Common Carrier

[Murphy Siding]

      I see this phrase used a lot in conjunction with railroads.  What does it actually mean, as far as it now pertains to the railroads?  Did it used to mean something else?

 

( For those who remember the TrainFinder Troll: No- I'm not trying to ship Amish furniture from a team track.)

[blhanel]

Is this something that would carry my Mom if she were in the Communications industry?

[Murphy Siding]

Is this something that would carry my Mom if she were in the Communications industry?

What can you say?  It's Friday!  (I fixed it.)

[mudchicken]

One who holds himself out to the general public to transport property or passengers, intrastate , interstate or in foreign commerce, for compensation. Common carriers must operate from one point to another over routes or territory prescribed by the ICC/STB (interstate)and by a Public Service or Public Utilities Commission (intrastate).

 

Designated contractual mercenary connected to the US/Canadian/Mexican rail network that actually provides the service.

[chad thomas]

    

 

( For those who remember the TrainFinder Troll: No- I'm not trying to ship Amish furniture from a team track.)

But if you did you would probably ship it on a common carrier.

[al-in-chgo]

    

 

( For those who remember the TrainFinder Troll: No- I'm not trying to ship Amish furniture from a team track.)

But if you did you would probably ship it on a common carrier.

 

IIRC from the past, pre-ICC abolition if not pre-STB establishment, "common carrier" was a term that carriers as well as us commoners used.  When I heard the more technical aspect of it, "La De Da Trucking, as a regulated Common Carrier, must obey the provisions of the [Whoozits Act] . . .  (maybe even inserting "interstate" would have been redundant back then)." 

For us who were fortunate enough to travel pre-Amtrqk, "common carrier" was sometimes used as an adjective meaning, roughly, "fares are standardized" and (especially?) during periods of inflation it connoted ("reasonable fare or base fare"). It applied to interstate bus lines as well as passenger trains. For example, R. Saunders' MAIN LINES talks about the old D&RGW standard-gauge mainline passenger trains as offering [rough quote]: "luxury service and accommodations at Common Carrier prices."   Which more than justified the old "extra fare" surcharges for the best l-d varnish IMHO. 

 

[Railway Man]

      I see this phrase used a lot in conjunction with railroads.  What does it actually mean, as far as it now pertains to the railroads?  Did it used to mean something else?

 

( For those who remember the TrainFinder Troll: No- I'm not trying to ship Amish furniture from a team track.)

The essential characteristics of a common carrier are a moving target as law evolves, technology changes, and reality intrudes, and an industry has flourished that employs people who profit by quibbling around the edges.  However, the typical characteristics of a common-carrier are as follows:

1. It is engaged as a business in the transportation of goods belonging to others or persons, or both.
   
2. It carries all goods offered and persons who present themselves, in accordance with its established rules and conditions.
3. It transports over an established route.
4. The transportation service must be for hire.
5. It must render adequate service that is regular and continuous.
6. It shall not practice unreasonable discrimination among shippers or persons offering themselves for transportation, with respect to services or charges.
7. It shall strictly warrant the safe delivery of goods and persons entrusted to its care except as a result of act of God or public enemy.

The opposite of a common carrier is a private carrier.  It has no special obligation to anyone, but often enjoys fewer priviledges, too.  Rights that may obtain to a common-carrier but not a private carrier include:

1. Eminent domain
2. Freedom from certain types of economic regulation.
3. Ability to obtain public aid.
4. Ability to obtain land from the public domain for right-of-way at no cost.
5. Freedom from restrictions normally imposed on corporations such as limiting the corporation to only one line of business
6. Franchise rights that guarantee freedom from competition 
7. Other significant grants of power not accorded to private carriers.

The first railways -- more strictly tramways -- were private affairs hauling the goods of their owner, e.g., coal from a mine adit to slackwater.  Once railways began to be constructed for the purpose of hauling the goods of others and persons, they were implicitly assumed to be common-carriers.  Only later was this assumption enshrined in law, and in rather herky-jerk fashion, state by state. 

RWM 

[JSGreen]

Thanks!....that's the part I was hoping to see...the "rights" or reason a Railroad would want to be a common carrier...

[Railway Man]

Thanks!....that's the part I was hoping to see...the "rights" or reason a Railroad would want to be a common carrier...

The choice recently came up on a proposed railway of some not-small length that would be built to serve one large customer -- should it be a common-carrier or an industrial (private) railway?   This railway would cross public roadways and be connected to the national railway network, thus without question be subject to FRA safety regulation and hours of service.  The question was whether it should be subject to STB economic regulation and come under the railroad retirement system.  As a common-carrier it would not be subject to the local government (county and city) dreaming up regulations which could be quite onerous, e.g., restricting its hours of operation, denying it the right to haul hazardous commodities or even solid waste, denying it the right to serve new customers or increase the number of train movements, etc.  As a common-carrier it would have the obligation to serve new customers if they appeared at terms and rates similar to what it was applying to its "home" customer. 

The risk with the common-carrier approach is that it's conceivable a large new customer -- a competitor of the home customer! -- would argue it was not liable to share in the very large costs to build this railway since its business was all "new" and the home customer had clearly anticipated amortizing the construction costs onto itself.  The new customer could wait until one minute after the home customer completed the railway and its plant, paying all-in costs, then announce plans to build its own identical plant across the street, making the same product, pay only for the operating and maintenance costs of the common-carrier railway because it was "new" business and none of the construction costs, and thus be able to price itself identically with the home customer but at a much higher profit margin.  Not a pretty picture.

The risk with the industrial railway approach is that this railway will exist for many years, in which the county governments have unlimited opportunity to dream up bizarre if not punitive regulations depending on their mood and the popularity of the railway and its customer at that point in time, and believe me, for all the griping done about the federal government in this forum, it is far less unpredictable or irrational than a county or small-town government, to say nothing of mean-spirited or greedy.   You can easily imagine a situation in which the railway's home customer decided to reduce its workforce, or close out one line of business, and the county government exacts reprisal by coming up with industrial regulations that make the rest of the plant uneconomical to operate.

RWM 

[Murphy Siding]

 As a common-carrier it would have the obligation to serve new customers if they appeared at terms and rates similar to what it was applying to its "home" customer. 

The risk with the common-carrier approach is that it's conceivable a large new customer -- a competitor of the home customer! -- would argue it was not liable to share in the very large costs to build this railway since its business was all "new" and the home customer had clearly anticipated amortizing the construction costs onto itself.  The new customer could wait until one minute after the home customer completed the railway and its plant, paying all-in costs, then announce plans to build its own identical plant across the street, making the same product, pay only for the operating and maintenance costs of the common-carrier railway because it was "new" business and none of the construction costs, and thus be able to price itself identically with the home customer but at a much higher profit margin.  Not a pretty picture.

RWM 

I'm not sure if I get the whole concept here.  Say I build the Murphy Siding Railroad, as a common carrier, for the sole purpose of servicing the Murphy Siding Jello Mine.  At the last minute, someone else opens a jello mine accross the tracks.  I *have* to charge them the same rates?  Besides, I thought the rates were private information between shipper and railroad?

[Railway Man]

Q.  I have to charge them the same rates?

A.  You could try.  But you would likely lose before the STB as it would be unreasonably discriminatory to pick charge different rates for the same terms and conditions. 

Q.  I thought rates were private information?

A.  Only if they are contract rates.  Rates that are public tariffs are public.  And the contract will not stay secret in a rate appeal to the STB.

RWM 

[bobwilcox]

Intelligent buyers and sellers of rail transportation know what the rate levels are out in the market place.  There are many way to discover this information. One way is to take a shipper to lunch.

[Railway Man]

You've been looking at my AMEX bill!

RWM