During the interval, while the increase of 4 cents was in effect, the complainants made a number of carload shipments upon which they were required to pay the higher charges. And the purpose of these three petitions is to obtain reparation on those shipments. When the cases were called for hearing a conference between the parties was suggested and held. It resulted in an understanding, which was reduced to writing in the form of a stipulation, that the defendants would submit to a reparation order on the basis of 3 cents per hundred pounds on all shipments made during the period of the effectiveness of the higher rates. This agreement being in harmony with the requirements of law as applicable upon this record, the hearing was accordingly adjourned in order that the defendants might check up the shipments claimed to have been made by the complainants under the increased tariff and thus arrive at a basis for the final adjustment of the controversy.

From the additional stipulation and evidence now before the Commission it appears that between December 15, 1904, and May 31, 1905, the complainants, Harth Brothers Grain Company, shipped, from various points of origin in the group described to various of the said points of destination, hay and corn aggregating 1,993,060 pounds in weight, upon which, in accordance with the stipulation of the parties, they are entitled to reparation in the sum of $597.92, being at the rate of 3 cents per 100 pounds; that during the same period shipments of wheat and corn were made by the complainant, A. Waller & Company, from Corydon, Grove Center and Waverly, in said group, to various points of destination in the territory described, aggregating 2,019,201 pounds, upon which that company is entitled to reparation, on the same basis, in the sum of $605.76; and that the shipments of wheat and hay made by complainants, Waller, Young & Company, during the interval of the effectiveness of said higher rates, from Henshaw and Morganfield, aggregated 2,179,550 pounds in weight, of which 432,000 pounds in seven carloads went forward directly to the destinations in question, and 1,747,550 pounds in twenty-six carloads to Nashville. Under the facts disclosed of record and under the stipu lation of the parties, the last-mentioned complainants are entitled to a refund of $129.60, being at the rate of 3 cents per 100 pounds, upon the seven carloads above mentioned. As to the twenty-six carloads shipped by the same complainants no order will be entered pending the production of further proof showing just how the increase in rates heretofore referred to affected those shipments.

An order will be entered accordingly.

12 I. C. C. Rep.

No. 981.

ENTERPRISE MANUFACTURING COMPANY; MONROE COTTON MILLS, AND GRANITEVILLE MANUFACTURING COMPANY

v.

GEORGIA RAILROAD COMPANY; CENTRAL OF GEORGIA RAILWAY COMPANY; SOUTHERN RAILWAY COMPANY; ATLANTIC COAST LINE RAILROAD COMPANY; ATLANTA & WEST POINT RAILROAD COMPANY; WESTERN & ATLANTIC RAILROAD COMPANY; WESTERN RAILWAY OF ALABAMA; CHARLESTON & WESTERN CAROLINA RAILWAY COMPANY; COLUMBIA, NEWBERRY & LAURENS RAILROAD COMPANY; CHESAPEAKE & OHIO RAILWAY COMPANY; ILLINOIS CENTRAL RAILROAD COMPANY; LOUISVILLE & NASHVILLE RAILROAD COMPANY; NASHVILLE, CHATTANOOGA & ST. LOUIS RAILWAY COMPANY; SEABOARD AIR LINE RAILWAY; MOBILE & OHIO RAILROAD COMPANY; TEXAS & PACIFIC RAILWAY COMPANY; MISSOURI, KANSAS & TEXAS RAILWAY COMPANY; ATCHISON, TOPEKA & SANTA FE RAILWAY COMPANY; SOUTHERN PACIFIC COMPANY; GREAT NORTHERN RAILWAY COMPANY; NORTHERN PACIFIC RAILWAY COMPANY; UNION PACIFIC RAILROAD COMPANY; OREGON RAILROAD & NAVIGATION COMPANY; OREGON SHORT LINE RAILROAD COMPANY; CANADIAN PACIFIC RAILWAY COMPANY; GREAT NORTHERN STEAMSHIP COMPANY, and OCCIDENTAL & ORIENTAL STEAMSHIP COMPANY.

Submitted May 31, 1907. Decided October 8, 1907.

1. Natural advantages of location are neither to be enlarged nor minimized by the Commission, whose duty and purpose is to secure just and reasonable transportation rates, as nearly equal as possible for all localities and individuals, having due regard to differences in circumstances and conditions.

12 I. C. C. Rep.

2. The Commission having upheld a rate of $1.15 per one hundred pounds on cotton goods from southern cotton mills to Pacific ports, in Enterprise Manufacturing Company v. Georgia R. R. Co. et al., 12 I. C. C. Rep., 149, and held a rate ten cents higher to Asiatic ports from the same points to be reasonable in China & Japan Trading Company v. Georgia R. R. Co. et al., 12 I. C. C. Rep., 272, the latter case is followed and the rate of $1.25 per one hundred pounds under present conditions again approved.

3. A rate which is advanced as the result of an agreement among carriers, even if such agreement be with color of violation of the Antitrust Act, will not on that ground alone be declared unreasonable; evidence of such violation is pertinent and must be considered, but the existence of such an unlawful agreement, even when proved, is not conclusive of the unreasonableness of the rates so advanced.

R. J. Southall and Alexander Ackerman for complainants. S. F. Andrews, C. B. Northrop, L. E. Payson and Hale Holden for defendants.

REPORT OF THE COMMISSION.

CLEMENTS, Commissioner:

This case involves the reasonableness of the rate of $1.25 per 100 pounds applying to the transportation of cotton goods, baled, from southern mills via Pacific ports to Asiatic ports, which rate complainants allege to be an excessive charge for the service performed and unduly discriminatory, as compared with rates to same destinations from more distant eastern cotton mills.

Complainants are manufacturers of cotton goods at Augusta and Monroe, in the State of Georgia, and Graniteville, in the State of South Carolina. There is keen competition in oriental markets for the cotton goods trade between domestic mills, North and South, and those of England, Germany, and Italy, the last-mentioned two countries having quite recently entered this field. Japan is also a competitor for this trade, but to an unappreciable extent. India, as well as Japan, produces some yarns, which are sold to the Chinese in the interior districts to be woven into narrow cloth. England's territory is more extensive than our own, but lies principally in the south, where her influence is predominant. She markets, however, a higher class product at a freight rate about 10 per cent higher from Manchester than is paid from our own mills.

The traffic in question may move from either of the great mill territories to New York and thence by way of the Suez Canal, or by rail to Pacific ports and thence to Shanghai or the call ports. In this trade New York is practically the only initial port. There are occasional calls at other ports and sometimes full loads are received at these latter, but the oriental business does not warrant the estab

lishment of regular lines from any other point. The rates, therefore, are reckoned from the port of New York and are quoted free on board, New York Harbor, thence by steamship via Suez Canal to Shanghai, which latter is practically the only port of delivery for these goods in the East; hence other domestic and foreign ports of call are ignored in the fixing of rates. Overland, the routes from either eastern or southern mills are by the various transcontinental lines to the Pacific ports, thence by trans-Pacific steamships to Asiatic ports.

The ocean rates for transportation of freight were not regularly filed with the Commission and apparently have never been rigidly adhered to, but used rather as maxima, the ships contracting for space at the best figures they could secure. One of the witnesses, an agent for a commission house, and founder as well of a line of steamships, testified that the average oriental rates applying at the time his company began to compete for the trade in 1902 were 42s. 6d. per ton, but that shortly thereafter the same were reduced to 20s., and within the next three years declined to 10s. Previous to July 1, 1902, these rates were 22s. 6d. per ton, equal, it was estimated, to about 45 cents per 100 pounds. On the date mentioned, however, they were changed to the basis of a hundredweight charge of 62 cents, New York to Shanghai.

From bills of lading covering actual shipments, it appears that the rates from Eastern mills since 1893 amounted to a charge of $11.25 per 40 cubic feet, but from tariffs filed with the Commission these were on January 26, 1903, 95 cents per 100 pounds from New England and Southern points; April 20, 1903, 90 cents, and on September 16, 1903, $1.10. Since January 20, 1904, the published rates from New England points have been $11.25 per 40 cubic feet, carload and less than carload, while from Southern points, since July 1, 1906, the rates have been $1.25 per 100 pounds, carloads. One of the witnesses testified that the record of measurement and weights for two years on shipments via a northern line showed 1,284.7 pounds per 40 cubic feet as the average weight on New England shipments of cotton goods, thus making the rate 87 cents. However, the estimated equivalent of $11.25 per 40 cubic feet is generally accepted as 85 cents.

The bulk of the cotton goods exported to China consists of unbleached cloth, 600 yards to the bale when of drills and 800 yards when of sheetings. The sheetings weigh about 3 yards to the pound, the values of the grades suitable for the Chinese market averaging about 64 cents per yard or $50 per bale.

The Puget Sound lines have had fluctuations from 90 cents to $1.25 to meet competition, and in the last two years less than 10 per cent of the traffic moving via these lines has been of New England origin.

It appeared from the testimony that in the division of the rates overland, when the rate from Southern mills to Asiatic ports was 90 cents, 33 cents was accepted for the haul to St. Louis, a 10-cent arbitrary from St. Louis to St. Paul, and the balance of the rate was equally divided between the transcontinental lines west of St. Paul and the steamships. Out of the $1.10 rate, 47 cents on the average was accepted for the haul to St. Louis, 10 cents to St. Paul, and the balance equally divided between the roads west and the boats. With the present rate of $1.25, some of the cotton goods from Southern mills pay less, some more, but 75 per cent of the traffic moving via the overland route and passing through St. Louis pays 47 cents to that point, 10 cents thence to St. Paul, and 34 cents each to the roads west and the steamships.

Our cotton-goods trade with China began in 1876, since which time our exports have been as follows:

Following the reopening of Manchuria in 1905, nearly 700,000 bales were shipped, or practically two years' shipments in one. Seventyfive per cent of the cotton goods shipped to the north of China was of American manufacture, and of this from 70 to 90 per cent came from Southern mills. At the present time, however, all trade to China is much depressed. Famine has threatened English territory, and as a result of the extraordinary movement in 1905, three times as much stock has accumulated in Shanghai as in previous years, or an amount equal to a year's shipment from this country. The Suez lines claimed to be carrying comparatively no cotton goods at the time of the hearing.

It requires from twenty to thirty days more time to ship via the Suez Canal from New York to Shanghai than is consumed via the overland route, thus equalizing the apparent differences between the two routes in the cost of marine insurance, which is 100 per cent higher by way of Suez, due to risks of voyage and interest on the investment at 6 per cent for the month longer voyage, amounting to about one-half of 1 per cent.

The principal part of the traffic from New York via Suez consists of steel and oil, which is transported at a rate of 20 cents per 100 pounds. The lines are glad to have cotton goods, as with light measurement it makes desirable freight. It is contended, however, that the rail lines can not compete for the carriage of steel and oil, since as soon as the rates approach cost of service or care the steel and oil corporations charter their own vessels. The steel interests have already put on a line to Dalny.