69

have no bearing on the case. In the most important case on this point, Mr. Justice Brewer said: "It is contended by the defendant that it was necessary for the Baltimore & Ohio Company to offer this inducement to Mr. Bruening in order to get his business, and not necessary to make the like offer to Mr. Wolf, because he would have to go to the expense of carting, by whichever road he transported; that therefore the traffic was not 'under substantially similar circumstances and conditions,' within the terms of section 2. We are unable to concur in this view. Whatever the Baltimore & Ohio Company might lawfully do to draw business from a competing line, whatever inducements it might offer to the customers of that competing line to induce them to change their carrier, is not a question involved in this case. The wrong prohibited by the section is a discrimination between shippers. It was designed to compel every carrier to give equal rights to all shippers over its own road, and to forbid it by any device to enforce higher charges against one than another." 70

§ 679. Concessions to certain localities.

Whether a concession made in certain localities constitutes discrimination seems not to be altogether settled, although on the authorities it would seem to be clear enough that differences in the basis upon which service is rendered in various localities do not in themselves constitute discrimination. The Supreme Court has held that giving cartage to the patrons in one city while making no such provision in others named, did not constitute a violation of the Act. In a recent proceeding before the Commission, ing Co.'s Case, 4 Can. Ry. Cas. 259.

69 Wight v. United States, 167 U. S. 512, 42 L. ed. 258, 17 Sup. Ct. 822.

70 See to the same effect, Hezel Milling Co. v. St. Louis, A. & T. H. R. R., 5 I. C. C. Rep. 57; Chicago F. P. C. Co. v. Chicago & N. W.Ry., 8 I. C. C. Rep. 316; The Brandt Mill

71 Interstate Commerce Commission v. Detroit, G. H. &. M. Ry., 167 U. S. 633, 42 L. ed. 306, 17 Sup. Ct. 986.

See also Re Wharfage Charges at Texas City, 26 I. C. C. 695, discussed in the next sentence.

it appeared that, to overcome natural disadvantages as respects other neighboring ports, Texas City interests offered generally free wharfage, and to large shippers warehousing services, at less than cost, but no opinion was expressed as to the legality of such deals, for generally speaking, in order to violate the Act the prejudice must result from something done by the carrier. Likewise it is not held to be an undue preference of one locality over another under the Act to perform a switching service at one point which is refused at another.72 The same principle applies to various matters relating to transit privileges granted by the carrier for traffic movements at one point, while not doing so at another.

Topic B. Concessions to Large Shippers

§ 680. Whether concessions may be made to large shippers. Common carriers have often given special discounts to large shippers in order to get their trade or to retain it, and sometimes they have attempted to defend this practice upon general principles. That this policy may often be advantageous in public business, as it is in private business, may be admitted, but it has already been seen that public duty may conflict with business policies. If, therefore, these concessions to larger shippers are in conflict with the public duty which the common carrier owes to smaller shippers, they must be held illegal as unjust discriminations. And this will be the clearer when it is shown that the favoring of such large shippers will give them such commercial advantages that they may crush out their smaller competitors in the common markets. The rule forbidding the granting of special reductions to larger shippers as such on the ground that they furnish a greater aggregate of business to the common carrier is, therefore, a necessary part of the law forbidding all personal dis

crimination.73 "The fact that one man is a large shipper and another a small shipper does not entitle the carrier to make a difference in the rate, if the property carried in each case is of the same class, and the distance and route is the same." 74

§ 681. Unreasonable differences universally forbidden. All courts now agree that if there is an unreasonable difference made between the rates given to the large patron and the rates charged a small patron, the schedule is illegal in that respect. The most recent case which brings out this test is Western Union Telegraph Company v. Call Publishing Company,75 where the plaintiff complained of a $5 rate per 100 words daily per month charged it for news despatches while its contemporary was charged only $1.50. Mr. Justice Brewer pointed out that it could not be said, even in this case, that the apparent discrimination could not be justified; for the general principle as he pointed out has two sides. Of course, such equality of right does not prevent differences in the modes and kinds of service and different charges based thereon. There is no cast iron line of uniformity which prevents a charge from being above or below a particular sum, or requires that

73 The quotation which follows is from United States v. Tozer, 39 Fed. 369.

74 By the weight of authority it is illegal to make reductions to large shippers as such. The principal cases are listed below: Western U. T. Co. v. Call Pub. Co., 181 U. S. 92, 45 L. ed. 765, 21 Sup. Ct. 561, overruling s. c., 44 Neb. 326, 62 N. W. 506; Hays v. Pennsylvania Co., 12 Fed. 309, B. & W. 368; Burlington, C. R. & N. Ry. v. N. W. Fuel Co., 31 Fed. 652; Kinsley v. Buffalo, N. Y. & P. Ry., 37 Fed. 181; United States v. Tozer, 39 Fed. 369; Fitzgerald v.

Grand Trunk Ry., 63 Vt. 169, 22 Atl. 76, 13 L. R. A. 70.

But see Savitz v. Ohio & M. Ry., 150 Ill. 208, 37 N. E. 235, 27 L. R. A. 626, affirming 49 Ill. App. 315; Cook v. Chicago, R. I. & Pac. Ry. Co., 81 Iowa, 551, 46 N. W. 749, 25 Am. St. 512, 9 L. R. A. 764; Rothschild v. Wabash, St. L. & P. C. R., 92 Mo. 91, 4 S. W. 418; Concord & P. R. R. v. Forsaith, 59 N. H. 122, 47 Am. Rep. 181; Silkman v. Yonkers Water Commissioners, 152 N. Y. 327, 46 N. E. 612, 37 L. R. A. 827.

75 Western Union Telegraph Co. v. Call Publishing Co., 181 U. S. 92, 45 L. ed. 765, 21 Sup. Ct. 561.

the service shall be exactly along the same lines. But that principle of equality does forbid any difference in charge which is not based upon difference in service, must have some reasonable relation to the amount of difference, and cannot be so great as to produce an unjust discrimination.754

682. Unreasonable differences forbidden by all courts. Indeed, long before this in the case of Burlington, Cedar Rapids and Northern Railway Company," which is often cited in this connection, Mr. Justice Brewer said in part: "If it be true, as held by Judge Wallace, that the rule forbidding an unjust discrimination does not necessarily prevent a railroad company from charging a less rate to one who ships a large quantity than to one who ships a small quantity (and I am not prepared to deny that under some circumstances, there is force in that proposition, on the same principle that a wholesale dealer sells a large bill of goods at a less rate than a small bill of goods), yet, even with that limitation, a discrimination so vast as this is, and so purely arbitrary, and which is so obviously solely in the interest of capital, and not based upon reasonable distinction in favor of a large as against a small shipper, cannot be sustained. For here the contract provides a special rate for shipment of 100,000 tons or over; that is, for one who ships 99,500 tons it makes a rate of $2.40; while to the man who ships 100,000 tons, or 500 tons more than the other, it makes a rate of $1.60,-a difference of 50 per cent in favor of the latter. Such a discrimination, even if any discrimination based upon the amounts of shipments is tolerable, is one so gross that it cannot be sustained." 77

764 See also Rothschild v. Wabash, St. L. & P. C. Ry., 92 Mo. 91, 4 S. W. 418; and Cook v. Chicago, R. I. & P. Ry., 81 Iowa, 551, 46 N. W. 1080, 25 Am. St. Rep. 512, 9 L. R. A. 764.

76 Burlington, C. R. & N. Ry. v. Northwestern Fuel Co., 31 Fed. 652.

77 But see State v. Central St. Ry., 81 Vt. 463, 71 Atl. 194, 130 Am. St. Rep. 1065.

§ 683. Reasonable differences permitted by some courts. In a very few jurisdictions it has been held that there is no legal objection to making a reasonable difference in the rates given to large shippers in comparison with the rates charged small shippers. The argument is that this is a business policy universally practiced; but the answer seems to be that this may nevertheless be opposed to the peculiar duties which the common carrier owes to the public as a whole. However, an extract is given from the opinion of Mr. Justice Allen in Concord and Portsmouth Railroad Company v. Forsaithe,78 so that the weight of this argument may be felt. In holding that the complainant, a small shipper, had no case, even under a statute which forbade discriminations, he said: "The terms of the statute must receive the interpretation which long-established usage and the custom of the commercial world have given them. That custom in all branches of business always has been, and is, to move, care for, and sell a large amount of a given commodity, in one parcel or in a given time, at a less price per pound, yard, or ton, than a smaller quantity of the same commodity, distributed in many and smaller parcels at different times. The expense of handling, carrying, and storing the smaller amount is much greater, pro rata, than that of the same operations upon the larger amount in one body, and a discrimination in favor of the larger dealers is not inequality, but reasonable equality. By any other construction the statute would defeat itself; for taking into account the lessened expense pro rata for transporting the greater amount of property in a single body or in a given time, the carrier would, by absolute equality of rates for all cases, receive a greater price rate for carrying the larger quantity than the smaller, and thereby make an unjust discrimination against the person transporting the largest quantity of goods. Unreasonable equality is inequality." 79

78 59 N. H. 122.

79 To the same effect is Silkman v.

Water Commissioners, 152 N. Y. 327, 46 N. E. 612, 37 L. R. A. 827.