fraud. In Wight v. United States, 167 U. S. 512, 42 L. Ed. 258. the conviction of a railroad agent for violation of this section in granting a rebate, was affirmed.

In Union Pacific Railway Company v. Goodrich, 149 U. S. 680, 37 L. Ed. 896 (1893), the supreme court affirmed the judgment rendered in the circuit court under a Colorado statute for an unjust discrimination in intrastate traffic, wherein the damages were measured by the amount of the rebate allowed a competitor. The court said that the plaintiff was entitled to the same terms which the favored company received, and damages to the exact extent to which that company was given the preference.

It constitutes no defense in discrimination between persons that the privilege may be withdrawn at will. Butchers & Drovers Stockyards Co. v. Railroad Co., 14 C. C. A. 290, 1. c. 297, 67 Fed. 35.

As to right to enforce rights of action for violation of this section in courts of law, in view of decisions of the supreme court requiring resort to Interstate Commerce Commission in cases cognizable by the commission, see infra sections 8 and 9 of the Act.

As to jurisdiction of equity see opinion of Grosscup, J., in U. S. v. M. C. R. R., 122 Fed. 544 (1903). See also Elkins Act of 1903, infra, § 422, as to suits in equity at instance of the government to restrain railroads from discriminations in rates.

§ 224. Connecting carrier not responsible for discrimination by initial carrier.-While a railroad is responsible for the rates on a connecting road, which it operates as part of its own line (Penn. R. R. Co. v. Interstate Coal Mining Co., supra), it was held by the supreme court in Penn. Refining Co. v. Western New York & Penn. R. R., supra, that a connecting carrier which receives cars from an initial carrier and participates in the through rate which is reasonable in itself, is not liable for a discrimination, alleged to have been made by the initial carrier in favor of shippers by tanks as against shippers by barrels, as the wrong, if any, was chargeable to the initial carrier only.

§ 225 (171). Effect of rebates upon contracts of affreightment. In Merchants Cotton Compress Co. v. Insurance Co., 151 U. S. 368, 38 L. Ed. 195 (1894), it was held, that there was

nothing in the Interstate Commerce Act which vitiated bills of lading or which by reason of the allowance of rebates actually made would invalidate a contract of affreightment, or exempt the railroad company from liability on its bills of lading. This was a suit of an insurance company which had paid losses claiming to be subrogated against the railroad company on bills of lading issued to the owners and consignees of cotton. It was not shown that the owner or consignee of the cotton had knowledge of the rebate.

§ 226 (171a). Discrimination in allowance to private transfer companies.-The railroads operating west from St. Louis made the rate on west bound traffic from East St. Louis the same as from St. Louis, and out of this rate allowed five cents per hundred pounds to transfer companies hauling less than carload lots from East St. Louis to St. Louis. The commission (10 I. C. C. R. 661), without deciding whether the railroads could properly apply the St. Louis rate to the station of a bona fide transfer company in East St. Louis and absorb the cost of transfer to St. Louis, nor whether by proper schedule they could allow all shippers from East St. Louis a fixed sum per hundred pounds for transporting their merchandise to the stations in St. Louis, ruled that an allowance from the rate could not be made to a carrier company, which was in effect only a private carrier organized and doing the business of one shipper, as such payment would be in effect a rebate to such shipper.

SECTION 3.

§ 227. Section 3. Undue or unreasonable preference or advantage for

bidden.

228. Origin of the section.

229. Relation to sections 1 and 2.

230. Preferences of localities enforced by competition are not unjust. 231. Application of the competition rule.

232. Whether competition is controlling is a question of fact.

233. Discrimination between domestic and foreign traffic in import and export rates not unjust preference.

234. Milling in transit and export trade.

235. Application of the import rule to intermediate points on the line. 236. Competition created by carriers.

237. The "basing point system" not illegal.

238. Basing points not exempt from regulating power of commission. 239. Grouping of rates.

240. Qualifications in the application of the competition rule.

241. Recognition of natural advantages of localities not an unjust preference.

242. Competing cities on opposite banks of rivers.

243. Differentials between competitive cities.

244. Preference in demurrage charges.

245. Uniform demurrage rules recommended.

246. Different forms of undue preference.

247. Undue preference in allowance for grain elevator service.

248. Undue preference in wharfage rights.

249. Undue preference in management of freight stations and warehouses.

250. Undue preference in car service.

251. The commission's regulations of coal car service sustained.

252. Discrimination by carrier in its own favor.

253. Undue preference in private cars.

254. Demurrage and other charges on privately owned cars.

255. The commerce court on demurrage charges upon private cars.

256. Exclusive use of excursion or sleeping cars of one owner.

257. Leasing of cars does not carry right of exclusive use by owner. 258. Stoppage in transit privileges.

259. Reconsignment charges.

260. Transit privileges.

261. Interference by state railroad commission with proportional

tariff rates.

262. Sidetracks and connections.

263. Undue preference in denying shippers the choice of route.

264. Undue preference in aribitrary division of territory.

265. Rate wars and undue preferences.

266. Discrimination in kinds of traffic.

267. Preferences against traffic-must involve injury.

268. A reasonable regulation of carload weights not preferential.

269. Differentials between grain and grain products.

270. The commission not concluded by ruling of state commission. 271. Discrimination in mode of shipment.

272. Classification.

273. Uniform classification recommended.

274. Consultation of carriers in classification not illegal combination. 275. Undue preference in classification.

276. Power of commission in correcting classification.

277. Reasonable regulations in classifications.

278. Facilities for interchange of traffic.

279. Discrimination in exacting prepayment from connecting car

riers not unjust discrimination.

280. Discrimination in exacting prepayment from shippers.

281. State control of interchange of interstate traffic.

282. State and municipal control of terminals.

283. The charging of local rates not an unjust discrimination. 284. The right of exclusive through routing.

285. Contract rights of trackage.

286. Rights of connecting carriers as to milling in transit privileges. 287. Exclusive contracts for station facilities not unlawful.

§ 227 (172). Section 3. Undue or unreasonable preference or advantage forbidden.-SEC. 3. That it shall be unlawful for any common carrier subject to the provisions of this act to make or give any undue or unreasonable preference or advantage to any particular person, company, firm, corporation, or locality, or any particular description of traffic in any respect, whatsoever, or to subject any particular person, company, firm, corporation, or locality, or any particular description of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever.

[Facilities for interchange of traffic.]

Every common carrier subject to the provisions of this act, shall, according to their respective powers, afford all reasonable, proper, and equal facilities for the interchange of traffic between their respective lines, and for the receiving, forwarding, and delivering of passengers and property to and from their

[Discrimination between connecting lines forbidden.]

several lines and those connecting therewith, and shall not discriminate in their rates and charges between such connecting lines; but this shall not be construed as requiring any such common carrier to give the use of its tracks or terminal facilities to another carrier engaged in like business.

228 (173). Origin of the section. This section has not been amended. It was said by the supreme court in the Import Rate Case, 162 U. S. 197, L. c. 222, 40 L. Ed. 940 (1896), that it was modeled upon the second section of the English act, for the better regulation of traffic on railways and canals, of July 10, 1854, and the eleventh section of the act of July 21, 1873, entitled "An Act to Make Better Provision for Carrying into Effect the Railway and Canal Act of 1854, and for other purposes connected therewith." Section 2 of this English act of 1854 is as follows, 17 and 18 Vic. c. 31.

"2. Every railway company, canal company, and railway and canal company, shall, according to their respective powers, afford all reasonable facilities for the receiving, and forwarding and delivering of traffic upon and from the several railways and canals belonging to or worked by such companies respectively, and for the return of carriages, trucks, boats, and other vehicles, and no such company shall make or give any undue or unreasonable preference or advantage to or in favor of any particular person or company, or any particular description of traffic, in any respect whatsoever, nor shall any such company subject any particular person or company, or any particular description of traffic, to any undue or unreasonable prejudice or disadvantage in any respect whatsoever; and every railway company and canal company, and railway and canal company having or working railways or canals which form part of a continuous line of railway or canal, or railway and canal communication, or which have the terminus, station, or wharf of the one near the terminus, station, or wharf of the other, shall afford all due and reasonable facilities for receiving and forwarding all the traffic arriving by one of such railways or canals by the other, without any unreasonable delay, and without any such preference or advantage, or prejudice or disadvantage, as aforesaid, and so that no obstruction may be afforded to the public desirous of using such railways or canals, or railways and canals as a continuous line of communication, and so that all reasonable accommodations may, by means of the railways and canals of the several companies, be at all times afforded to the public in that behalf."

Section 11 of the English act of 1873, 36 and 37 Vic. c. 48. re-enacts section 2 of the English act of 1854, and provides specifically for the enforcement of the duty of receiving, forwarding and delivering from and to other companies. For history of this second section of the English act of 1854, see opinion in the case of L. & Y. Railroad Co. v. Greenwood, Law Reps.