No. 27976

BARTON AUTO COMPANY, INCORPORATED, ET AL. v. ANN ARBOR RAILROAD COMPANY ET AL.

Submitted June 1, 1939. Decided October 19, 1939

Rates on passenger automobiles and parts, in carloads, from certain eastern transcontinental points to Spokane, Wash., not shown to have been or to be unreasonable, except to the extent that they exceeded the corresponding concurrent first-class rates. Reparation awarded in the latter instances.

H. W. Prickett and Milton H. Love for complainants.

Dean H. Eastman, Thomas H. Maguire, Dana T. Smith, A. J. Clynch, J. P. Plunkett, Edwin C. Matthias, and Conrad Olson for defendants.

J. C. Bruce for Public Utilities Commission of Idaho, intervener.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS AITCHISON, SPLAWN, AND CASKIE

BY DIVISION 2:

Complainants excepted to the examiner's proposed report. Our findings differ somewhat from those proposed by him.

1

Complainants are individuals, partnerships, and corporations dealing in automobiles and parts at Spokane, Wash. By complaint filed February 21, 1938, as amended, they allege that the all-rail and lake-and-rail first-class rates and the rates and minimum weights on passenger automobiles and extra parts, in carloads, from Duluth, Minneapolis, and St. Paul, Minn., transcontinental group F points; Kenosha, Racine, and Racine Junction, Wis., transcontinental group D points; Detroit, Flint, Grand Rapids, North Flint, Lansing, and Pontiac, Mich., Fitch, Toledo, and Wagon Works, Ohio, and South Bend, Ind., transcontinental group C points; and Black Rock (Buffalo), N. Y., a transcontinental group B point, to Spokane are, and since November 20, 1933, have been, unreasonable. The first-class

1 Riegel Brothers, a partnership composed of Guy E. Riegel and Dee R. Riegel; John D. Moore, an individual; D. E. Wallace, an individual; W. J. Richmond, an individual; Transport Motor Company, a corporation (in 1919 the name of this complainant was changed from Transport Corporation and on December 15, 1938, it sold its business); HullRodell Motors, Incorporated; Halstead Motor Company, a corporation (in 1934 the name of this complainant was changed from Halstead Franklin Company, a corporation); Barton Auto Company, Incorporated; and Eldridge Motors, Incorporated.

rates are alleged to be unreasonable only to the extent that they were or are applicable to automobiles. There is no allegation that automobiles are improperly classified. The complaint was amended at the hearing by the elimination of Omaha, Nebr., as an origin. We are asked to prescribe reasonable rates and minimum weights on passenger automobiles and parts and to award reparation on shipments moved since November 20, 1933.

Informal complaints 2 were filed with respect to certain of the claims, all within the statutory period, and the formal complaint was filed within the period provided by our Rules of Practice. The Public Utilities Commission of the State of Idaho intervened on behalf of complainants but took no active part in the proceedings. Rates and differences in rates are in amounts per 100 pounds, and unless otherwise indicated do not include the general increases authorized March 8, 1938.

The rates in issue are joint through first-class rates, and commodity rates named in west-bound tariffs for application over allrail and lake-and-rail routes. The first-class rates are governed by the western classification. Passenger automobiles are rated first class, minimum 10,000 pounds, and freight automobiles second class, minimum 12,000 pounds, for standard cars 36 feet 6 inches in length; and both are subject to rule 34. Under that rule the minima on passenger automobiles are 11,200 pounds for cars 40 feet 6 inches, 11,700 pounds for cars 41 feet 6 inches, and 16,200 pounds for cars 50 feet 6 inches.

The assailed commodity rates prior to December 24, 1936, were the same as the first-class rates, but during the period December 31, 1936, to March 27, 1938, they were 5 cents higher than the firstclass rates. The explanation of this is that the formerly authorized emergency charge of 5 cents expired on December 31, 1936, as to the class rates, whereas on December 24, 1936, the commodity rates were increased 5 cents. On March 28, 1938, this increase was eliminated and all of the rates were increased 10 percent. The present commodity rates are the same as the first-class rates.

The commodity rates are now, and for several years have been, subject to minima of 10,000 pounds for cars not over 41 feet 6 inches in length and 12,000 pounds for larger cars, to and including 51 feet. The respective tariffs provide for application of the rate that produces the lowest charge. The higher commodity rates and the lower minima produced the lowest charges in some instances and

2 Nos. 162971 and 166560.

Agent Toll's tariffs I. C. C. Nos. 1297 and 1315 and reissues; and Agent L. E. Kipp's tariffs I. C. C. Nos. 1374, 1384, and 1401.

were used. Lake-and-rail rates from Detroit were and are 17.5 cents less than the all-rail rates to Spokane.

The average distances over routes used, weights per car, and rates charged on 625 carloads of passenger automobiles received by complainants over all-rail and lake-and-rail routes, together with the revenues per car, per car-mile, and per ton-mile, are shown in the following table:

Complainants seek rates for the future not exceeding 87 percent of first-class rates constructed in the same manner as those to points in western trunk-line zone IV, as modified by the extension of the zones and rates in Great Falls Traffic Assn. v. Chicago, B. & Q. R. Co., 226 I. C. C. 467, plus the general increase of 10 percent in 1938, subject to minimum weights of 10,000 pounds for cars not over 41 feet 6 inches in length and 12,000 pounds for cars over 41 feet 6 inches to and including 51 feet. We are asked to award reparation on shipments prior to March 28, 1938, based on the same minima and on the scales of first-class rates prescribed in Western Trunk Line Class Rates, 164 I. C. C. 1, modified so that the scales beyond 1,500 miles will apply to blocks of 25 miles instead of 50 miles, with differentials added for that part of the distance west of the border of zone III equal to 20 percent of the zone III scale therein prescribed; and on shipments on and after March 28, 1938, on the basis of the rates and minima sought for the future. As an alternate basis for reparation on shipments prior to March 28, 1938, complainants suggest rates constructed in the same manner as to points in zone III, plus differences between the original zone III scale and the scale of rates prescribed in Arizona Corp. Comm. v. Arizona E. R. Co., 113 I. C. C. 52, and Utah Shippers Traffic Assn. v. Atchison, T. & S. F. Ry. Co., 172 I. C. C. 306, as differentials for the distances beyond zone III. This would produce lower rates than the basis

• Reopened for further consideration and pending.

of 20 percent of the original zone III scale as differentials for the distance west of zone III. In their exceptions complainants suggested other bases of rates for the future and for reparation purposes in the event that we disapprove the bases proposed by them at the hearing. They are shown in appendix C.

The assailed rates, and those proposed at the hearing for the future and as bases for reparation, are shown in the following table:

1 November 20, 1933, to December 23, 1936.

December 24, 1936, to March 27, 1938.

• On and after March 28, 1938. Last column for future.

The basis of rates sought for shipments prior to March 28, 1938, is substantially the same as that prescribed for the future in CoveyBallard Motor Co. v. Alton & S. R., 174 I. C. C. 674, decided by division 4 on May 29, 1931, and Idaho Public Utilities Comm. v. Oregon Short Line R. Co., 194 I. C. C. 359, decided by division 5 on June 9, 1933. The former proceeding embraced rates and minimum weights on automobiles and parts from Racine Junction, Milwaukee, and Kenosha, Wis., Detroit, and Auburn and Connersville, Ind., to Salt Lake City, Utah. Rates were prescribed for the future based on the scales of first-class rates prescribed for western trunk-line territory, with differentials added for that part of the haul west of Cheyenne, Wyo., equal to 20 percent of the zone III scale therein prescribed. The latter proceeding embraced all-rail and lake-and-rail rates and minimum weights on automobiles and parts, in carloads, from shipping points in Wisconsin, Michigan, Indiana, Pennsylvania, Ohio, and New York to destinations in Idaho on lines of the Oregon Short Line Railroad Company and the Pacific and Idaho Northern Railway Company. In that proceeding the finding in Covey-Ballard Motor Co. v. Alton & S. R., supra, was followed as to

the rates for the future, and a similar formula was used as a basis for reparation. For the distance west of western trunk-line territory an amount equal to 35 percent of the zone III rate was added. The same formula was used by the Commission for reparation purposes in Acker v. Alton R. Co, 213 I. C. C. 162, with respect to automobiles from eastern origins to destinations in Montana, and to Salt Lake City and Ogden, Utah, and Rawlins, Wyo. These bases will be referred to as the 20-percent basis and the 35-percent basis, respectively.

Complainants rely on three major propositions to prove that the assailed rates were and are unreasonable: (1) The rates to Spokane, as measured by the first-class rates, are relatively higher than rates on passenger automobiles between numerous points in western territory, and the minima applicable in connection with the first-class rates are generally higher than those between other points; (2) the assailed rates are higher than rates on freight automobiles from the origin territory to Spokane, and between other points, and are relatively higher than rates on certain other light-loading and less-thancarload commodities; and (3) they are higher than would result from application of the 20-percent basis prescribed for the future in the proceedings cited.

Representative rates on passenger automobiles between points in western trunk-line territory, from points in that territory and from eastern transcontinental groups to points in Mountain-Pacific and Pacific coast territory, and from Pacific coast cities to destinations in Mountain-Pacific territory are set forth in appendix A to this report and are compared with the first-class rates from and to the same points. The average rates computed from freight bills on several hundred shipments, together with the revenues per car, per car-mile, and per ton-mile, and similar data as to revenues which would be produced by the proposed rates, are shown in appendix B. First-class rates and minima provided by the western classification apply to automobiles between many points in western territory, but in many instances lower rates and more favorable minima are afforded by exceptions to the classification, and by specific commodity rates. On the date of the hearing a basis of 87 percent of first class applied generally in western trunk-line territory, and still lower commodity rates applied from many shipping points. From Minneapolis, Racine, Chicago, Ill., and Kansas City, Mo., to certain points in Minnesota, South Dakota, North Dakota, Wisconsin, Iowa, Nebraska, Missouri, Wyoming, Colorado, Kansas, Oklahoma, and Texas, for distances ranging from 123 to 1,050 miles the rates ranged from 24 to 87 percent and averaged 69 percent of the contemporaneous first-class rates; from points in official and western trunk-line terri