NOBLES No. 924. BROTHERS GROCER COMPANY; MORROWTHOMAS HARDWARE COMPANY, SUCCESSORS TO SPRINGFELLOW-HUME HARDWARE COMPANY; WHITE & KIRK; AMARILLO HARDWARE COMPANY; AMARILLO COLD STORAGE COMPANY; AND E. R. ROACH DRUG COMPANY v. FORT WORTH AND DENVER CITY RAILWAY COMPANY; COLORADO & SOUTHERN RAILWAY COMPANY; SOUTHERN KANSAS RAILWAY COMPANY OF TEXAS; ATCHISON, TOPEKA & SANTA FE RAILWAY COMPANY; PECOS & NORTHERN TEXAS RAILWAY COMPANY; PECOS VALLEY & NORTHEASTERN RAILWAY COMPANY; CHICAGO, ROCK ISLAND & GULF RAILWAY COMPANY; AND CHICAGO, ROCK ISLAND & PACIFIC RAILWAY COMPANY. Submitted June 7, 1907. Decided June 24, 1907. 1. Original complaint herein was mainly directed to the claim that Amarillo, Tex., should be made a Texas common point, but one paragraph alleged unreasonable rates from points without the State of Texas to Amarillo, and complainants attempted to show upon the hearing under this paragraph that certain specific rates were too high: Held, That the complaint should have explicitly directed attention of defendants to the rates which were to be put in issue and passed upon by the Commission, and that therefore the testimony offered was inadmissible. Complainants allowed to amend complaint and defendants given opportunity to introduce further testimony upon the issues thus made. 2. Competition between carriers from producing points in the Middle West and the Atlantic Seaboard over the right to serve different portions of the State of Texas was finally adjusted by making the rates to all parts of the commonpoint territory the same, with a few exceptions; but Amarillo, situated in the Pan Handle of Texas, 142 miles north and west of Quanah, the last commonpoint station of one of the defendants, does not properly fall within the competitive lines, and therefore complainants' contention that Amarillo should be placed in Texas common-point territory should not be sustained. 3. It appears in this case that a certain defined territory in the northern part of Texas, commonly known as the Burnt District, takes from Kansas City and other Missouri River points lower rates than are made to the balance of the State, in recognition of greater proximity to these Texas points; the class rates from Kansas City to Fort Worth, representative of the Burnt District, are higher than from Kansas City to Amarillo, though Amarillo is less than the average distance to the Burnt District; and that the Santa Fe System is rebuilding its road to Amarillo, which will soon be situated upon its main line: Held, That the present class rates from Kansas City to Amarillo are unreasonable and unjust and that the commodity rates between said points should not exceed those from Kansas City to Fort Worth; but that the class rates from St. Louis to Amarillo may properly be higher than from St. Louis to Fort Worth. J. W. Veale and S. H. Cowan for complainants. M. A. Low and E. B. Peirce for C., R. I. & P. Ry. Co. and C., R. I. & G. Ry. Co. Robert Dunlap, Gardiner Lathrop, and A. A. Hurd for A., T. & S. F. Ry. Co.; So. Kans. Ry. Co. of Texas, Pecos & N. T. Ry. Co., and Pecos V. & N. E. Ry. Co. Spoonts, Thompson and Barwise for Ft. W. & D. C. Ry. Co. REPORT OF THE COMMISSION. PROUTY, Commissioner: The complainants are merchants doing a wholesale and retail business at Amarillo, Tex., and the defendants are engaged in the transportation of the commodities in which they deal between Amarillo and various points within and without the State of Texas. The original complaint was mainly directed to the claim that Amarillo should be made a Texas "common point." One paragraph, however, alleged that the rates imposed by the defendants from points without the State to Amarillo were unjust and unreasonable, and the complainants attempted to show upon the hearing that certain specific rates were too high, claiming the right to do so under this paragraph. The Commission was of the opinion that the complaint should explicitly direct the attention of the defendants to those rates which were to be put in issue and passed upon by the Commission, and that therefore the testimony offered was inadmissible under the original complaint; but the complainants were allowed upon the hearing to amend their complaint by charging that the class rates from Kansas City to Amarillo and from St. Louis to Amarillo were unjust and unreasonable, and that the rate on coal from the Colorado fields to Amarillo was unjust and unreasonable. The defendants were informed at the time the amendment was allowed that they would be given opportunity to introduce further testimony in the future if they were not prepared to fully try the case upon the issues thus made. It appeared, however, that the Santa Fe and Rock Island systems, which were mainly interested in the rates whose reasonableness was thus put in issue, were represented both by counsel and by witnesses from the traffic and operating departments. 12 I. C. C. Rep. Testimony was received touching the cost of constructing, maintaining and operating the lines by which this traffic moves, as well as upon the traffic propositions as such which were involved. No desire was expressed at the conclusion of the hearing to offer further evidence, and no such intimation has been since conveyed to the Commission. We feel that a full hearing upon the issues tendered by the amended complaint has been had. The rate on coal from the Trinidad region to Amarillo was, at the time of the hearing, $3.35, the distance being about 254 miles. It was announced near the conclusion of the hearing that the Fort Worth & Denver City Railway had proposed to reduce this rate to $2.90 per ton and that the complainants in consideration of this reduction would not press that feature of the complaint. The reasonableness of these rates, both the old and the new, has not, therefore, been considered. Upon the complaint as amended and heard three questions are presented: 1. Should Amarillo be made a Texas common point? 2. Are the class rates from Kansas City to Amarillo excessive? 3. Are the class rates from St. Louis to Amarillo unreasonable? What is known as Texas common-point territory comprises the entire State east of a line drawn from Quanah upon the north in a devious direction through Big Spring, San Angelo and other towns to Corpus Christi upon the south. This portion of the State, some 400 miles from north to south by an average width of nearly 300 miles from east to west, takes the same rate-that is to say, rates from nearly all parts of the United States are the same to every railway station within these limits. This system of common-point rates has been in effect for many years and originally grew out of the competitive conditions under which traffic moved into the State of Texas. Freight from the Atlantic seaboard may reach Galveston by water and thence move by rail to different inland points, or it may be transported from the same point of origin by all-rail routes to the State of Texas, and in such case may reach that State either through a gateway like Kansas City or through St. Louis and the various other gateways upon the Mississippi River. Producing points in the Middle West compete with similar producing points upon the Atlantic seaboard, and this traffic from the Middle West can reach Texas from either the north or the east. The contest between the different lines over the right to serve different portions of the State produced intense competition and much controversy, which was finally adjusted by making the rates to all parts of the territory the same, with the exception of a small territory in the vicinity of Galveston, which enjoys lower rates from all directions, and another territory in the north of the State which takes lower rates from Kansas City and Missouri River points. A glance at the map will show that Amarillo, situated as it is in the Pan Handle of Texas, 142 miles north and west of Quanah, the last common point station of the Fort Worth & Denver City Railway, does not properly fall within these competitive lines. It was urged upon the hearing that Big Spring, which was made a common point a few years ago, was no more favorably located than Amarillo, and it is probable that there are few if any reasons which could be urged in favor of that city which could not be urged with equal force in favor of Amarillo. But Big Spring might have been made a common point by the Texas & Pacific Railway Company, upon whose line it is situated, without the consent of defendants, and while the defendants undoubtedly participate in rates to that station they are not responsible for the action of the Texas & Pacific; nor is there competition between Big Spring and Amarillo except to a very remote extent. It is difficult to see why, upon the reasoning advanced by the complainants, this common point territory might not be indefinitely extended in all directions. The contention of the complainants in that respect is not sustained. A certain defined territory in the northern part of Texas, commonly known as the Burnt District, takes from Kansas City and other Missouri River towns lower rates than are made to the balance of the State, thereby offering an exception to the rule that rates to all points in common-point territory are the same. The class rates from Kansas City to Fort Worth, which may be taken as representative of this Burnt District, to Amarillo and to common points are as follows, in cents per 100 pounds: From Kansas City, Mo., to Fort Worth, Tex.... 127 137 1 2 3 4 5 A B C D E 117 107 96 89 70 72 65 53 41 34 116 104 96 76 79 70 58 45 38 121 104 96 75 79 70 58 46 39 Common points. The lower rates from Kansas City to this district are made in recognition of the greater proximity of that market to these towns. Kansas City and the lines connecting it with these Texas points insist that because the distance is so much less the rate shall not be the same to all common points. The distance from Kansas City to Amarillo is somewhat less than the average distance to this Burnt District, which includes Big Spring, San Angelo and Quanah. It was said by the defendants upon the hearing that the cost of transportation to Amarillo was greater than to towns in the Burnt District, but this is not clear. For more than half the distance the route is over the same iron. From the point of division by the Santa Fe it was formerly true that the line to Amarillo was in somewhat inferior condition and handled considerably less business than to Fort Worth. At the present time that system is rebuilding this road to Amarillo for the purpose of making it a part of its main transcontinental line by way of the Belen cut-off. When that route is open, as it will be in the very near future, Amarillo will be situated upon the main line of the Santa Fe, and there is no reason to suppose that by that route the cost of transportation in the future will be greater to Amarillo than to Fort Worth. In our opinion the same recognition of proximity which has given the lower rate to Fort Worth and other towns in the Burnt District should give to Amarillo a rate no higher than is applied at these stations. The present class rates from Kansas City to Amarillo are high, upon every consideration, and in our judgment ought not to exceed, for the various classes, the following amounts, in cents per 100 pounds: Classes Rates.. 1 117 2 3 4 5 Α B C DE 107 96 89 70 72 65 53 41 34 We are also of the opinion that commodity rates from Kansas City *to Amarillo ought not, generally speaking, to exceed those to Fort Worth. The class rates from St. Louis to Fort Worth and Amarillo are as follows, in cents per 100 pounds: Classes To Forth Worth To Amarillo... 1 2 3 4 5 A B C DE 137 121 104 96 75 79 70 58 46 39 147 130 112 103 81 86 75 63 50 43 The complainants insist that these rates ought not to be higher to Amarillo than to Fort Worth, which, in this case, takes the regular common-point rate. The distance to Fort Worth is, however, by the short line more than 100 miles less than to Amarillo. We think the class rates from St. Louis to Amarillo may properly be higher than to Fort Worth and that the present differences in these rates are not excessive. Unless Amarillo is to be made a common point, there seems to be no good reason why its rates from this market should be reduced to the common-point scale. An order will be issued directing that class rates from Kansas City do not exceed the amounts above found to be just and reasonable. The opinion has also been expressed that commodity rates from Kansas City to Amarillo ought not to be higher than those to Fort Worth, and perhaps an order might properly be made to that effect. It has seemed, however, the better way to go no further at this time than a recommendation. Should the defendants fail to comply with this suggestion, the complainants can by a new complaint call our attention to specific rates upon particular commodities, and we can then consider whether there is in the instances complained of any special reason which ought fairly to except them from the general rule. |