ants contend that the ownership of property transported does not afford a proper basis for distinction in rates. They cite Interstate Commerce Commission v. Delaware, L. & W. R. 220 U.S. 235, which upheld our decision in Export Shipping Co. v. Wabash R. Co., 14 I.C.C. 437. There the carriers endeavored to prevent the application of the carload rates on less-than-carload shipments cullected by so-called forwarders from different consignors, combined them into carloads, and shipped the same in the name of the forwarding agent or the owner of one of the less-than-carload shipments, to one consignee, who might be the forwarding agent himself, another forwarding agent at destination or the owner of a part of the property transported. The consignee of the shipment, whoever he might be, received the carload and distributed its contents to the parties for whom intended. The Supreme Court said:

The contention that a carrier when goods are tendered to him for transportation can make the mere ownership of the goods the test of the duty to carry, or, what is equivalent, may discriminate in fixing the charge for carriage, not upon any difference inhering in the goods or in the cost of the service rendered in transporting them, but upon the mere circumstance that the shipper is or is not the real owner of the goods is so in conflict with the obvious and elementary duty resting upon a carrier, and so destructive of the rights of shippers as to demonstrate the unsoundness of the proposition by its mere statement.

In the instant proceedings defendants are making no contention such as that made in the case just cited. The rates which they apply were prescribed by us in the livestock investigation. The original contract of carriage has been completed in that the livestock has been delivered at the market, offered for sale and actually sold to another party. A new shipper then appears and a new contract for transportation to a destination beyond is entered. Defendants assert that since January 25, 1932, they have denied sale of livestock in transit at the midwestern markets and reforwarding therefrom at the balance of the through rate for various reasons stated in our report in the livestock investigation and not alone because of the ownership of the livestock. This position finds support in the language quoted.

Many representative producers of livestock testified as to the importance of the livestock markets, to the depressed condition of their industry, and to the tremendous reductions in prices, and expressed the opinion that some of this drop in prices in 1932 was due to the cancelation of the change in ownership privilege. Complainants and interveners urge upon us the desirability of affording the producers lower transportation charges and a greater freedom of markets through the general establishment of more favorable transit arrangements. They contend that if this is done producers will

realize higher prices due to a wider distributed flow of livestock and increased competitive bidding.

Much evidence was presented, particularly on behalf of the Denver, Ogden, Salt Lake City, and midwestern markets, to combat the statement in our original report in the livestock investigation that transit could not be adequately policed at the larger markets. Complainants urge that since the handling of livestock through the midwestern markets is practically identical with that through Denver and that where there are differences they are of a minor character, defendants should encounter no particular difficulty in policing the traffic to prevent unlawful mixing and misbilling at the public markets. Each carload is run into, and kept in, a separate pen generally from the time it arrives until it is delivered. The pens remain unlocked during the day but are locked at night and the animals are counted and receipted for the next morning. Many of them it is claimed are branded. Most of the men that look after the livestock are employees of the stockyard companies. Ordinarily they have no particular interest in the freight charges and would have nothing to gain by mixing the shipments, or by manipulation of billing. Commission firms found guilty of unethical conduct are severely dealt with by their organizations. It is to the interest of all parties operating at the stockyards to see that no crooked work goes on. Complete records are kept by the stockyard companies with respect to each carload while in their custody. Shipments can quite generally be traced from destination back to the point of origin by the records of the stockyards companies and carriers. Appropriate and satisfactory certificates as to the identity of the livestock and as to the length of time it has remained at the stockyards must accompany directions for reforwarding, and are subject to check against stockyard records. Complainants admit that occasional instances of improper conduct may be found, as in any line of business, but urge that no reason exists for fear that there would be much unlawful mixing or misbilling. It was conceded that the owners of livestock could go to the pens in which animals were held for them, transfer some to another pen containing other animals belonging to them, and that the only check was to see that they actually belonged to the person in question. Further that there was nothing to prevent the owner so mixing shipments if it were to his interest to do so. It was further admitted that trucked-in animals, at least at some points, are kept in the same part of the stockyards as rail receipts.

Defendants urge that the policing could not be done without prohibitive expense. They point to the large slaughter of livestock at most of the principal markets, the great supply of inbound billing thus made available for use on outbound shipments, the increasing

movement into the markets by truck, the fact that much of the livestock is not branded, that often only an expert can locate and recognize brands, that the records kept are primarily for the protection of the producer, the stockyard companies and commission firms rather than the carriers, and are not designed to protect freight charges. Defendants hesitate to rely upon the certificate of the forwarder and the records at the stockyards. While they can examine and check stockyard records to the extent that their time and office force may permit, they cannot, as a practical matter, watch the physical operations at the stockyards with respect to each carload to see that there is no clandestine mixing. They fear that shipments from different parts of the country may be surreptitiously mixed and local or trucked-in livestock substituted to make up especially attractive carloads and then shipped out for resale on the basis of the through rate, without any record of the operation appearing in the books of the stockyard companies, thus depriving them of from $20 to $70 per car in freight charges. They would not run these risks after shipments were bought by packers for slaughter, because there would generally be no reason for mixing the animals after they were sold. Their fears relate principally to shipments which have passed over the scales and gone into the actual or constructive possession of traders and speculators. These operators ship considerable quantities. When sale-in-transit arrangements were available at the midwestern markets several years ago a large percentage of the shipments from traders and speculators went out at the balance of the through rate. Defendants contend that this record confirms our conclusions in the livestock investigation that there are possibilities of abuse at the large markets and that, if transit were established, they would encounter the difficulties to which we there referred. They stated that, under present rules, very little difficulty is experienced where shipments are consigned to regular commission firms and are sold to an order buyer or to a packer for forwarding, and that the same was true prior to January 25, 1932. It is necessary only to establish definitely, after a shipment has been offered for reforwarding, that no sale has been made. This can be determined by a check of the commission firm's record of sale against the invoice of the order buyer, or packer; and when the number of head, weight, and price agree, it is felt safe to assume that no change in identity has taken place. However, it is claimed that even under present rules and also prior to January 25, 1932, they do, and did, have difficulty in policing shipments of the traders or speculators who operate quite extensively at the public markets. Where shipments are sold to, or consigned to, traders or speculators who take complete possession thereof, no check can be

made, for the reason that no records are kept of weights or anything else. No specific instances of violation were cited, but defendants point out that, since they have no means of verification, the certification by the shipper must be accepted. At Denver no particular difficulty is experienced in policing the transit arrangements. Some cases of misuse of billing have been found, but very few that might be termed willful violations. The opinion was expressed that the more liberal the rule, and the fewer the things which are forbidden, the less liability there is of violation.

Complainants urge that the privilege of change of ownership is of material benefit to the producers, in that it encourages buyer competition at the markets which results in higher prices; that if producers elect to seek the greater competition available at Chicago there is danger of glutting the market at that point which would depress livestock prices and react to the serious disadvantages of the shippers to all markets; that the denial of the privilege results in increased direct buying, thus avoiding the markets altogether, and also in increased movement by truck. There was much detailed testimony to the effect that buyers might, if necessary to secure livestock which they particularly desired, pay more for that which had through billing available; that the entire benefit of such increased price might be passed on to the producer or split between the producer or the person for whom the livestock was bought, and that the present arrangements at Denver are necessary and beneficial to the producers and should be extended to all markets. Various exhibits were offered to show that the percentages of truck receipts to the total were greater at the complaining markets than at Denver, which it is claimed is due to the privileges available at Denver and denied. to the other markets, and that the extension of the same privileges to such markets would bring back traffic to the rails. As is well known, there has been a tremendous increase in truck receipts at the various markets in recent years, and this was true during the time sale in transit was available at the complaining markets. It is pointed out that the present rates on livestock are much in excess of those prescribed by us prior to 1918, whereas the values of livestock are considerably lower.

Complainant in no. 25123 seeks broader transit arrangements on all kinds of livestock, particularly the establishment of the so-called concentration arrangements on hogs. In 1923, approximately 76 percent of the hogs slaughtered under Federal inspection were purchased at public-market stockyards, less than 24 percent coming from other sources, including the points at which the privileges it seeks now to obtain applied, whereas, in 1931, only 58 percent was pur

chased at the public markets and some 42 percent procured from other sources. This, it is contended, causes buyers either to refrain from bidding at the public markets at all, or else not to enter the market until late in the day, thereby preventing general competition and depressing prices. It urges that if the arrangements whereby livestock may be sold in transit at these country points and be reforwarded therefrom on the basis of the lowest through rates are reasonable, it is unreasonable to deny the same privilege to its market. On hogs stopped at National Stock Yards, sold, and reforwarded to New York, for example, the combination of locals apply which are in every instance at least 6 cents higher than the proportional rates applicable on like shipments concentrated at country points and moved by way of the National Stock Yards but which the shipper does not order stopped. The latter shipments are frequently taken into the stockyards by the carriers for feed, water, and rest under the 28-36 hour law, During 1932, about half of the livestock traffic moved out of East St. Louis by the Pennsylvania Railroad Company had been thus stopped by the carriers themselves. It is asserted that in such instances the services performed are practically the same as when the shipments are stopped at the direction of the shipper, sold, and reforwarded, and that on shipments not stopped at all the only differences are the switching into and out of the stockyards. However, when shipments are stopped at the market for feeding and rest, this is at the option of the carrier and the shipment never passes out of its control. This is not true as to livestock which has been delivered to the consignee who takes complete possession thereof and is responsible therefor. Receipts of livestock at National Stock Yards in 1932, with the exception of sheep, decreased considerably, notwithstanding the fact that there was not only an increased supply, and a heavier slaughter of hogs in 1932 than in 1931. These declines complainant attributes to the inability of producers and shippers to sell their livestock at National Stock Yards and move to ultimate destination at the lowest charges applicable to through movements.

On traffic by way of Chicago which the shipper does not direct be moved into the stockyards at that point, the proportional rates are likewise lower than on shipments going into the stockyards, there sold and reforwarded. The Chicago complainant takes the position that livestock can be handled through the Chicago Stock Yards at no greater expense than shipments moved into and out of competing public or country markets. To establish this it is shown that livestock originating at certain points could be moved out of line, for example, through Denver, there sold and reforwarded to points be