In Stuttgart Rice Mill Co. v. Alabama & V. Ry. Co., supra, minimum differentials were prescribed, Stuttgart under Lake Charles, of 11 cents to Kansas City and 10 cents to Omaha. These differentials are at present observed from both interior Louisiana and Texas. The interior Louisiana and Texas complainants suggest that the differentials are too great. It is obvious, however, that they are no more than adequate to preserve to Arkansas the advantage of its geographical position in serving these markets.

From Arkansas, interior Louisiana, and Texas to certain points, such as Duluth, in western trunk-line territory the present rates on clean rice are somewhat higher than the column 27.5 rates prescribed in Consolidated Southwestern Cases, supra.

Finding 11.-We find, consistently with the conclusions reached in previous chapters of this report, that the rates on clean rice from Arkansas, interior Louisiana, and Texas to destinations in western trunk-line territory are, and for the future will be, unreasonable to the extent they exceed column 27.5 rates from and to the same points, subject to a carload minimum not exceeding 40,000 pounds.

RATES IN THE SOUTHWEST

In no. 23109 it is alleged that the rates from points in Louisiana, particularly Lake Charles, to points in Texas, are unreasonable under section 1, and in comparison with the lower intrastate rates from Texas mills to the same destinations are unduly prejudicial to Louisiana shippers and preferential of Texas shippers, in violation of sections 3 and 13.

Lake Charles is approximately 32 miles by rail from the Texas border and 37 miles from Orange, Tex. Prior to December 15, 1921, the rates from all rice-shipping points in Louisiana to nearly all points in Texas were made by combining the local rate of 34 cents from Lake Charles to Orange with the interstate rate from Orange to destination. In Lake Charles Rice Milling Co. v. Abilene & N. R. Co., supra, the rates from Lake Charles to destinations in Texas were found unreasonable to the extent they exceeded those from Orange by more than 7.5 cents. The rates established in purported compliance with that proceeding, subject to a reduction of 10 percent in 1922 and with some minor changes in 1925, are still effective. It is apparent from the following table, which shows the distances and rates from Lake Charles to important destinations in Texas, together with the column 27.5 rates under the southwestern revision, that to many points in Texas the present rates are excessive, even if allowance be made for the low minimum weight. The rates are subject to a 30,000-pound minimum:

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The last that shipments from Lake Chacies are subject to a minimum implainant's fear in siling further increased by

competition, the testimony being that at the time of hearing fully

50 percent of the tonnage of clean rice from mills in Texas to destinations in that State was moving by truck. On exceptions defendants say that further investigation after the hearing indicated that this estimate was too low and that they had lost fully two-thirds of the Texas traffic to their highway competitors. To meet this situation defendants have reduced the common-point rates within Texas for distances up to 310 miles, and to destinations more than 125 miles from any mill point they have applied the reduced rate, based on the mileage from the nearest mill, from all Texas mill points. Milling in transit is not permitted in connection with the reduced rates, but stopping in transit for partial unloading is allowed. No reductions were made in the rates from Lake Charles despite the fact that Lake Charles is nearer to many points in Texas than are the mills in that State. After the hearing in no. 23109, but before that in no. 26430, defendants also established reduced rates from all mill points in Texas and Louisiana to points in Oklahoma, in order to meet truck competition. Using Oklahoma City as a representative destination, alternating rates were established from interior Louisiana, including Lake Charles, and from the Texas mill points, of 46.5 cents, minimum 30,000 pounds, 42.5 cents, minimum 60,000 pounds, and 39.5 cents, minimum 80,000 pounds. These rates, however, were not made applicable from Louisiana points to destinations in Texas except to the extent necessary to conform to the fourth section.

Defendants explain their failure to establish truck-competitive rates from Lake Charles to Texas, by stating that complainant in no. 23109 omitted to show that any rice is moving from Lake Charles to points in Texas by truck. If, however, the recent reductions from Texas mills to points in Texas, as well as those from Lake Charles across Texas to points in Oklahoma, were due to truck competition, it is obvious that defendants encounter at least the same degree of truck competition in transporting rice from Lake Charles to Texas, especially as the shortest distance from Lake Charles to the nearest point on the Oklahoma border is 275 miles and only 32 miles to Texas. The record indicates a purpose on the part of defendants to place Lake Charles at an undue disadvantage and to favor the Texas mills on traffic to points in Texas, which purpose we find has been accomplished in disregard of sections 3 and 13 (4) of the statute. This situation should be corrected when the rates herein prescribed are published. Otherwise the matter may be again brought to our attention with a view to entering an appropriate order.

Another allegation in no. 23109 is that more liberal transit privileges are accorded in Texas to interstate shipments of rice originating in Texas than are granted in Louisiana on interstate shipments

vary considerably depending upon the length of the rail haul at either end. For example, from El Campo to Spartanburg, S. C., the rate is 52.5 cents, composed of a rail factor of 12.5 cents to Houston, a 20-cent water factor from Houston to Charleston, and a 20-cent rail factor beyond. The record is not clear as to whether port charges of 3.5 cents at Charleston are added to or absorbed in the rate. Treating 3.6 water miles as equivalent to 1 rail mile, complainant computes the distance from Houston to Charleston as 432 miles. The rail haul is 78 miles to Houston and 222 miles from Charleston, making the total distance 732 miles. The column 27.5 rate for that distance under the southwestern revision, treating only the initial 78 miles to Houston as in southwestern territory and the remainder of the distance as in the Southeast, is 59 cents, or 6.5 cents more than the present combination rate. From other origins to other destinations the existing combinations are likewise generally less than the singlefactor column 27.5 rates, similarly computed. The principal allegation of the Texas complainants against these rates, however, is not that they are unreasonable per se, but that they are relatively unreasonable and unduly prejudicial in comparison with the 41-cent allrail rate from Arkansas. It is doubtful, on account of diversity of carriers, whether a section 3 order would lie relating the rail-waterrail rates in question to the all-rail rates from Arkansas, but we need not determine the point, because it does not appear that Arkansas has an undue advantage. To Charleston, as to other south Atlantic ports, El Campo has a rate advantage of at least 7.5 cents over Stuttgart, and to interior points where Stuttgart has an advantage in rate, it usually has an advantage in distance.

Finding 7.-We find the rail-water-rail rates assailed not unlawful.

REQUEST IN NO. 26618 FOR JOINT RAIL-AND-WATER RATES

The interior Louisiana complainants allege, among other things, that the failure of the rail carriers and water carriers to establish joint rates for the transportation of products of rough rice from points in interior Louisiana through Lake Charles and "other Louisiana water points of shipment" to destinations in most of the States in the South and official territory, relatively adjusted to those from other points at which their competitors are located, is unreasonable and unduly prejudicial, in violation of sections 1, 3, and 15. They seek through routes and joint rates in connection with the Bull Steamship Line via Lake Charles. The answer of the Bull Steamship Line, then the Baltimore & Carolina Line, Incorporated, was that, while the absence of through routes and joint rates was un

lawful in the respects alleged, such absence was due solely to the refusal of its rail connections to join with it in establishing such routes and rates.

During the course of the first hearing in these proceedings (other than no. 23109) defendants pointed out that numerous allegations in the several complaints were so broad in character as to place them under difficulty in preparing their defense. They suggested that some arrangement or rule of procedure be adopted by which to bring the issues within workable compass. The presiding commissioner thereupon ruled that complainants would be expected to complete the presentation of their evidence in chief at that hearing, that any allegations in the complaints which were not supported by affirmative evidence at the conclusion of that hearing would be regarded as abandoned, that an adjournment would then be taken for a reasonable time to permit defendants to prepare their defense accordingly, and that at the adjourned hearing, following defendants' presentation of evidence, complainants would be permitted to introduce evidence in rebuttal only. The first hearing continued for five days after that ruling was announced, during which time complainants introduced no evidence in support of their request for through routes and joint rates in connection with the Bull Steamship Line.

At the adjourned hearing, which by written notice served on all parties was "for the purpose of receiving evidence in behalf of defendants and rebuttal", the Bull Steamship Line offered a petition of intervention in support of complainants' request for the establishment of joint rates and through routes in connection with its line, and asking for affirmative relief. The examiner permitted the intervention to the extent that it did not unduly broaden the issues. After defendants had completed the presentation of their evidence, a witness representing the Bull Steamship Line testified, over defendants' objection, in support of the request for joint rates and through routes in connection with its line. On brief defendants renew their objection to the admission and consideration of such evidence. We think the objection is well taken. In view of the ruling of the presiding commissioner, complainants must be deemed to have abandoned that part of their complaint by failing to introduce any evidence in support of it during the first hearing. The petition of intervention sought to reinject into the case an issue which had been removed, and constituted an undue broadening of the issues within the meaning of the Rules of Practice. We could not order through routes and joint rates established on basis of the testimony introduced, because defendants were surprised thereby and have not had their day in court.