Leaving the interest of that company entirely out of consideration, it must still be remembered that a considerable quantity of grain comes from sections east of the Missouri River, from which rates are not, on the average, much, if any, higher to St. Louis than to Kansas City, and may be actually lower, and also that by virtue of the fact that the proportional rate is the same from all Missouri River points to St. Louis, that market may own grain grown west of the Missouri River at a disadvantage which, as compared with Kansas City, is less than the full proportional rate. For example, if the grain originates at a point in Nebraska from which the rate is 6 cents to Omaha and 10 cents to Kansas City, the St. Louis merchant pays 15 cents for the transportation, as against 10 cents by the Kansas City dealer, producing a difference against St. Louis, not of 9 cents, but of 5 cents.

On the whole, we are of the opinion that rates 5 cents per 100 pounds lower on wheat and 4 cents per 100 pounds lower on corn and other coarse grains would be reasonable. This would produce a proportional rate from St. Louis of 13 cents per 100 pounds upon wheat and 11 cents per 100 pounds upon corn and other coarse grains. Apparently, although this was not gone into upon the hearing, the products of grain take the same rates into this territory as the grain itself, and the rates upon flour, corn meal, and other grain products should be correspondingly reduced from St. Louis.

We are also of the opinion that the present rates from St. Louis are unjust and unreasonable, and that the above rates, considered in and of themselves as proportional rates, would be just and reasonable, without special reference to competitive conditions at the Missouri River, and that they ought not to be exceeded for the future.

Little Rock contends that these rates from St. Louis ought not to be reduced because the merchants of that city have provided elevators for the handling of this grain directly from the field to customers in Arkansas territory. It states that the distance is much less from points of production west of the Missouri River by the direct line to Little Rock than it is via St. Louis.

This is undoubtedly correct, and upon the basis of the rates above suggested the combination via St. Louis will still be materially higher than via the direct line from the country station. Both Little Rock and St. Louis are entitled to a fair and reasonable rate and to do whatever business can be done upon such an adjustment. In our opinion the rates above suggested are fair to St. Louis; if those from the field to Little Rock are too high, they can be reduced after investigation by this Commission.

The territory in question was not very accurately defined upon the hearing, nor is it certain that exactly the same changes ought to be

applied in all portions of that territory. We shall accordingly treat Little Rock, Ark., as typical of the whole territory and issue an order applicable to that point alone, relying upon the defendants to readjust the balance of their rates in accordance with the views herein expressed. If that adjustment is not satisfactory to the complainants, the matter can be again brought to our attention either by further proceedings under this complaint or by the filing of a new complaint. It should be noted that no opinion is expressed upon the differential of 3 cents taken by Omaha above Kansas City into this territory, nor upon the reasonableness of applying the same proportional rate from all points upon the Missouri River to St. Louis, both of which matters were referred to by the Kansas City interests upon the hearing there, and have been again forcibly called to our attention in the brief filed by those interested.

13 I. C. C. Rep.

No. 1268.

HOLCOMB-HAYES COMPANY

v.

ILLINOIS CENTRAL RAILROAD COMPANY AND SOUTHERN RAILWAY COMPANY.

Submitted October 28, 1907. Decided December 9, 1907.

1. The Commission does not approve the practice whereby a carrier puts in rates with a clause under which they expire after a short time, for the purpose of enabling the Commission to do justice in a particular case. In order to prevent the discriminations which the act was intended to defeat, the Commission, in such cases, will hereafter require the rates to remain in effect for a definite period of time to be designated in the order.

2. Complainant is entitled to recover from defendants the sum of $3,071.56, as reparation for unjust and unreasonable charges on specified shipments of cross-ties made under the rates complained of in this case.

Charles L. Allen for complainant.

J. M. Dickinson, Ed. Baxter and Blewett Lee for Illinois Central Railroad Company.

Ed. Baxter and C. B. Northrop for Southern Railway Company.

REPORT OF THE COMMISSION.

HARLAN, Commissioner:

On the 1st day of December, 1905, the Tennessee Central Railroad, extending from Harriman Junction, Tenn., on the east, through Nashville to Hopkinsville, Ky., on the west, ceased to be operated as a separate and independent road, and was turned over under lease to the Illinois Central Railroad Company and to the Southern Railway Company, the former taking possession of that part of the line that lies west of Nashville, which is now known as the Nashville Division of the Illinois Central Railroad Company, while the Southern Railroad Company assumed control of that part that lies east of NashIville and is now known as the Nashville Division of the Southern Railway. This action was followed a few days later by a general notice canceling all through tariffs formerly in effect over the road whose separate existence was thus terminated.

When this occurred the complainant was engaged in filling a contract for the delivery of a large number of railroad cross-ties at Pawnee Junction, Bloomington, and Paxton, in the State of Illinois. Arrangements had been made for shipping the ties from points on the line of the Tennessee Central Railroad both east and west of Nashville. In view of certain provisions in the contract, the complainant could not delay the shipments without subjecting itself to a financial loss; and instead of waiting for a readjustment of rates to those destinations from the points in question, it was thought best to send the shipments forward under such rates as might still remain in effect. The shipments began to move during the latter part of November, 1905, and continued until February 6, 1906. From points on the new Nashville Division of the Illinois Central Railroad-that is to say, from points on the old Tennessee Central Railroad west of Nashville-2,431 cross-ties were shipped to Illinois destinations in 6 carloads; of these 1,000 ties in 2 carloads were billed to Bloomington and 1,431 ties in 4 carloads were forwarded to Pawnee Junction. From points on the new Nashville Division of the Southern Railway that is to say, from points east of Nashville-the complainant forwarded 8,711 cross-ties in 28 carloads to Pawnee Junction and 9.155 cross-ties in 26 carloads to Paxton.

The complainant alleges in its petition, which was filed on August 27, 1907, that the rates actually collected upon these shipments were unlawful in that they were excessive and unreasonable in amount. The record shows that on the 1,000 cross-ties shipped to Bloomington from points west of Nashville freight charges aggregating $200 were actually collected, being at the rate of 20 cents per tie. The complainant avers that the charges ought not to have exceeded 163 cents per tie. On the 4 carloads containing 1,431 cross-ties shipped from the same points to Pawnee Junction the defendants collected $257.58, being at the rate of 18 cents per tie. The complainant now insists that charges should have been collected on the latter shipments at a rate not exceeding 14 cents per tie. On the 8,711 cross-ties shipped from points east of Nashville to Pawnee Junction the total rate actually collected appears to have been an average of 37.9 cents per tie. On the 9, 155 cross-ties shipped from the same points of origin to Paxton freight charges were collected at rates from the various points of origin that average 35.58 cents per tie. It is to be inferred from the whole record that the rates actually collected were an overcharge; at any rate, an examination of the tariffs on file with the Commission reveals no basis for such average charges per tie. The complainant now insists that a reasonable rate on the shipments from points east of Nashville would not have exceeded 193 cents per tie. Its contention is based upon the allegation that shortly after these several shipments were made and the freight charges collected, as respec

tively indicated above, the rates were reduced by the defendants to the amounts mentioned in the complaint as the rates that ought to have been charged and collected. The prayer of the complainant is that reparation, amounting in the aggregate to the sum of $3,159.58, be awarded to the complainant on these shipments, that amount being the difference between the rates actually collected and the rates which the complainant alleges were subsequently put in effect by the defendants and are now in force, although, as will hereafter appear, they were not in effect for a long intermediate period.

When the case was called for hearing, counsel for the respective defendants admitted that the exhibits attached to the complaint correctly set forth the details with reference to all the shipments referred to in the complaint, and that they properly state the amount of freight charges actually collected. They also admitted, upon an examination of the whole situation, that the complaint was well founded. Upon stipulation and leave given, the defendants therefore withdrew their respective answers and submitted the cause to the Commission upon the complaint and exhibits attached thereto and upon the testimony of Mr. Holcomb, which was then taken. During the course of the hearing it was discovered that the rates of the defendant, the Illinois Central Railroad Company, from points on its new Nashville division to the destinations in question had not been changed since the date of the shipments. In the absence, therefore, of testimony showing the unreasonableness of those rates, there was no basis upon which the Commission might enter an order for reparation. For this reason the complainant withdrew its claim for reparation on the 6 carloads containing 2,431 cross-ties that moved from points west of Nashville. As to the 17,866 cross-ties in 54 carloads that moved to the destinations mentioned from points east of Nashville, it was understood at the hearing that reparation might be awarded on the basis of the lower through rate of 193 cents, which was established by the defendants from those points shortly after the shipments moved, by a tariff effective February 2, 1906. It was stated by counsel on the hearing that this through rate was still in effect. But upon subsequent investigation of the tariff schedules on file in the office of the Commission the fact was disclosed that the tariff naming this joint through rate was canceled in June, 1906, since which time no through rate had been in existence between the points in question. This condition of the tariffs was called to the attention of the officers of the Southern Railway Company. And by a tariff duly published and filed with the Commission, effective November 28, 1907, that company and the Illinois Central Railroad Company have now reestablished the joint through rate of 193 cents per cross-tie between the points in question, with a carload minimum of 250 ties.