A History of Inland Transport and Communication in England

by Edwin A. Pratt

The position is thus controlled by the words "same or similar circumstances." In what is known as the "Southampton case," decided by the Railway and Canal Commission in 1895, the fact that foreign produce was being carried at lower rates by the London and South-Western Railway Company from Southampton to London than were being charged for English produce was not disputed; but it was successfully argued (1) that lower rates might reasonably be granted for train-loads of produce capable of being loaded into the waggons at the docks and carried through, under the best transport conditions, direct to London than for small consignments, picked up at wayside stations, and loaded and carried under far less favourable traffic conditions; (2) that there was no real detriment to local producers, since the towns concerned were importing more than they were sending away; and (3) that in no respect were the circumstances "the same or similar." There was, said Sir Frederick Peel, one of the Commissioners, "no concurrence between the two classes of traffic, and the greater economy of transport in the dock traffic justified the lower rate."

The principle here involved disposes of, probably, most of the complaints which have been made from time to time on the subject of undue preference; but as these complaints were especially rife in 1904, a Departmental Committee, presided over by Lord Jersey, was appointed by the Board of Trade to inquire whether or not the railway companies were according preferential treatment to foreign and colonial farm, dairy and market-garden produce from ports to urban centres as compared with home produce. The Committee declared in their report "that the evidence tendered has failed to show that the railway companies are giving undue preferential treatment to foreign and colonial produce as compared with home produce contrary to the intention and effect of existing legislation." They found that some of the traders who complained had compared rates which did not include terminal services with rates that did; had quite wrongly divided what were, in effect, "through" rates, first subtracting the full charge of the shipping company and then assuming that the remainder could be compared with the rate from the first; or had omitted to take into account differences in regard to bulk of consignments, packing, etc.

In effect, no British railway rate may give a preference to foreign as distinct from British produce so far as quantities, conditions and circumstances are the same. The rates are to be available for like consignments whatever the source of their origin. Where the home producer has been unable to provide the same quantities, under the same conditions and circumstances as the foreigner, he has equally been unable to avail himself of a rate open to all the world. He has had the disadvantage of the retail trader as compared with the wholesale trader. The principle involved is practically the same as that in operation on Continental State railways, where the traders who can provide the biggest loads get the advantage of the most favourable rates. On the Belgian State railways, for instance, there are special rates for 50, for 100 and even for 300-ton consignments which can obviously be taken advantage of by only a limited number of traders. But while the retail man cannot expect to get the same terms as the wholesale man, there is no adequate reason why the wholesale man should be kept to the same level as the retail man, and be refused the lower rates for his consignments to which he is entitled on account of their greater bulk or better loading. The question is certainly complicated by the fact that the wholesale man here in question is generally a foreigner; but the railway companies could not be required to discriminate against him, and to penalise him on account of his nationality. The matters at issue must needs be looked at from the point of view of a business proposition rather than from that of expecting the railway companies to usurp the functions of the State in carrying out a policy of Protection.

Of late years far less has been heard, in the agricultural world, at least, of these allegations of undue preference. The whole position has been changed through the praiseworthy efforts of the Agricultural Organisation Society in spreading among the agricultural community a practical appreciation of the advantages of combination, as adopted by their foreign competitors, included in such advantages being the lower rates which the railways already offer for grouped or other large consignments. The excellent work carried on by the society is calculated to confer, in many different directions, much more benefit on market gardeners, dairy farmers and agriculturists in general than would be gained by them simply from seeking to persuade, or even to force, the railway companies to carry at wholly unremunerative rates the small consignments of non-associated producers, forwarded under the least favourable conditions in respect to economical transport.

As regards the machinery provided by Parliament for dealing with traders' grievances, there is, in the first place, the Railway and Canal Commission, which, taking the place of the earlier Railway Commissioners, was made a permanent body under the Act of 1888. The Court consists of two Commissioners appointed by the Board of Trade, and three ex-officio members, chosen from the judges of the High Court, and nominated by the Lord Chancellor, the Lord President of the Court of Session and the Lord Chancellor of Ireland for England, Scotland and Ireland respectively; though in practice only one of the three takes part in the proceedings in connection with any case brought before the Court. The jurisdiction of the Commissioners includes powers to enforce obligations under special Acts, and to deal with questions of traffic facilities, private sidings, undue preference, through rates, etc.

Whether or not procedure before this body is too costly for other than wealthy litigants to take advantage of is a question which need not be discussed here; but traders have the further advantage of what is known as the Conciliation Clause of the Act of 1888, which provides that "(1) Whenever any person receiving, or sending, or desiring to send goods by any railway is of opinion that the railway company is charging him an unfair or an unreasonable rate of charge, or is in any other respect treating him in an oppressive or unreasonable manner, such person may complain to the Board of Trade. (2) The Board of Trade, if they think that there is reasonable ground for complaint, may thereupon call upon the railway company for an explanation, and endeavour to settle amicably the differences between the complainant and the railway company." A resort to this expedient by aggrieved parties involves the payment of no fees or costs.

The eleventh report by the Board of Trade of their proceedings under the Conciliation Clause shows that during 1908 and 1909 the number of complaints made to them was 280—a total insignificant in comparison with the many millions of separate transactions in which the traders and the railway companies must have been concerned during the two years in question. The 280 complaints are classified as follows: Rates unreasonable or excessive in themselves, 39; undue preference, 65; rates unreasonably increased, 22; classification, 30; delay in transit, 27; owner's risk, 17; rebates, 23, through rates, 15; miscellaneous, 42. Settlement or partial settlement was effected in 91 cases; in 62 the complaints were not proceeded with; in 122 an amicable settlement could not be arrived at; and in five the proceedings had not been completed. "In certain of the cases," the report further states, "in which an amicable settlement was not reached, it seemed clear to the Board of Trade that the complainants had no real ground for complaint."

Boyle and Waghorn are of opinion that in matters more or less personal to the applicant, or of comparatively minor importance, the procedure under this Conciliation Clause has saved much litigation; though when questions of general principles are at issue the Board of Trade, as a rule, prefer to remit the determination of them to the Railway Commission. They further say: "The principal cause of the comparative absence of litigation lies in the fact that a law of railway traffic is being gradually evolved, reasonably considerate of the rights of both parties, and adapted to the actual circumstances of the traffic. In the early days of railways this was very far from being the case." ("The Law Relating to Railway and Canal Traffic.")

Much of the adverse criticism of railway rates and charges which has been indulged in of late years, without even any resort to an inexpensive complaint to the Board of Trade, has been due to comparisons with railway conditions in other countries.

At one time the comparison specially favoured was between English and American railway rates; and this was persisted in until it was conclusively shown that there was, and could be, no basis of comparison between huge consignments, carried long distances, on comparatively inexpensive lines, and small average consignments, carried short distances, on the most costly railway system in the world. The element of "the same or similar circumstances" was obviously lacking.