Mr. FERGUSON. I do not know that it is set out in express terms. I would have to refer to the contracts.

Mr. ADAMSON. They are so used?

Mr. FERGUSON. Yes, sir; I think the contracts contemplate that. Mr. MANN. The icing of these cars is necessary, is it not, in order to carry on this interstate commerce?

Mr. FERGUSON. Without the icing of those cars it is in no sense transportation.

Mr. MANN. It is one of the necessary agencies?

Mr. FERGUSON. Yes, sir.

Mr. MANN. And in that sense it is a part of interstate commerce? Mr. FERGUSON. Yes, sir.

Mr. STEVENS. And it is only one contract you make- -one contract covers everything? For example, you buy strawberries in Arkansas; you make one contract for carriage from the Arkansas shipper to parties at Duluth?

Mr. FERGUSON. Yes, sir.

Mr. STEVENS. And that includes all of the agencies for delivering the goods to the consignee in the proper condition?

Mr. FERGUSON. We always supposed so, but according to later-day railroad doctine it does not.

Mr. DAVENPORT. A suggestion was made, and an inquiry put, that the icing of the car is a necessary facility in the transporting of freight. Is the furnishing of the ice, putting the ice in the car, any different from that of supplying coal to the carrier for its locomotives, and putting it in a car or other appliance which the common carrier may require?

Mr. FERGUSON. To my mind it is a necessary part of the service, as a whole, just as coal is.

Mr. DAVENPORT. And in the same relation legally?

Mr. FERGUSON. Legally; yes.

Mr. DAVENPORT. It has the same legal relation?

Mr. FERGUSON. Yes, sir.

Mr. MANN. I am afraid you have not been well advised, then.

Mr. FERGUSON. That is my own conclusion; do not charge it to my attorney. I had reference to that being a part of the transportation duty, and without the performance of it it would be impossible to transport.

Mr. MANN. The purchasing of coal by a railroad for its own use in an engine, and the purchasing of ice to put in a car, necessary to the carrying of particular freight, are entirely separate propositions.

Mr. FERGUSON. I did not understand that was the question. I thought it was with reference to the work of putting it in. I do not think that the question of icing itself has been passed upon by our higher courts. But I think the question has been before the courts in other cases, the question has been fairly up. For instance, there is the Stockyards case.

Mr. STEVENS. We have those cases here.

Mr. FERGUSON. I think it is the Keeth case, where the railroad company attempted to delegate to a private corporation the right to own and operate stock yards through which all competitors must discharge their cattle, and that company imposed such charge as it might see fit for that service. I think the court held that it was contrary to law and ordered the contracts canceled, notwithstanding the showing

was that a large amount of money had been invested in those stock yards.

The same plea of property rights was made in that stock-yards case as is made in the case of the car lines with respect to legislating away their rights to use these cars. I do not for a moment believe that property would be confiscated. I think that question would settle itself very quickly between the carriers and the car lines. I think if the use of these cars was prohibited by law, that, inasmuch as they are good business men, they would get upon some common ground and bargain for the sale of those cars.

Mr. ADAMSON. Do you not think it would be better and fairer, if they were useful at all, instead of outlawing them-destroying themto regulate them?

Mr. FERGUSON. I think that is an absolute impossibility.

Mr. ADAMSON. You have three now running upon the same lines; you have the passenger car and the express car and the Pullman car. Why not add a fourth?

Mr. FURGUSON. They are engaged in a little different line of business, and in this case here the second common carrier becomes a merchant; it is essentially the same thing as the railroads of this country becoming the merchants and fixing the rate for independents.

Mr. ADAMSON. You understand we are not depending upon the act to regulate commerce for our authority, but upon the article of the Constitution that authorizes Congress to regulate commerce between the States, which applies to a jew peddler or a yoke of steers as it does to the trains; we can regulate anything that does that, no matter what it is or who it is.

Mr. FERGUSON. In my opinion such a remedy would in a very short time result in a monopoly. I think it must result in a monopoly, a monopoly of the instrumentalities of carriage. I do not believe that is wanted, and I think the same system would spread and continue until it absorbed all of the equipment of the carriers.

Mr. ADAMSON. You say you have a monoply now. We might give you a better monoply.

Mr. FERGUSON. We have not a monopoly in respect to all territory; here and there there is a free corner left.

STATEMENT OF MR. GEORGE B. ROBBINS, OF CHICAGO, PRESIDENT OF THE ARMOUR CAR LINE AND DIRECTOR IN THE ARMOUR COMPANY.

Mr. ROBBINS. Mr. Chairman and gentlemen, I have here a few notes that I have prepared, which perhaps it would be best for me to follow. The CHAIRMAN. Suit your own convenience.

Mr. ROBBINS. I wish to be understood in what I may say on the subject of private car companies to refer particularly to refrigerator cars, which comprise nearly or quite 70 per cent of the total number of private cars in use, and still more particularly to the equipment of the Armour car lines.

I have been in active charge of this branch of the Armour business since the early days of refrigerator cars, and a brief statement of their necessity and the development in the various industries dependent thereon may lead to a more intelligent understanding of the business in which private car companies are engaged.

Prior to twenty years ago suitable cars were not obtainable, and their building by private companies was encouraged by the railways, and from that time to the present they have continued to do so, particularly for packing-house products, fruit, berries, etc., recognizing that the service required is of a special character, necessitating expensive equipment, extensive icing facilities, and a large organization all over the country.

When the building of special fruit cars was first contemplated by the Armour interests it was a grave question whether the regularity of the crops year in and year out would justify embarking in the enterprise; and the phenomenal increase in the shipment of fruit, berries, etc., during the last ten years is largely due to the introduction of an ample supply of special refrigerator cars, which, under careful supervision and systematic refrigeration, has widened the distribution of such products by constantly improving methods in this special service. Indeed, the railroads and growers generally welcomed the advent of suitable cars and service with which to get their products to market.

No one else appeared with the courage, even under exclusive contracts with the railroads, to take the chances of building sufficient cars, from time to time, to keep abreast of the berry and fruit business, and put a stop to the enormous losses theretofore experienced by both the growers and the railroads from lack of sufficient and suitable cars. The private car companies, owners of special cars, furnish them to the railroads at a rental, generally of three-fourths of a cent per mile run for refrigerators, and no charge whatever is made against the shipper for their use, the railroads charging only their regular rates for transportation of the contents, the same as if the roads furnished their own cars. The rental therefore is a matter between the railroads and the car companies and does not affect the shipper or the public.

The great majority of shipments requiring refrigeration (berries, fruit, etc., in particular) are ordered refrigerated by the shippers; the car companies supervise the loading and stripping and furnish the local initial icing, and reice the cars as required at established stations.

Contrary to the general impression, therefore, private car companies are not engaged in transporting any commodity of commerce, nor are they engaged in any interstate business in furnishing ice at fixed local points, any more than the coal company furnishing coal to the locomotive hauling a train of interstate freight.

A good illustration of the distinction between shipments refrigerated and those not refrigerated is the orange business from California, consisting of from 25,000 to 30,000 carloads annually. About half the shipments are started under ventilation without ice, and when the thermometer falls below the freezing point the ventilators are closed and cars used for protection against frost. The railroads pay the car company all rentals for such cars and no charge is made against shippers. When the season advances and the orange becomes ripe or puffy and shippers order cars refrigerated, the car company furnishes the initial ice and the reicing at fixed local points along the lines of the railroads in the different States where it has icing stations, and a refrigeration charge is made therefor.

Equipment is parked in advance for business in widely separated parts of the country at different seasons, with consequent delays and idle cars. It is a well-known fact that the fruit and berry crops origi

nate in small sections or localities at widespread points throughout the United States, and mature at different times of the year, and when matured and ready for market, must be moved promptly, the shipping season lasting generally only a few weeks. For example, the peach crop of Georgia for the year 1904 consisted of over 5,000 carloads, which were moved by the railroads in our cars to distant markets, the harvest season lasting only about six weeks. About 4,000 of these individual special refrigerator cars were required by the railroads to handle that crop. For the local service that was required in loading, stripping, and icing these cars by our company, a force of upward of 50 agents and inspectors, in addition to laborers, was required.

The estimated crop in Georgia last year was 4,000 cars. On that estimate an adequate supply of ice was arranged for in advance, and not until the crop was moving was it found that the estimate was far short and a thousand cars more than estimated were offered and taken care of. To meet this situation ice had to be shipped from Lake Erie in train-load lots at great additional expense but without change over our published charges for refrigeration.

Mr. STEVENS. What do you mean by published charges?

Mr. ROBBINS. We publish a regular refrigeration charge. I will take that up now, or come to it later.

Mr. STEVENS. If you will come to it later, it will be all right. Mr. ROBBINS. Another example is Michigan, where in an ordinary year 3,000 carloads of peaches are moved by the railroads in our cars in the space of six weeks. This requires about 2,000 individual special fruit-refrigerator cars.

One

In North Carolina last year we refrigerated some 3,000 cars of strawberries within a month, or an average of 100 cars per day. of our principal ice-storage houses in that district burned at the opening of the season, and we bought ice at distant points at greatly increased expense for freight and shrinkage without advancing the charge to shippers.

In Idaho last season our ice house at Payette burned, and in some cases we were unable to obtain supplies for initially icing cars, and claims for large amounts have been received from shippers for damages from unavoidable causes.

Even with our facilities for doing business in every State in the Union, Mexico, and Canada, we are likely to have several thousand cars idle during part of the winter season, as comparatively little fruit is maturing at that time.

Then again, it often happens that the fruit crop is cut short or practically ruined by excessive rains, windstorms, or frosts, after the necessary cars have been packed, and sometimes iced, for the movement of the business. I might go on and cite other examples, but these seem sufficient to illustrate the hazards and vicissitudes of the business.

The refrigeration charges to the public are based on cost of ice, supervision, etc., together with a reasonable addition thereto for general expenses, claims, contingencies, and profit, and are as low as consistent with first-class service. These charges are printed and distributed freely among shippers and railways.

Here is a sample of one of our tariffs. They are sent out as widely as possible. There is nothing secret or private about them. Our district offices are furnished with a full supply, and anybody can have them on application, either to our district offices or to our home office.

Mr.

Ferguson referred to being unable to get refrigeration rates at St. Paul. I do not see anything out of the way about that. Duluth is not an originating point for fruit, and naturally nobody there has a tariff. If he applied to our district office or to our home office he would have had a refrigeration tariff by return mail; they would have been only too glad to have sent him one.

Mr. STEVENS. I understood that he applied to the local office of the railroad company and they could not obtain them.

Mr. ROBBINS. I do not think that was the proper place to apply. The rates to Duluth are not posted there.

Mr. STEVENS. He could not seem to obtain by telegraph the information he desired.

Mr. ADAMSON. I am afraid you are laboring under a minimized impression of the importance of Duluth, which you would not have if you would read Proctor Knott's speech on Duluth.

Mr. Escн. You not being a common carrier of course do not feel that it is incumbent upon you to publish your rates for that service? Mr. ROBBINS. No; I do not know that there would be any objection, but we have not done so. With one or two exceptions, I have not heard of any complaint of our not doing so. If we filed them at Washington or in our focal depot I dare say this complainant would not find the tariff in that case.

Mr. STEVENS. When do you make out these tariffs?

Mr. ROBBINS. The current tariff, as shown on its face, is good for the season only, and we generally make them up during the winter and spring for the coming season.

Mr. ESCH. Do they fluctuate much from year to year?

The

Mr. ROBBINS. No; they never advance; they sometimes are reduced. In our contract with the railroad companies we generally figure out what is a fair rate, considering all conditions, and we specify those rates in our agreements which shall not be exceeded, and frequently we have made reductions in those rates voluntarily. I can quote you cases of that, if you like. In Georgia, for example, previous to 1898 there were about five different car lines operated in that State. rate of refrigeration was $90 a car to New York. Beginning with 1898 we made an exclusive contract with the Central of Georgia Railroad to furnish all their cars, in consideration of which we made the rate $80. In 1901 we voluntarily reduced the rate to $68.75 a car, because the volume of business had grown a little larger and we were able to get a little cheaper ice. Further, in that connection, in California, which is the largest fruit-producing section in the country, turning out as it does 30,000 to 40,000 acres of fruit a year, previous to the time we operated the rate, for example, from Sacramento to Chicago was $125 a car

Mr. MANN. The rate for icing, you mean?

Mr. ROBBINS. The rate for icing. When we made that contract, which was the time we entered the business, we reduced the rate to $90, a reduction of $35.

Mr. STEVENS. Under an exclusive contract?

Mr. ROBBINS. Under an exclusive contract, on the theory that we or anybody else could do the business more cheaply when one company was handling it all than if it was distributed among several companies. Previous to that time there had been three or four different companies operating from California. In 1899 we reduced the rate