MANSFIELD RAILWAY. The Mansfield Railway & Transportation Company was incorporated as long ago as 1881, by the citizens of Mansfield, who built 2 miles of track from the town to a connection with the Texas & Pacific, at a point known as Mansfield Junction. Within the past 10 years this track and the equipment then in use was acquired by E. A. Frost and others, through purchase, for the sum of $12,500, of the entire capital stock of the railway company. At about the same time a large body of timber land was purchased, lying west of the line of the Texas & Pacific, and a sawmill was erected at a point near Mansfield, known as Oak Hill. The timber and the mill were held and operated by a corporation, owned by Frost and his associates, known as the De Soto Land & Lumber Company, which also held the stock of the Mansfield Railway. Some 6 or 8 miles of logging roads were constructed from a connection with the incorporated line into the timber. There is some obscurity in the record, but our understanding is that the Frost-Johnson Lumber Company was later organized by the same interests, and took over the property and business of the De Soto Company. The additional tracks that had been constructed by the Frost interests, however, were transferred in 1908 to their tap line corporation, the Mansfield Railway & Transportation Company. The lumber company reserved to itself the free privilege of operating logging trains between the timber and the mill; the value of this- reservation was not reflected in the purchase price, which fully covered the value of the property transferred, as the record clearly indicates. The tap line has issued and outstanding capital stock to the amount of $77,300, all of which is held by the stockholders of the Frost-Johnson Lumber Company; and it is indebted to the lumber company in the sum of $216,806.97.

The two companies are identical in interest. There is a subsidiary corporation of the Frost-Johnson Company that performs the entire logging service. It is owned absolutely by the lumber company, which has assigned to it the trackage privilege over the tap line; and we shall refer to it hereinafter simply as the logging company.

The tap line as described on the record now consists of about 16 miles of track commencing at the town of Mansfield and terminating at a logging camp in the woods known as Hunter. In addition to the original connection with the Texas & Pacific at Mansfield Junction the tap line joins the Kansas City Southern, which subsequently built through this section, at a point about one and one-half miles east of Mansfield. The tap line has one locomotive, a passenger coach, and one box car; the logging cars are owned by the logging company. In addition to the incorporated road there are in the aggregate nearly 25 miles of unincorporated logging tracks in the, woods.

The tap line does not haul the logs to the mill, which, as hereto-fore stated, is at Oak Hill, about three-fourths of a mile from the junction with the Kansas City Southern and two and one-half miles from the point of interchange with the Texas & Pacific. The mill is within 300 feet of the right of way of the Kansas City Southern, with which it was formerly connected by a spur track that was abandoned and later taken up. The logs are moved to the mill by the logging company under the reserved trackage right already referred to. The service performed by the tap line for the proprietary company consists in switching the empty and loaded cars for lumber shipments between the mill and the tracks of the trunk lines, a distance of three-fourths of a mile or two and one-half miles, respectively. The tap line, however, bears the expense of maintaining the incorporated tracks extending into the woods over which the logging trains are operated.

There are no other yellow-pine sawmills served by the tap line. But there is a hardwood mill adjacent to the mill of the Frost-Johnson Company, which apparently obtains a substantial portion of its logs from the Frost-Johnson Company or its subsidiary logging company, the price paid including delivery at the hardwood mill. Such logs are hauled to the mill by the logging company under its trackage right in the same manner that the logs are hauled to the Frost-Johnson mill. The hardwood mill also obtains some logs along the Texas & Pacific, which are switched by the tap line to the mill at a charge of $2.50 a car or less. The tap line has joint rates on hardwood as well as yellow-pine lumber.

A good deal of outside traffic is handled over the original two miles of line from Mansfield to Mansfield Junction, but there is practically no traffic in which the proprietary company is not interested over the remainder of the track. Hunter, at the western end of the line, is a logging camp, and there are very few settlers along the line who are not employees of the lumber company or the subsidiary logging company. During the fiscal year ending June 30, 1910, 28,596 tons of lumber were handled, of which 91.4 per cent was supplied by the Frost-Johnson Company. There was 16,539 tons of miscellaneous freight, almost all of which moved over the line between Mansfield and Mansfield Junction, and a considerable proportion of which was handled for the controlling interests or their employees. The tap line operates a daily train in each direction on regular schedule and handles passengers, mail, and express; but its revenues from passenger train operation during the year 1910 aggregated only $1,209.76, its freight revenue being $25,617.19.

As stated the spur track of the Kansas City Southern, about 300 feet long, which formerly went directly into this mill, was torn out; the switching is now done over a track of the tap line three-fourths of a mile long. This arrangement being effected, the Kansas City Southern thereupon undertook to pay the tap line allowances of 1 to 4 cents per 100. We hold this to be a mere manipulation of the situation in order to establish a relation that is unlawful. The tap line also crosses the right of way of the Texas & Pacific within a short distance from the mill, but the lumber is switched by the tap line back toward Mansfield and then to the junction with that line, a distance of about 2-1 miles; the tap line receives from the Texas & Pacific 1 to 4 cents per 100 pounds. In this case we regard any allowance as unlawful.

ADDENDUM: The Mansfield Railway case was appealed through the United States Commerce Court, and eventually decided by the United States Supreme Court in 1914. The following was abstracted from that decision, published in 234 U.S. 1:

MANSFIELD RAILWAY & TRANSPORTATION COMPANY
The Mansfield Railway & Transportation Company and the Frost-Johnson Lumber Company are identical in interest. The tap line extends from Mansfield to a logging camp in the woods known as Hunter, a distance of about 16 miles and the line which was originally incorporated by the citizens of Mansfield in 1881 consisting of 2 miles of track from the town to a connection with the Texas & Pacific at Mansfield Junction. Later the Mansfield Company acquired the two-mile track and equipment, and the interests controlling it purchased a large amount of timber lands near Mansfield at a point called Oak Hill where a mill was built, and spur tracks were laid into the timber, which were later turned over to the Mansfield Company, with the free privilege reserved to the Lumber Company to operate logging trains between the timber and the mill, which operation is performed by a subsidiary company. The purchase price did not reflect the value of the reservation. There are about 25 miles of unincorporated logging tracks. The tap line also has a connection with the Kansas City Southern. It owns a locomotive, a passenger coach and a box car.

The service performed by the tap line is switching cars between the mill and the Kansas City Southern about three-fourths of a mile, although the mill is within 300 feet of the Kansas City Southern and was formerly connected by a spur track which was abandoned and taken up, and to the Texas & Pacific, a distance of two and one-half miles. The tap line bears the expense of maintaining its tracks extending into the woods.

No other yellow-pine mills are served by the tap line, but there is a hardwood mill adjacent to the Frost-Johnson mill, obtaining a substantial portion of its logs from the latter company or subsidiaries, the price including delivery at the hardwood mill, the logs being hauled by the logging company under its trackage right. Some logs are also obtained from the Texas & Pacific, for the switching of which the hardwood mill pays the tap line $2.50 a car or less. The tap line maintains joint rates on hardwood as well as yellow-pine.

Practically no traffic other than that in which the Lumber Company is interested moves over the track from Mansfield to Hunter, but a good deal of outside traffic moves over the original two miles from Mansfield to Mansfield Junction. 16,539 tons of miscellaneous freight was handled during the year ending June 30, 1910, most of which passed over the Mansfield Junction branch, and much of which was for the controlling interests or their employes; while during the same time 28,596 tons of lumber were handled, 91.4 per cent of which was supplied by the Lumber Company. A daily train is operated by the tap line in each direction on regular schedule, handling passengers, mail and express; but in 1910 the passenger revenues were only $1,209.76, while its freight revenues were $25,617.19.

The Commission noticed the abandonment of the 300 foot spur track and then the payment of an allowance of 1 to 4c per 100 pounds, and held that it was a mere manipulation of the situation in order to establish an unlawful relation; and also held that since the tap line crosses the right of way of the Texas & Pacific within a short distance, the allowance of a like amount by the Texas & Pacific for switching from the mill to Mansfield and down to the junction was unlawful.