whether a large dealer or a small dealer, to any such destructive disadvantage."

8754. Services to large shippers and to small shippers practically identical.

Moreover, the services to large shippers and to small shippers are practically identical. The large shipper sends more carloads in the aggregate than the small shipper, it is true; but it makes no real difference whether a railroad takes two cars from A or one car each from A and B. And it is plain that to carry two barrels of sugar for one person on a given date, and to carry one barrel of sugar for another person, between the same points, over the same route, two days later, are contemporaneous, and like services. The argument may be pressed further: It is not in the least certain that the shipper who furnished the largest aggregate tonnage during the year may not have shipped in the most irregular way in the most inconvenient quantities. There is, therefore, nothing to differentiate the services performed for a large shipper in comparison with a small shipper. In Kinsley v. Buffalo, New York & Philadelphia Railroad Company 10 this was well argued in granting a petition of one Couper alleging that there had been illegal discrimination against him by the receiver of a railroad then operated under the control of the court. It was said per curiam: The petitioner seeks to obtain reimbursement from the receiver of the sum of $478.44, with interest from April 3, 1887, which he alleges was unlawfully exacted from him as and for freights for the transportation of oil upon the railroad in the custody of the receiver. The exaction of this sum is admitted, as is also the fact that a less rate was charged to another shipper of oil upon the railroad. This charge is justified by the master upon the ground that the quantity of oil shipped by another shipper

9 United States v. Tozer, 39 Fed. 369 (1889).

10 37 Fed. 181 (1888).

was much larger than that shipped by the petitioner, and hence that the larger proportionate expense attending the handling and transportation of the smaller shipment warranted a higher rate than was charged for the larger shipment. In this conclusion we do not agree with the learned master. It does not differentiate the service performed for the several shippers, nor the conditions or circumstances under which it was performed. The only difference is that in one case the quantity shipped was larger, and in the other case it was smaller. This has been repeatedly held to be an insufficient and unwarrantable reason for discriminating rates of charge.11

755. Reductions to passengers in parties.

Reductions to passengers in parties can only be justified if there is a difference in the cost of service. Thus such reductions were held by the Interstate Commerce Commission12 to forbid granting a special reduced rate to all persons traveling in parties of ten or more. The Commission ruled that the selling of "party rate" tickets was not within any of the discriminations specifically excepted and allowed by section 22 of the Act, gave no effect to the fact that the discrimination created new business and was not between competitors, held that equality of treatment of every person must be preserved and stated that "It is difficult to see how this individual equality is preserved when in a carload, say of nineteen persons, all starting from the same point and having the same destination, ten of them pay two cents per mile each, and the other nine three cents." The Supreme Court,13 however, rightly held that conveying one person singly and conveying him as one of a party of ten did not constitute like services, "under substan

11 Citing Hays v. Pennsylvania Co., 12 Fed. 309 (1882).

12 Pittsburg. C. & St. L. R. Co. v. B. & O. R. Co., 2 Int. Com. Rep. 729, 3 I. C. C. Rep. 465 (1890).

13 Interstate Com. Com. v. B. & O. R. R., 145 U. S. 263, 12 Supp. Ct. 844 (1895).

tially similar circumstances and conditions," that the making of a lower rate per capita for party rate tickets was a due and reasonable preference and not unlawful discrimination. In delivering the opinion of the court in the case last referred to, Mr. Justice Brown said: "Whether these party

rate tickets are commutation tickets proper, as known to railway officials, or not, they are obviously within the commuting principle. As stated in the opinion of Judge Sage in the court belows: The difference between commutation and party rate tickets is that commutation tickets are issued to induce people to travel more frequently, and party rate tickets are issued to induce more people to travel. There is, however, no difference in principle between them, the object in both cases being to induce travel without unjust discrimination, and to secure patronage that would not otherwise be secured.'

"In order to constitute an unjust discrimination under section 2 the carrier must charge or receive directly from one person a greater or less compensation than from another, or must accomplish the same thing indirectly by means of a special rate, rebate, or other device; but, in either case, it must be for a like and contemporaneous service in the transportation of a like kind of traffic, under substantially similar circumstances and conditions. To bring the present case within the words of this section, we must assume that the transportation of ten persons on a single ticket is substantially identical with the transportation of one, and, in view of the universally accepted fact that a man may buy, contract, or manufacture on a large scale cheaper proportionately than upon a small scale, this is impossible."14

14 Refusing the party ticket rate to the United States Government for the transportation of soldiers in parties numbering ten or over has properly been held, in United States v. Chicago & N. W. Ry. Co., 127 Fed. 785 (1904), not to be unlawful discrimination, as the conditions surrounding such transportation were found to be different from those of ordinary parties; the government not paying in advance was one reason.

TOPIC CREBATES TO EXCLUSIVE SHIPPERS.

§ 756. Whether lower rates may be made to exclusive shippers.

The advantages which may accrue to the railroad company if it may make lower rates to those who will ship by it exclusively are plain and this policy would largely prevail in making rates between competitive points doubtless if it were not for the recognition of its essential illegality. That such a policy may be advantageous to the company which employs it may be granted, but it has already been seen that those who conduct a public employment must forgo many methods of getting business and holding it which are permissible in private affairs. The chief argument made in favor of such specially lower rates to those who will ship exclusively is to say that there is in reality no personal discrimination in such an arrangement when it is open to all who choose to conform to the condition. But this is as inconclusive here as it is when used in support of other kinds of discrimination between different shippers, for if the condition is one which it is inconsistent with public duty to impose, there is no legal justification for any departure from equality of rates to all who ask the same transportation for like goods. 2

1 See Chapter X, supra.

2 By the general rule it would seem to constitute illegal discrimination to give rebates to exclusive shippers.

United States-Menacho v. Ward, 27 Fed. 529, B. & W. 372 (1886); Bigbee & W. R. P. Co. v. Mobile & O. Ry. Co., 60 Fed. 545 (1893).

Alabama-Mobile v. Bienville Water S. Co., 130 Ala. 379, 30 So. 445, B. & W. 417 (1901).

Indiana-Louisville, E. & St. L. Con. R. Co. v. Wilson, 132 Ind. 517, 32 N. E. 311, 18 L. R. A. 105 and note (1892).

Missouri-McNeer v. Mo. Pac. Ry., 22 Mo. App. 224 (1886).

New Jersey-Messenger v. Pennsylvania R. R., 7 Vroom (36 N. J. L.), 407, 13 Am. Rep. 457, 8 Vroom (37 N. J. L.), 531, 18 Am. Rep. 754, B. & W. 357 (1874).

North Carolina-Hilton Lumber Co. v. Atlantic Coast Line, 136 N. C. 479, 48 S. E. 813 (1904).

8757. Shippers who use rival lines must not be charged more than usual rates.

It would seem to be plainly contrary to public duty for a common carrier to charge shippers who at times employ a rival carrier in their shipments more than the usual rates which other shippers are charged. Yet this sort of discrimination has been defended before the courts more than once even in its most extreme forms. The leading case on this point is undoubtedly Menacho v. Ward,3 the facts of which it is necessary to state rather fully. It was alleged by the complainant that the defendants had announced generally to New York merchants engaged in Cuban trade that they must not patronize steamships which offered for a single voyage, and on various occasions when other steamships had attempted to procure cargoes from New York to Havana had notified shippers that those employing such steamships would thereafter be subjected to onerous discriminations by the defendants. The defendants alleged in their answer to the bill, in effect, that it has been found necessary, for the purpose of securing sufficient patronage, to make differences in rates of freight between shippers in favor of those who will agree to patronize the defendants exclusively. Within a few months before the commencement of this suit two foreign steamers were sent to New York to take cargoes to Havana, and the complainants were requested to act as agents. Thereupon the complainants were notified by the defendants that they would be "placed upon the black-list" if they shipped goods by these steamers, and that their rates of freight would thereafter be advanced on all goods which they

Ohio-Scofield v. L. S. & M. S. R. R., 43 Ohio St. 571, 3 N. E. 907, 54 Am. Rep. 846 (1885); Brundred v. Rice, 49 Ohio St. 640, 32 N. E. 169, 34 Am. St. Rep. 589 (1892).

But see Lough v. Outerbridge, 143 N. Y. 271, 38 N. E. 292, 42 Am. St. Rep. 712, 25 L. R. A. 674, B. & W. 380 (1894), and Fitchburg R. R. v. Gage, 12 Gray (Mass.), 393, B. & W. 354 (1859).

327 Fed. 529 (1886).