# Transcript of Record — Pennsylvania Railroad Company, Plff. In Err. v. Keystone Elevator & Warehouse Company > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386002_0544%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Transcript of Record - **Published:** January 1, 1915 - **Citation:** 237 U.S. 432 ## Text (24,427) SUPREME COURT OF THE UNITED STATES. OCTOBER TERM, 1914. No. 683. THE PENNSYLVANIA RAILROAD COMPANY, PLAINTIFF IN ERROR, v8. KEYSTONE ELEVATOR AND WAREIIOUSE COMPANY. IN ERROR TO THE SUPREME COURT OF THE STATE OF PENNSYLVANIA. INDEX. Original. Print Transcript from the court of common pleas, No. 5, of Vhila- i CO ica yee av ebsxceen ewes bereKpeeae scseeces > ee 1 1 i oc. Aang eck rash keh Omeae re as EN hehe koe 1 1 eee TOE MNO. ovo oe nee citi ccccitocncsccssosesene 2 1 e556 oS Uw h WARN Oe ROD OL RS 3 2 ee er oo) uuivacxvec kee 600s 06 hu RAP eee a eke 5 2 i Oe Ms. cis eae pas ens Seba ssh bent eaboe wees 6 3 Affidavit of defense—deposition of George D. Dixon........ 13 11 i OS obs Wenn b.on Weds hn sued) 090406 db 0500's > 0 H0% 14 11 WE stews chseunenvne pie phe sPakeb cages sei us sxeweh owas 15 13 MD OR WURis o.n0 5 5660 c cbs ceases edscckosersens 16 13 Acceptance of appointment and oath as referee........... 17 13 re Pe cons eer tite eeh ener dreer nest weredales 18 15 DO OE Scan dba res ceonerantbacdeobov ss aroeen 36 33 PN UE BW od basco ahead ooh eeee prove Adare dees 39 26 Exceptions of Pennsylvania R. R. Co. to report....... 40 37 Jupp & DetTwriter (INc.), PRINTERS, WASHINGTON, D. C., NoveMBER 20, 1914, INDEX. Original. Print weetamnny Of Wane! TA, ON... os ccc cc vccccsensesses 47 44 EE IE Soo od ox ne n'b oe nbbe on 6s vs S| | Richard M. Richardson................. 5S DD TE I ss cc cbev bis kb chhnw ween 61 58 Robert Clinton Wright..........ccce.0% 42 69 Pe ae es cop nk baw ns das daseuse> 86 83 Stipulation as to WERGPNNEB s 5 coc seesrercrcsesvercces 95 ? Testimony of Harvey C. Miller (recalled)............ 97 a4 Robert Clinton Wright (recalled)... ... 115 liz Harvey C. Miller (reealled)............ 119 116 Ce. OE SI sac rescheenvccaeve 122 liy Robert Clinton Wright (recalled)... ... 131 128 Harvey C. Miller (recalled)............ 132 1-y Exhibit A—Statement, I. C. C., G. No. 2953........... 136 133 Se Ae I aks sobs oO SS + b.eb es Obie nob oes os 5% 138 35 Order for judgment and assessment of damages........... 140 136 SE NE oe caches etwas nee es ROKR Fb Ud xbb'e on awd oa eae 141 136 i ee tkncs WS oro okU beens HO SAD rebcerbeobeowre 142 sr eS S52 Leb ick 56 Sse eS be es seh adeeb abs beeps ees 145 138 Ss ese pk bine wiki es os bee by 6 bo Cx kane 145 13) otis tiers sash pew sree bs sed) oe barb iss bacebccen eee 152 142 i Sot see re sk ioe reesei SENSE bkG ese Ch Dace 152 142 NE hss bass p45 9a we oo 0 on S Soho ooo ow ore ehsiwe aoe 155 143 Citation and service........... ever hinbrereber vaeke inshore we 155 144 I NO cht kw ph no den RE dvb vv 00 6% xe de 156 144 Sa ee NOUNS OC SUNN, 005 locas vces os cvccvssocutcce 157 145 I I sn ok oss} oe bax onder 6 oadebad.ow rds 158 146 ee Eee a eee eee TN oe ee 164 150 OAT ON ee ET EET PPLE TR 165 Il Serer ry rr Ty Sey ep ae ee 165 1] uae Ree aoe yeahs FES eh el > rte wikwh kb ke wawe 166 151 THE PENNA. R. R. CO. VS. KEYSTONE ELEVATOR & WAREHOUSE CO. 1 1 Copy of Docket Entries. Abstract of the Record, Showing the Question Presented for the Decision of the Court and How Disposed of. Il. Copy of Docket Entries. M. Hampton Todd, John Hampton Barnes. April 8, ’11.—Statement and rule to file aff’t of defence filed. May 5, °11.—Aff’t of defence filed. May 6, °11.—Rule to plead filed. May 9, 711.—Plea filed. June 21, '11.—Acceptance of appointment as referee and oath filed. Feb. 10, 1914.—Referee’s report with exceptions and disposition of same and testimony filed showing that there is due and owing by the def’t to the pl't’ff the sum of 17,507.04 with int. thereon from Jan’y 24, 1911, filed. Ko die.—Referee’s bill filed. Summons Assumpsit. Exit April 1, 1911. Ret. 1st Monday April, 1911. Served April 3, 1911. Feb. 21, 1914. __Exceptions dismissed, Report of Referee confirmed.. 20 die.—Opinion filed. March 5, 1914.—Judgment in the amount 20,827.27 the excep- tions to the Report having been dismissed, March 5, 1914.—Damages ass’d at 20,827.27. March 12, 1914.—Certiorari from Supreme Court of Jan’y T., 1914, No. 123, &¢., brought into office. Eo die.—Appeal Bond filed. 2 C. P. No. 5, March Term, 1911. No. —. Keystone ELEVATOR AND WAREHOUSE COMPANY vs. PENNSYLVANIA RAILROAD CoMPANY. To the Prothonotary : Issue summons assumpsit as above. Returnable first Monday of April, 1911. M. HAMPTON TODD, Attorney for Plaintiff. Erskine, April 1st, 1911. Endorsement: Noe. 2319 March Term 1911—C. P. No. 5—Key- — Elevator and Warehouse Company vs. Pennsylvania Railroad ProhyTo ee for summons. Filed Apr. 1-1911 Hunter Pro 2 THE PENNSYLVANIA RAILROAD COMPANY VS. 3 Summons. CounTyY OF PHILADELPHIA, 88: The Commonwealth of Pennsylvania to the Sheriff of the County of Philadelphia, Greeting: [ SEAL. ] We command you that you summon Pennsylvania Railroad Com- pany late of your County, so that it be and appear before our Judges, at Philadelphia, at our Court of Common Pleas, No. 5 of the County of Philadelphia, to be holden at Philadelphia, in and for the said County on the first Monday of April next, there to answer Keystone Elevator and Warehouse Company of a plea of Assumpsit And to have you then and there this writ. Witness the Honorable J. Willis Martin President of our said Court, at Philadelphia, the Ist day of April in the year of our Lord, one thousand nine hundred and eleven (1911). J. U. L. HUNTER, Prothonotary. Served the Pennsylvania Railroad Company the within named defendant company by handing April ard 1911 personally a true and attested copy of the within writ to G. A. Walker the Asst. Treas- urer of said defendant company, in the County of Philadelphia, State of Pennsylvania. So answers, GEORGE H. RATIN, Deputy Sheriff. JOSEPH GILFILLAN, Sheriff. 4 Endorsement: 2319 March Term, 1911—Court of Com- mon Pleas, No. 5—Keystone Elevator and Warehouse Com- pany vs. Pennsylvania Railroad Company—Summons. Assumpsit— M. Hampton Todd. Sheriff's Appearance Docket 24998 4-3-11— G. A. Walker Asst. Treas.—Leedin. 5 Common Pleas No. 5, March Term, 1911. No, 2319. Keystone Evevator & WaREHOUSE Co. vs. PENNSYLVANIA RarLroap CoMPANy. Enter my appearance in this case for the defendant. JOHN HAMPTON BARNES. JOHN HAMPTON BARNES, Attorney for Defendant. Franklin Bank Building, April 5th, 1911. To the Prothonotary Common Pleas. Endorsement: No. 2319, March Term, 1911—Common Pleas, No. 5—Keystone Elevator & Warehouse Company, vs. Pennsylvania Railroad Company—Order for Appearance—Filed Apr. 5 1911— Browning Pro Proth’y.—John Hampton Barnes. bzia aed ‘2 Statement of Claim STATEMENT OF CLAIM COMMONWEALTH OF PENNSYLVANIA \ County oF PHtLaveLrnta } The plaintiff. the Keystone Elevator and Warehouse Company, claims to recover from the defendant, The Penn- sylvania Railroad Company, the sum of Seventeen thousand five hundred fifty-one dollars and four cents ($17,551-04) with interest thereon from January 24th, 1911, upon a cause of action of which the following is a statement. On to-wit. March ist, 1gog, at the County aforesaid, the defendant rented by oral agreement to the plaintiff for the term of at will the elevator and warehouse owned by it and located on the line of its railroad at the southeast corner of Clearfield street and Park avenue, in the City of Philadelphia, County aforesaid, at the annual rental of Six thousand dollars, payable in equal quarterly pay- ments, which rent the defendant agreed to pay. And thereupon, on to-wit, the day and year aforesaid, at the County aforesaid. it was further orally agreed he- tween the plaintiff and the defendant that the defendant would do the necessary shifting to enable cars to reach the elevator and warehouse aforesaid for the purpose of taking from and delivering to the same all freight shipped there- from or destined thereto and should and would take and deliver the same over its lines at the same rates, except in case of traffic hauled short distances upon which it was customary for the defendant to apply rates varying with respect to different station deliveries in the City of Phila- delphia, in the same manner and with the same promptness that it delivered and received traffic at any other terminal point controlled by it in the City of Philadelphia. And at the same time and place it was further agree: letween the said parties that the defendant would move, free of charge, from the elevator aforesaid to its water front terminals all grain received over its lines after receiving a om LORIE OO wae RE Ie — — 122a 4 , OP CEE i concise eciei ATT Te 2,036.26 In the month of June, 1909, 12,975.- 660 pounds of grain and other merchan- dise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ......... savevteseesesos 1254 Statement of Claim In the month of July, 1909, 15,908,- 610 pounds of grain and other merchan- dise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ......... errr eey PPer ere In the month of August, 1909, 20,- 354.150 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ................ In the month of September, 1909, 22.- 124,595 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ................ In the month of October 1909, 16,- 749.795 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ......... reer In the month of November, 1909, 19- 927,607 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the sum of ................. In the month of December. 1909, 21,538,400 pounds of grain and other merchandise, which at the rate of thirty- five cents per ton of two thousand pounds amounts to the sum of ................ In the month of January, 1910, 21,- 912,845 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts fo the sum of ........... os 2,784.01 3.507.23 3.871.80 2.929.04 3487.33 3-709.23 3834-75 RO Pann. oe eee eee SLAP DLE GET AE Q 126a Statement of Claim In the month of February, 1910, 17,- 441,625 pounds of grain and other mer- chandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the swum Of ........02 50000: 3,052.28 In the month of March, 1910, 19,123,- o10 pounds of grain and other merchan- dise, which at the rate of thirty-five cents per ton of two thousand pounds amounts 0 CRE SNE OE on os oko choke te eee eens 3,340.53 In the month of .\pril, 1910, 19,121,- 475 pounds of grain and other merchan- dise, which at the rate of thirty-five cents per ton of two thousand pounds amounts ics Ce NE ce eased se cas 3,340.26 Amounting in the aggregate to the Se, eee Tee re re ere ee Se $42,820.00 And the said plaintiff further says that afterwards, to- wit, at the County aforesaid, on to-wit, January 24th, tot, the defendant paid to the plaintiff on account of its afore- said indebtedness and liability to it the sum of $28,420.19. the said sum being the actual amount of the cost to it of keeping and performing its said agreement with the defend- ant, as aforesaid, which payment was made by the defend- ant and accepted by the plaintiff without prejudice to the plaintiff's right to sue for and recover from the defendant in addition thereto such just and reasonable compensation as in equity and right it was entitled to receive and be paid for keeping and performing the terms and conditions of the aforesaid agreement on its part kept and performed. And the said plaintiff further says that it is justly and equitably entitled to recover from the said defendant the said balance of $17,551.04 with interest thereon from Janu- ary 24th, 1911, and the said defendant is liable for and justly indebted to it for said sum and being so liable did PDP REIS OE LIES LO EI NOR UL INTE BS TITER ILLES OLED INDUS SE RELIES 127a Statement of Claim on, to-wit, January 24th, 1¢11, at the County aforesaid, undertake and promise the jlaintiff to pay the same; never- theless being so liable it failed and neglected to pay the same, wherefore plaintiif claims to recover the same in this action. KEYSTONE ELEVATOR & WAREHOUSE CO.. (Sgd) Watrer F. Hacar. President. COMMONWEALTH OF PENNSYLVANIA eS COUNTY oF PHILADELPHIA : Water FP. HaGar being duly sworn doth depose and say that he is President of the Keystone Elevator and Warehouse Company, the plaintiff in the above action, that he makes this affidavit on its behalf, and that the facts therein set forth are true to the best of his knowledge, information and belief. (Sed) Watrer F. Hacar Subscribed to and before me this seventh day of April, IQT I. ROBERT G. ERSKINE [SEAL] Notary Public Commission expires February 27, 1913. 12 Endorsement: No. 2319 March Term 1911—C. P. No. 5— Keystone Elevator and Warehouse Company vs. The Penn- sylvania Railroad Company—Statement of Claim To Prothonotary C. P. Enter Rule on Defendant to file an affidavit of defense in fifteen (15) days or judgment sec. reg. M. Hampton Todd, At- mar for Plaintiff—Filed Apr. 8-1911 Blair Pro Proth’y. M. H. o aa rie oP. Br OFM SSL PLP BLNEOI PD EV ILO ELE NIE AALS BITRE POP SOR PPL PE . : 128a 10 lfidazit of Dejense AFFIDAVIT OF DEFENSE CoUNTY OF PHILADELPHIA, COMMONWEALTH OF PENNSYLVANIA, hss Georce D. Dixon, being duly sworn deposes and | says: I am the Freight Traffic Manager of the Pennsyl- vania Railroad Company, the defendant in the above en- titled action and I have knowledge of the matters and things referred to in the plaintiff's statement of claim filed therein. The defendant has a full and complete defense to the claim set out in said statement of claim, the nature and character of which is as follows: The agreement made by the defendant with the plain- tiff under the circumstances and conditions set out in the statement of claim for the payment to the plaintiff for its services rendered to the defendant, has been fully and en- tirely performed by the defendant by the payment by it to the plaintiff of the sum of $28,420.19 on January 4th, tort. payment whereof is admitted in the plaintiff's statement of claim to have been made to it, and no agreement was 1t any time made by the defendant whereby it became in- debted to the plaintiff in any sum in excess of the said amount of $28,420.19. The defendant is not indebted to the plaintiff in the sum of $17,551.04 nor in any other sum whatsoever, nor did the defendant on the said 24th day of January, 1gi1 or on any other day widertake and promise the plaintiff to pay the same. All of which matters and things are true and defendant expects to make proof thereof at the trial of this cause. Geo. D. Dixon Sworn to and subscribed before me this 5th day of May, IQi I. H. E. Cain Notary Public Commissicn expires February 21, 1915. PIE EM EPIL ERE SOR 2 LENGE NE EE CIOS IN ATE ts gga cy 8 96 ig ww ” oo KEYSTONE ELEVATOR & WAREHOUSE COMPANY. 11 Iendorsement: No. 2319 March Term 1911—C. P. No. 5— Keystone Elevator & Warehouse Co. vs. Pennsylvania Rail- road Co,—Aflidavit of Defense—Filed May 5 1911 Pro Proth’y— John Hampton Barnes Morris Building, Philadelphia. 14 C. P. No. 5, March Term, 1911. No. 2319. Keystone ELeEvaToR & WAREHOUSE COMPANY Vs. PENNSYLVANIA RAILROAD. To the Prothonotary : Enter a rule on Defendant to plead in fifteen days or judgment sec, reg. M. HAMPTON TODD, Attorney for Plaintiff. May 5th, 1911. Endorsement: No. 2319 March Term 1911—C. P. No. 5——Key- stone Elevator & Warehouse Company vs. Pennsylvania Railroad Co.—Rule to Plead—Filed May 61911 Pro Proth’y.—Todd. 129a Rule io Plead—Plea To the Prothonotary: Enter a rule on Defendant to plead in fifteen days or judgment sec. reg. M. Hampton Topp Attorney for Plaintiff May 5th, 191! The defendant pleads Non ssumpsit, Payment, Pay- ment with Leave, etc. Joun Hampton Barnes, May oth, 1911. KEYSTONE ELEVATOR & WAREHOUSE COMPANY. 13 15 Endorsement: No. 2319 March Term 1911—C. P. No. 5— Keystone FE. & W. Co. vs. Peansylvania R. R. Co.—Plea— Filed May 9 1911—J. W. Hill Pro Proth’y.—John Hampton Barnes. 16 In the Court of Common Pleas No. 5 for the County of Philadelphia, March Term, 1911. No. 2319. Keystone ELEVATOR AND WAREHOUSE CoMPANY vs. PENNSYLVANIA RAILROAD CoMPANY. And now June 16th, 1911, it is agreed between the parties in the above action that the same be referred to G. Heide Norris, Esquire, as Referee under the provisions of the Act of Assembly entitled “An Act to provide for the submission of civil cases by agreement of the parties to a referee learned in the law,” approved May 14th, 1874, P. L. 166, and the amendments thereto. The parties further agree to waive notice of time and place of hearing and to meet on notice from the Referee after his acceptance of the appointment and qualifying as such. The compensation of the Referee to be fixed by himself after con- sultation with counsel for plaintiff and defendant, subject to the approval of the court. M. HAMPTON TODD, Attorney for Plaintiff. J. HAMPTON BARNES, Attorney for Defendant. Endorsement: 2319 M’ch Term 1911—C. P. No. 5—Keystone Elevator & Warehouse Co. vs. Penna. Railroad Co.—Agreement to refer under Act May 14th, 1874—June 16-’11—Todd for plaintiff Barnes for defendant. 17 C. P. No. 5, March Term, 1911. No. 2319. Keystone ELEVATOR AND WAREHOUSE Co. vs. PENNSYLVANIA RAILROAD CoMPANY. The undersigned having been appointed as Referee under Act of May 14th, 1874 by agreement of counsel for the parties, hereby accepts the appointment as such Referee and appoints as the time of first meeting, Fridey June 23d, 1911 at 11 a. m. at his office No. 439 Land Title Building in the City of Philadelphia. G. HEIDE NORRIS. June 21, 1911. 55 A LRP PIT DY eH 14 THE PENNSYLVANIA RAILROAD COMPANY Vs, City AND CounTY OF PHILADELPHIA, State of Pennsylvania, ss: G. Heide Norris having been duly sworn according to law deposes and says that he will perform his duties as Referee in the above case according to law and to the best of his ability. G. HEIDE NORRIS. Sworn and subscribed to before me this 21st day of June, 1911. JAS. W. FLETCHER, Dep. Proth’y. Endorsement: No. 2319 March Term 1911—C. P. No. 5—Key- stone Elevator and Warehouse Co. vs. Pennsylvania Railroad Co.— Acceptance of Appointment as Referee and oath—Filed, Jun- 21 1911 Jas. W. Fletcher Pro Proth’y.—G. Heide Norris, Attorney at law, Rooms 437-439-441 New Land Title Building Philadelphia. Referee’s Report { ~) APPENDIX IN THE Court of Common Pleas, No. 5 March Term, 1911. No. 2319 KEYSTONE ELEVATOR AND WAREHOUSE CO. VS. PENNSYLVANIA RAILROAD COMPANY REFEREEF’S REPORT To the Honorable the Judges of said Court: The undersigned Referee, appointed by agreement of the parties under the Act of May 14, 1874, P. L. 176, filed June 16, 1911, having accepted the appointment and filed the required affidavit, notified counsel for the parties of a meeting to be held for the purposes of his appointment at his office No. 439 Land Title Building on June 23, 1911. On the above date and at subsequent meetings on July 10, 1911, February 28, April 28, June 5, July 9, July 14 and November 7, 1913, he was attended by M. Hampton Todd, Esq., counsel for plaintiff, and by John Hampton Barnes and George Stuart Patterson, Esqs., counsel for the defendant. The testimony of the, various witnesses who were sworn by the Referee was taken stenographically and after- wards reduced to typewritten form. The testimony is sub- mitted with this report together with the exhibits. U 62 2a Referee’s Report 16 This is an action to recover on an oral contract between the plaintiff and the defendant entered into on March 1, 1909, at Philadelphia, for services rendered by the plaintiff to the defendant for elevating, warehousing and other services on certain grain and other merchandise in the period from March 1, 1g0g, to April 30, 1g10. In the agreement it was stipulated that plaintiff should perform the services agreed upon from March 1, 1909, until either party should give notice of a desire to terminate the same and it was also stipulated that for the services rendered the defendant should pay to the plaintiff a just and reasonable sum for each ton of grain and merchandise handled by it. The statement of claim avers that the plaintiff, in con- sequence of said contract, entered upon its duties and per- formed services from March 1, 1909, to April 30, 1gto, when the contract was terminated by notice from the defendant. It also claims that thirty-five cents a ton is a just and reasonable value for services performed for the defendant and claims the sum of $42,826, for the actual tonnage handled by it under the contract. The statement also admits the payment by defendant on January 24, 1911, of the sum of $28,420.19. leaving on that date a balance due, including interest on monthly balances of $17,551.04, which sum is claimed by plaintiff from the defendant with interest thereon from January 24, 1911. The affidavit of defence filed by the defendant claims that the sum of $28,420.19 was paid by it in full satisfac- tion of the contract set forth in the statement of claim and denies that there is owing to the plaintiff the sum of $17,- 551.04 or any other or further sum. The defendant also filed a plea of “non assumpsit, payment with leave,” etc. The matter having thus been brought to an issue and no question having been raised as to the amount or char- acter of the services performed, the plaintiff called the following witnesses to prove that the just and reasonable value thereof was thirty-five cents a ton as the compensa- tion stipulated for in the contract. 34 i? Referce’s Report Samuel Bell, Jr., manufacturer of flour, with mills at Thirty-first and Market streets, Philadelphia, in business for thirty-five years, connected with the Merchants’ Ware- house Company since 1890, one of the principal owners of the Washburn and Crosby mills and familiar with the sub- ject of compensation for terminal service, testified that thirty-five cents a ton was a very reasonable charge in the years 1909 and 1910. Jacob Michel, superintendent of the Merchants’ Ware- house Company for twenty-five years, testified that fifty cents a ton was a fair compensation for these services in receiving grain, elevating it, redelivering it, collecting freight and being responsible for storage and warehouse receipts. He did not think thirty-five cents a ton was enough. Richard M. Richardson, general superintendent of the Keystone Warehouse Company, at Buffalo, N. Y., since 1go7, and acting for the Pennsylvania Railroad, New York Central Railroad, The Erie Railroad, the Wabash Railroad, the Michigan Central Railroad, thought that fifty cents a ton was a fair compensation for the services rendered by the plaintiff in the period from March 1, 1909, to April 30, 1910. He considered thirty-five cents per ton an unreason- ably low charge. Harvey C. Miller, principal stockholder in the Key- stone Elevator and Warehouse Company, testified that he had been engaged in the grain and elevator business since 1880 in Philadelphia and in a number of places in Western Maryland. He considered thirty-five cents a ton a very reasonable charge for the services rendered by the »laintiff to the defendant in the period from March 1, 1go9, to \pril 30, 1910. He thought the charge ought to be forty- two and a half cents a ton. The defendant offered no testimony to disprove the reasonableness of the charge of thirty-five cents a ton claimed by the plainiff as its proper compensation for the work performed under the contract but offered to show : - GOT Pee PO Pe fe RYT Ss “ PLE I - 4a i$ Referee’s Report “The different methods of delivering grain and other commodities by the plaintiff, the reason for the employment of the Elevator Company by the defendant, the explanation of the service performed by the plaintiff for the defendant, for and on behalf of the consignees of grain and other claims of property; for the purpose of establishing the necessity for the employment of the Elevator Company by the defendant, the function which the Elevator Company periormed in connection with transportation and the rela- tion of the defendant to the owners and consignees of grain, etc., handled through the elevator and warehouse, this to he followed by proof of the profits made by the Elevator Com- pany by the operation of its elevator.”’ Objection was made to this offer, but it was not pressed and testimony was permitted to be offered by the defendant for the purpose of throwing light on the reasonableness of the compensation claimed by exhibiting the amount and kind of work done by the plaintiff. Robert Clinton Wright, freight traffic manager of the Pennsylvania Railroad, was then offered as a witness by the defendait and testified at length on the subject covered by the above offer. Incidentally tariff schedule of charges by the plaintiff company was offered in evidence for Tariff I. C. C—G. No. 2953. in effect April 17, 1907, marked “Exhibit A.” Of this the witness said that it covers a tariff of charges to the public and does not cover the rate of payment by the railroad company to the ele- vator company. The defendant then made the following offers of proof : 1. That during the time embraced within the plain- tiff’'s statement, to wit, from March 1, 1909, to May 1, 1910, the capital stock of the Keystone Elevator and Ware- house Company, the plaintiff in this case, was Ten thou sand (10,000) shares at Ten (10) dollars each, all of which was issued and outstanding, and that during the said time Nine thousand three hundred and sixty (9360) shares ~T 5a i9 Referce’s Report of said stock, at a par value of $93,600 was the property of Mr. Harvey C. Miller. 2. That during the period in question, the said Harvey C. Miller was a member of the firm of L. P. Miller & Sons, who were shippers, consignees and dealers in grain, and that during the period in question go per cent. of the business elevated, stored and handled through the elevator and warehouse of the plaintiff company at North Phila- delphia, as referred to in the statement of claim, was grain elevated, stored and handled for and on account of the said firm of L. F. Miller & Sons, and for compensation for the elevation, storage and handling of which and the grain and merchandise of other owners and consignees through said elevator and warehouse this suit is brought, as is more specifically detailed in plaintiff's statement. 3. That said grain, the property of L. F. Miller & Sons and other owners, as aforesaid, and for the elevation, storage and handling of which through the Keystone [le- vator this action was brought, was grain which was shipped (at the tariff freight rates) from points in States other than Pennsylvania over the lines of the defendant com- pany to said Keystone Elevator and delivered by the defend- ant to the plaintiff company, who, in turn, elevated the same into the elevator and performed various other services with respect thereto, as more particularly detailed in the tariff hereinafter referred to. 4. That other grain dealers and consignees of grain competitors of L. F. Miller & Sons, located in the city of Philadelphia, received grain transported over the lines of the defendant from the same points as mentioned in para- graph 3 of this offer, and on which they paid the same freight transportation rate as that paid on grain of L. F. Miller & Sons, and that said other grain dealers and con- signees did not have any elevator nor perform any elevator service in connection with such grain, and accordingly did not receive any compensation therefor. ET AO GO MS OEE > PLIES BM AIL, IGT AM OI PPPS PET . Sa 20) Referee’s Report These offers were objected to by the plaintiff as irrele- vant and immaterial to the issue. The objection was sus- tained and an exception noted for the defendant. The defendant then offered to prove: 5. The defendant further offers to prove from the hooks of the plaintiff company that the plaintiff company and the said Harvey C. Miller, as the owner of 93.6 per cent. of the capital stock of said company, have already received by reason of the payment made by the defendant to the plaintiff, as averred in the plaintiff's statement, and the payments made to the plaintiff by consignees and owners under the tariff (admitted in evidence) for the performance by the plaintiff of the various services agreed to be per- formed by the plaintiff for the defendant, and for the per- formance of which this action is brought, the cost of such performance, as well as a reasonable profit in addition to said cost, and that the further payment demanded by the said plaintiff company for the performance of said services is forbidden by the provisions of the Act of Congress, entitled “An Act to Regulate Commerce,” approved eb- ruary 4, 1887, its amendments and supplements, as well as the \ct of Congress entitled “An Act to further regulate commerce with foreign nations and among the States,” approved February 19, 1903, its amendments and supple- ments. Counsel for the defendant stated (as recited in the offer) that the object was to show that the plaintiff had already received by means of the payment made by the defendant and by payments made to the plaintiff by con- signees and owners under the published tariff, the full cost as well as a reasonable profit for the services performed by it under the contract with the plaintiff and that no further amount could be recovered by it, the same being forbidden by the Act of Congress February 4, 1887, and its supple- ments and that the Referee must take into consideration the payments made to the plaintiff »y the owners and con- 7a “21 Referce’s Report signees of grain under the tariff in question, for perform- ance of the services which the plaintiff agreed with the defendant to perform and for which the defendant agreed to pay a reasonable compens:tion. Tn view of the mixed nature of the contract recited in the statement of claim and with the thought (at the time) that evidence of payments by other parties that the defend- ant for services to be performed by the plaintiff, might throw some light on the balance claimed to he due by the defendant for the full amount of reasonable charges against the defendant under the contract, the Referee overruled the objection for the present and noted an exception for the plaintiff. The defendant then offered: 6. A duly authenticated copy of the opinion, report and order of the Interstate Commerce Commission, decided January 7, 1913, dealing with the operation of the said Keystone elevator by the Keystone Elevator and Ware- house Company during the period covered by this suit, as well as the lease and contract with the defendant company under which the plaintiff has operated the same, and mak- ing an order against said defendant forbidding the leasing of said elevator to the plaintiff or the payment of any allow- ance for its services upon any property passing through said elevator or warehouse belonging to a stockholder of said plaintiff company, unless tariffs of the defendant should embrace similar privileges to all other shippers using this or any other elevator in the city of Philadelphia. This offer was objected to by the plaintiff. The ob- jection was overruled for the present and an exception noted for the plaintiff. Walter F. Sims was then called as a witness and testi- fied to various matters covered by offers 1, 2, 3, 4 and 5. Counsel representing both sides then presented a stipu- lation under date of July 9, 1913, showing receipts and disbursements by the plaintiff company and by Harvey C. ial. cael Ld al OOO IGT LOL LL LOOT I OP LOE ALG ODIO FE, 8a Referee’s Report SIP | to we Miller trading as the Philadelphia Cleaner Company dur- ing the period covered by the contract in this suit. This was objected to by the plaintiff as irrelevant The objection was overruled and exception noted for the plaintiff. The stipulation appearing in full on pages 66 and 67 shows: Expense Keystone Elevator & Warehouse Co. March 1, 1909 to April 30, 1910. . .$36,935.69 Receipts Keystone Elevator & Warehouse Co. March 1, 1909 to April 30, 1I910.... 42,922.43 Expense Philadelphia Cleaner Co. March 1, 1907 to April 30, 1g10.... 3,169.00 Receipts Philadelphia Cleaner Co. March 1, 1907 to April 30, I910.. 35,060.08 (Paid by Elevator Co. to Harvey C. Miller.) Harvey C. Miller was recalled and asked by counsel for the defendant, “Who performed the services under item 1 of the tariff?” (Exhibit “A”) as follows: “Receiving, weighing, storing freight cars, including first ten days storage and delivering to cars or wagons?” This and subsequent questions on the same line were objected to by counsel for the plaintiff. The objections were overruled and an exception noted for the plaintiff. Mr. Miller was asked, on page 75, “What would be the cost of duplication of the plant of the Cleaner Company ?” Objected to by plaintiff and objection overruled and exception noted. On page 88 the plaintiff moved to strike from the record all testimony of Mr. Miller taken at the meet- ga er : ’ wt) Referee’s Report ing of July 9, 1913. Motion overruled and exception noted. Carroll M. Bunting, a witness for the defendant, was asked, page 102: “What part of the gross receipts of the Elevator Company account was ascribed to services per- formed by the Elevator Company without the use of the patented process of the Cleaner Company ?” This was objected to by the plaintiff as irrelevant and not the subject of expert testimony. Objection overruled and exception noted. The witness then went on as an expert to apportion the division of earnings between the elevator company and the cleaner company by comparison with his experience of similar divisions of earnings between one railroad com- pany and another. A motion was made by the plaintiff to strike out the entire testimony of the witness. Robert C. Wright being recalled by the defendant, he was asked, page 111: “At the time covered by this suit, namely, between March 1, 1909 and April 30, 1910, did the published tariffs of the Pennsylvania Railroad Company authorize the payment of any allowance to any shipper, owner or consignee of grain, using the Keystone Elevator or any other elevator in the City of Philadel- phia, upon grain owned by such shipper, owner or con- signee?” and he was also asked, page 112: “During that period, did the Pennsylvania Railroad Company, in point of fact pay any such allowance to any shipper, owner or consignee of grain, as just described?” Both these questions were objected to by the plaintiff. The objections were overruled and exception noted. The action of the Referee in overruling practically all of the objections of the plaintiff to the defendant’s formal offers of proof and te the subsequent questions asked of the defendant’s witnesses, has been here fully set out so that no question can arise on the record as to the present view MP a Pte FS PO Ores lm i NEEL ET EY LOR, ee MPTP Se >. 10a tw Referee'’s Report of the Referee in his proposed action in now sustaining all of the objections made by the plaintiff and in striking out the testimony covered by the requests of the plaintiff to that effect. Reference was made to the decision in the case of Marr vs. Marr, 103 Pa. p. 463, as to the duty of the Kereree to hear all testimony, material and pertinent to the issue and to the report upon the same. The Referee has never had any doubt, as evidenced by his sustaining the original objection made by plaintiff, that the only question material and pertinent to this case is as to what is a just and reasonable compensation under a quantum meruit for the services performed by the plain- tiff for the defendant. From the substance and manner in which some of the defendant's offers were put, the Referee was of the opinion however that perhaps they involved evidence which might throw light upon this very question of reasonable com- pensation. The contract itself called for so many things and services to be done and performed by the plaintiff for the defendant, that it might be possible, if the plaintiff received payment from other parties for any of these serv- ives so contracted for, the defendant might be relieved pro fanto from part of its obligation to pay. In other words, the language of the contract and of the offers was to a certain extent confusing to the issue. The testimony as taken threw no light whatever on the just and reasonable compensation due to the plaintiff by the defendant, but exhibited conclusively the purpose to invoke the provisions of the Interstate Commerce Act to defeat the plaintiff's claim for the balance due under the contract. In passing on the question here involved, the Referee has not reviewed, and will not rev ew, the testimony of the witnesses in extenso because the formal offers cover fully the defendant’s contentions. In declining these offers and sustaining the plaintiff's objections, the defendant is fully Ifa ~ Ko) Referce’s Report protected, because on appeal, for the purposes of argument, the subject matter of the offers must be taken as proven. Let us now take up the consideration of the merits of the case and the respective contentions of the parties. The plaintiff claims that this is a common law action to recover on a quantum meruit a just and reasonable com- pensation, as stipulated for in the contract, for services fully and faithfully performed. The defendant does not deny that the services were performed as contracted for, but alleges that the balance claimed by the plaintiff, over and above the amount admit- tedly received, cannot be recovered from it because, by virtne of holding the contract, the plaintiff has, out of its special facilities and by control through its principal stock- holder of patented devices, made enormous profits out of its customers, the consignees and owners of grain and mer- chandise whose elevating and warehousing business it has transacted. The defendant has cited the Act of Congress of Feb- ruary 4, 1887, Sections 2 and 15, known as the Act to Regulate Commerce, and the Act of June 29, 1906, Section 1, known as the Elkins Act, and the following cases: In re Allowance to Elevators vs. 1. C. C., 12 1. C. C., page 85. Trafic Bureau of St. Louis vs. C. B. IW. R. R., 14 I. C. C. page 317 Federal Sugar Refining Co. vs. B. & O. R. R. Co., 17 1. C. C. pages 40-47. Southern Pacific Terminal Co. vs. Interstate Commerce Commission, 219 U. S. page 489. Peavey & Co. vs. Union Pacific R. R. Co., 76 Fed. Rep. page 409. Interstate Commerce Commission vs. Diffen- baugh, 222 U. S. page 42. 7 ici 12a cK y ’ Referee’s Report Interstate Commerce Commission vs. Key- stone Elevator Co., Opinion 2114 and order made thereon, January 7, 1913. Also on the point that every contract is sub- ject to the limitation of the Interstate Commerce .\ct. N. Y., N. H. and H.R. R. Co. vs. Interstate C. C., 200 U. S. page 361. Armour Packing Co. vs. United States, 209 U.S. page 56. Section 2 of the Act to Regulate Commerce, approved February 4, 1887, as amended and supplemented, provides: “That if any common carrier subject to the pro- visions of this Act shall, directly or indirectly, by any special rate, rebate, drawback, or other device, charge, demand, collect, or receive from any person or persons a greater or less compensation for any service ren- dered, or to be rendered, in the transportation of pas- sengers or property, subject to the provisions of this Act, than it charges, demands, collects, or receives from any other person or persons for so doing for him or them a like and contemporaneous service in the transportation of a like kind of traffic under substan- tially similar circumstances and conditions, such com- mon carrier shall be deemed guilty of unjust discrim- ination, which is hereby prohibited and declared to be unlawful.” Section 15 of the same Act provides: “If the owner of property transported under this Act directly or indirectly renders any service con- nected with such transportation, or furnishes any in- strumentality used therein, the charge and allowance therefor shall be no more than is just and reasonable, and the commission may, after hearing on a complaint or on its own initiative, determine what is a reasonable 13a ‘) 3 OM 4 Referee’s Report charge as the maximum to be paid by the carrier or carriers for the services (service) so rendered or for the use of the instrumentality so furnished, and fix the same by appropriate order, which order shall have the same force and effect and be enforced in like man- ner as the orders above provided for (in) under this section.” Section 1, of the Act of June 29, 1906, provides: “The willful failure upon the part of any carrier subject to said acts to file and publish the tariffs or rates and charges as required by said acts, or strictly to observe such tariffs until changed according to law, shall be a misdemeanor, and upon conviction thereof the corporation offending shall be subject to a fine of not less than one thousand dollars nor more than twenty thousand dollars for each offense; and it shall he unlawful for any person, persons, or corporation to offer, grant, or give, or to solicit, accept or receive any rebate, concession, or discrimination in respect to the transportation of any property in interstate or foreign commerce by any common carrier subject to said act to regulate commerce and the acts amendatory thereof whereby any such property shall by any device whatever be transported at a less rate than that named in the tariffs published and filed by such carrier, as is required by said act to regulate commerce and the acts amendatory thereof, or whereby any other advan- tage is given or discrimination is practiced. Every person or corporation, whether carrier or shipper, who shall, knowingly, offer, grant, or give, or solicit, accept, or receive any such rebates, concessions, or discrimina- tion shall he deemed guilty of a misdemeanor, and on conviction thereof shall be punished by a fine of not less than one thousand dollars nor more than twenty thousand dollars.” I4a > 5 = Referee's Report The Referee has read and carefully considered the statutes above referred to and the cases cited by the defend- ant, but it does not seem to him that they have any bearing on the point in issue under the facts of this controversy. It is undoubtedly true that the acts of Congress have been passed and the Interstate Commerce Commission has been created and it and the Courts have acted upon a state of affairs in the commerce of the United States, that required strong measures for correction. The cases referred to by the defendant mostly arose in an endeavor to correct the result of the various devices which were adopted to circumvent the law. There were also other cases, where the machinery of justice has been invoked, in which the alleged violations of law grew out of a perfectly open and fair transaction not intended to offend any statute. The Referee is aware that the Interstate Commerce Commission has undertaken to cut down compensation, for services rendere | by shippers to railroads, to an infinitesimal point and even refused to sanction any payment whatever bevond the actual cost of the service. The case of the Allowance to Elevators, 12 1. C. C. page &5. and the so-called Peavey case, Traffic Bureau vs. Railroad Co., 14 1. C. C. page 317, are illustrations of this attitude. The Supreme Court of the United States, however, in the case of the /nterstate Commerce Commission vs. Diffen- baugh, 222 U. S. page 42, has put an end to such drastic action. \ bill in equity was filed against the order of the Interstate Commerce Commission in the Peavey case in the Cirevit Court for the Western District of Missouri and an injunction was granted restraining its execution. Peavey ws. Railroad Company, 176 Fed. Rep. page 409. 15a 2Q Refercee’s Report \n appeal was then taken to the Supreme Court of the United States and the action of the Court below was sustained. I. C. C. vs. Diffenbaugh, 222 U.S. page 42. In the opinion in this case delivered by Mr. Justice Hoimes, the following appeared: “The law does not attempt to equalize fortune, opportunities or abilities. On the contrary, the Act of Congress in terms contemplates that if the carrier receives service from the owner of property trans- ported or uses instrumentalities furnished by the latter, he shall pay for them. ‘That is taken for granted in Section 15, the only restriction being that he shall pay no more than is reasonable.” Now what more have we in the case before us than is sanctioned by the statute and this language of the Court of last resort? The defendant, conducting a railroad and being the owner of an elevator, a most useful adjunct in attracting business to its lines, makes a contract with an acute and experienced grain merchant to lease its elevator and carry on and conduct the elevating and warehousing business and agrees to pay him or his company a reasonable charge per ton for so doing. The business is carried on successfully and satisfactorily for a period of years antecedent to and for the time covered by the claim here made and then the defence is set up that it is against the law to pay the full claim because the shipper, conducting the elevator, has made large profits from other shippers out of the business. It is true that Harvey C. Miller was a large majority stockholder in the Keystone Elevator Company, that he, or his firm, was a large shipper of grain, who used the ele- vator; it is also true that he practically owned the Phila- delphia Cleaner Company, which cleaned the grain passing through the elevator and it is true that he made considerable 16a Referce'’s Report profit for the elevator company and for himself, as the Philadelphia Cleaner Company, out of the business he transacted, but wherein and how do these facts affect the right of the elevator company to recover its compensation under the contract with the defendant? The law explicitly allows proper compensation under such circumstances and the Courts have said also that it does not attempt to equalize fortune, opportunity or ability. How then can it be successfully contended that Mr. Miller is to be deprived of what his business acumen has enabled him to earn for himself or his associates? M1. Miller is certainly entitled to the earnings of his industry and skill without having them offset against what is due to him or his company on this contract. No case has been cited by the defendant which sus- tains any conclusion to the contrary. If the plaintiff is not to receive the compensation contracted for by reason of the objection made by the defendant, then the benefit of the plaintiff's ability will inure not to it but to the defendant. There is no offer to prove any fraudulent de- vice or arrangement, to secure an unfair advantage over competitors and in the opinion of the Referee no such fraudulent claim can be presumed or its effect produced by the circumstances of this case. On the subject of the reasonableness of the charge, we must take into consideration the fact that a written contract for similar services has been in existence between the parties for a number of years prior to the period in controversy and the compensation fixed in that contract was thirty-five cents per ton. Moreover, the services re- quired to be performed by the plaintiff under the previous written contract and under the present verbal agreement were many and varied, requiring technical skill and con- stant attention and involving many duties and responsi- bilities. As set out in the Statement of Claim, the plain- tiff was required “to use all reasonable efforts to secure 17a _ a ~e Referee’s Report to the lines owned, leased, controlled and operated by the defendant, all traffic controlled by it or destined to or from the elevator and warehouse, to prefer the traffic of the defendant to that of other lines in the use of the plaintiff's facilities; to furnish at its own cost, the manuai labor required; to promptly load and unload all the cars of the defendant; to handle promptly and effectively all traffic delivered by the defendant; to pay all operating and running expenses of the elevator and warehouse: to act, free of cost, as agent of the defendant for collection of freight; to protect and indemnify the defendant from all liability on account of omission and commission on the part of the plaintiff in respect to the grain and merchandise received at the elevator and also on account of receipts for grain and merchandise received by the plaintiff; to keep all property, for which the defendant might be re- sponsible, insured against fire and to perform the general duties incident to such agency.” The plaintiff's witnesses, Messrs. Samuel Bell, Jr. Jacob Michel and Richard M. Richardson, previously re- ferred to, all persons of great experience in the grain elevator and warehouseing business, having been made acquainted with the terms of the contract, all testified that thirty-five cents per ton was a fair and reasonable com- pensation for the services performed by the plaintiff for the defendant. Harvey C. Miller testified that the price ought to be forty-two and a half cents per ton for the period in which the services were performed, and some of the other wit- nesses referred to said that even fifty cents a ton would not be unfair in view of the duties of receiving grain, elevating and redelivering, collecting freight receipts and being responsible for storage and warehouse receipts. Mr. Miller testified (p. 25) that thirty-five cents a ton about represented the actual cost, and (on p. 113) that if the U #2 18a Referee’s Report business brought by the Philadelphia Cleaner Co. was excluded, the cost would have been $1.52 1/2 per ton. As against this evidence, the defendant offered no testimony or made any claim that the plaintiff was charg- ing more than others in the same line of business, or that the charge of thirty-five cents per ton was not entirely reasonable. The sixth offer of defendant (to which objection was made and temporarily overruled), related to the decision and order of January 17,1913, of the Interstate Commerce Commission in the Keystone Elevator case. There the Commission dealt with the particular parties to this case under the contract, and the decision involved a considera- tion of the operation of the elevator company during the period covered by this contract, and an order was made prohibiting the making of any similar contract under like conditions for a period of two years from March 1, 1913. Neither in the opinion of the Commission nor in its order referred to (made nearly three years after the serv- ices rendered had been performed), did it undertake to adjudicate upon the right of the Keystone Elevator Com- pany to recover from the Pennsylvania Railroad Com- pany compensation for the services rendered between March 1, 1909 to April 30, 1910. The order simply pro- hibits future contracts or leasing under similar conditions for two years from March 1, 1913, and in view of the decision of the Supreme Court in the Diffenbaugh case, that is probably as far as the Commission would now undertake to interfere. The Referee now sustains all of the objections of the plaintiff and strikes out all the testimony as requested by the plaintiff. In the opinion of the Referee the plaintiff has proved its case and the defendant has offered no legal defence to the payment of the balance claimed. This case is gov- erned by the rules of common law applicable to actions 19a ‘ey Le Te ) Referee's Report of assumpsit on a quantum meruit and the plea of noa assumpsit, payment, etc., is not sustained by offers to prove that the largest stockholder of the plaintiff company, who was also a member of a firm of grain shippers, furnish- ing a large portion of the business to the plaintiff and who was also the owner of a patented grain cleaning ap- paratus, made large profits for himself and the plaintiff out of the elevator and warehousing business during the period covered by the contract. “Evidence as to the amount of profits earned by the plaintiff in his own business while attending to the defendant’s business is inadmissible.” Wiley vs. Goodsell, 33 N. Y. App. Div., p. 452; 38 N.Y. Suppl, p. 376: Cyc, Vol 40, p. 2848 and 2849 The referee finds the following facts: FINDINGS OF FACT 1. That the plaintiff at the special instance and re- quest of the defendant agreed to render the service, de- scribed in the statement of plaintiff's cause of action, to the defendant for the term beginning the first day of March, 1909, and ending the 30th day of April, 1910, for the compensation of what the same should be reasonably worth. 2. That the reasonable and just value of the services rendered by the plaintiff to the defendant for the period set forth in the first above finding is thirty-five cents per ton for each ton of grain and other merchandise handled by it through the said elevator and warehouse upon which, under the terms of said agreement, it was entitled to compensation. . 20a - Referee'’s Report 3. The plaintiff is entitled to compensation upon the following tonnage of grain and other merchandise, namely : In the month of March, 1909, 13, 732,040 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the IS Eh ok ev ae so ie eh ea a $2,403.11 In the month of April, 1909, 12,153,295 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the WW i Wo nde ie eee bse caeaek 2,126.83 In the month of May, 1909, 11,635,770 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the GE ide bistenetadd teeer naan es 2,036.26 In the month of June, 1909, 12,- 975,660 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thou- sand pounds amounts to the sum of = 2,270.74 In the month of July, 1909, 15,- g08,610 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the EE ke hoe riko adored eiuceds 2,784.01 2ia Referee’s Report In the month of August, 1gog, 20,384,150 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the ey ey Pee er Te are In the month of September, 1 goy. 22,124,595 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the ee ee mg Py aoe In the month of October, tgog, 16,740,795 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the OE Ses axnéskadicessaddaaeeeces In the month of November, 1909, 19,927,607 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the ok Seer err ore he ee rery In the month of December, 1gog, 21,538,460 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thousand pounds amounts to the GEN ce uausbcisenssesdesnonee oy In the month of January, 1910, 21,912,845 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thou- sand pounds amounts to the sum of > ww - 3,871.80 2,929.04 3,487.33 3,769.23 3834-75 36 22a wv Referee’s Report In the month of February, 1910, 17,441,625 pounds of grain and other merchandise, which at the rate of thirty-five cents.per ton of two thou- sand pounds amount to the sum of 3,052.28 In the month of March, Ig1!0, 19,123,010 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thou- sand pounds amounts to the sum of 3,346.53 In the month of April, 1910, 19,212,475 pounds of grain and other merchandise, which at the rate of thirty-five cents per ton of two thou- sand pounds amounts to the sum of 3,346.28 Amounting in the aggregate to oe ek Pre eee ee eee Te $42,826.00 4. That the defendant has paid to the plaintiff on account of said services on the 24th of January, 1911, the sum of $28,420.19. CONCLUSIONS OF LAW First—That the defence set up and offered to be proved by the defendant is an insufficient answer to the plaintiff’s claim. Second.—That there is due and owing by the defend- ant to the plaintiff the sum of $17,551.04, with interest thereon from January 24, 1911. The Referee therefore recommends that judgment shall be entered accordingly in favor of the plaintiff and against the defendant. All of which is respectfully submitted. G. Hebe Norris Referee January, 1914. 23a . Exceptions of Defendant to Report of Referee EXCEPTIONS OF THE PENNSYLVANIA RAIL- ROAD COMPANY, DEFENDANT, TO REPORT OF REFEREE First—The defendant excepts to the refusal of the Referee to admit in evidence the defendant's offers as follows: “1. That during the time embraced within the Plaintiff's statement, to wit, from March Ist, 1909, to May Ist, 1910, the capital stock of the Keystone Elevator & Warehouse Company, the Plaintiff in this case, was Ten thousand (10,000) shares at Ten (10) Dollars each, all of which was issued and outstand- ing, and that during the said time Nine thousand three hundred and sixty (9360) shares of said stock, at a par value of $93,600 was the property of Mr. Harvey C. Miller.” “2. That during the period in question, the said Harvey C. Miller was a member of the firm of L. F. Miller & Sons, who were shippers, consignees, and dealers in grain, and that during the period in ques- tion go per cent. of the business elevated, stored and handled through the elevator and warehouse of the Plaintiff Company at North Philadelphia, as referred to in the statement of claim, was grain elevated, stored and handled for and on account of the said firm of L. I. Miller & Sons, and for compensation for the elevation, storage and handling of which and the grain and merchandise of other owners and con- signees through said elevator and warehouse this suit is brought, as is more specifically detailed in plaintiff's statement.” a) 3. That said grain, the property of L. IF. Mil- ler & Sons and other owners, as aforesaid, and for the elevation, storage and handling of which through the Keystone Elevator this action was brought, was grain which was shipped (at the tariff freight rates) from points in States other than Pennsylvania over the lines of the Defendant Company to said Keystone Ele- ee — 5 Ps eat ae ae ee bet dee RPE Es Poe edad Exceptions of Defendant to Report of Referee vator, and delivered by the Defendant to the Plaintiff Company, who, in turn, elevated the same into the elevator and performed various other services with respect thereto, as more particularly detailed in the tariff hereinafter referred to.” “4. That other grain dealers and consignees of grain, competitors of L. I. Miller and Sons, located in the City of Philadelphia, received grain transported over the lines of the Defendant from the same points as mentioned in paragraph 3 of this offer, and on which they paid the same freight transportation rate as that paid on grain of L. F. Miller & Sons, and that said other grain dealers and consignees did not have any elevator nor perform any elevator service in connection with such grain, and accordingly did not receive any compensation therefor.” 5. The Defendant further offers to prove from the books of the Plaintiff Company that the Plaintiff Company and the said Harvey C. Millcr, as the owner of 93.6 per cent. of the capital stock of the said Com- pany, have already received by reason of the payment made by the Defendant to the Plaintiff, as averred in the Plaintiff's Statement, and the payments made to the Plaintiff by consignees and owners under the tariff (admitted in evidence) for the performance by the Plaintiff of the various services agreed to be per- formed by the Plaintiff for the Defendant, and for the performance of which this action is brought, the cost of such performance, as well as a_ reasonable profit in addition to said cost, and that the further payment demanded by the said Plaintiff Company for the performance of said services is forbidden by the provisions of the Act of Congress, entitled ‘An Act to Regulate Commerce,’ approved February 4, 1887, its amendments and supplements, as well as the Act of Congress entitled ‘An Act to further regulate com- merce with foreign nations and among the States,’ approved February 19, 1903, its amendments and sup- plements.” “6. A duly authenticated copy of the opinion, report and order of the Interstate Commerce Com- mission, decided January 7, 1913, dealing with the sy 25a oh ~ Exceptions of Defendant to Report of Referee operation of the said Keystone Elevator by the Key- stone Elevator & Wasehouse ‘Company during the period covered by this suit, as well as the lease and contract with the Defendant Company under which the Plaintiff has operated the same, and making an order against said Defendant forbidding the leasing of said elevator to the Plaintiff or the payment of any allowance for its services upon any property passing through said elevator or warehouse belonging to a stockholder of said Plaintiff Company, unless tariffs of the Defendant shoukl embrace similar privileges to all other shippers using this or any other elevator in the City of Philadelphia.” Second.—The defendant excepts to the refusal of the Referee to admit in evidence the stipulation of coun- sel set out on pages 66 and 67 of the testimony, as follows: “A\np Now, July gth, 1913, it is stipulated be- tween the parties to this cause that the books of the Plaintiff Company show the following for the period between March Ist, 1909, and April 30, 1910: [. Expenses. ATs Wo es Sola Sc ahd ata Wels we eae Ae $5,012.68 Cees a kee eu bee h ees cave xe 2,847.62 SP EOE PEP Re T ore ee Pe eee ee eee 177 ese ees Lee ee hae os ee ote we 7,872.50 TT ET Ce eee ae Pe eee 17,975-00 EE oy Cok wad kn es FACE Rao ee De EE 3,050.00 MMiae ceUkECaa tyke va aku eie cadaee os $36,935.69 That during the same period of time the expenses of the Cleaner Company were $3,169.00 II. Receipts. eS errr ererrr eres 3,976.45 CERO rr. Kien Rou R Rs Cee wwe 2,300.55 EIN fs CS aa he Se eames wo 6,335-31 CE DD aw inne ha,gra bo nee e ke 22.14 wo ye es ree re err ree 22,818.59 SR oak 56k 65s ede Soke eee 919.26 40 Exceptions of Defendant to Report of Referee 26a Sub-letting leased property.............. 415.00 Weighing on wagon scales.............. 156.72 Steam heat sold to Railroad Co........... 1,605.88 Warehouse Storage ( Not elevator)........ 919.80 Charges at 1-4¢ bushel................. 53-57 Received from wagons at 1-2¢ per bushel. . 3.19 “cs “ “ “c I “ “ fi 5,22 Transferring lading of car for Railroad Co. en RUC Sg coca cia cuts 585.95 oe SO eer er er ree 7.05 EE 5 kc ws oo Nok a oe ee .. 2,110.46 RINE Cahier. Wank sal) cue ot be caletpene eS 9.77 SR RE AES ret en BUS ict 46.92 Ee AAS PRN nO PRT ARR ier 1.25 eg RO EE An aera 2,159.70 “s “ Be dua wr kb eo la bese alae es 511.14 7 7 dk. AE roe Pee 39.50 ss Mee Pica saw eid ames 23.00 CONE ass eg ork ceases (ees ie enh 852.01 NO ey cw alex ais 5 eae in eos $15,922.43 That during the same period of time the Elevator Company paid Mr. Harvey C. Miller the sum of $35,- 060.08 for the right to use in said elevator certain patented processes for cleaning and otherwise treating grain, said payment being at the rate of 3-4¢ per bushel on all grain so cleaned or treated. July 9, 1913. M. Hampton Topp, Atty for Pitf. Joun HAmpton Barnes Atty. for Defendant. Third.—The defendant excepts to the refusal of the Referee to admit in evidence the testimony of Harvey C. Miller in answer to the question: “Who performed the services under item 1 of the tariff?” (Exhibit A) as follows: “Receiving, weigh- ing, storing freight cars, including first ten days stor- age and delivering to cars or wagons.” 27a 44 Exceptions of Defendant to Report of Referee to the refusal of the Referee to admit in evidence the testi- mony of Harvey C. Miller in answer to the question: “What would be the cost of duplication of the plant of the Cleaner Company ?” and to the ruling of the Referee striking out all the testi- mony of said Harvey C. Miller taken at the meeting on July 9, 1913. Fourth—The defendant excepts to the refusal of the Referee to admit in evidence the testimony of Carroll M. Bunting, a witness called by the defendant, in answer to the question: “What part of the gross receipts of the Elevator Company account was ascribed to services performed by the Elevator Company without the use of the pat- ented process of the Cleaner Company 7” and to the striking out by the Keferee of the entire testi- mony of the said witness Carroll M. Bunting. Fifth—The defendant excepts to the refuasl of the Referee to admit in evidence the testimony of Robert C. Wright in answer to the question: “At the time covered by this suit, namely, between March 1, 1909 and April 30, 1910, did the publishe:| tariffs or the Pennsylvania Railroad Company author- ize the payment of any allowance to any shipper, owner or consignee of grain, using the Keystone Elevator or any other elevator in the City of Philadelphia, upon grain owned by such shipper, owner or consignee? During that period, did the Pennsylvania Railroad Company, in point of fact pay any such allowance to any shipper, owner or consignee of grain, as just described ?” Sixth.—The defendant excepts to the following state- ment by the Referee: “The Referee has never had any doubt, as evi- denced by his sustaining the original objection made 42 28a Exceptions of Defendant to Report of Referee by plaintiff, that the only question material and perti- nent to this case is as to what is a just and reasonable compensation under a quantum meruit for the services performed by the plaintiff for the defendant.” Seventh—The defendant excepts to the express find- ing of the Referee as follows: “The Referee now sustains all of the objections of the plaintiff and strikes out all the testimony as re- quested by the plaintiff.” Eighth—The defendant excepts to the finding by the Referee as follows: “In the opinion of the Referee the plaintiff has proved its case and the defendant has offered no legal defence to the payment of the balance claimed. This case is governed by the rules of common law applicable to actions of assumpsit on a quantum meruit and the plea of non assumpsit, payment, etc. is not sustained by offers to prove that the largest stockholder of the Plaintiff Company, who was also a member of a firm of grain shippers furnishing a large portion of the business to the plaintiff and who was also the owner of a patented grain cleaning apparatus, made large profits for himself and the plaintiff out of the elevator and warehousing business during the period covered by the contract.” Ninth—tThe defendant excepts to the following finding of fact by the Referee: a 2. That the reasonable and just value of the services rendered by the plaintiff to the defendant for the period set forth in the first above request is thirty- five cents per ton for each ton of grain and other mer- chandise handled by it through the said elevator and warehouse upon which, under the terms of said agree- ment, it was entitled to compensation.” Tenth.—The defendant excepts to the finding by the Referee in the third finding of fact that the plaintiff is entitled to compensation upon the tonnage of grain and merchandise therein set forth in the sum of $42,826. yy 29a 4 Exceptions of Defendant to Report of Referee less as a credit the payment made by the defendant to the plaintiff of the sum of $28,420.19. Eleventh.—The defendant excepts to the finding of law by the Referee as follows: 1. That the defence set up and offered to be proved by the defendant is an insufficient answer to the plaintiff's claim.” Twelfth—The defendant excepts to the finding of law by the Referee as follows: ss, 2. That there is due and owing by the defend- ant to the plaintiff the sum of $17,551.04, with interest thereon from January 24, 1911. The Referee therefore recommends that judg- ment shall be entered accordingly in favor of the plain- tiff and against the defendant.” Joun Hampton Barnes Attorney for defendant. Jany 28, 1914 The Referee has considered the foregoing exceptions and sees no reason to change his report in any particular. The exceptions are therefore dismisse’. G. Hetpe Norris January 29, 1914. Referee LOLOL LOD 2 > a ee = EP CT ee iach iil 44 ” Testimony TESTIMONY Meeting held before the Referee, G. Heme Norris, Esg., at his office, No. 439 Land Title Building, Philadel- phia, Pa., on Friday, June 23, 1911, at 11 a. m. PRESENT: G. Hetpe Norris, Esg., Referee. M. Hampton Topp, Esg., Attorney for plaintiff. Joun Hampton Barnes, Esg., Attorney for defend- ant. SAMUEL BELL, Jr., having been duly sworn, was ex- amined as follows: By Mr. Topp: YQ. Where do you live? A. 1314 Locust Street. (). What business are you engaged in? A. Manufacturer of flour, and flour mills. (). Have you any interest in the elevator business ? A. None except my own. Q. Where is it? A. Thirty-first and Market. (). Known by what name? A. Quaker City Flour Mills. ©. How long have you been engaged in the grain and flour business? A. About thirty-five years. QM. Are you familiar with the operations of a grain elevator 7 A. Yes. Q. .\t one time, I believe, you were selected as an arbitrator, were you not, by either the Keystone Elevator or the Pennsylvania Railroad, to pass upon the reasonable- 3la Samuel Bell, Jr. ness of the allowance then made by the Railroad Company to the elevator ? A. Yes, sir. by THe REFeree: Q. In what case? A. That was the case of Pennsylvania Railroad and Keystone Elevator Company. By Mr. Topp: ©. It was under the terms of the lease? A. Under the terms of the lease. ©. Who selected you? A. There was Mr. Kingston, of the Pennsylvania Railroad, and myself and another gentleman; I forget who that was. By THe REFEREE: ©. Was your appointment in regard to the question involved in this case? A. It was the price of the terminal, you understand, that the Pennsylvania Railroad Company was to pay to the Keystone Elevator Company: at that time, in 1906, there was a terminal to be charged. 3y Mr. Topp: QO. Have you read the plaintiff's statement of his cause of action in this case? A. I have. O. You also, by reason of your connection with the Merchants’ Warehouse Company, are familiar or not with the subject of compensation for terminal services? A. Yes. O. How long have you been identified with the Merchants’ Warehouse Company ? 32a Samuel Bell, Jr. 46 A. Since 1&go. Q. You are also familiar with this subject in other places besides Philadelphia, are you not? my: Taree. Q. Your business brings that subject up before you continuously, does it not? A. Yes, sir. QO. You are a modest man, I know, but I would like to show that you are one of the principal owners in the Washburn & Crosby Mills, are you not? A. Yes, sir. QO. Which make 45,000 barrels of flour a day, do they not ? A. Yes, sir; that is, in all their plants. ©. Based upon the information which you have ac- quired in this way, from your ownership of the Quaker City Milling Company, who own elevators, and having familiarized yourself with the services alleged to have been performed by the Keystone Elevator and Warehouse Com- pany for the Pennsylvania Railroad Company, what would you say would be a fair and reasonable compensation for such services for the period from March 1, 1909 to April 30. 1910, payable monthly ? A. Can I not just say what I base that on when I answer it? Q. You can say first what you think it should be and then give your reasons for it afterwards. A. I would say that 35 cents a ton would be a very reasonable charge on grain. Q. Now go on and just tell the Referee your reasons for saying that. A. We handle grain at the Quaker City Flour Mill and our expense there of loading and unloading and doing similar work, such as was performed by the Elevator Com- pany, the cost was fully the amount I have named, 35 cents a ton. On merchandise, basing it on my long experience 334 4“ ‘ Samuel Bell, Jr. with the Warehouse Company, I would say that, as that is handled differently, a fair charge on that would be 50 cents a ton. I am basing that on my connections with the costs doing the business in my connection with the Merchants’ Warehouse Company. Q. They handle about how many tons of merchandise, would you say, a year, the Merchants’ Warehouse Com- pany ? A. In 1890 there was 120,000 tons handled. At that time the terminal cost was 38.7 cents per ton. Owing to the advance in labor, we find that in 1904, when we handled 208,838 tons, the cost was 61.1 cents per ton. Now we go from 1904 to 1911, when we handled 83,513 tons for five months—I am just giving that to take it up to date— that cost 87.6 cents. That is the reason I am basing my 50 cents per ton on merchandise. Q. Of course, merchandise such as you have de- scribed as handled through your Merchants’ Warehousing Company is more expensive than grain ? A. A great deal. Q. Was it more or less expensive to operate an ele- vator and render the services such as were rendered in this case in 1909-10 than it was prior to that time? A. Yes, sir; more expensive. QO. How much percentage would you say there had been of an increase in the expense of operation of ele- vators between, take the year 1903 and the year 1909? I just take those two years for example; if there are any other two years that illustrate it better, take them. A. You said elevators; I do not know whether I can answer that question, because I have not the statement of the cost. Q. Give us your approximation on that. Was it more or less? A. I should say, when I based 35 cents a ton charge in 1906, that it is more costly to do the grain business U 62 34a Samuel Bell, Jr. 48 and handle it in the same way now than it was at that time. Q. In 1909? A. Yes. That.is my reason for saying that; I in- vestigated then and knew that was a low cost, therefore, 35 cents a ton today must be a very low cost. By THe Rereree: Q. Not today, but in 1909. A. Yes. By Mr. Topp: ©. By low cost you mean a reasonably low compen- sation for the services ? A. Yes, reasonably low compensation for the services QO. You do not know, do you, directly what it has cost the Keystone people to render this service ? A. No, sir. CROSS-EXAMINATION by Mr. BARNES: ©. In the matter in which you were arbitrator in 1go6, you say it was under a lease. Was that the same lease as is involved here? A. Yes, sir. Q. And you rendered a decision on that subject and made an award on that subject? A. Yes. The Referces all decided at that time that that was the proper charge to make at that time. . So this same question has been before you as ar- bitrator about which you are now testifying as an expert witness ? A. Yes, sir. Q. And your testimony as an expert, of course, is in entire consistency with your report as an arbitrator ? A. Yes, sir. hs 49 Samuel Bell, Jr. (At Mr. Barnes’ request, the following portion of the witness’s direct testimony was read: “We handle grain at the Quaker City Flour Mill, and our expense there of loading and unloading and doing similar work, such as was performed by the Elevator Company, the cost was fully the amount I have named, 35 cents a ton.”) By Mr. Barnes: Q. By similar work, do you mean work in connec- tion with the transportation of grain by any railroad ? A. No, sir; that is just the loading and unloading. ©. From what? A. From the cars. We have to unload it from the cars, elevate it, weigh it and put it back into the bins. (). With what railroad has your Company siding connections 7 \. Pennsylvania Railroad. (). In what way, then, does the work which you do it that elevator differ from what you understand to be that done by the Keystone Elevator and Warehouse Com- any in this case? \. [| would say that they did not have very much service to do outside of that, without they collected freights. (Question repeated. ) By Mr. Topp: ©. How do the services rendered by the two com- pare? A. I should think they are about the same. By Mr. Barnes: Q. I understand you, then, to express an opinion that the cost of that service is in excess of 35 cents, or is 35 cents ? si 6a .. {) 3 Samuel Bell, Jr. A. Is 35 cents. Q. And that includes no profit to the Elevator Com- pany for doing the work? A. In handling quantities, they may be able to make a profit on that; I do not know. ©. What would be your judgment as to the percent- age of profit in that transaction, that payment? A. I should think 10 per cent, they ought to have anyhow. ©. That is to say, that the 35 cents includes, in the gross business on which such payment is made, the cost of service plus 10 per cent on the gross? A. That, I say, would be a reasonable charge. ©. I asked you whether the 35 cents includes that? A. Yes, sir. RE-DIRECT EXAMINATION By Mr. Topp: ©. Does the Washburn-Crosby Company have any elevators? A. Yes, sir. ©. To what extent? A. They have some four hundred, but they are run under different management from the Washburn-Crosby Company ; but they are owned by the Washburn Company. ©. They are operated in connection with the Wash- burn-Crosby Company ? A. Yes, sir. ©. Four hundred elevators? A. We have what we call houses along the line of the railroad. ©. That is where you receive grain from one car and spout it into another? A. Yes. That would be different from a terminal elevator. 37a 4 Jacob Michel ee | Q. The price which you have named for the Quaker City Elevator; does it or not include responsibility for freight collections and for warehouse receipts ? A. No, sir. Q. Or proper deliveries, right deliveries ? A. No, sir. (Adjourned until Monday, July 10, 1911, at 10.30 a. m.) Meeting held at the office of the Referee, G. Heide Norris, Esq., 437 Land Title Building, Philadelphia, on Monday, July 1oth, 1911 at 10.30 a. m. Present: G. Herne Norris, Esg., Referee. M. Hampton Topp, Esg., for Plaintiff. Joun Hampton Barnes, Esg., for Defendant. Jacos Micue , having been duly sworn, was examined and testified as follows: By Mr. Topp: ©. Where do you reside? A. Philadelphia. ©. What is your business? A. Superintendent of the Merchants’ Warehouse Company. ©. How long have you been such superintendent ? A. About twenty-five years. ©. The Merchants’ Warehouse Company is a freight terminal station of the Pennsylvania Railroad, is it not? A. Yes, sir. Q. What is the character of the duties performed by the Merchants’ Warehouse Company ? A. We receive the freight from the Pennsylvania Railroad Company in cars and unload it and store it and deliver it. 38a On Samuel Bell, Jr. Q. Are you familiar with the duties performed by the Keystone Elevator and Storage Warehouse Company for the Pennsylvania Railroad at North Philadelphia? A. No, sir. I am familiar with it to the extent that they handle merchandise the same as I do. I am not familiar with grain. We do not handle grain, and never did handle grain. Q. Don't you handle grain in sacks? A. We might handle it, but very little. Q. A limited quantity? A. We don't get a car in five years, I guess. ©. You receive merchandise generally at the plat- form, handle it and redeliver it? A. Yes, sir. Q. And that you say you have been doing for twenty- five years? A. Yes, sir. Q. Assuming as a fact that the Keystone Elevator and Warehouse Company received grain, elevated it, re- delivered it, collected freights, was responsible for storage and warehouse receipts, what in your judgment would you say would be a fair compensation for such services per ton during the period covered by the time from March Ist, 1909, to April 30th, 1910? A. Fifty cents a ton. By Mr. Barnes: ©. I understood you to say that you had not at your place had anything to do with elevating and the storage of grain? A. That is right. Q. Or services of that character? A. Yes, sir. By Mr. Topp: Q. But you have handled hay ? A. Yes. “ 39a e 2:3 Jacob Michel Q. Which is also included in the services rendered by the Keystone Elevator and Warehouse Company ? A. Yes, sir. Q. And straw? A. Yes, sir. Q. What would you say would be a fair compensa- A. I should say fifty cents would be a fair com- pensation. Q. What would you say as to thirty-five cents a ton? A. Well, I don’t think it is enough. That is, not now. It might have been in former times, but things have changed. Everything has gotten dearer, labor, and so forth. Q. What was the rate of allowance made to your warehouse when you started in twenty-five years ago? A. The first agreement was at twenty cents a ton, and then they saw they could not operate the warehouse at that price at all, and the Pennsylvania Railroad Board authorized Henry D. Welsh, who was then a director, to report as to what price they ought to compensate at, and the price was then raised to thirty-five cents a ton on the recommendation of Mr. Welsh, and it was that for a few years, and then it was subsequently raised on the assorted merchandise to forty cents. ©. What time was that raise made? A. The raise from twenty cents to thirty-five cents was made a few months after the warehouse was in opera- tion. Say about six months. The next raise of five cents, to forty cents, was made subsequently, in 1891. ©. Can you tell us the rate of wages for common labor starting with 1886? A. At that time we paid our laborers $41 a month. At that basis, that would make it $1.33 a day. There were subsequent raises—three of them, I think. I have the dates all here. At the present time we pay them $2.06 a day. i ei ahaa cs é . OEP 40a Jacob Michel Q. That is practically an increase of sixty percent ? A. Yes, sir; sixty percent in wages alone. Q. How about the materials that entered into the work ? . A. All materials have increased in price I should say at least thirty-three percent. Possible some more. Q. Comparing 1g03 with 1909 what would you say had been the increase in wages and of the materials used? I mention 1903, because that is the date of our prior con- tract with the railroad. A. I can give you the successive raises of the wages. In 1886 we paid $41 a month. That is at the rate of $:.33 aday. The first advance was to $45 a month, in June 1902. Then, after a few years there was a subsequent raise of ten percent, and after a few years more another ten percent. Then, there was a raise of six percent on April Ist, 1910. So that we now pay $2.06 a day, as against $1.33 in 1886. MQ. Was there or not, or have you any data which will enable you to speak on it, an increase in the materials used in and about an elevator or warehovse ? A. Thave | + anything now except the general increase in everything, which everybody knows. QO. What do you know? We cannot examine every- body. We are just asking you. A. I know repairs of all kinds are higher, and oils, and everything that enters into the operation. Q. About how much percentage? A. I should say at least thirty-three percent. Some twenty-five percent. By THe REFEREE: Q. This merchandise that you handle, what is it? Mr. Topp: He has testified assorted merchandise; general merchandise. By THE QO. A. Mr. 4ia a Richard M. Richardson REFEREE: You are speaking of general merchandise? Yes, sir. BarNEs: I do not understand that he has handled any grain. Mr. Mr. Tovp: Oh, yes; he handles grain in sacks. BARNES: He said not often; once a year. No cross-examination. Ricuarp M. Ricnarpson, having been duly sworn, was examined and testified as follows: By Mr. Topp: QO. A. Q. A. Where do you reside? Buffalo, New York. What is your employment there ? General superintendent of the Keystone Ware- house Company. like that ; Q. there ? A. Q. SLE EL Fe MEBSIO BRIE NED LG SE E P AVE SIC LMG LOT ORD TOAD IEA PELE SLE LO ALLS: At what place? At Buffalo. How long have you been in that position? Since 1907. Four years. What kind of a business do you do there? General merchandise warehouse work. There is no elevaticn involved? No, sir. That is, grain elevation? No, sir. No grain elevators or belts, or anything no bulk grain. Do you act for more than one railroad company Yes, sir. Who do you act for? 42a 06 Richard M. Richardson A. The Pennsylvania, the New York Central, the Erie, Wabash, and the Michigan Central. Q. Your services include the receipt and discharge of merchandise at the platform? A. Yes, sir. F Q. Flour in sacks? A. Yes, sir. (). And grain in sacks too, or not? A. Oh, yes; occasionally corn comes in sacks, and there are four days free storage with roads which we have terminal arrangements with. ©. You are allowed a terminal charge for the serv- ices thus rendered? A. Yes, sir. Q. What free storage period have you? A. We give them four days free storage. Q. Are you familiar with the services rendered by the Keystone Elevator and \Varehouse Company at North Philadelphia ? A. Yes, sir; fairly so. Q. Including the receipt of grain in bulk and the ele- vation by machinery ? A. Yes, sir. Q. And delivery to bins? A. Yes, sir. Q. And delivering out? A. Yes, sir. Q. And collection of freights ? A. Yes, sir. Q. And the receipt of hay and straw in bulk? A. Yes, sir. Q. And also delivering it at the warehouse? A. Yes, sir. Q. The receipt of hay and straw is more directly in accord with the business that you do at Buffalo? A. The hay is, yes, sir. That would come under the general merchandise. = aay | 43a ; _* Richard M. Richardson Q. Based upon your knowledge of that service, and in the line of the experience that you have had from ren- dering terminal services generally, what would you say would be a fair compensation for such services in the period of time covered by March ist, 1909, and April 3oth, 1910? A. Do you mean the actual cost with the percentage of profit on there, and everything? QO. Yes. A. Offhand I should say fifty cents a ton. Q. Would you or would you not consider thirty-five cents a ton an unreasonable charge? A. An unreasonably low charge, I should say. ©. Has there or not been any increase in wages between the year 1903 and 1909 for the character of labor employed in this kind of work? A. Yes, sir. Q. What about has been the percentage in increase? A. From twenty to twenty-five percent. Q. Before you went to Buffalo where were you em- ployed, and in what capacity ? A. I was superintendent of the Keystone Elevator and Warehouse Company at North Philadelphia. Q. The plaintiff in this action? A. Yes, sir. QO. How long had you been in that position? \. I guess about two years. Q. You are entirely, then, familiar with the very business which is the subject of this controversy ? A. Oh, yes. The elevator and handling, and all that. Q. And also with the figures incident to the conduct of the business? A. Ihave no recollection of what those costs are now. You see, it has gone out of mind. Q. Based on the experience which you had obtained while you were such superintendent, supplemented by your experience in the terminal warehouse at Buffalo, are you RPL ROLL IE MAILE AG EIGER LEE LIE ST BELG I! IOLEIE E LS LEA CTE ISLE LIS i 44a ate) Harvey C. Miller still of the opinion that thirty-five cents a ton would be an unreasonably low charge? A. Decidedly so. ©. You were superintendent under the old agreement of October 1903? A. Yes, sir. Q. Which provided for thirty-five cents a ton? A. Thirty-five cents a ton elevation and the handling that went through there. CROSS-EXAMINATION By Mr. BARNEs: Q. In your estimate of the return per ton, you say you include cost and profit. In what relative percentage do those two elements enter into your computation? A. I should say we ought to have twenty-five percent profit. Harvey C. MILvier, having been duly sworn, was examined and testified as follows: By Mr. Topp: ©. You are the principal stockholder in the Keystone Elevator and Warehouse Company, are you not? A. Yes, sir. ©. You are also the patentee of the drying process which is in use in the elevator ? A. Yes, sir. ©. The agreement between the Keystone Elevator and Warehouse Company, which went into effect in October of 1904, terminated when, according to its terms, first? A. In 1908. Q. From October 1908 on how long was it continued in force and by what means? 45a 59 Harvey C. Miller A. It was continued first by a resolution of the Board, I think. Q. The Board of the Pennsylvania Railroad? A. Of the Pennsylvania Railroad Company, yes, sir. Just an extension of a few months at a time. ©. Until what date? A. I think March Ist, 1909. Q. The resolution of the Board which extended it to that date was not renewed? That is practically the situa- tion, is it not? There was a resolution of the Board, of which you had notice, extending it until that date? A. Yes, sir. Q. And there was no subsequent resolution renewing it? A. No, sir. Q. How did you come to perform or continue to per- form the services in connection with the operation of that elevator ? A. With an understanding that we would be paid. ©. Who was that interview with, and when and where, and who were present? A. Mr. John B. Thayer, Mr. George Dixon, Mr. George Stuart Patterson, and yourself and myself. ©. How long prior was that to the first of March 1909 ? A. I could not recall the exact date. It was sometime prior to that. A short time possibly. I cannot recall the exact date. ©. From October of 1908 until the first of March 1909 there had been negotiations on hand for a renewed contract, had there not ? A. Yes, sir. ©. The old contract was absolutely terminated on March Ist 1909, and then this arrangement of which yeu have spoken was entered into just shortly prior to that time ? A. Yes, sir. POR IDL LLL LIME ROO PS ER NEAR OL AILS IG MILI VELL IAI MYL GM 46a Harvey C. Miller 60 Q. Just what was that arrangement? Mr. Barnes: This was verbal, oral? Mr. Topp: Oh, yes. A. We were to continue the operation of the elevator until such time as we could reach an agreement or an under- standing or make a contract, and they were to pay us—-we were to perform the same services that we had, and they were to pay us.a reasonable compensation for our services. Q. The question of the amount being left open? A. Yes, sir. Q. Practically, then, you were to continue tc per- form the same services ? A. Yes, sir. Q. The only question left open being the amoun of compensation ? A. Yes, sir. We were to continue. We were to pay the same rent, and did pay the same rent. ©. That continued until what time? A. That continued for fourteen months. Q. Until the 3oth day of April 1910? A. Yes, sir. ©. When a new agreement was negotiated, which we have nothing to do with here? A. Yes, sir. Mr. Topp: In this connection I offer in evidence the statement of our cause of action, filed in this case, so far as it refers to the elements of charge, beginning at the foot of page 4, under the date of “For the month of March 1909, 13,723,040 pounds of grain and other merchandise, at the rate of 35 cents per ton of 2,000 pounds, the sum of $2,403.11,” and so on through month by month until the month of April 1910, when the charge was for $19,121.475 pounds, at 35 cents per ton, of 2,000 pounds, amounting in the aggregate to the sum of $42,826.00. We acknowledge 47a Harvey C. Miller a credit having been paid on account of that sum, being paid on January 24th, 1911, in the sum of $28,420.19. Q. How long have you been engaged in the grain business ? A. Since 1880. Q. How long in connection with the operation of an elevator ? A. Since the same date. Q. In how many different localities? A. Philadelphia, Western Maryland: a number of places in Western Maryland. Q. Are you familiar practically with the operations of an elevator such as the one used at North Philadelphia? A. Yes, sir: I think so. ©. You also are familiar with the services rendered by your company to the Pennsylvania Railroad for the period beginning March ist 1909 to April 30th 19107 A. Yes, sir. ©. Based upon your experience would you or not consider thirty-five cents a ton a reasonable or an unreason- able charge for the services rendered by your company to the Pennsylvania Railroad for that time? A. It would not be high enough, considering the cost of labor and material, but considering it was a continuance of the other contract, | should say it would be a reasonable compensation for that time. Q. I do not care anything about the continuance of that contract. I want to bring it down to the services ren- dered Letween those two dates. A. Then, for the services rendered between those dates it should be about forty-two and a half cents a ton. QO. A. Yes, sir. ). Why do you say that? It ought to be seven and a half cents a ton more? on A. Iam adding the actual cost plu; twenty-five per- cent profit. 48a Harvey C. Miller 62 Q. You mean by “actual cost” the total cost of the operation of the elevator and the total receipts therefrom? A. Yes, sir. CROSS-EXAMINATION By Mr. Barnes: Who owns the elevator ? The Pennsylvania Railroad Company. How do you occupy it? Under a lease. That is, up to March 1st, 1909, you had an agree- ment in writing with the railroad company for the use and occupation of the premises and for rendering certain services there ? A. Yes, sir. Q. And thereafter that occupation continued and those services were rendered under the arrangement which you have spoken of in your direct testimony 7 A. Yes, sir. ©. What were those services that you rendered in respect to grain at the elevator? A. The receiving, the elevating and delivering to the consignees, and collecting the freight, making proper deliv- eries, and keeping the grain in proper condition, and seeing that the same number of bushels were delivered as received, and the same quality, and so forth, and quantity. Q. And it is for those services that you make this claim on the basis of thirty-five cents per ton? A. Yes, sir. ©. What proportion of that thirty-five cents which you regard as a reasonable compensation represents cost and what proportion represents profit ? A. I should say between thirty-three and thirty-five cents a ton actual cost, and the difference between that and forty-two and a half cents, I should say was the profit 49a «7 de> Harvey C. Miller (. In your thirty-five cents, which you claim here, what proportion of that is profit? A. If the actual cost was thirty-four cents, it would be one cent a ton. Q. I want to know, without going into the total of your figures, what percentage of the thirty-five cents per ton would represent profit over cost? A. Very little. Q. Can you tell us what? A. Practically nothing, if we took into consideration the fact that we are responsible for shortages and things of that character. (). That is risk? A. Yes, sir: but that should be considered. ©. lLagree with you, but that is compensation. What I want to know is what percentage of the thirty-five cents per ton, as near as you can state it, would represent actual cost ? A. I should say about thirty-four cents a ton would be actual cost, and if we got thirty-five cents that would be a cent profit. ©. Your total claim, as shown by your statement of claim for this period, was $42,826. The amount which was paid to you, and for which you give credit to the rail- road company, was paid to you on a statement that it was the actual cost incurred by the Keystone Elevator and Ware- house Company, was it not? A. Not to my knowledge, it wasn't. ©. You received a voucher for the $28,420.19 which was paid to you? A. Yes; but I did not understand that that covered the actual cost. (). That voucher read, “For the actual cost incurred by the Keystone Elevator and Warehouse Company” ? A. That might be. I did not so understand it. (). “As ascertained and certified by Vollem, Fernley, U 62 i “sits . TO AT TS ee - ee Pe 50a Harvey C. Miller 64 Vollem & Rorer, public accountants, in performing the services which the railroad company was required to per- form in receiving and handling grain and other traffic at the railroad company’s elevator and warehouse, at its North Philadelphia freight station, in the City of Philadelphia and State of Pennsylvania, from March 1, 1gog, to and inclusive of April 30th 1910, $28,420.19. This amount does not include any increment of the claim made by the Keystone Elevator and Warehouse Company for compensation for said services in addition to actual cost, which claim, asserted by the elevator company but not conceded by the railroad company, remains open and unadjusted.” You gave the railroad company credit in that amount for a claim which you are now presenting here? A. We gave them credit for what they paid us. This audit was not made by us at all. It was made by them. ©. The statement which I have read to you was made by the railroad company on its voucher, which you signed in getting the money or was signed in your behalf and you received the money, but you did not make the state- ment at all. A. No. Q. And it was the zailroad company’s statement of the amount which they paid on the basis of this voucher ? A. I presume so. We ran along for thirteen months, and we needed the money, and they finally paid us this amount, and, as | understand, Mr. Todd got it and accepted it as a payment on account. Q. And Mr. Todd was authorized to receipt the voucher on your behalf and get the money for you? A. Certainly, or he would not have done it. ©. The balance between your claim and the amount which was paid is $14,405.81. and the amount which you now claim is $17,551.04, the difference being $3,145.23, which is what? A\. That is interest, | suppose. 5la Harvey C. Miller Q. The calculation of interest is made upon the amounts due on the first day of each month during the period in suit, which amounts in the aggregate to $42,826, and that interest on that $42,826 is calculated up to the date of the payment of the $28,420.19? Is that correct ? A. Yes. ©. What part of the service which the Keystone Elevator and Warehouse Company now claims compensa- tion for in respect of this grain is done by the Philadelphia Cleaner Company? What does the Philadelphia Cleaner Company do? A. Re-conditions the grain. ©. What do you mean by that? A. I mean rejected grain that is treated and restored to a higher grade. Q. Tell us what actually is done. What does the Philadelphia Cleaner Company do? What work does it do? A. A car load of grain would be elevated, and it would be dropped into this process, this machinery. QO. Who does the elevation? A. The elevator company. Then it goes through this by gravity and down until it reaches the storage bins. ©. And then what happens to it? A. Then it is treated and goes in the storage bins. QO. Who does that? A. The Philadelphia Cleaning Company. ©. That is its part of the services, is it? A. Yes, sir. Q. What is the Philadelphia Cleaning Company? Is it a corporation ? A. No, sir. Q. What ts it? A. It isa name under which [ conduct the business. ©. What does the Philadelphia Cleaning Company get for that service ? 52a Harvey C. Miller A. It gets a royalty of three-quarters of a cent a bushel. Q. From the elevator company or from the con- signees of the grain—which? A. I should say they get it from the elevator com- pany and the Elevator gets it from the consignee. Q. All of that comes to you, does it not? A. Yes, sir. Q. Individually ? A. Yes, sir. ©. And you are also, as you have testified, the larg- est shareholder of the Keystone Elevator and) Warehouse Company ? A. One of the largest, ves, sir. Q. I thought Mr. Todd asked you whether you were the largest? A. Well, I think I am, yes, sir. Yes, I am the largest. Q. There is a difference between “one of the largest”’ and “the largest.” A. I am the largest. By Mr. Topp: ©. You hold a majority of the stock, and it is abso- lutely under your control ? A. Yes, sir. By Mr. BArNeEs: QM. Do you hold a very preponderating majority of the stock ? A. 1 should say yes. (. \re there any other substantial shareholders in the Keystone Elevator and Warehouse Company than your- self ? A. Yes, sir. QM. Do you own seventy-five percent of the stock of that company ” A 3a Meeting A. I think so. I would not like to say exactly, be- cause | am not sure. ©. We will say approximately? Is that right? A. I think that is all right. Adjourned to meet pursuant to agreement of counsel and the Referee. Meeting held at the office of the Referee, G. Heide Norris, Esq., Land Title Building, Broad and Chestnut Streets, Philadelphia, on Friday, February 28th, 1913, at three o'clock p. m. Present: G. Hetpe Norris, Esq., Referee. M. Hampton Topp, Esg., representing the Plaintiii. GEORGE STUART PATTERSON, EsQ., representing the Defendant. After discussion between the Referee and counsel rep- resenting the respective parties, the meeting adjourned. Meeting held at the office of the Referee, G. Heide Norris, lésq., Land Title Building, Broad and Chestnut Streets, Philadelphia, on Monday, April 28th, 1913, at eleven o'clock a. m. Present : G. Hetpe Norris, [Eso., Referee. M. Hampton Topp, Esg.. representing the Plaintii. GEORGE STUART Patrerson, EsgQ., representing the Defendant. Mr. Parrerson: Mr. Referee, as preliminary to the introduction of evidence contained in the formal offer o/ proof, a copy of which has been submitted, I desire to call Mr. Robert C. Wright, who is the freight traffic manager of the Pennsylvania Railroad Company, and who is 68 a” Meeting familiar with the method of handling grain, and other commodities, so far as the question of the delivery of the Railroad Company is concerned, both at Philadelphia and at other points, for the purpose of testifying as to the dif- ferent methods of delivery of grain and other commodities, which are, in point of fact, delivered through this elevator and warehouse; the reason for the employment of the Ele- vator Company by the Railroad Company and an explana- tion of the services performed by the Elevator Company for the Railroad Company, for and on behalf of the con- signees of grain and the other classes of property. The object of this offer is to establish, first, the necessity for the employment of the Elevator Company by the Railroad Company, the function which the Elevator Company bears or performs in connection with transportation, and the relation of the Railroad Company to the owners and con- signees of grain and other commodities handled through the levator and Warehouse. This all to be followed by thts formal offer as to the profits which the Elevator Company has received at the present time from the operation of the elevator during the period in question. Mr. Topp: The offer of the whole is objected to. There are certain features in it, however, that I recognize might aid the Referee in viewing the character of the sery- ices rendered, and the plan through which such services were rendered, and the necessity therefor, which possibly, under a view of this case, might be relevant testimony. With the Referee’s permission, however, I will withdraw my objection, with leave, after the testimony is taken, to move to strike out such parts of it as I think are not relevant, and have any exceptions then reserved that may protect my client's rights. Tue Rereree: Very well. I will grant you that permission. 554 GO a | ‘ Robert Clinton Wright Ropert CLinton WriGut, having been duly sworn, was examined and testified as follows: iby Mr. PATTERSON : ©. You are at the present time freight traffic mana- ger of the Pennsylvania Railroad Company ? A. Tam. Q. During the period between March ist, 1909, and Ist, 1910, what were your duties? A. I was general freight agent. Q. As general freight agent did you have any famil- iarity with the operation of the Keystone Elevator at North Philadelphia ? A. I believe so; reasonable familiarity with its op- erations, and a particular knowledge of its relation as a terminal for the Railroad Company. Q. Prior to your appointment as general freight agent of the Pennsylvania Lines East had you occupied any position with the Company at Baltimore? A. Yes. I was special agent in the general agent’s office for a number of years, ending in 1897, and I was also soliciting agent for about two years. Q. As such did you have any familiarity with the handling of grain at Baltimore? A. I did. Q. When grain is transported from the point of origin over a line of railroad to the point of destination, in what way or ways is delivery made by the Railroad Company to the consignees or owners of that grain? A. Speaking of grain which is consigned for a rail- road delivery, and not to a private siding, and left at that private siding, and that, of course, is delivered to the ware- house of the person and handled in his own way,—but when grain is consigned for public delivery at a railroad station, it can either be delivered direct from cars, the car being placed, and turned over to the consignee for delivery as 56a 0 ro . Robert Clinton IWright ot the freight, or it can be handled through an elevator, the delivery being made to the consignee by the Elevator. ©. When you say that delivery is made by the Ele- vator, what do you,mean by that? A. If you would like me to go more fully into the— Q. Ina very general way. A. Simply that in order to release the cars, instead of being placed on the track subject to the consignee’s option cf unloading, they are delivered to an Elevator and un- loaded at once into the bins of that Elevator, and there subject to the consignee’s order; the Elevator, in turn, aclivering it to the consignee or his order, at his wish and desire, subject to the charges for the service performed. ©. Asa general proposition, does the Railroad Com- pany have an elevator for local delivery and an elevator for export delivery ? A. We have at important places, like Philadelphia and Baltimore. ©. What is the elevator which was employed by the Pennsylvania Railroad Company to perform this local de- livery at Philadelphia? A. The Keystone Elevator, at North lhiladelphia. ©. What other facilities did the Keystone Elevator and \Warehouse Company provide for the Railroad Com- pany at North Philadelphia ? \. Included in the lease to them of the Elevator was part of an old warehouse at North Philadelphia, which rep- resented that part of the contract referring to the ware- house business. It represented it in a very small way. (). That warehouse was used for what purpose ? A. For a terminal of the Railroad Company. In other words, the cars consigned to the warehouse are placed there and unloaded at once into that. to release the cars. Q. Unloaded by whom? A. Unloaded by the Warehouse Company into the warehouse, and through that warehouse delivery is made te the consignees. ~? ee 7a mn Robert Clinton Il right ©. As a general rule, carload freight is unloaded by whom? A. As a general rule, carload freight is unloaded by the consignor, loaded by the shipper and unloaded by the consignor. Q. How is it that in this particular instance the car load freight is handled by the Warehouse Company and not by the Railroad Company ? A. At certain large points, governed by different competition, the Railroad Company undertakes to unload certain classes of carload freight, and by our published tariff that is the case in Philadelphia. We unload this car- load freight for consignees. ©. And you employed the Elevator and Warehouse Company to perform the service for you? A. In this particular locality, that is our terminal that performs it for us. Q. Grain having been unloaded from the cars into the elevator as described by you, what may or may not happen to that grain? A. Tf | understand your question, the grain unloade:! into the Elevator is subject either to delivery without an further handling or treatment, or it is subject to various workings, as shown in the tariff of the Railroad Company. That is to say, it can be turned or blown or dried, :nixed before delivery, or bagged upon delivery. Various differ- ent treatments are offered, at the proper charge. All of which could not he given if the grain were delivered di- rectly from the car to consignee. It is an additional at- traction in the handling of grain, to have those privileges. Q. When the grain is handled as you have described, from the car into the Elevator, is the handling covered in the ordinary freight rate, or is there a specific charge there- for in addition to the freight rate? A. The tariff of the Elevator shows the charge, which does not mean simply the unloading, but includes receiving, weighing and storing, including the first ten days storage 58a ey . . — Robert Clinton Wright and delivery to cars or wagons, for which the charge is one-half cent per bushel. Mr. Patterson: I offer in evidence the Tariff re- ferred to by the witness, being I. C. C.-G, No. 2953, taking effect April 17th, 1907. ( Tariff marked, “Exhibit A, G. H. N.’’) Q. Has this Elevator in it any machinery operated by any company or concern other than the Elevator Company ? A. Yes, sir. It has machinery in it operated by the Philadelphia Cleaner Company. Q. I direct your attention to the Tariff, Item No. 1, being one-half cent per bushel for receiving, weighing and storing from cars, including first ten days’ storage and de- livery to cars or wagons. Is the service involved in that item performed by the machinery of the Elevator Company ? A. Yes. According to my understanding that service is performed by the Elevator Company machinery. ©. Will you take each of those items. A. Item No, 2, storage each succeeding ten days or fraction thereof. That is, of course, stored in the Elevator. Item No. 3, blowing, screening or mixing in store (additional). I understand that to be the machinery of the Elevator. Item No. 4, turning in store (additional). I under- stand that to be the Elevator. Item No. 5, drying No. 2 grade of any kind of grain. This I understand to be a function of the Philadelphia Cleaner Company. Item No. 6, stacking, in lots of 1,000 bushels or over, including transfer through Elevator, and blowing, but no storage beyond forty-eight hours after completion of service. This I understand, is the function of the Elevator. Item No. 7, drying other than No. 2 grades, including transfer through the Elevator, and bagging, if desired, but 59a Robert Clinton Wright no storage beyond forty-eight hours after completion of service. This I understand to be the work of the Philadel- phia Cleaner Company. Item No. 8, cooling, including transfer through the levator, and bagging. if desired, but no storage beyond forty-eight hours after completion of service. This I under- stand to be the work of the Philadelphia Cleaner Company. (J. Does the consignee, under that Tariff—I direct your attention to it—pay anything for elevation in addition to the charges specified therein ? A. As I understand, the Tariff on these charges are the entire charges made against the owner for the work as shown. Q. Item No. 3 and Item No. 4, take those. A. It specifies absolutely that it is in addition to the half cent paid for the receiving, weighing and storing. (). Those are the only items on the Tariff which are specified as additional ? A. That is correct. Mr. Patterson: Mr. Todd, you may cross examine Mr. Wright. Mr. Topp: Reserving the right of objection, as here- tufore indicated, | will proceed with the cross examination. CROSS-EX AMINATION By Mr. Topp: ©. Ina general way, the situation is like this, is it not: The Pennsylvania Railroad leases this Elevator to the Keystone Elevator and Warehouse Company, the plaintiff in this action ? A. That is correct. (). And charges them a rental therefor ? A. Yes, sir. QM. This case involves the question of what is a “4 60a Robert Clinton Il right reasonable compensation for the services rendered by the Elevator Company to the Railroad Company in connection with the transportation services at that Elevator, does it not ? A. Lam not entirely familiar with the whole gist of this case. That is my understanding, from what I have heard. Q. The charges to which you refer as being in the Tariff are the charges that are made to the public, are they not? A. They are. QO. They have nothing to do with the question of what is or is not a reasonable compensation, as between the Railroad Company and the Keystone Elevator Company for the services rendered by that Company ? ( Objected to as a question of law. ) (Question withdrawn. ) Q. There is no provision in this Tariff, is there, for what is compensation for the Elevator Company for the services rendered to the Railroad Company ? \. No rates on this Tariff as to a payment by the Railroad Company to the Elevator Company. Q. Prior to the first of February, 1g0g, there was a contract subsisting between the Elevator Company and the Railroad Company regulating that proposition, was there not ? \. There was. ©. And since the first of May, 1910, there has been a contract regulating that? A. There has. Q. The period between the first of February, 1909, and the first of April, 1910, the services were rendered but there was no contract fixing the rate of compensation? \. No contract alive during that period. X 61a Robert Clinton Wright ~?> ww ©. No contract alive during that period? A. No. QO. What is Item No. 1 on that Tariff? A. Receiving, weighing and storing from cars, in- cluding first ten days’ storage and delivery to cars or W agons. Q. That is intended to cover, is it not, after the cars have arrived at the Elevator Station, the charge made to the public for unloading that car, for placing it in the bins, for the free storage period, and the delivery of that grain within the free storage period to the consignee or his order ? A. That charge is the charge against the consignee for those combined services. Q. And that is a portion of the services that the Rail- road Company has undertaken to do for the shipper or the consignee, as the case may be. A. Let me get clear on that. Do you mean that those services would ordinarily be included in the transportation ? ©. No. I did not ask you that. A. I do not want to get confused. You mean that we have undertaken to furnish this to the consignee at the proper charge and through the proper facility ? QM. Yes. You have undertaken to do that as a por- tion of your service to the consignee, or the consignor, as the case may be? A, With a proper charge therefor, not included in the freight rate. ©. That service, the actual unloading of the car, put- ting it in the bin, and the reloading of it out of the bin, has to be performed by the Elevator Company ? A. That is correct. Q. And for that service, prior to the first of February 1909, the Railroad Company made a contractual allowance to the Elevator Company ? A. It did. I would not like to say it was for that purpose exactly. My understanding is it was an allowance 76 62a Robert Clinton Wright made to the Elevator Company for whatever work the Railroad would have had to perform itself if it had run the Elevator, with due regard for what it might charge the public. : ©. Would that include the treatment of sick grain? A. No. Q. That would be within the general language that you have used a moment ago? A. What I wanted to convey was that the payment for a facility of that kind very often depends on what that facility can collect itself. What it can collect is more or less subject to the will of the Railroad carrier, because if the facility so employed attempts to collect more than is fair and proper, under the rules of the City, then it makes some difference in what might be allowed by the carrier. ©. You mean by that expression, that the Railroad Company attempts to control the charges of its tenant. A. It has some supervision over it. ©. That is a supervision which would amount to a certain amount of control over it? Is that it? A. A certain amount of control over it, yes. Q. With the view that the public might be treated fairly? I presume that is the fundamental thought ? A. Exactly so; that the interests of the carrier should not be interfered with. ©. Which, if the public were not treated fairly, they would be interfered with ? A. That is correct. QO. You have included in that tariff, to which you have just called attention, services which you have desig- nated as being performed by the Philadelphia Cleaner Company ? A. Yes, sir. ©. That is the service that is rendered after the grain has been fully delivered into the Elevator, under paragraph 1 of the tariff, to which you have referred ? 63a 7 Mecting A. That is my understanding of it. Q. And rendered at the request of the owner? A. Yes, sir. (. It may or may not be rendered, just as the owner requires ? A. Yes, sir. Q. The same thing may be said as to mixing, may it A. Yes, sir. ). And clipping ? A. Yes, sir. (). And all the other various services rendered at the owner's request for the purpose of marketing the article that he has delivered to the Elevator ? A. Yes, sir. After discussion between the Referee and counsel rep- resenting the respective parties, the meeting adjourned. Meeting held at the office of the Referee, G. Heide Norris, Esq., Land Title Building, Broad and Chestnut Streets, Philadelphia, on Thursday, June 5th, 1913, at 11 o'clock A. M. Present : G. Heipe Norris, Eso., Referee. M. Hampton Topp, Esg., representing the Plaintiff. GEORGE STUART PATTERSON, Esy., and Joux Hampton Barnes, Esq.. representing the Defendant. Mr. Patterson: The defendant offers to prove that during the time embraced within the Plaintiff's statement. to wit, from March Ist, 1g0g, to May Ist, 1910, the capital stock of the Keystone Elevator & Warehouse Company, the Plaintiff in this case, was Ten Thousand (10,000) shares at Ten (10) Dollars each, all of which was issued and out- standing, and that during the said time Nine Thousand three O4a Meeting hundred and sixty (9360) shares of said stock, at a par value of $93,600 was the property of Mr. Harvey C. Miller; that during the period in question, the said Harvey C. Miller Was a member of the firm of L. F. Miller & Sons, who were shippers, consignees, and dealers in grain, and that during the period in question go per cent of the business elevated, stored and handled through the elevator and warehouse of the Plaintiff Company at North Philadelphia, as referred to in the statement of claim, was grain elevated, stored and handled for and on account of the said firm of L. F. Miller & Sons, and for compensation for the elevation, storage and handing of which and the grain and merchandise of other owners and consignees through said elevator and ware- house this suit is brought, as is more specifically detailed in plaintiff's statement; that said grain, the property of I.. If. Miller & [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386002_0544%3A1. Public record. Not legal advice.