphy, of the Needles, California, put in a claim on the same grounds, and their claim was paid promptly; and as soon as their claim was presented, the railroad company immediately reduced their rates to conform with the law. Not only did they reduce the rates to points in California, but also to points in Arizona; and the grounds they take for declining to pay the claim is that the goods were destined to a point in Arizona. At the same time they delivered the freight to another transportation company at Mojave, California, where their responsibility ceased.

We are of the opinion that our claim is equally as justifiable as the claim of Messrs. Monaghan & Murphy, and respectfully ask your advice upon the subject. When they were carrying a carload of flour from San Francisco to Los Angeles for $65 they were charging us $130 for a car from San Francisco to Mojave, and we have their express bills showing the amount paid to them.

An early reply will oblige yours, very truly,

(Signed:)

P. S.-We inclose letter of Mr. R. Gray, which please return.

SOUTHERN PACIFIC COMPANY

W. H. TAGGART & CO.

OFFICE GENERAL FREIGHT AGUA, SAN FRANCISCO, August 21, 1886. } MESSRS. W. H. TAGGART & Co., Kingman, A. T.:

GENTLEMEN: Inclosed I hand you all papers in a claim for overcharge, in the sum of $724 18, presented by you with your favor of June third, and would say, first, that payment of the claim is respectfully declined.

I have been at some pains to procure copies of the billing of each shipment and to carefully revise the same, and find that the charges imposed by this company are strictly in accordance with the published tariff rates in force at the time of shipment.

Your claim for refund, on the ground that this company has charged more or less than the amount allowed by the State law of California, has no bearing upon the case, since the laws of California take no cognizance of and have no jurisdiction over charges of transportation companies on interstate commerce, which are regulated by circumstances over which the individual State governments have no control, and are based upon facts which affect the general trade between the points of shipment and the points of destination, as it relates to freight from other States to the same points. Trusting that this explanation will be satisfactory, I am,

(Signed:)

Very truly yours,

RICHARD GRAY.

The Board of Railroad Commissioners met at 3 o'clock. President Carpenter presented the following letter in answer to the complaint of Messrs. Taggart & Co. of Kingman, A. T., which had been referred to him at a previous meeting of the Board.

STATE OF CALIFORNIA, OFFICE OF THE BOARD OF RAILROAD COMMISSIONERS, 14 DUPONT STREET, SAN FRANCISCO, September 24, 1886.

W. H. TAGGART & Co., Kingman, A. T.: GENTLEMEN: Having considered your communication of the twenty-sixth ultimo, we take the facts to be as follows: On commodities shipped by your firm on the Southern Pacific

19

Railroad and its connecting lines from San Francisco to Mojave, A. T., the Southern Pacific Company charged a higher rate than it charged from San Francisco to Los Angeles for the same class of freight. It is further assumed and stated that the company not only paid the claim of Monaghan & Murphy, of the Needles, but by reason thereof reduced its rates to points in California and Arizona. And by bills of lading you offer to show that while flour was shipped from San Francisco to Los Angeles for $65 per carload, the charge from the same shipping point to Mojave, in Arizona, was $130 per carload. Upon this statement of facts you say: "We are of the opinion that our claim is equally as justifiable as that of Messrs. Monaghan & Murphy, and respectfully ask your advice on the subject."

Our conclusions are as follows:

First-The discrimination between persons which the law defines and forbids, consists in charging one more than another for the same class and quantity of freight between the same points and in the same direction. There is, therefore, in the case presented, no discrimination against your firm at Mojave, or in favor of Monaghan & Murphy at the Needles.

Second-The Constitution and common-sense of this State permit a higher rate of charge if not more in the aggregate, for a short than for a longer haul, including the shorter and in the same direction.

Hence the charge for a carload of flour from San Francisco to Los Angeles is not the criterion of charge for the same quantity to Mojave.

Third-The charge for a continuous service by connecting roads within the State may be lawfully pro rated between them, and in case of an alleged overcharge the only question will be whether the charge in its entirety is just and reasonable. But as the service in the case was not wholly within the State, we hold without prejudice to your alleged claim in a different forum, that we have no jurisdiction in the premises.

S. H. PARKER, Secretary.

J. G. CARPENTER,

President of the Commission. W. W. FOOTE,

Commissioner Third District. WM. P. HUMPHREYS,

Commissioner Second District.

KINGMAN, MOJAVE COUNTY, A. T., September 30, 1886.

State Board of Railroad Commissioners:

GENTLEMEN: Yours twenty-fourth at hand, and carefully noted. You have evidently misconstrued our letter of the twenty-sixth of August, relative to the point at which the Southern Pacific Company deliver the freight to the Atlantic and Pacific Railroad Company. In shipping goods to Kingman, Arizona, the Southern Pacific Company deliver them to the Atlantic and Pacific at Mojave, California, not Mojave, Arizona, and for this service they charged us $130 per car for flour, while they carried it one hundred miles further (to Los Angeles), for $65. Merchandise consigned to Monaghan & Murphy, at the Needles, is also delivered to the Atlantic and Pacific Company at Mojave, California, exactly under the same circumstances as merchandise consigned to us, and for which service they charged them the same rates of freight as they charged us, although they (the railroad company), afterwards refunded to Messrs. Monaghan & Murphy the full amount of overcharge as presented by them, being figured on a basis of $65 per car, San Francisco to Mojave, California.

According to Mr. Gray's letter we take it that, because we are unfortunate enough to be doing business in Arizona, sixty miles from the California line, we must pay the Southern Pacific Company $65 per car more on merchandise than is paid by Messrs. Monaghan & Murphy, at the Needles; or suppose, for instance, we were located on the Arizona side of the Colorado River, and Monaghan & Murphy on the California side, or only one mile apart; does the law give the Southern Pacific Company the right to charge us double the freight that they charge Messrs. Monaghan & Murphy, simply because we happen to be doing business in Arizona? If this is the true meaning of the law, we could have had our goods shipped in our name to Mojave, California, and reshipped from there to Kingman, Arizona. There being two distinct rates of freight charged by each company, viz.: $130 by the Southern Pacific, San Francisco to Mojave, and $130 by the Atlantic and Pacific, Mojave to Kingman, while if the goods had been shipped or consigned to us at Mojave, the Southern Pacific charges (we take it), would have been $65 instead of $130. We are sorry to trouble you so much on account of this matter, but we feel that you did not quite understand the situation as explained to you in our letter, and we also feel that we have been imposed upon and discriminated against by this railroad company, and consider that we are justly entitled to the amount of claim presented to them, and which they have declined to pay. The following sketch will explain the matter more fully. Very respectfully,

(Signed:)

W. H. TAGGART & CO.

The second letter of Commissioner Carpenter, in answer to W. H.

Taggart & Co., Kingman, A. T., who complained of discrimination, was read and unanimously approved of. The letter is as follows:

STATE OF CALIFORNIA, OFFICE OF THE BOARD OF RAILROAD COMMISSIONERS, 14 DUPONT STREET, SAN FRANCISCO, November 26, 1886.

W. H. TAGGART & Co., Kingman, Arizona Territory:

GENTLEMEN: Your communication of September 30, 1886, was duly received, and should have had an earlier reply.

The facts which you have recapitulated and illustrated by diagram, are precisely as they were understood and taken in our advisory letter of September 24, 1886.

In deference to your request, without such formal complaint as the statute prescribes, we volunteered the opinion that through rates of transportation from San Francisco to Mojave, and thence to Kingman, Arizona Territory, are not governed by local charges from the same place of shipment, to Los Angeles, or to the Needles, in this State. We held, further, that the service of connecting carriers, and the intermediate transfer of freight from one to the other, relates to the same ultimate destination and delivery, at a point beyond the borders of the State, and therefore beyond the constitutional cognizance of this Commission.

To this opinion, thus informally rendered, as stated in substance, we respectfully and . confidently adhere. Finding the facts as presented to us, we hold that the alleged difference between local and through rates is not discrimination, as defined and prohibited by law. They are subject to different conditions of service, and to separate jurisdictions. They are severally just and reasonable, or otherwise, without comparison or relation one with the other. Such comparison would be irrelevant, and no such relation is established or implied by any law of this State. Freight shipped at San Francisco and destined, via Mojave, to Kingman, Arizona, falls ipso facto within the category of interstate traffic, and on both sides of the Colorado River is foreign to our jurisdiction; while in transitu over connecting roads, however often transferred from one to another at intermediate points, it retains, to its ultimate destination and delivery, the status of commerce among the States. By whatever successive stages or coöperation of railroads, or of ship and car, it may be conducted, in contemplation of law, both commodity and carrier are exempt from State interference or control by the exclusive jurisdiction of the Federal Government. In support of these positions the decisions of Courts are numerous and conclusive. The Wabash, St. Louis, and Pacific Railway Company, Plaintiff in error, v. The People of the State of Illinois, is an agreed case in which said company admits that for transporting the same class of freight upon its railroad and upon and over railroads connecting therewith, from Peoria and Gilman, in Illinois, to New York, the charge was ten cents less per hundred pounds and $26 less per carload of twenty-six thousand pounds for the longer than for the shorter haul. In the Court of last resort, after an exhaustive review of the so called "granger cases" and analogous adjudications, in connection with the statute prohibiting the alleged discrimination, the judgment of the lower Court is reversed, and a majority of the Justices concur in saying: "We must, therefore, hold that it is not, and never has been, the deliberate opinion of a majority of this Court that a statute of a State which attempts to regulate the fares and charges by railroad companies within its limits for a transportation which constitutes a part of commerce among the States is a valid law."

In County of Mobile v. Kimball, 102 U. S., 691, the scope of Federal authority in the premises is clearly stated as follows: "Commerce with foreign countries and among the States, strictly considered, consists in intercourse and traffic, including in these terms navigation, and the transportation and transit of persons and property, as well as the sale, purchase, and exchange of commodities. For the regulation of commerce, as thus defined, there can be only one system of rules, applicable alike to the whole country, and the authority which can act for the whole country can alone adopt such a system. Action upon it by separate States is not, therefore, permissible."

The Pacific Coast Steamship Company v. The Board of Railroad Commissioners, decided by Justice Field and Judge Sawyer, in the Circuit Court of the United States, Ninth Circuit, District of California, covers and concludes the case we are considering as follows: "The fact that several different and independent agencies are employed in transporting the commodity, some acting entirely in one State and some acting through two or more States, does in no respect affect the character of the transaction to the extent in which each agency acts in that transportation; it is subject to the regulation of Congress." Hoping that the reasons assigned for our opinion will at least convince you that we mean to be right, we remain, yours truly,

Attest: S. H. PARKER, Secretary.

G. J. CARPENTER,

WM. P. HUMPHREYS,
W. W. FOOTE,

Railroad Commissioners.

Los ANGELES, CALIFORNIA, October 23, 1886. DEAR SIR: The Los Angeles and Independence Railroad will stop both ways on the corner of Washington and San Pedro Streets, in this city; they sell tickets on Alameda Street, and stop all their south-bound trains near Aliso; their main depot is on Fernando

Street, about one half mile north. When a passenger gets on the cars at the corner of Washington and San Pedro, going to Aliso Street, less than two miles, they require him to pay 15 cents or put him off the train. Can't you stop this enormous charge? The railroad spoils our street (San Pedro) and charges us an exorbitant fare. Five cents would be enough. Can't you get them down to such a rate? It is too high a rate to pay for school children, and it is too high for anybody. I believe it is your duty under the statute to help us, and I am sure you will do the best you can for us when your attention is directed to a given case.

I live on the corner of Washington and San Pedro. It would somewhat repay me for the inconvenience I suffer from the damage to the street and my property by reason of the presence of the railroad if they would reciprocate and charge me a street-car rate. Truly yours, (Signed:) JAMES PATTISON, Corner Washington and San Pedro.

The above letter was referred to the Southern Pacific Company on November twenty-sixth, and the following answer received and filed in office of the State Board of Railroad Commissioners on the twenty-second day of December, 1886:

SOUTHERN PACIFIC COMPANY, OFFICE GENERAL PASSENGEL AGENT,
FRANCISCco, December 21,

MR. STAFFORD H. PARKER, Secretary State Board Railroad Commissioners, 14 Dupont Street,
San Francisco:

DEAR SIR: Referring to our letter to you, No. 13771 B, of the twenty-ninth ultimo, we beg to say that we gave attention at the earliest practicable moment to the subject-matter of Mr. James Pattison's communication to your honorable Board.

We beg, therefore, to inform you that the corner of Washington Street and San Pedro, at which Mr. Pattison resides, is known as Washington Street Station of the Los Angeles and Independence Railroad, and is distant from our Los Angeles depot 3.4 miles.

Since August 18, 1883, 15 cents has been our fare between those two points. We cannot reduce it to 5 cents, as suggested by Mr. Pattison, and we cannot well make it 10 cents. Practically, however, Mr. Pattison and family can obtain the rate of ten cents, as we can and will sell for their use, between those two points, what are known to us as thirty-trip family commutation tickets, at a rate of $3. His application for such ticket to our Los Angeles station agent will be promptly met. Respectfully yours, (Signed:) T. H. GOODMAN, G. P. and T. A.

R. A. D.

Order No. 36 was introduced by Commissioner Carpenter and unanimously adopted, as follows:

BOARD OF RAILROAD COMMISSIONERS OF THE STATE OF CALIFORNIA. Having referred the letter of James Pattison, complaining of overcharges between Washington Street Station and Los Angeles Depot, on the Los Angeles and Independence Railroad, to the Southern Pacific Company, and received the reply of said company, we find that the charge complained of is below the maximum of schedule rates, and, for the reasons given by complainant, not extortionate. Without further proceeding, therefore, the matter is dismissed.

Order No. 37 was introduced by Commissioner Carpenter and adopted, Commissioners Carpenter and Humphreys voting for, and Commissioner Foote against, as follows:

BOARD OF RAILROAD COMMISSIONERS OF THE STATE OF CALIFORNIA. Having made the necessary comparisons and examination of the local classification for the Southern Pacific Railroad, Northern Division, which took effect, with the approval of this Commission, January 1, 1883, and also the recent revision of said classification now on file in this office; and it appearing that the changes of said classification from higher to lower classes, and the new carload rates made therein are just and reasonable, it is hereby ordered that said revision of classes and said carload rates be and the same are hereby approved and established on and for said road.