is still in force on fertilizer and fertilizer materials. These combinations are the sums of the proportionals, and not the local rates, to and from the river crossings. The combination rates between the North and the South have been higher than the scale prescribed in Fertilizers between Southern Points, 113 I. C. C. 389.

In the case last cited, herein termed the Southern case, distance rates were prescribed on fertilizers in southern territory over standard lines, with certain arbitraries accorded short or weak lines. In Ohio Farm Bureau Federation v. Ahnapee & W. Ry. Co., 146 I. C. C. 419, herein termed the Northern case, distance rates were prescribed on fertilizer and fertilizer materials in central territory. In the Northern case ammoniacal liquor was included for the first time among the articles listed as fertilizer materials. Sulphate of ammonia was included in the fertilizer materials list in both the Southern case and the Northern case. On October 5, 1929, southern carriers voluntarily placed ammoniacal liquor in the list of articles taking the fertilizer rates. Sulphate of ammonia and ammoniacal liquor are nitrogenous materials in active competition with tankage. Since March 16, 1931, rates on these commodities from Milwaukee and origins in central and trunk-line territories to southern destinations have been on the basis fixed in the Interterritorial case. These rates were prescribed to Helena, Ark., and stations in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, and Virginia in By-Products Coke Corp. v. Aberdeen & R. R. Co., 169 I. C. C. 126.

Rates to the Mississippi Valley on the basis prescribed in the Interterritorial case enable complainants to meet competition, but they say that to the remainder of southern territory the rates are not properly related to those on competing materials from Milwaukee and other origins in central and southern territories. They do not seek rates on tankage lower than the rates on sulphate of ammonia or ammoniacal liquor approved in the Interterritorial case. However, complainant Sewerage Commission would not be satisfied if the rates on fertilizer materials, both within the South and from Milwaukee to the South, were increased to the level of the rates on tankage now in effect from Milwaukee to the South. Intervener Armour Fertilizer Works also opposes increase of the rates on sulphate of ammonia and ammoniacal liquor to the level of the rates assailed. Fundamentally, undue prejudice can not exist unless the resulting injury will cease upon removal of the prejudice regardless of the manner of its removal. Duluth Chamber of Commerce v. Chicago, St. P., M. & O. Ry. Co., 122 I. C. C. 739, 742. In cases where parity has been sought only by reductions, we have regarded the allegation of

undue prejudice as withdrawn. Boise Payette Lumber Co. v. Abilene & S. Ry. Co., 146 I. C. C. 457, 462. No finding will be made on the allegation of prejudice and preference.

Defendants in central territory entered no appearance at the hearing. The Chicago and North Western Railway Company, which serves the points of origin considered, was represented at the hearing but offered no evidence. The southern carriers' defense is directed to a showing that the rates assailed were and are reasonable. They are willing, however, to put into effect for future application rates based on the scale prescribed in the Southern case, but the northern lines are unwilling to concur. The carriers in Florida are willing also to apply these rates for the future without the addition of any arbitraries. Defendants say that the scale approved in the Interterritorial case, if applied to the traffic involved would result uniformly in drastic reductions, and that to points in the Mississippi Valley it would produce higher rates from Milwaukee than were formerly in effect. From Milwaukee to Memphis, the rate prior to September 15, 1929, was $4.70; the present rate is $5.40.

Defendants contend that the so-called southern and northern scales were not fixed on a maximum reasonable basis. For this reason they object to interterritorial rates made less than the southern rates to reflect the more favorable transportation conditions in official territory, as was done in the southern class-rate revision. In the Northern case and in the Southern case, maximum reasonable rates were prescribed.

Defendants refer to the approximate average percentage relationship which the tankage rates from Milwaukee to certain representative southern fertilizer-manufacturing points bear to the contemporaneous first-class rates, as follows: Prior to September 15, 1929, 19.7 per cent; present rates 19.9 per cent; the so-called southern fertilizer scale, 16.5 per cent; Royster scale,2 19 per cent; and the so-called interterritorial scale, 15.9 per cent. The rates in the Southern case average 15.9 per cent of the first-class K-2 scale fixed in the southern class-rate revision. That scale, for distance blocks from 225 to 1,200 miles, inclusive, except the 250th-mile block, ranges from 16 to 16.4 per cent of the first-class K-2 scale. These comparisons indicate that the southern fertilizer and interterritorial scales, if extended for application to the southeastern territory, would approximate each other, at least mathematically, whereas weighted averages based upon actual revenue movement and referred to hereinafter show that a combination of the northern and southern scales

250 I. C. C. 34.

applied interterritorially is about the same as the interterritorial scale.

Rates on peat humus, a filler used in the manufacture of fertilizer, from Manito, Ill., to certain points in Georgia, Florida, and Alabama, were assailed in International Agr. Corp. v. Chicago & I. M. Ry. Co., 174 I. C. C. 507, and 179 I. C. C. 359. The rates assailed averaged 17.5 per cent of first class, as compared with 15.9 per cent under rates prescribed in the Southern case, 18.3 per cent under the Royster scale, and 15.4 per cent under the Interterritorial case scale. On reconsideration, the rates assailed were found unreasonable prior to September 15, 1929, to the extent that they exceeded the rates prescribed in the Southern case, and unreasonable on and after that date to the extent that they exceeded or might exceed the rates approved in the Interterritorial case. Similar conclusions were reached in Read Phosphate Co. v. Atchison, T. & S. F. Ry. Co., 182 I. C. C. 499, with respect to the rates on tankage, in carloads, from Milwaukee, Chicago, and Indianapolis, Ind., to Nashville, Tenn.

Defendants list the values and average car loadings of various commodities on which we have approved or prescribed rates based on percentages of first class, and compare these rates with the rates assailed. On only three of these commodities, viz, crude tar, cullet, and oyster shells, are the rates a lower percentage of first class than the rates on fertilizer in the South. While all of these articles are not directly comparable with fertilizer and fertilizer materials in point of carriage, it is claimed that the comparisons illustrate that fertilizer rates in the South and the assailed rates are very low.

The average revenue per ton-mile produced by the application of the interterritorial scale to a number of representative points to which there is an actual movement of tankage is 7.7 mills; the application of the southern fertilizer scale produces 7.9 mills per ton-mile; and on the basis of the northern scale the revenue earned per ton-mile is 7.3 mills. In the Northern case, division 3 stated that, notwithstanding the smaller volume of movement of fertilizer in central than in southern territory, the more favorable transportation conditions in general and the greater density of all traffic in the former territory warranted a somewhat lower level of rates on fertilizer in that territory than in the South.

The following comparisons give the car-mile and ton-mile revenue yields based on the rates assailed and the northern, southern, and interterritorial scales as applied to actual movements to the South, excluding points in southern territory to which rates are now based on the latter scale:

This indicates that the application of the weighted averages of the combined northern and southern scales to complainants' traffic would produce car-mile and ton-mile revenue approximately the same as, and in some instances slightly less than, the interterritorial scale sought.

We find that the rates assailed were unreasonable prior to September 15, 1929, to the extent that they exceeded the rates prescribed in the Southern case; and that on and after that date the rates assailed were, are, and for the future will be, unreasonable to the extent that they exceeded, exceed, or may exceed the rates and manner of constructing rates, found reasonable on fertilizer and fertilizer materials in the Interterritorial case. In computing reparation, rates should be determined in accordance with the formula prescribed in Prairie Pipe Line Co. v. Arkansas W. Ry. Co., 146 I. C. C. 149, as modified in Magnolia Petroleum Co. v. Chicago, R. I. & G. Ry. Co., 151 I. C. C. 795.

We further find that complainants and interveners made and received shipments as described, respectively, and paid and bore the charges thereon; that they were damaged thereby in the amount of the difference between the charges collected and those which would have accrued at the rates herein found reasonable; and that they are entitled to reparation, with interest. Complainants and interveners should comply with Rule V of our Rules of Practice. Complainants in Docket No. 25239 may also submit Rule V statements covering shipments received or made by them. Affidavit proof of paying or bearing of charges should accompany these statements. If defendants object to this method of proof, complainants may request further hearing. All parties to these two proceedings submitting Rule V statements should indicate thereon whether or not the shipments were routed by defendants. To the rates prescribed herein for application on and after January 4, 1932, may be added the present authorized emergency charges.

An appropriate order will be entered.

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AITCHISON, Commissioner, dissenting in part:

I dissent from this report so far as it awards damages based on the formula approved in the Magnolia Petroleum Co. case, 151 I. C. C. 795, and so far as it awards reparation on shipments which moved prior to March 16, 1931.

No. 25038

CHRIS LARSEN ET AL. v. DENVER & RIO GRANDE WESTERN RAILROAD COMPANY ET AL.

Submitted September 21, 1932. Decided January 11, 1933

Rates on cattle and sheep in carloads, from certain points in Utah on the lines of the Denver & Rio Grande Western Railroad Company to Los Angeles and Colton, Calif., found to have been unreasonable. Reparation awarded.

John G. Beaver, B. Elwin Bishop, and Richard T. Eddy for complainants and interveners.

J. M. Souby, J. A. Gallaher, A. S. Halsted, E. E. Bennett, and Edwards C. Renwick for defendants.

REPORT OF THE COMMISSION

DIVISION 3, COMMISSIONERS MCMANAMY, BRAINERD, AND LEE BY DIVISION 3:

Exceptions were filed by defendants to the examiner's proposed report. Our conclusions differ in one respect from those recommended by him.

1

Complainants by complaint filed February 6, 1932, allege that the rates charged on cattle and sheep, in carloads, prior to January 25, 1932, from certain points in Utah on the lines of the Denver and Rio Grande Western Railroad Company, hereinafter called the Rio Grande, to Los Angeles, Calif., were unreasonable.

Various persons intervened but at the hearing all except the Oehl Packing Company 2 withdrew from further participation in

1 Chris Larsen, an individual; National Packing Company, a corporation; and M. R. Hampton and W. E. Holaday, copartners trading under the name of Hampton Live Stock Commission Company, successors to M. R. Hampton, an individual trading under the name of that company prior to November 9, 1931.

2 A partnership composed of Conrad H. Oehl, Ernest J. Oehl, Herbert Oehl, Julius Oehl, and R. J. Oehl. Informal complaints embracing claims of this intervener were filed on January 11 and March 14, 1932.