.
TO THE ' % '
HON OR ABLE CARL SCHURZ,
SECRETARY OF THE INTERIOR.
»
MEMORIAL
•
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•
OF THE
COMMITTEE OF NINE
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tJr I±i Li
FIRST MORTGAGE BONDHOLDERS
vJr 1 JtlEi
KANSAS PACIFIC RAILWAY CO.
V
NEW YORK, JAN. 11, 1878.
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New York :
H. J. HEWITT, PRINTER, 27 ROSE STREET.
1878.
New York, January 11, 1878.
To the Honorable Carl Schurz, Secretary of the
Interior, Washington, D.C.
Sir : On April 21, 1877, we had the honor of addressing
a memorial to you on behalf of the holders of the several
classes of first mortgage bonds issued on the main line of
the Kansas Pacific Railway, and on October 1, last, we sub¬
mitted a statement supplementary thereto. .You deemed
the subject of those two communications of sufficient im¬
portance to call for a reference to it in your annual report
to the President.
On November 27 and December 6, respectively, upon
motion of Hon. T. T. Crittenden, of Missouri, and of Hon.
J. B. Chaffee, of Colorado, the House of Representatives
and the Senate of the United States adopted resolutions
calling upon the President for information as to what legal
impediments, if any, existed which prevented him from
executing the several acts of Congress relative to the Paci¬
fic railroads, in accordance with the obligations accepted
and agreements made by the Union Pacific Railroad Com¬
pany and its branches with the United States, as stipulated
and agreed upon in those several acts.
The President having referred the subject to yourself
and the Attorney-General of the United States, the princi¬
pal roads mentioned in the resolutions, to wit: The Kansas
Pacific Railway Company, the Burlington and Missouri
River Railroad Company, the Union Pacific and Central
Pacific Railroad Companies were accorded a hearing, which
took place at the Department of Justice on December 19
and 20, last.
At this hearing Mr. A. J. Pox>pleton, general attorney
of the Union Pacific Railroad Company, appeared, among
others, and submitted an" argument the nature of which
2
seems to render it incumbent upon us, both with reference
to its denial of the allegations in our memorial and the
supplement thereto and to the notice of the same in your
official report, to lay before you a statement in reply to the
points raised in his argument.
In doing this we do not propose to follow the lengthy,
and tortuous plea of said attorney in all its details. For, a
critical examination necessarily leads to the conclusion
that its principal object was not so much to bring out in
proper relief the main points at issue, as to obscure them
by a cloud of incidental questions without pertinence. It
strikes us, indeed, that all the ingenuity expended in the
preparation of the plea, reduced to its proper value,
amounts to nothing more than a resort to the common de¬
vice of violators of the law to divert attention from their
own malefactions by charging others with them. For our
part, we shall confine ourselves to a concise affirmation of
the true issues involved and to answering so much of the
argument of the attorney of -the Union Pacific Railroad
Company as bears upon them.
The first point calling for our attention is the substantial
allegation in said argument :
That there is no discrimination within the meaning
of the acts of Congress by the Union Pacific Railroad
Company against the Kansas Pacific Railway Company
or against the public generally.
In Appendix B of our memorial, as well as in the re¬
marks of Senator Chaffee upon the Senate resolution, men¬
tion is made of certain rates of freight which are repre¬
sented to have been exacted by the Union Pacific Railroad
Company, but which the attorney of the Union Pacific
Railroad Company pronounces erroneous and not true in
fact. We have ascertained, upon due investigation, that
the figures given by us and by the Senator from Colorado
were obsolete. Our mistake arose from the fact that the
figures were taken from a tariff making no reference to the
special order of the General Freight Agent of the Union
Pacific Railroad Company, dated January 1, 1872, printed
in the appendix to the argument of its attorney. From
the rule of most railroad companies, that special orders
3
and special rules expire with the year in which they are
made, and are repromuRated if intended to remain in
force, we assumed said order to be no longer in effect.
But while admitting our error, we are able to adduce
proof that the publication of rates by the Union Pacific
does not by any means assure strict adherence to them in
practice, and that, on the contrary, arbitrary deviations
from them are not infrequent occurrences. For this proof
see Exhibit A in the Appendix. The spirit towards the
Kansas Pacific shown in them is noteworthy.
Our mistake relative to the freight rates actually charged
by the Union Pacific Railroad Company was not, however,
a fundamental one. We erred simply as regards the man¬
ner and degree of discrimination, but not as to the ex¬
istence of discrimination itself. The bold untruthful¬
ness of Mr. Poppleton's claim that no discrimination is
practised by the Union Pacific is shown, indeed, by
the self-convicting evidence of his own argument. This
evidence lies in his admission that the same rates are
charged by the Union Pacific Railroad Company from
Cheyenne as from Omaha on westward business, and the
same rates to Cheyenne as to Omaha on eastward business ;
and further, in the very order of January 1, 1872, cited
against us, and in the official freight tariffs of the Union
Pacific Railroad Company now in force, herewith submit¬
ted in Exhibits B, C, and D of the Appendix. By this
admission and avowal the Union Pacific concedes the pivo¬
tal point of the whole controversy. The result is just this :
Business going half the length of the Union Pacific Rail¬
road—that is, from Cheyenne to Ogden, or vice versa—is
charged the same, where it is charged at the Omaha rate, as
business going the whole length of the line, that is, from
Omaha to Ogden, or vice versa. But freight delivered to
the Union Pacific at Cheyenne, and destined for principal
Pacific coast points, is charged the Omaha rate (see Exhibit
B), no matter from what eastern point the freight was
shipped ; and comparison of the Omaha rate with the
through rates on freight shipped from principal eastern
points via Council Bluffs (Exhibit C or D), will demon¬
strate the fact that the most palpable and outrageous
4
discrimination against freight via Cheyenne is main¬
tained.
For example : The New York through rate, via Council
Bluffs, on alcohol, whiskey, high wines, and pure spirits,
in wood, owner's risk of breakage (these articles being
of that class of freight known as fc*B"), is $2 per hun¬
dred pounds, apportioned as follows :
Lines East of Chicago, . . .44
Chicago to Council Bliiffs, . . .23
Council Bluffs to San Francisco, . .1.33
$2.00
The proportion of the rate between Council Bluffs and
San Francisco being apportioned thus :
To the Central Pacific, . . . $ .6158
To the Union Pacific, . . . .7142
$1.33
The same class of freight from New York or any other
common point delivered to the Union Pacific at Cheyenne
for transportation to San Francisco is charged at the
Omaha rate, which is $1 85 per hundred pounds, which
rate is (presumably) apportioned between the Central Pacific
and the Union Pacific, on the same basis as other
through rates, which would give :
To the Central Pacific . . $ .6158
To the Union Pacific . . . 1.2342
$1.85
But in whatever matter this rate is apportioned, it is
indisputable that freight of the same class (in this instance
Class "B"), when shipped via Cheyenne, is charged an
excess of 52 cents per hundred pounds, from whatever
eastern point it may have been shipped, over like freight
when shipped via Council Bluffs, although in the latter
case the distance traversed is 516 miles greater than in the
former case.
5
On a carload (22,000 lbs.) of this class of freight, this
excess amounts to $114 40, as will be readily seen from the
following figures :
22,000 lbs., Class UB," at $1.85 per 100
lbs., ma Cheyenne (1,398 miles), . $407.00
22,000 lbs., Class "B," at $1.33 per 100
lbs., ma Council Bluffs (1,914) miles, . 292.60
$114 40
The natural consequence of this policy is that the Kansas
Pacific Railway is absolutely shut out of any share of
either the through overland and the local business to
points east or west of Cheyenne, and that the entire
business is forced over the Union Pacific.
As regards the passenger traffic, the Kansas Pacific Rail¬
way Comx>any is placed under the same absolute embargo.
The fact is that any overland passenger coming over the
Kansas Pacific Railway to the Union Pacific Railroad, or
coming over the Union Pacific Railroad to the Kansas Pa¬
cific Railway, finds that he cannot obtain passage over the
distance from Chevenne to Ogden, or from Ogden to Che¬
yenne, without paying^/the same passenger rate as is
charged for the full distance from Ogden to Omaha, or
Omaha to Ogden—or, in other words, he is compelled to
^aj^/the same fare for 516 miles as for 1,032 miles.
The practical working of this is fully set forth in Exhi¬
bit E of the Appendix, in the letter of the General Passen¬
ger Agent of the Kansas Pacific Railway, commenting
upon the letter of the General Passenger Agent of the
Union Pacific Railroad, printed in the appendix to Mr.
Poppleton's argument.
It will be in point in this connection to call your atten¬
tion once more to the conclusive proof of gross discrimina¬
tion by the Union Pacific against the Kansas Pacific afford¬
ed by the case of the Second Infantry transported last
summer from Kansas City to San Francisco over the Kan¬
sas Pacific, Denver Pacific, Union Pacific, and Central Pa¬
cific Railroads.
The second point in Mr. Poppleton's argument for the
6
Union Pacific, calling for notice by ns, is the cliarge made
therein: That it was not by the action of the Union Pa¬
cific Railroad, but by the discriminating rates established
by the Denver Pacific Railway at the instance of the Kan¬
sas Pacific Railway Company, that the people suffered
from the grievances which the Senate and House resolu¬
tions bring to the notice of the Government.
We have never denied, and do not now deny, the dis¬
criminating practices alleged against the Kansas Pacific
and Denver Pacific Railway Companies. On the contrary,
we distinctly admit the facts asserted in this connection to
be true. It seems to ns a great hardihood, however, on
the part of the corporation that compelled those two com¬
panies in self-defence to resort to this discriminating poli¬
cy to now make it a subject of complaint against them.
What are the historical facts ? The Kansas Pacific and
Denver Pacific Companies have always demanded the re¬
cognition of their legal rights, under the acts of Congress,
from the Union Pacific Company. (See letter of General
Superintendent Anderson, Exhibit F of the Appendix.)
No such recognition was ever granted, and therefore the
Kansas Pacific and Denver Pacific Companies, ever since
their completion, have been confined to the local business
along their lines and to such through business as the
limited trade of the then Territory and now State of Colo¬
rado alone afforded. Not content with its monopoly of
the transcontinental business, the Union Pacific Company
endeavored in previous years to obtain also a portion of
the Colorado business, first by the attempted construction
of the Colorado Central line as originally contemplated,
and subsequently, when the completion of the Colorado
Central was prevented by financial embarrassments, by
seeking access to Denver over the Denver Pacific Railway.
o —
To surrender any portion of the Colorado business to the
Union Pacific Company at that time, or at any time prior
to the year 1873, would have forced the Kansas Pacific
Company into bankruptcy even previous to that year,
when it was compelled to suspend payment of the interest
on its first-mortgage bonds. Being denied its legitimate
share of the transcontinental business as stated, the Kan-
7
sas Pacific Company, having acquired control of the Den¬
ver Pacific Railway, naturally made use of that road as a
defensive weapon against the threatened encroachment of
the Union Pacific Company upon its Colorado traffic.
In saying this we do not wish to defend, but only to
explain, the reasons which compelled the Kansas Pacific
Company, in self-defence, to shut the Union Pacific Com¬
pany out of Colorado by means of the Denver Pacific road.
From the standpoint of the Kansas Pacific Company that
policy, as a means of protecting its revenues, no doubt
seemed right; but it was nevertheless a wrong upon the
public. The attorney of the Union Pacific Company in¬
geniously ignores the fact that it is this "wrong, together
with the discrimination practised by the Union Pacific
Company upon the public, that gave rise to the resolutions
passed by the two Houses of Congress. In fact the ward¬
ing of the preambles sliow^s tfiat not only the Union Paci¬
fic Company, but the Kansas Pacific and Denver Pacific
Companies are alike complained of.
We have all along taken a position identical with that
assumed by said preambles and resolutions. That is, we
urged a correction of the evils complained of, in the interest
not so much of the property in which we are particularly
concerned, as of the general public. Having taken this
position, we contend that the past practices of the Kansas
Pacific and Denver Pacific Companies do not at all bear
upon the questions before the Government, and that they
cannot be used as arguments against setting right the
wrongs perpetrated upon the public by them and the
Union Pacific Company.. In this view we claim further
that it is of no consequence whatever in the question pre¬
sented to the Government what the President of the Kan¬
sas Pacific Railway may have said at any time in explana¬
tion of the non-fulfilment by his company of its obligations
to first mortgage creditors, or what negotiations he may
have carried on with the Union Pacific Company for the
purpose of extricating the Kansas Pacific Company from
the chronic financial difficulties under which it has labored
ever since the completion of its line to Denver from being
denied its proper share of the transcontinental business.
8
And it should be here noted that, in the negotiation with
the Union Pacific, the legal rights of the Kansas Pacific were
distinctly reserved, as shown in agreement of Robert E.
Carr, President, of September 29, 1874, quoted by Mr.
Poppleton.
It is well known that it is only a little over a year since
the Kansas Pacific Railway jmssed out of the control of the
company and under that of Receivers appointed in the
foreclosure suit brought by first mortgage bondholders.
It is only since this change of control that the interests we
represent have had any direct influence upon the manage¬
ment of the road, and it is therefore entirely illogical and out
of place to bring up against us any alleged inconsistencies
in the past management with the legal rights and obligations
of the Company under the acts of Congress. We would
add that the policy complained of in the case of the Den¬
ver Pacific Company was abandoned last summer, and that
the Union Pacific Company had the opportunity, since
that time, to compete for Colorado business over the Den¬
ver Pacific line on equal terms with the Kansas Pacific
Company, and was formally invited to avail itself of this
opportunity by the management of the Denver Pacific
Company. Hence the assertion that it was necessary to
complete the Colorado Central Railroad to Cheyenne in
order to give the people of Colorado the benefit of com¬
peting lines for business, is altogether unfounded and
frivolous.
A third point in Mr. Poppleton's argument we deem it
well to answer is :
That the subject brought to the notice of the Government
is a private grievance, and does not affect any public in¬
terest, and hence does not call for the intervention of the
Government.
This point is already met in part by our remarks on the
preceding looint relative to our position in the controversy.
We hold that the paramount interest involved is that of
the public, and through it the Government, as the proper
protector, and we declare ourselves ready to accept what¬
ever consequences the correction of the evils complained
of may bring to the particular property in which our con-
9
stituents are interested as mortgagees. All the prevarica¬
tion of the Union Pacific cannot explain away the cardinal
fact—as palpable as the existence of the Pacific Railroad
itself—that at no time since the completion of the Kansas
Pacific and Denver Pacific roads have they been able to do
any of the transcontinental carrying business, either from
the East or from the West, and that the people depending
on the Kansas Pacific road and its tributaries, and on the
other branches of the Union Pacific, created by acts of
Congress, have thus been practically subjected to a most
extravagant and illegal monopoly. Kor have the advocates
of the Union Pacific at any time or anywhere undertaken
to deny that it has enjoyed and is enjoying an unbroken
monopoly of the transcontinental business, which has grown
to such lucrative proportions as to be unprecedented in the
history of railroad development in this country. Will they
or any one else be bold enough to contend that Congress,
in passing the successive acts relative to the Pacific rail¬
roads, intended to establish such a monopoly % The spirit
and letter of these acts show that the contrary was intend¬
ed, and the Supreme Court of the United States has so
construed these acts, and the maintenance of it, in defiance
of them, requires the intercession of the Government.
Moreover, the latter, independent of its duty as protector
of the public, is directly interested in compelling a. change
in the existing situation, as holder of the second mortgage
on the Kansas Pacific Railway, representing at this time,
with accrued interest, a sum of over $8,500,000. This mort¬
gage claim of the Government shows very clearly that Con¬
gress could not have been guilty of the improbable incon¬
sistency of voting, on the one hand, to subsidize the Kansas
Pacific Railway and to require the subsidy to be secured by
mortgage, and of deliberately giving, on the other hand,
the Union Pacific a monopoly of that business by which
alone the Kansas Pacific Company could expect to meet
its obligations for principal and interest of the Government
mortgage.
A fourth point of the attorney of the Union Pacific Rail¬
road which we desire to meet is :
That the grievance complained of, toeing a private one,
10
the proper remedy for it therefore lies in the courts,
through the interpretation by them of existing laws, and
that the Union Pacific is not responsible for the delay,
until recently, ?'/i the seeking of such remedy.
In making tliis plea, the attorney of the Union Pacific
has not felt it incumbent upon himself to say that his Com¬
pany was at no time willing to have the remedy he suggests
sought by the Kansas Pacific. He might have stated, how¬
ever, the following facts, viz.: The acts of Congress relative
to the Pacific railroads prior to 1874 having been found in¬
adequate to compel the Union Pacific to abandon its discri¬
minating policy against its several branches, the stringent
act of June 20, of the year mentioned, was passed in order
to insure compliance with all the acts. Suit to compel
compliance was promptly commenced by the Kansas Pacific
after the passage of the act last named. But shortly after¬
wards the Union Pacific (see Exhibit B, in the appendix to
Mr. Poppleton's argument,) entered into negotiations with
the Kansas Pacific for the purpose of avoiding strict com¬
pliance with the laws, and negotiations for a compromise
between the two companies have been carried on, at differ¬
ent times, ever since. These negotiations, which wTere as
eagerly sought and followed by the Union Pacific as by the
Kansas Pacific, were the sole reason why the suit com¬
menced in the summer of 1874 was not pushed with greater
vigor. And it can be clearly demonstrated that whenever
any movement in this suit wras threatened by the Kansas
Pacific the Union Pacific officers succeeded in causing delay
by new- and more favorable terms and negotiations, which
they invariably abandoned wTien they had succeeded in
sufficiently delaying the proposed movement. What must
then be thought of the hardihood that reproaches the
Kansas Pacilic with the delay in seeking the proper remedy
in the courts, the responsibility for which the Union Paci¬
fic- shared \
Mr. Poppleton might have explained further that for the
actual prosecution of the suit in the United States District
Court at Omaha in November the public is not by any
means indebted to the Union Pacific. He might have
stated that the persons in control of his company have
11
labored long and hard with ns, at once by promises and
threats, to obtain onr assent to a compromise, one of the
conditions of which was that the trial of the case pending
at Omaha should not be proceeded with. He might have
stated also that we steadily refused to entertain their pro¬
positions, and this from the conviction that we had no
right to be parties to a bargain by which public interests
were sacrificed to private ones.
Another point in the plea of the Union Pacific attorney
is:
That the Kansas Pacific expects the Government to
cure an inherent defect in its organism, viz. : the
greater distance of the Kansas Pacific from its eastern
terminus at Kansas City to Cheyenne, as compared with
the distance from the eastern terminus of the Union
Pacific at Omaha to Cheyenne.
We beg to submit that none of the several interests con¬
cerned in the Kansas Pacific have any such expectation,
and they do not make any such demand. What they
justly claim, in regard to through business, is, simply
and solely that the Kansas Pacific and Denver Pa¬
cific shall be permited to compete for the transconti¬
nental business on a basis of division with the Union
Pacific, under which, regardless of the difference in dis¬
tance mentioned and the "inherent defect in its organi¬
zation," the Union Pacific shall not charge these com¬
panies, the Government, or the public for transportation of
freight or passengers over that half of its road between
Cheyenne and Ogden (Cheyenne being equidistant between
the eastern and western terminus of its road) a rate of
freight or fare greater than one half of the lowest rate
charged by it for traffic of a similar description and charac¬
ter going over its entire road.
Having thus declared our readiness not to claim any ad¬
vantage on account of that "organic" difficulty, we feel
at liberty to express the hope that the Union Pacific will
adopt a similar course and no longer endeavor to evade
the consequences of the nature of its organism in respect
not only of its rights, but also its obligations under the
acts of Congress. It will never do for that creature of the
12
law to claim the vast benefits conferred upon it by the acts
calling it into existence, and at the same time to refuse
compliance with the conditions under which those benefits
were granted.
We do not propose to follow the counsel of the Union
Pacific, in detail, in regard to the question of the greater
cost of transportation over the portion of his company's
road west of Clievenne. He makes the allegations on this
•j o
point, the correctness of which we cannot test, and which
can only be tested by practical trial, from which we are of
course debarred. We venture to call attention to the fact,
however, that Mr. Poppleton has not attempted to contro¬
vert the statements contained in the speech of the Hon. Mr.
Chaffee in support of the Senate resolution, as to the com¬
parative grades on the Kansas Pacific and the Union Pacific
roads ; and we would add, in face of the statement that the
Union Pacific can haul only nine cars over grades ninety
feet to the mile, that on the Kansas Pacific, over like grades,
fifteen cars are hauled, and fourteen cars on the Denver
Pacific over grades as high as one hundred feet to the
mile. That railroads through mountainous regions are not
necessarily more expensive to operate, is shown by the re¬
ference in the letter of President Thos. A. Scott, of the
Pennsylvania Company, printed as Exhibit G in the Ap¬
pendix, relative to the operating expenses of the mountain
division of his road.
It is doubtless pertinent in this connection to recall the
fact that the Union Pacific Company enjoys one immense
advantage over the Kansas Pacific Company, that the most
difficult and least remunerative portion of the latter's
road was built by private capital, while it is notorious that
the Government, by its subsidy, paid more than the whole
cost of the entire line of the Union Pacific, and that the
latter1 s alleged necessities arise from the desire to earn an
income on fictitious capital.
The point raised by Mr. Poppleton that if the Union
Pacific were compelled to abstain from its present discrimi¬
nating policy, the Kansas Pacific would have it in its
power to ruin the former company by cutting rates,
is almost too frivolous and trivial to require notice. What
13
the Kansas Pacific needs in order to meet all its vast liabili¬
ties is increased earnings, and there is no reason to suppose
that even with a legitimate share of the overland business
it will ever be in so independent financial a condition as to
allow it to pursue the suicidal policy suggested.
Mr. Poppleton further alleges, in proof of the alleged
unreasonableness of the demands of the Kansas Pacific
upon the Union Pacific, that "the apportionment of rates
upon no two roads in the United States is made on that
basis, except as it is indicated and justified by the cha¬
racter of the roads. Allowance is universally made for
difference in grades, difference in curvature, difference in
local or through business, cost of fuel and water and labor,
and the numerous elements which enter into the cost of
maintenance and operation of railroads. Nor can it be
otherwise, until some process is discovered to equalize what
nature has made unequal—to convert mountains into plains?
to make crookedness straight, or in some miraculous man¬
ner obliterate the irregularities inherent in different works
of the Creator." (See page 14 of his brief.)
These assertions are no less bold or untruthful than
most of the others to which we have felt called upon to
reply. And we beg to again refer to the letter of the
President of the Pennsylvania Railroad Company, Exhibit
G, which is the best possible refutation of Mr. Poppleton's
assertions in this respect, because it is emphatic and appo¬
site, so far as the management of the Pennsylvania road is
concerned (which road is very like the Union Pacific road
in this, that the western end of it is built over a very
mountainous country), and because the author of the letter
is without question the most accomplished and experienced
railroad president in this country, whose disinterested
statement that " the pro-rate basis on actual distance is
now, I think, the universal rule with all leading railroads
on their interchangeable traffic " cannot well be doubted.
Furthermore, a reference to Exhibits C and D will show that
the through rate between Council Bluffs and San Francisco is
apportioned between the Union Pacific and Central Pacific
roads, giving to the former 54 per cent, of the rate and 46
per cent, to the latter. Now the mileage of these two
14
roads (making allowance for the bridge at Omaha) is in
the same proportion, and this proves the well-known fact
that the Union Pacific Company pro-rates with the Central
Pacific Company upon a strict pro-rate per mile basis.
Inasmuch as the legal questions involved in this contro¬
versy, under the existing acts of Congress relating to the
Pacific roads, were fully and clearly set forth and submit¬
ted by counsel for the Kansas Pacific in a printed argu¬
ment at the recent hearing before yourself and the Attor¬
ney-General, we abstain from replying to so much of Mr.
Poppleton's brief as covers these questions.
And in conclusion we beg to state our convictions, based
upon the reasons and logic contained as well in the printed
argument of the counsel of the Kansas Pacific, above re¬
ferred to, as in a recent " Letter to the President" by the
Hon. J. P. Usher, that the most sure and final remedy for
the existing evils can be best obtained by the enactment
by Congress of a further amendment of the Pacific Rail¬
road acts, which shall provide for the appointment by the
Executive of a Commissioner whose duty it shall be to de¬
vise and promulgate rules and regulations, under the di¬
rection and control of the Secretary of the Interior, for the
operation and management of all the roads of the Pacific
railroad systems, in accordance with the duties and obli¬
gations imposed by the 15th section of the Act of 1864, and
investing the Commissioner with the duty of compelling
the observance of these rules and regulations by any of¬
fending company in a most summary manner; and a sum¬
mary manner for enabling the Commissioner to enforce
this compliance shottld be provided by law.
Respectfully submitted;
By order of the Committee of Nine of first-mortgage
bondholders of the Kansas Pacific Railway.
L. H. MEYER,
Chairman.
ARTEMAS H. HOLMES,
Secretary.
Hated New York, January 11th, 1878.
4
15
Form 4.
Mm CH. DUNBAR,
EXHIBIT A.
U p p p. Laramie Station, May 10, 1877.
cash in all cases on
delivery of goods
"f
To UNION PACIFIC RAILROAD COMPANY, Dr.
For Freight from Cheyenne, May 8th, 1877.
No. Car.
4402
Description of Articles. Weight.
1 Iron Safe, > . .
1680
Back Charges.
28
20
Our charges.
21
84
Consignor At 2809.A-
Received Payment for the Company.
No. Way Bill, 60-
(Signed)
Our Charges
Back Charges
Total
21
84
28
20
50
04
Claims for Overcharge and Loss or Damage must)
be sent to E. F. Test, Claim Agent, with this s
Expense Bill, and Particulars, immediately. )
Agents will be careful to fill out this Expense Bill properly.
The foregoing is the receipted freight bill of the Union
Pacific Company for transporting an iron safe weighing
1680 lbs., delivered by the Denver Pacific road at Cheyenne,
from that point to Laramie, 57 miles. According to the
Official Local Tariff of the Union Pacific, iron safes are
classified " Third Class," and the rate of freight between
Cheyenne and Laramie is 22 cents per 100 lbs. on " Third
Class " freight.
A comparison of the rate charged and received by the
Union Pacific in this case, with the official rate, as follows :
16
1 iron safe, 1680 lbs., at $1.30 (rate charged) per
100 lbs. $21.84
1 iron safe, 1680 lbs., at $0.22 (official rate) per
100 lbs . . 3.69
$18.15
shows that the discriminating rate demanded and received
in this instance was $1.08 per 100 lbs., and amounted to
$18.15 on a haul of 57 miles.
Form 4.
Laramie, May, 187
M CHAS. HUSTER,
cash in all cases on )
delivery of goods. \
To UNION PACIFIC RAILROAD COMPANY, Dr.
For Freight from
No. Car.
Description of Articles.
Weight.
Back Charges.
Our Charges.
(-)
80 Casks B Beer.
1 Box Show Cards,
21000
312
50
315
00
omaha bee print.
Consignor, D. P. R. R.
Our Charges
Back Charges
315
312
50
Received Payment for the Company,
No. Way Bill,
Total, $
627
50
(Signed)
Claims for Overcharges and Loss or Damage must be sent)
to E. F. Test, Claim Agent, with this Expense Bill and >
Particulars, immediately. )
Agents will be careful to fill out this Expense Bill properly.
17
[copy.]
All Special Rates will terminate with
the year, unless otherwise agreed.
Kansas Pacific Railway,
Junction City and Ft. Kearney Railway.
C. S. Greeley, ) receivers>
Henry Villard, j
General Freight Office,
Kansas City, Mo., Oct. 28th, 1877.
Hon. Jerome B. Chaffee,
U. S. Senate, Washington, D.C. :
Dear Sir :
At request of Mr. D. M. Edgerson, President of the
Denver Pacific R.R., I enclose you the original Union
Pacific R.R. freight receipt for one carload of Beer
shipped from St. Louis to Laramie, Wy., via Denver and
Cheyenne, in May, 1877. The charges on this car over the
different railroads are as follows :
From St. Louis to Kansas City, 275 miles, . . $50 00
" Kansas City to Denver, 639 " . . 182 70
Denver to Cheyenne, 106 " . . 79 80
Cheyenne to Laramie, 57 " . . 315 00
u
$627 50
The rate from St. Louis to Laramie via Omaha
would have been $506 80
Divided as follows :
From St. Louis to Omaha, . . $70 00
" Omaha to Laramie, . . 436 00
$506 80
The rate on Bottled Beer in carloads from Chicago to
O
is
San Francisco (a distance of over 2,400 miles), according
to the published Union Pacific tariff, is $2 per 100 lbs.
The freight on this car would have been $420, or only $105
more for 2,400 miles than charged for a distance of 57 miles.
I have other cases showing equally outrageous discrimi¬
nations, which can be furnished if called for.
Yours res'y,
(Signed) JOHN MUIR,
Gen. Frt. Agent.
(Exhibit B.)
THROUGH* FREIGHT'TARIFFS,
IN FORCE FEBRUARY 1st, 1877.
Published only for the information and guidance of Agents and Employees of the UNION and CENTRAL PACIFIC RAILROADS.
Agents and Shippers will take notice that the authority for the Rates herein given is simply a notice from the various roads forming
the lines that they are willing to accept them ; the Union and Central Pacific Railroad Companies do not guarantee these Rates, or agree
to refund charges in excess of them made by any other than their own roads. Shippers should see that their freight is properly described
and contracted, and billed out accordingly by forwarding line.
TO
San Francisco, Sacramento,
MARYSYILLE, SAN JOSE, STOCKTON,
AND
oakland, california.
RATES PER 100 POUNDS.
KJROM
1st Class
2d Class
3d Class
4th Class
Class A
Class B
Class C
Class D
Special
Class
6 00
5 31
5 00
g 50
5 00
If 25
If 00
3 75
If 00
3 19
3 00
2 75
3 00
2 65
2 50
2 25
2 50
2 39
2 25
2 00
2 00
2 12
2 00
1 85
1 75
1 86
1 75
1 70
1 50
1 59
1 50
1 50
Cincinnati and Indianapolis,
Chicago and St. Louis, - - -
Omaha, ---------
At NEWYORK RATES.—From Boston, Pailadelphia, Baltimore, Richmond, Va., New
Orleans, Albany, Troy, Buffalo, Suspension Bridge, Cleveland, Newark, N. J., Pittsburgh,
Bellaire, Wheeling and adjacent points ; Montreal and Sherbrooke, Que. ; Sharon, Green¬
ville, Hubbard and Sharpsville, Pa., Youngstown, Niles and Leetonia, O., via A. & G. W.
R. R. From all stations on Line of the L. S. & M. S. R'y, East of Cleveland, New Castle,
Pa., via Stoneboro, and Akron, O., via B. & O. R. R.
At CINCINNATI RATES.—From Detroit, Mich., via the M. C. R. R. ; Toledo, San¬
dusky and Defiance, Ohio; Junction City, Zanesville, Newark, Mt. Vernon, Mansfield,
Shelby, Monroeville, Tiffin, Fostoria, Deshler, Ohio, and Auburn, Ind., via the B. & O. R. R. ;
Fort Wayne, Peru, Wabash, Logansport, Lafayette, Ind., and Danville, 111., via the T. W.
&W.R'y ; Columbus, Dayton, Springfield, Ohio, and Richmond, Ind.,via the P.C. & St.L.R.R.
Louisville, Ky., nvuy use these Rates with Ohie-River transfer charges added.
At CHICAGO RATES.—From Quincy, 111., Milwaukee, Racine, Kenosha, and Beloit,
Wis., Hannibal, Kansas City and St. Joseph, Mo., Leavenworth and Atchison, Kans., and
all points on and east of the Mississippi River, on the main lines of C. R. I. & P., C. & N.
W., and C. B. & Q. R. Rds. Freeport, Rockford, Elgin, Crystal Lake, 111., and Clinton, la.,
via C. & N. W. R. R. Bement, Tolono, Decatur, Springfield, Taylorville, Lincoln, Dele-
van, Pekin, and Peoria, 111., via T. W. & W. R. R.
At OMAHA RATES.—From Fremont, Kearney Junction, and Cheyenne.
All freight not named herein, or clearly analogous to articles named will be charged First-class rate. No single shipment rated less than 100 lbs. Upon Freight
loaded by Shippers, Double Ra i ls will be charged upon any excess above 22,000 lbs. loaded in apy Car ; and if different kinds of Freight are loaded in the car, the double
charge will be collected on that taking the Highest Rate. The Union and Central Pacific R. R. Cos., each for its road, reserves the right of deciding what rates shall be
charged when the analogy is not clear. No Contracting Agent has authority to deviate from the rates herein given The right is reserved to change this tariff at any time
On all freight liable to leakage and evaporation charges will be collected on actual weight at time and place of shipment.
Oils and all otber liquids are taken at owner's risk of leakage ; Earthenware and glass, and freight in earthen or glass packages, at owner's risk of breakage ; Petro¬
leum and its products, and other extremely combustible freight, at owner's risk of lire All goods not properly boxed, at owner's risk of chafing, wet and waste, and all
perishable property at owner's risk of frost, heat and decay.
The Companies do not guarantee to carry the freight by any particular train nor in time for any particular market and will not be responsible for losses occasioned by
delays. Shippers of freight for which two rates are provided, the lower rate being conditioned upon a release, must sign a release of the form furnished by the Company
and said release must be produced at point of delivery, or the higher rate will be charged.
Agricu ltural Implements, Wagons, and similar freight, when loaded upon flat cars, should not be loaded to exceed eleven feet six inches in extreme height above the
top of the rail, or nine feet in extreme width. and should be well secured by iron rods passing over the load and connecting the upper ends of the stakes in such a manner
as to prevent spreading. The Companies reserve the right, when the above rules are not complied with, to either refuse the freight, to transport it entirely at owner's risk
of injury from collision with tunnels, water tanks, snow sheds, etc, or to remove any excess from the car and charge first-class rates upon the same.
■ Freight will be charged upon the stakes etc , if delivered. If left with the car no charge will be made.
As cars frequently become disabled while in transit, all freight should be loaded in such a manner that it can be transferred and reloaded without injury.
E. P. VINING,
Gen'l Freight Agent, U. P. R. R.
Omaha, Nee.
F. KNOWUAND,
Cfen'l Agent, U. & 0. P. R. Rs.
287 Broadway, New York.
J. C. STUBBS,
Gen'l Freight Agent, C. P. R. R.
San Francisco.
(Exhibit C.)
TABLE OF DIVISIONS OF RATES ON FREIGHT
From NEW YORK.
In Force and Approved by Lines Interested, January 1st, 1877.
Via COUNCIL BLUFFS.
CLASS.
Double
1st
1^ 1st
1st
2d
3d
4th
A
B
C
D
Special.
Basis of Divisions.
Rate per 100 Lbs., - -
$12.00
$9.00
$6.00
$5.00
$4.00
$3.00
$2.50
$2.00
$1.75
$1.50
22 per cent. New York to
Chicago.
Omaha Bridge, Transfer,
5 cents.
Balance to he divided.
15 per cent. Chicago, to
Council Bluffs.
85 per cent, plus Omaha
Bridge Transfer 5 cents,
Council Bluffs to California
Through Points.
east OP CHICAGO.
CHICAGO to COUNCIL BLUFFS.
kink.
2.64
1.40
7.96
1.98
1.05
5.97
1.32
.69
3.99
1.10
.58
3.32
.88
.46
2.66
.66
.34
2.00
.55
.28*
1.66*
.44
.23
1.33
.38*
• 19*
1.17
.33
.17
1.00
C. P. & U. P. Proportion of
Line Rate from
COUNCIL BLUFFS
to
♦SACRAMENTO.
C. P.
U.P.
3.63.86
4.32.14
2.72.32
3.24.68
1.81.24
2.17.76
1.50.42
1.81.58
1.20.06
1.45.94
.89.7
1.10.3
.74.29
.92.21
.58.88
.74.12
.51.52
.65.48
.43.7
.56.3
Omaha Bridge Transfer, 6
cents.
46 per cent, of Balance
154 per cent of Balance.
*Marysville, San Jose, Stockton and Oakland, same Divisions as Sacramento.
fFive Cents Omaha Bridge Transfer to be deducted from Total Line Rate and added to U. P. proportion.
C. P. & U. P. Proportion of
Line Rate from
COUNCIL BLUFFS
to
SAN FRANCISCO.
C. P.
U.P.
3.66.56
4.29.44
2.75.02
3.21.98
1.83.94
2.15.06
1.53.12
1.78.88
1.22.76
1.43.24
.92.4
1.07.6
.76.99
.89.51
.61.58
.71.42
.54.22
.62.78
.46.4
.53.6
San Francisco Terminal,
5 cents.
146 per cent, of Balance.
§ 54 per cent, of Balance.
Omaha Bridge Transfer, 5
cents.
JFive Cents San Francisco Terminal to be deducted from Total Line Rate and added to C. P. proportion.
§ " " Omaha Bridge Transfer " " " " " D. P. "
AT NEW YORK RATES AND DIVISIONS. FROM BOSTOJtf, Mass., ALBANY and TROY, N. Y., PHILADELPHIA, Pa.
NEWARK, N. J., and BALTIMORE, Md., via CHICAGO; RICHMOND, Va., via CHICAGO, NEW ORLEANS, La., MONTREAL and
SHERBROOKE, Que. —
Rates via CHEYENNE—Comparison.
U. P. &C. P. Proportions of
Line Rates from
CHEYENNE to SAN
FRANCISCO, which are (in
all cases of Freights
C. P.
3.66.56
2.75.02
1.83.94
1.53.12
1.22.76
92.4
r .76.99
.61.58
.54.22
.46.4
U.P.
5.33.44
3.99.98
2.66.06
2.21.88
1.52.24
1.32.6
1.23.01
1.23.42
1.15.78
1.03.6
received at CHEYENNE) .
llxed at OMAHA Rates, which are
9.00
6.75
4.50
3.75
2.75
2.25
2.00
1.85
1.70
1.50
Excess of Rates charged for Freight
via CHEYENNE, over Rates
charged for Freight of like
class via COUNCIL BLUFFS,
(although in the latter ease the
haul Is 516 miles longer.)
1.04
.78
.51
.43
.09
.25
.33.5
.52
.53
.50
(Exhibit D.)
TABLE OF DIVISIONS OF RATES ON FREIGHT
From CHICAGO and ST. LOUIS.
In Force and Approved by Lines Interested, January 1st, 1877.
Via COUNCIL BLUFFS.
CLASS.
Double
1st
1^ 1st
1st
2d
3d
4th
A
B
C
D
Special.
Basis of Divisions.
Rath per 100 Lbs., - -
$10.00
$7.50
$5.00
$4.00
$3.00
$2.50
$2.25
$2.00
$1.75
$1.50
Omafia Bridge, Transfer,
EAST.
1.49
1.12
.74
.59
.44
.37
.33
.29
.25*
.22
5 cents.
15 per cent, of Balance.
LINK.
8.51
6.38
4.26
3.41
2.56
2.13
1.92
1.71
1.49*
1.28
85 per cent, of Balance.
C. P. & U. P. Proportion of
Line Rate from
COUNCIL BLUFFS
to
♦SACRAMENTO.
C. P.
U.P.
3.89.16
4.61.84
2.91.18
3.46.82
1.93.66
2.32.34
1.54.56
1.86.44
1.15.46
1.40.54
.95.68
1.17.32
.86.02
1.05.98
.76.36
.94.64
.66.47
.83.03
.56.58
.71.42
Omalia Bridge Transfer, 5
cents.
46 per cent, of Balance,
t 54 per cent of Balance.
*Marysville, San Jose, Stockton and Oakland, same Divisions as Sacramento.
fFive Cents Omaha Bridge Transfer to be deducted from Total Line Rate and added to U. P. proportion.
C. P. & U. P. Pioiiortion of
Line Rate from
COUNCIL BLUFFS
to
SAN FRANCISCO.
C. P.
U.P.
3.91.86
4.59.14
2.93.88
3.44.12
1.96.36
2.29.64
1.57.26
L.83.74
1.18,16
1.37.84
.98.38
1.14.62
.88.72
L.03.28
.79.06
.91.94
.69.17
.80.33
.59.28
.68.72
San Francisco Terminal,
5 cents.
146 per cent, of Balance.
§ 54 per cent, of Balance.
Omaha Bridge Transfer, 5
cents.
JFive Cents San Francisco Terminal to be deducted from Total Line Rate and added to C. P. proportion.
§ " '• Omaha Bridge Transfer " " " " " U.P. "
AT CHICAGO RATES AND DIVISIONS. FROM QUINCY, Elinois, MILWAUKEE, RACINE, KENOSHA and BELOIT, Wis..
HANNIBAL, KANSAS CITY, and ST. JOSEPH, Mo, LEAVENWORTH and ATCHISON, Kansas, and all points on and EAST of the
MISSISSIPPI on the Main Lines of the C. R I & P. R. R.^C. & N. W—BY., and C. B. & Q. R. R. ; FREEPORT, ROCKFORD. ELGIN1
and CRYSTAL LAKE, 111., and CLINTON, Iowa, via C. & N. W. R R ;vto and from BEMENT, TOLONO, DECATUR,, SPRINGFIELD,
TAYLORVILLE, LINCOLN, DELEVAN, PEKIN and PEORIA, all in Illinois, via the T. W. & W. RY.
Rates via CHEYENI^E--Comparison.
U. P. & C. P. Proportions of
Line Rates from
CHEYENNE to SAN
C. P.
3.91.86
2.93.88
1.96.36
1.57.26
1.18.16
,98.38
; .88.72
.79.06
.69.17
.59.28
FRANCISCO, which are (in
all cases of Freights
U.P.
5.08.14
3.81.12
2.53.64
2.17.74
1.56.84
1.26.62
1.11.28
1.00.94
1.10.83
.90.72
received at CHEYENNE)
fixed at OMAHA Rates, which are
9.00
6.75
4.50
3.75
2.75
2.25
2.00
1 85
1.70
1.50
Excess of Rates charged for Freight
via CHEYENNE, over Rates
charged for Freight of like
class via COUNCIL BLUFFS,
(although in the latter case the
haul is 516 miles ionger.)
.49
.37
.24
.34
.19
.12
J .08
'.14
• 20*
.22
19
EXHIBIT E.
New York, January 7, 1878.
A. H. Holmes, Esq., New York :
Hear Sir :
My attention has been called to a letter from Mr. T. L.
Kimball, General Passenger and Ticket Agent of the
Union Pacific Railroad, dated December 13, 1877, relative
to the discrimination in rates by that company against the
Kansas Pacific, to which I would beg leave to briefly reply.
M^. Kimball's letter is somewhat ingeniously framed, and
to those not familiar with the subject seems plausible
enough ; but the basis on which his statements are made
is an unfair one, to sav the least, and calculated to mislead.
y *y y
He takes special pains to show the rates and divisions to
points local to the Union Pacific Road (Cheyenne and
Ogdu^y-which are arbitrary and of secondary importance
to t§S^uestion at issue.
It is the transcontinental business for which we are in
the main contending. Mr. Kimball goes on to say, "that
the passenger who pays his fare from Kansas City to
Cheyenne by either the Union Pacific or Kansas Pacific
line, and pays again from that point to Ogden, gets his pas¬
sage at the same cost, regardless of the route by which he
reached Cheyenne, as if he had purchased a through ticket
from Kansas City to Ogden." If he had carried his argu¬
ment further, however, and included San Francisco, he
would have shown that the passenger, by buying from
point to point, would have had to pay considerably more
than if he had purchased a through ticket in the first in¬
stance, as the following figures will show :
Omaha to Cheyenne, . ) U. P. j . $31.00
Cheyenne to Ogden, . f proportion I . 46.50
Ogden to San Francisco, C. P. " (gold), 53.00
Total, $130.50
20
While the through rate is but $100 currency, and is di¬
vided as follows:
Omaha to Ogden, U. P. proportion, . $54.00
Omaha to San Francisco, C. P. proportion, 46.00
Total, $100.00
By applying these divisions to through business, to or
fro»i San Francisco, via Kansas Pacific route and Chey¬
enne, the Union Pacific would be entitled to $27> the dis¬
tance from Cheyenne to Ogden being 516 miles, or just half
way between Omaha and Ogden, the balance on the other
half of the rate accruing to the Kansas Pacific route ; but
instead of this equitable division the Union Pacific people
insist oti claiming $46 50, or the exorbitant rate of 9 cents
per mile, actually 1 ]/2 cents per mile more than their ave¬
rage local rate, and 3^ cents per mile in excess of the rate
obtained on through business in connection with the Cen¬
tral Pacific road, a course of action utterly at variance
with custom, law, or justice, leaving but $7 50 as the pro¬
portion of the Kansas Pacific and Denver Pacific line for
carrying the passenger 745 miles, or say 1 cent per mile, a
ridiculously low and altogether unprofitable rate. Here is
where the discrimination exists of which we complain, and
which prevents the Kansas Pacific line from competing for
through business to and from California on a just arid
equitable basis.
Very respectfully,
D. E. CORNELL,
General Passenger and Ticket Agent.
21
EXHIBIT F.
"C."
Lawrence, Kans., Aug. 2, 1870.
Col. C. G. Hammond,
General Superintendent U. P. R. P., Omaha, Neb. :
Hear Sir :
As you verbally requested on the 25th ult., I submit the
following written statement of the views of the Kansas
Pacific Railway Company relative to the accommodation
to be furnished by the Union Pacific Railroad for business
from or to the Kansas Pacific, and the rates to be charged
for freight and passengers that pass from the road of one
company to that of the other. Their views are embodied
in the following extract from the act of Congress (Public,
No. 185) approved July 2, 1864. "Sec. 15. . . . The
several companies authorized to construct the aforesaid
roads are hereby required to operate and use said roads
and telegraph for all purposes of communication, travel,
and transportation, so far as the public and the Govern¬
ment are concerned, as one continuous line, and in such
operation and use to afford and secure to such equal ad¬
vantages and facilities as to rates, time, and transportation,
without any discrimination of any kind in favor of the
road or business of any or either of said companies, or
adverse to the road or business of any or either of the
other." . . .
It is thus explicitly declared by Congress that the Union
Pacific Railroad shall carry freight and passengers from
and to the Kansas Pacific at the same rates, in the same
time, and on the same conditions as if received from any
other source.
In general terms the Union Pacific Railroad is entitled
to charge for the distance travelled the same proportionate
rate, or the same rate per ton or per passenger per mile,
and no more, for traffic from or to the Kansas Pacific
as is charged over its whole road for such traffic between
the same general competing points.
o 2
To illustrate : If tlie Union Pacific proportion of through
fare between New York and San Francisco is $54 for 1,032
miles between Omaha and Ogden, it is entitled to $27 for
the 516 miles between Cheyenne and Ogden for passengers
by Kansas Pacific.
In short, the Kansas Pacific claims that business by its
road is entitled to the same rates, time, and facilities be¬
tween Cheyenne and Ogden as similar business receives by
way of Omaha, and that at competing points, in making
through passenger rates and contracting for freight by its
route, its agents may make the same proportionate rates
over the Union Pacific between Cheyenne and Ogden as
the agents of the Union Pacific make for same traffic be¬
tween Omaha and Ogden. It is the disposition and the
intent of the managers of the Kansas Pacific Pailway to do
all in their power to build up a successful traffic between
the East and the West by their line, and to do it in a fair
and legitimate way, and they desire and expect to be met
by the Union Pacific in a spirit that will enable the u to be
to that road a friend and ally, rather than a rival, believing
the interest of both companies will be best promoted by
such course. Very respectfully,
A. ANDERSON,
General Sup't.
Col. Hammond replied that the foregoing had been for¬
warded to their President or Directors at Boston.
(No other reply.)
f
o'^
_
EXHIBIT G.
Kansas Pacific Railway Company, )
St. Louis, Dec. 24, 1877. j
My Dear Sir :
You will confer a favor on me by sending any reports
you may liave, wliicli show the cost of operating your
road by divisions, separating the cost of operating and
maintaining the mountain divisions from the cost of opera¬
ting and maintaining those which lie in comparatively
level countries. Very truly yours,
(Signed) ROB. E. CARR,
President.
Tiios. A. Scott, Esq.,
President, Philadelphia.
Pennsylvania Railway Company, (
Philadelphia, Dec. 29, 1877. J
Rob. E. CaPvR, Esq., President Kansas Pacific Railway
Company, St. Louis:
My Dear Sir :
I have your favor of 27th inst. and I also have your
letter to Mr. Thaw of same date. On looking over the
operating expenses of our Pennsylvania Railroad divisions
for 1876, I find that the expenses of the Pittsburgh divi¬
sion, which includes the heavy mountain grade of ninety-
five feet to the mile, from Altoona to the summit, and
fifty-two feet down on the other side, amounted to sixty -
nine per cent, of the gross earnings, while the expenses of
the Philadelphia division, which represents a fairly rolling-
country with ruling gradients of about thirty-nine feet to
the mile, were sixty-two per cent.
In regard to the enquiry in your letter to Mr. Thaw,
whether the Pennsylvania Railroad charges the lines east
or west of the mountains more than a pro-rate of the
through rate on account of its mountain division, I beg to
say that it does not; that the mountain division is only
charged its actual mileage, and nothing added by reason of
LM
tlie heavy grade, and further that the Pennsylvania Rail¬
road Company pursues the same policy with all other lines
on its joint traffic, whether they control the connecting
lines, or whether they are controlled by others. The pro¬
rate basis on actual distance is now, I think, the universal
rule with all leading roads on their interchangeable traffic.
Yery truly yours,
(Signed) THOMAS A. SCOTT,
President,
G. '
25
SUPPLEMENT TO EXHIBITS "A" AND "B"
In Appendix to Memorial addressed on January 11, 1878, to
the Secretary of the Interior by the Committee of Nine of
the First-Mortgage bondholders of the Kansas Pacific
Paihoay,
WITH FURTHER EVIDENCE
of the discriminations practised by the Union Pacific Railroad.
Office of Londoner & Bro., j
Denver, Col., January 8, 1878. )
Hon. Jerome B. Chaffee, Washington, D. C.:
Dear Sir : Your speech has attracted the attention of
all the business men of Colorado, and fairly elicited the
most satisfactory comment by all parties.
Denver and Colorado have been suffering from the dis¬
criminations of the Pacific roads ever since they were
thrown open for business.
The law, as we common business men understand it,
has been openly and flagrantly violated. Hundreds of
thousands of Colorado's best acres having been donated to
the Pacific railroad companies by Congress upon certain
conditions, one of them being that there should be no dis¬
crimination for or against the business of any of the
branches, we believe we have a right to it, at least fair
play in the handling of our business by the Pacific roads.
To illustrate how we have been treated, allow me to state
the following case: Since the completion of the Colorado
Cent ral Rail road-between Denver and Cheyenne I applied
for a rate on a car-load of Utah dried peaches from Ogden
to Denver. They gave me the following quotations :
Ogden to Cheyenne, . . . $500
Ogden to Omaha, . . . 300
a discrimination of $200 per car-load against business for
Colorado I did not accept the rate, but will be compelled
to purchase in Kansas City or Omaha.
26
Another case in point:
Some months since I purchased in San Francisco a car¬
load of canned goods and shipped to Denver, paying freight
$390. The same car of goods, according to their advertised
tariff, could have been delivered in St. Louis for $300. So
that, as a matter of fact, I am compelled to go to St. Louis
or Chicago to buy California canned goods at the best rates
for Denver market.
Another transaction: I purchased in California three car¬
loads of syrup in five-gallon kegs. Upon enquiry I found
that the cost from there to Denver direct, ma Cheyenne,
would be $4 10 per keg ; but by shipping through to Omaha
and down to Kansas City, consigned to an outside party, and
from thence ma the Kansas Pacific Road to Denver, the
syrup could be delivered for $3 25 per keg. Of course, I
shipped by the latter roundabout route, the goods being
subjected to about 1,400 miles extra and useless travel, and
my house liable to serious loss and vexatious delay inci¬
dent to the numerous transfers.
1 could make a long list of these discriminations against
Denver and Colorado which have fallen under m}^ personal
observation if it was necessary to do so. It is a matter of
public notoriety that Utah potatoes can be shipped from
Ogden to Omaha cheaper than they can be to Denver.
In travelling between Denver and Utah and the Pacific
coast we are discriminated against in the same manner.
Your Colorado friends desire you every possible success
in your efforts to have the laws of Congress honestly and
faithfully enforced in this matter, so that Colorado busi¬
ness interests may not be repressed and dwarfed by the
very agency the Government intended should foster and
build them up. Very truly-yours,
(Signed)
WOLFE LONDONER.
27
Office of Martin & Cornforth, )
Denver, Col., January 2, 1878. f
Hon. J. B. Chaffee,
United States Senator for Col.:
Dear Sir : I have read with much pleasure your speech
upon the management of the Pacific roads. You are cer¬
tainly on the right track, and I trust you will lay on
vigorously and spare not until the laws of Congress shall
be obeyed by all the Pacific roads, both in letter and spirit.
As an illustration of the unjust discrimination which has
been practised against Colorado business, I will state that
the firm of Martin & Cornforth, of Denver (of which I am
the senior partner), has been compelled to pay on fruit
shipments for Denver, Sacramento to Cheyenne, $425 per
car-load. The same car would be taken Sacramento to
Omaha (516 miles more distance) for the same sum, $425.
The rate to Chicago from Sacramento is $500 per car-load.
The rate per car-load Cheyenne to Denver is $90, making
the through rates from Sacramento
to Denver, .... $515
to Omaha, .... 425
to Chicago, .... 500
This is but one illustration. There is the same kind of
discrimination against Denver and Colorado whenever we
wish to ship in dried fruits from California, or grain, fruit,
or potatoes from Utah, and the same injustice in a marked
degree on canned goods.
The rates from the Pacific Coast or Utah to Omaha,
Chicago, Cincinnati, and St. Louis are less than to Denver.
I may add thai the same discrimination is practised
against us when we desire to travel, as their published
tariff shows:
Omaha to San Francisco, . $100
Cheyenne to " " . 100
Very truly yours,
(Signed)
J. H. MAPTUST.
28
Union Pacific^Railroad Company, )
General Freight Department, >
Omaha, March 31, 1877. )
John H. Bishop, Esq., Cheyenne :
Dear Sir : Referring to your favor of the 28th inst., I
would ask whether you are not agent for the lime made by
Mr. A. W. Haygood at Granite Canon?
If so, if any special rate were granted, it would be pre¬
ferable to have the arrangement made direct with the manu¬
facturer rather than with any one else.
If you are not handling Haygood's lime, but selling that
of some other manufacturer, please let me know who it is
that is making the lime in which you deal.
Yours truly,
(Signed) E. P. VESTING,
G. F. Agent.
Union Pacific Railroad Co., )
General Freight Department. >
Omaha, April 6, 1877. )
J. H. Bishop, Esq., Cheyenne, W. T.:
Dear Sir : Referring to your favor of the 3d inst., I
would respectfully state that it can hardly be expected
that we should give special rates upon freight brought to
Cheyenne ma the D. P. R. R., and then shipped only some
twenty or thirty miles over the U. P. R. R., when it ought
to come over the U. P. R. R. from Omaha.
For such dealers as ship their freight from Omaha to
Cheyenne ma the U. P. R. R. we can afford to make some
reduction upon the freight that they ship from Cheyenne
to local stations, and shall "probably make such arrange¬
ment with such dealers as fast as may be practicable.
If Mr. Haygood, however, buys his supplies from Mr.
Nagle or other dealers in Cheyenne who discriminate
against the U. P. R. R., you will readily see that it will be
impossible for us to make any reduction.
Yours truly,
(Signed) E. P. VINING,
G. F. Agent.
29
Union Pacific Railroad Company, )
General Freight Department, >
Omaha, April 13, 1877. )
John H. Bishop, Esq., Cheyenne:
Dear Sir : Referring to your favor of 11th inst., I would
say :
First. I have arranged with Mr. Haygood for a rate
upon lime from Granite Canon to Cheyenne.
Second. There has been no recent change made in the
rate upon wood from Buford to Granite Canon.
Third. I cannot offer you any reduced rate upon provi¬
sions, etc., from Cheyenne to Granite Canon, but if you
will purchase your groceries, etc., from Whipple & Hay, I
think you will find that firm prepared to deliver the goods
at Granite Canon at prices as low as you could have them
laid down there when our former rates were in force.
Yours truly,
(Signed) E. P. YHSTHSTG,
G. F. Agent.
Union Pacific Railroad Company, )
General Freight Department, v
Omaha, April 21, 1877. )
J. H. Bishop, Esq., Cheyenne :
Dear Sir: Your favor of the 18th instant is at hand.
I would infer from that and foiTner letters which I have
received from you that you think I have some personal
feeling against you or some complaint to make against
you. This is not the case.
I have not investigated to see what you were doing per¬
sonally. Any complaint that I have made regarding
Cheyenne business has been of a general nature and in¬
tended merely to explain our position, and not intended as
personal complaints against you.
It is certainly our desire to have our relations perfectly
harmonious with you as well as with all our other patrons,
and I am glad to learn that your feelings are the same.
Yours truly,
(Signed) E. P. VINING,
G. F. Agent.
30
General Freight Office, Kansas Pacific Pail- )
road, Kansas City, Mo., January 8, 1878. j
A. H. Holmes, Esq., Attorney to Committee of Kansas
Pacific First-Mortgage Bondholders, New York:
Dear Sir :
I enclose you two Central Pacific Pailroad bills of
lading, one dated July 14, 1877, covering a car-load of
canned salmon contracted from San Francisco to Kansas
City at $1.50 per 100 lbs. ; the other dated July 18, 1877,
covering a car-load of salmon and canned goods contracted
from San Francisco to Denver at $1.95 per 100 lbs., equal
to $390 per car of 20,000 lbs.
As per certified copies of telegrams herewith from J. N.
Keller, who is the agent of the Union Pacific Pailroad at
Cheyenne, the divisions of the rate are :
Central Pacific, . . . $143.40 = $0.71T7o
Union " . . 156.60 = .78T\
Leaving for Denver Pacific as
per freight receipt attached, 90.00 = .45
Total, . $390.00 $1.95
On the shipments from San Francisco to
Kansas City the through rate is, . $1.50
Deduct K. C., St. J., and C. B. proportion
as shown on freight receipt, . . .22
Central Pacific and Union Pacific pro¬
portion, . . . . .1.28
Deduct Central Pacific proportion, . .71f\
Leaving Union Pacific proportion for
1,032 miles, when destined to Kansas
City, ..... .56^
Leaving Union Pacific proportion for 516
miles, when destined to Denver, . .78^
Difference charged by the Union Pacific
for 516 miles in excess of what it
charges for 1,032 miles, . .22
For fear the Union Pacific may claim that the $1.95 rate
31
was charged in consequence of car being a mixed shipment
of canned goods and salmon, I send you two additional
bills of lading, showing the $1.95 rate on straight car-loads
of canned goods and coffee.
The $1.50 rate from San Francisco to Kansas City has
been in effect all last year.
Yours respectfully,
JOHN MUIR,
General Freight Agent.
A. Q. 13 a.
Denver Station, July 28, 1877.
Mr. ISAAC BRINKER,
Denver,
To DENVER PACIFIC RAILWAY, Br.
For Transportation from Cheyenne.
Manifest.
Car.
Date.
No.
No
Initials.
* Description of Articles.
Weight.
Rate.
Amount.
July.
175 Cases C. Goods.
28
67
714
127 Cases Salmon, . .
302
Back charges,
20000 j
|
45
90
300
00
00
Consignor Ogden, 694, 7, 25. Total,
$390
00
Received Payment for the Company,
S. R. Ainslie, Agent.
Central Pacific bill of lading of July 18, 1877, attached,
showing charges to be $1.95 per 100 lbs. on not less thati
20,000 lbs. from San Francisco to Denver.
32
A. Q. 13 a.
Denver Station, Aug. 2, 1877.
Mr. J. S. BROWN & BRO.,
Denver,
To DENVER PACIFIC RAILWAY, Dr.
For Transportation from Cheyenne.
Manifest.
Date. | No
t
Car.
No. Initials
i
Description of Articles.
Weight, j
j
j
i
t
Rate.
i
1
;
! Amount.
I
1
'
Aug.
1
"
•l
1
1
1
1
i
i
i
2
3
5404 U. P.
1
1
I
131 Sacks Coffee, . .
20180
! 45
j
i
90
81
Back charges,
i
!
t
302
12
:
Consignor, Ogden, 809, 7, 30, '77. Total,
!
1
i
$392
93
Received Payment for the Company,
S. R. Ainslie, Agent.
Central Pacific bill of lading of July 26, 1877, attached,
showing charges to be $1.95 per 100 lbs. on not less than
20,000 lbs. from San Francisco to Denver.
A. q. 13 a.
Denver Station, Aug. 2, 1877.
Mr. ISAAC BRINKER,
Denver,
To DENVER PACIFIC RAILWAY, Dr.
For Transportation from Cheyenne.
Manifest.
Car.
.
1
Description of Articles.
Weight.
Rate.
Amount.
Date.
No.
No.
Initials.
'
Aug.
W.B.
2
5
4250
U. P.
324 Cases C. Goods, . .
■
20080
I
45
90
36
Back charges,
t
1 1
| I
! j
!
300
59
1
! I
1 j
1 "i
Consignor, Ogden, 810, 7, 30, Total,
1
i
i
$390
95
Received Payment for the Company,
S. R. Ainslie, Agent.
Central Pacific bill of lading of July 25, 1877, attached,
33
showing charges to be $1.95 per 100 lbs. on not less than
20,000 lbs. from San Francisco to Denver.
Way Bill showing lower rate by $0.45 per hundred on
freight from San Francisco to Kansas City via Omaha,
Kansas City being 638 miles further east via Kansas Paci¬
fic than Denver.
O. F. O. Form 20.
Kansas City Station, Aug. 1, 1877.
M McCORDEN & CO.,
To KANSAS CITY, ST. JOSEPH & COUNCIL BLUFFS RAILROAD, Dr.,
For Freight and Charges from Council Bluffs.
n
£
o
S
o3
ft
7, 31.
Pro. No.
D B Page
Report'd
m
£
Sh
O
o
449
46
»■.
eS
O
o
o
£
OS
O
DC
o
A
934 K. C.
52
Description of Articles.
Rate.
tuo
£
300 Cases Salmon,
21300
22
W. & J. L.
1.28
1.50
to
f?
OS
a
o
u
13
o
46 86
0D
o
tf
OS
A
O
A
v
03
pq
272
64
Received Payment for the Company,
Aug. 3, 1877.
J. E. Smith, Agent.
w.
Consignor, Union Pacific.
Central Pacific Bill of lading of July 14, 1877, attached,
showing charges to be $1.50 per 100 lbs. on not less than
20,000 lbs. from San Francisco to Kansas City.
u
Certified copies of telegrams between J. N. Keller, XI. P. Agent
at Cheyenne, and 3. R. Ainslie, K. P. Agent at Denver.
" Denver, January 5.
"To J. N. Keller, Chej^enne.
" Please give me U. P. and C. P. charges separately on
car canned goods for Brinker by your way bill 67, July 28,
1877. Please answer quick. S. P. Ainslie."
" Cheyenne, January 6.
" To S. K. Ainslie.
" Car canned goods for Brinker way bill 67, July 28,
Central Pacific proportion $143.40, Union Pacific propor¬
tion $156.60. J. N. Keller."