that between Seattle and Portland the increases in the number of trips, tonnage hauled, and resultant revenues in 1939 over 1938 were as follows:

Heyser's operating revenues in 1938 were $67,249.29 and its operating expenses were $67,663.14, resulting in an operating loss of $413.85. In 1939 its operating revenues were $112,194.89 and the operating expenses $102,591.54, leaving a profit of $9,603.35. The revenues derived from Sears' shipments during the last 6 months of 1939, multiplied by 2 in order to determine the approximate total revenues obtained from that company's shipments during the year, amounted to $18,055.44. This respondent applied the proposed rates to the shipments transported for Sears during the same 6 months, and multiplied the total obtained by 2 to determine the approximate revenues that would have been derived under the proposed schedules. These computations show that it would have received $16,298.22 from Sears. This amount is $1,857.22 less than it received, and 1.65 percent of its gross income and 19.63 percent of its net earnings for 1939.

Heyser claims that, because of the increased volume of traffic and of operating economies resulting from the use of lighter and more modern equipment, its operating costs in 1939, considering the volume of traffic transported, were less than in 1938.

Although seven other motor common carriers participate in rates between Seattle and Portland, Heyser only would be affected materially if the proposed schedules become effective. Heyser maintains that the establishment of the proposed adjustment would not divert traffic from other motor carriers, but merely would forestall an increase in private-carrier operations. It directs attention to the fact that similar rates and mixing provisions are maintained by the rail carriers between Portland and Vancouver, Wash., on the one hand, and Bend, Oreg., on the other, and by motor common carriers between points in western Oregon, including, among others, Portland, Klamath Falls, Salem, Roseburg, Corvallis, Eugene, and Grants Pass.

Representatives of the Seattle Hardware Company, the Schwabacher Hardware Company, of Seattle, Harper Megee, Inc., and the Sunset Electric Company, of Portland, appeared in opposition to

the proposed schedules. These companies sell many commodities in small quantities to independent dealers who are in competition with Sears, Montgomery Ward, and Western Auto Supply. They contend that they would be unable to make sales in sufficient volume to avail themselves of the proposed rates and consequently would have to pay the higher less-than-truckload class rates to their disadvantage compared with the lower rates that would be paid by their respective competitors. They admit, however, that there are truckload commodity rates on various mixtures of articles commercially related to each other, in which they are interested. They were unable to name a commodity or group of articles moving in substantial volume between Portland and Seattle which did not move on a commodity rate.

The protesting motor carriers estimate that the reductions occasioned by the proposed adjustment would be nearly twice as much as those estimated by Heyser. Based on the tonnage of Sears during the last 6 months of 1939, they compute that Heyser's reduction in gross revenue would have been $1,799.50, and, on that basis, arrive at an estimated annual reduction of $3,599. This amount would equal a reduction in gross revenue of 3.2 percent and in net earnings of 30.8 percent. They assert that competition would compel other motor carriers operating between Seattle and Portland and other points to make like reductions. They also contend that the proposed schedules would tend to prevent merchandise from moving under the present class rates and would encourage the freight-forwarding business between Seattle and Portland.

The weight per cubic foot of Sears' shipments ranges from 12 to 15 pounds. The protestants state that, because of the light density per cubic foot of the traffic, the capacity of the equipment in tons is not as essential as the cubical capacity of the equipment; that 20,000 pounds cannot be loaded in any one of Heyser's vehicles; and that the rule under consideration is similar to the multiple-car rule proposed by certain rail carriers in connection with all-freight commodity rates and held to be unlawful in Middle Atlantic States M. C. Conf., Inc., v. C. R. Co. of N. J., 232 I. C. C. 381. This position is not tenable for the reason that no rule of this kind is in effect or here proposed. The present class rates apply to volume shipments, each of which is tendered at one time, on one day, at one point, by one shipper, and on one bill of lading, for the transportation to one point and to one consignee.

Protestants also call attention to the fact that in All Freight Between Portland and Seattle, 238 I. C. C. 729, the Commission found not justified proposed graduated all-freight rail commodity rates subject to varying minima between Portla attle. In that decision

the proposed rates were found to be unduly low. It principally involved the level of proposed commodity rates which would apply on all kinds of freight with certain exceptions, regardless of classification, and therefore has no application in this instance, which concerns the lawfulness of a proposed rule for application on mixed shipments rather than the level of rates.

It is well settled that the differences in the quantities transported as a single shipment may afford a fair and reasonable basis for differences in transportation rates. In rail transportation these differences are recognized as between carload and less-than-carload lots. In truck transportation, in addition to truckload and less-than-truckload rates, there are so-called volume rates. Further, in rail transportation in connection with mixed carloads of allied, or commercially related, commodities generally transported for account of large shippers, the Commission has prescribed or approved the application of the respective carload rates to the actual weight of each commodity in the

car.

In Mixed-Shipment Tonnage-Reduction Rule-Oregon, 22 M. C. C. 533, division 3 found not justified a mixing rule proposed for application in connection with interstate volume class rates and any-quantity rates between points in Oregon substantially similar to that proposed herein. The decision in that proceeding is not controlling herein for the reason that the respondents therein failed to meet the burden of showing that the resulting rates would be reasonable and otherwise lawful. The record herein justifies the approval of the proposed schedules, if amended to remove all ambiguities and to insure definiteness.

We find that the suspended schedules are not justified. The respondents will be required to cancel them without prejudice to filing similar schedules containing a mixing rule with provisions to the effect that the proposed rates shall apply only to commodities accorded less-than-truckload or any-quantity ratings of first class or lower, that any deficiency in weight shall be considered as fourth class, and that the proposed rates shall not apply where specific commodity rates are applicable.

An appropriate order will be entered.

ALLDREDGE, Commissioner, dissenting in part:

I can go along with the findings in the report to the extent that they apply to the rates subject to a 20,000-pound minimum, but I would find that the suspended schedules, to the extent that they apply in connection with rates subject to a 10,000-pound minimum, result in charges that are unreasonably low, unjustly discriminatory, and unduly prejudicial.

No. MC-21170 (SUB-No. 1)1

BOS FREIGHT LINES, INCORPORATED, EXTENSION OF OPERATIONS-GROCERIES AND CANNED GOODS

Submitted July 15, 1940. Decided February 20, 1941

1. In No. MC-21170 (Sub-No. 1), public convenience and necessity found to require operation by applicant as a common carrier by motor vehicle, of groceries, from Minneapolis, Minn., to 10 specified points in Iowa, over irregular routes. Issuance of a certificate approved upon compliance by applicant with certain conditions, and application in all other respects denied.

2. In No. MC-21170 (Sub-No. 3), public convenience and necessity found not to require operation by applicant as a common carrier by motor vehicle, of groceries, canned goods, and store supplies, between points in Iowa, Missouri, Minnesota, Oklahoma, Arkansas, and Kansas, over irregular routes. Application denied.

3. No. MC-100811 dismissed upon request of applicant.

Stephen Robinson for applicants in Nos. MC-21170 (Sub-No. 1) and MC-10081.

Stephen Robinson and Sidney H. Johnson for applicant in No. MC-21170 (Sub-No. 3).

B. C. Brile, John Gamble, John N. Hughes, Jr., and M. F. Schlick for protestants in No. MC-21170 (Sub-No. 1).

Nathan S. Sherman, George R. Hise, Erwin Larson, John E. McCullough, W. J. McCarthy, Walter Hitchen, Cyril H. Wissel, D. C. Nolan, L. M. Hartley, J. F. McGrath, and C. R. Smith for protestants in Nos. MC-21170 (Sub-No. 3) and MC-100811.

Jerome D. Fenton for intervener in No. MC-21170 (Sub-No. 3). H. C. Marcusen for Iowa State Commerce Commission in Nos. MC-21170 (Sub-No. 3) and MC-100811.

REPORT OF THE COMMISSION

DIVISION 5, COMMISSIONERS LEE, ROGERS, AND PATTERSON BY DIVISION 5:

Separate recommended orders were issued on the applications here considered, one by a joint board in No. MC-21170 (Sub-No. 1), and one by an examiner in Nos. MC-21170 (Sub-No. 3) and MC-100811. Exceptions were filed by protestants to the recommended order of the

'This report also embraces No. MC-21170 (Sub-No. 3), Bos Freight Lines, Incorporated, Extension of Operations-Groceries, Canned Goods, and Store Supplies, and No. MC100811, A. H. Bos, Doing Business as Bos Transfer Co., Contract Carrier Application.

joint board in No. MC-21170 (Sub-No. 1) and by applicant in the recommended order of the examiner in No. MC-21170 (Sub-No. 3). As the proceedings involve related issues, they will be disposed of here in one report.

By an order of February 17, 1940, in No. MC-21170, applicant was granted a "grandfather" clause certificate as a common carrier by motor vehicle of general commodities, with certain exceptions, between Kansas City, Mo., and St. Paul, Minn., serving Kansas City, Kans., St. Joseph, Mo., and certain intermediate and off-route points in Iowa and Minnesota, of groceries, canned goods, petroleum products, and paint between Marshalltown and Chicago, Ill., and of groceries and canned goods between Marshalltown and Colorado Springs, Colo., serving certain intermediate and off-route points in Colorado, all over specified routes; and of salt from Hutchinson and Kanopolis, Kans., to certain points in Iowa, of flour and feed from Kansas City, Mo., and certain points in Kansas to certain points in Iowa, of vegetables from Denver, Greeley, and Colorado Springs, Colo., and points within 35 miles of the latter point to Marshalltown, of paper and cardboard boxes and cartons from Lawrence, Kans., to certain points in Iowa, of vinegar, soap, and petroleum products from Kansas City, Mo., to certain points in Iowa, of household goods between Marshalltown and points within 80 miles thereof, on the one hand, and points in Iowa, Missouri, Kansas, Minnesota, Illinois, Nebraska, and Colorado, on the other, and of groceries and canned goods between Marshalltown, on the one hand, and Fargo, N. Dak., and certain points in Minnesota, on the other, and between certain points in Iowa, on the one hand, and certain points in Missouri, on the other, all over irregular routes.

No. MC-21170 (Sub-No. 1).—By application filed February 17, 1939, Bos Freight Lines, Incorporated, of Marshalltown, Iowa, seeks a certificate of public convenience and necessity authorizing operation in interstate or foreign commerce as a common carrier by motor vehicle of groceries and canned goods from Minneapolis and St. Paul, Minn., and Kansas City and St. Joseph, Mo., to Perry, Newton, Grinnell, Webster City, Charles City, Boone, Clear Lake, Nevada, Waverly, Hampton, and Atlantic, Iowa, over irregular routes. Rail carriers and one motor carrier operating in the affected area oppose the application.

Applicant has terminals at Marshalltown, Waterloo, Cedar Rapids, Des Moines, and Mason City, Iowa, St. Paul, Minn., and Kansas City and St. Joseph, Mo. In July 1939, when the hearing was held in No. MC-21170 (Sub-No. 1), it owned and operated 12 semitrailers and 6 straight trucks, 9 of which were refrigerated. These tractors and trucks were of late-model type, whereas the semitrailers were