the applicants and the Ocean Company would not be substantial and would be insufficient, of itself, to warrant denial of the application. Representations have been made that the Ocean Company is the only steamship line able and willing to replace the service formerly offered by the New England Company on traffic to and from points beyond New England, and the record does not indicate otherwise.

We find that the proposed service by water will be operated in the interest of the public, will be of advantage to the convenience and commerce of the people, and will neither exclude, prevent, nor reduce competition on the route by water under consideration. The application will be granted. Pursuant to section 5 (21) of the act, the Ocean Company will be required to file with the Commission tariffs of its rates, schedules, and practices covering such service.

An appropriate order will be entered.

226 I. C. C.

No. 27588

LUSTBERG NAST & COMPANY, INCORPORATED, v. NEW YORK, NEW HAVEN & HARTFORD RAILROAD COMPANY ET AL.

Decided February 14, 1938

Rate charged on cotton piece goods, in less than carloads, from North Dighton, Mass., to York, Pa., found applicable. Finding in prior report, 223 I. C. C. 278, reversed. Complaint dismissed.

Abner Pollack for complainant.
John B. Prizer for defendants.

REPORT OF THE COMMISSION ON RECONSIDERATION

MCMANAMY, Commissioner:

In the prior report, 223 I. C. C. 278, division 3 found that the rule 25 class rate of 71 cents charged on cotton piece goods, in less than carloads, shipped from North Dighton, Mass., to York, Pa., was inapplicable and that the applicable rate was a commodity rate of 59.5 cents contemporaneously in effect from North Dighton to Rockland, Md., which rate was subject to an intermediate rule.1 Reparation was awarded. Upon petition of defendants the case was reopened for reconsideration.

Complainant routed the shipments "via N. Y. N. H. & H. R. R. Co.,. for P. R. R. Co., delivery". They moved over the line of the carrier first named to Casanova (Harlem River), N. Y., the New York Connecting Railroad to Bay Ridge, N. Y., car float to Greenville Piers, N. J., thence over the Pennsylvania Railroad to Morrisville, Pa., on the west bank of the Delaware River opposite Trenton, N. J., thence over the line of the Pennsylvania through Glen Loch, Coatesville, and Columbia, Pa., to destination. The line of the Pennsylvania extending west from Morrisville is called the Trenton cut-off. The distance over the route of movement was 404 miles. Another line of the Pennsylvania lies to the south of the Trenton cut-off, and passes. through Philadelphia, Pa., and Wilmington, Del., to Baltimore, Md. From Baltimore a line of the Pennsylvania extends in a northerly and slightly westerly direction through York and Harrisburg, Pa. At Hollins, Md., a few miles north of Baltimore, the Green Springbranch of the Pennsylvania extends north and west to a connection with the Western Maryland Railway at Green Spring Junction, Md.

1 The same as rule 27 of our Tariff Circular 20.

Rockland is located on the Green Spring branch north and west of Hollins, 12 miles from Baltimore and 52 miles from York. The distance from North Dighton to Rockland over the Pennsylvania line through Philadelphia and Baltimore is 424 miles, and over the Trenton cut-off, through York, 456 miles. From point of origin to Rockland the latter route is 7.5 percent circuitous. From Morrisville, the point of divergence, to Hollins, the point of incidence, the route of the Pennsylvania through York is 23.7 percent circuitous as compared with the route through Philadelphia and Baltimore.

Defendants' position was and is that the route of the Pennsyl vania through York to Rockland is not a practicable, logical, or natural route, and therefore cannot be regarded as an open route to which the intermediate rule would apply. The governing tariff set forth the through route from point of origin, but did not specify any local routing or junction points on lines of the Pennsylvania. The contention of the Pennsylvania is that the practicable route to Rockland is over its line through Philadelphia and Baltimore, over which route York is not intermediate to Rockland.

The claim that the route of the Pennsylvania through York to Rockland is impracticable, illogical, and unnatural is predicated upon the circuity of that route, and upon the fact that operating arrangements of the Pennsylvania provide for the movement of traffic from Greenville Piers to Rockland over the route through Baltimore.

Division 3 concluded that the circuity of the route through York was not excessive. In regard to operating conditions complainant had pointed out and the division took notice that in Olean Glass Co. v. Pennsylvania R. Co., 213 I. C. C. 229, the Pennsylvania had shown that all freight traffic from points east of Morrisville to points west of Glen Loch moved via the Trenton cut-off, that operating conditions on this line were favorable, and that it avoided the heavily congested Philadelphia area.

In the prior report it was stated that Rockland is west of Glen Loch. Defendants criticize this statement as erroneous and misleading. They assert that the Trenton cut-off is intended for the movement of freight traffic to points west of Glen Loch on the main line of the Pennsylvania. As above indicated, Rockland is not located west of Glen Loch on the main line of the Pennsylvania. On a direct air line, Rockland is in a southwesterly direction from Glen Loch.

Our decisions with respect to the questions here at issue have not been uniform. Therefore, our decisions and those of the Federal courts dealing with the questions here presented will be reviewed at some length.

Two questions are here presented for consideration, viz: Is the route in question a reasonable and practicable route over which the shipper has a right to require his shipment to move, and has the

shipper the right to specify local routing over the lines of any carrier? It is a well-settled general principle that the intermediate rule applies over a circuitous route provided that the circuity is not excessive. R. T. Frazier Saddlery v. Missouri Pac. R. Co., 96 I. C. C. 1; Planters Oil Mill v. Yazoo & M. V. R. Co., 115 I. C. C. 21; Toberman Mackey Co. v. Chicago, B. & Q. R. Co., 122 I. C. C. 299; Atwood Davis Sand Co. v. Chicago & N. W. Ry. Co., 136 I. C. C. 471; 3 Armour Fertilizer Works v. Central R. Co. of New Jersey, 200 I. C. C. 187; Olean Glass Co. v. Pennsylvania R. Co., supra; Union Underwear Co., Inc., v. Frankfort & C. R. Co., 214 I. C. C. 695; and DeiselWemmer-Gilbert Corp. v. Pennsylvania R. Co., 218 I. C. C. 137.

4

It is also an established principle that the intermediate rule does not apply over a route that is unduly circuitous or that is regarded as impracticable, illogical, or unnatural because of other operating difficulties, even though the routing is not in terms restricted. G. Caruso & Co. v. St. Louis-S. F. Ry. Co., 156 I. C. C. 429, and cases therein cited; Miner Lbr. Co. v. Pennsylvania R. Co., 161 I. C. C. 801; Quality Gas & Oil Co. v. Northern Pac. Ry. Co., 185 I. C. C. 395; Marsh & Marsh, Inc., v. Inland Waterways Corp., 194 I. C. C. 88; Interstate Fruit Co. v. Chicago, M., St. P. & P. R. Co., 195 I. C. C. 563; Janney-Semple-Hill & Co. v. Cleveland, C., C. & St. L. Ry. Co., 201 I. C. C. 765; John Clark Co. v. Alton & E. R. Co., 208 I. C. C. 621; National Radiator Corp. v. Pennsylvania R. Co., 213 I. C. C. 431; Rundle Mfg. Co. v. Southern Ry. Co., 218 I. C. C. 543; Swift & Co. v. Akron, C. & Y. Ry. Co., 220 I. C. C. 778; Lafond Motor Co. v. Northern Pac. Ry. Co,. 2 Fed. Supp. 658, and cases therein cited; Standard Oil Co. v. Pennsylvania R. Co., 40 Fed. (2d) 52;° and Updike Grain Corp. v. St. Louis-S. F. Ry Co., 52 Fed. (2d) 94.

No fixed rule has been observed in regard to the degree of circuity or other operating difficulty considered as rendering a route unavailable. For example, in Miner Lbr. Co. v. Pennsylvania R. Co., supra, by the Commission, it was said:

In no case where the application of rule 77 has been considered have we established any definitely settled rule of what is or is not a reasonable or natural route. Every case has been decided on its own merits.

2 The intermediate rule now approved for use in railroad tariffs is rule 27 of our Tariff Circular 20. Some of the cases cited in this report relate to rule 77 of Tariff Circular 20, as to which the same principles have been held to apply. Accordingly, and for the sake of brevity, reference to the "intermediate rule" will be understood to mean either rule 27 or rule 77, unless otherwise indicated. Rule 77 was canceled October 10, 1930. In a suit upon the reparation order in this case the findings were sustained by the Circuit Court of Appeals, Seventh Circuit, in Chicago & N. W. Ry. Co. v. Wilcox Co., 68 Fed. (2d) 883, certiorari denied 293 U. S. 560.

See the dissenting opinion in this case for a discussion of early cases dealing with this and analogous questions.

This was a suit to enforce compliance with the award of reparation in Staples Oil Co. v. Northern Pac. Ry. Co., 172 I. C. C. 499. The award was not sustained.

Certiorari denied, 282 U. S. 872.

Elements other than circuity have often entered into the final determination as to whether a claimed route was impracticable, illogical, or unnatural. In this instance, circuity is only one of the factors which must be given consideration.

Frequently it occurs that, for a part of the distance, the direct route and the circuitous route are made up of the same lines, and in considering circuity much depends upon whether the circuity given the greater weight is that from point of origin to the more distant point to which the specific rate is published or merely that from point of divergence of the two routes to point of incidence, the latter always being greater.

Defendants rely particularly upon Quality Gas & Oil Co. v. Northern Pac. Ry. Co., supra, and National Radiator Corp. v. Pennsylvania R. Co., supra. In the case first cited, by division 4, the complainants alleged that the rates charged on shipments of petroleum products from the Midcontinent field to specified points in Minnesota were inapplicable. The shipments moved via Minneapolis or Minnesota Transfer, Minn., thence over rails of the Northern Pacific Railway Company. The destinations were located on the circuitous line of the Northern Pacific between the points named and Superior, Wis. Complainants claimed that the applicable rates were those published to Allouez, Wis., or Carlton, Minn., more distant points, made subject to an intermediate rule. The Northern Pacific also has a direct line between the points above mentioned. The circuity of the longer line between Minneapolis and Carlton was about 68 percent, and of the entire route from point of origin, including the longer line, about 9 percent. The Northern Pacific contended that the use of the longer route to Carlton and Allouez could not have been intended by the makers of the tariff, that it was the general practice to move traffic beyond Minneapolis over its direct line, and that this was the only reasonable and proper route. The division stated, page 398:

The question arises as to whether the circuitous route of the Northern Pacific is a direct one under a reasonable interpretation of the applicable tariffs. Indirect routes result from the desire of the carrier having the long route to compete with the line maintaining the short route. Under such circumstances, the shipper has the right to designate which of the competing routes shall be used. The preservation of a competitive status as between carriers may be regarded as justifying such a right. But where, as here, both the long and short route from point of divergence are parts of the same railroad, the element of competition disappears, and with it any obvious reason, so far as this record shows, or public interest is concerned, for the asserted right of the shipper to specify routing. It must be assumed that the carrier will use its most economical route, and in view of the practical certainty of this, no reason appears why it should specify routes over its own lines.