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MOTOR FREIGHT EXPRESS v. UNITED STATES

February 17, 1954

MOTOR FREIGHT EXPRESS
v.
UNITED STATES et al.



The opinion of the court was delivered by: STALEY

This court was convened to hear and determine the merits of plaintiffs' claim that two orders of the Interstate Commerce Commission should be set aside. *fn1" One of the orders was dated March 17, 1952, and issued after a "grandfather" application proceeding at the commission's Docket No. MC-10875. The other was dated December 19, 1952, and resulted from two complaint proceedings at Docket Nos. MC-C-1322 and MC-C-1351. On November 25, 1953, we denied a preliminary injunction. We now decide that there is no fatal infirmity in the challenged orders and that they may not be set aside.

 The orders concern the scope of operating authority of Branch Motor Express Company, a common carrier by motor vehicle. Branch intervened and has taken part in the proceedings. *fn2" Plaintiffs are ten motor carriers who compete with Branch at the points in dispute.

 None of the testimony that was taken before the commission was put into evidence here. Therefore, we take the background facts from the trial examiner's report and those of the commission. The history of the litigation is rather involved and goes all the way back to 1936.

 On February 10, 1936, Branch *fn3" filed with the commission two applications under the "grandfather" provisions of Sections 206(a) and 209(a) of Part II of the Interstate Commerce Act. The application under Section 206(a) *fn4" of the Act sought a certificate of public convenience and necessity to operate as a motor common carrier of general commodities over certain specified regular routes. At its MC-10875, the commission conducted an informal investigation on this application and, on June 10, 1938, entered a compliance order providing for the issuance to Branch of a grandfather certificate to operate as a motor common carrier of general commodities, with certain immaterial exceptions, and excepting "garments, and materials and supplies used in the manufacture" thereof, over the routes and serving the points requested in the application, including the terminal points and principal intermediate points named, but not specifically including the highway junction points and all intermediate points.

 Branch next appeared before the commission in 1944 and petitioned to reopen the proceedings at both docket numbers in order to determine whether it should be authorized to operate as a common carrier of garments from, to, and between all of the points on the routes as to which it had been authorized to haul general commodities. No exceptions having been taken to the examiner's recommended order, it became effective as the order of the commission. On April 23, 1945, a corrected certificate was issued to Branch which authorized the extended scope of operation requested in Branch's petition. This was the certificate held by Branch when the proceedings were begun which precipitated the present dispute. It did not, nor did any of the prior certificates, specifically list the cities of York and Lancaster, Pennsylvania, among the intermediate points at which Branch was authorized to render service on its Baltimore-Reading routes.

 In February of 1950, Branch petitioned for "correction, clarification, reconsideration, or revision" of its certificate. Specifically, it sought a determination that it was entitled to serve all the intermediate points on its authorized routes. The proceeding was opened and a further hearing took place. Motor and rail carriers appeared in opposition, and much evidence was received. From the examiner's and the commission's reports we learn that Branch's 1950 petition for clarification asserted that it had always considered that its certificate authorized service at all intermediate points on its regular routes, whether or not listed therein; that it has, in fact, served all such points since long prior to the grandfather date; but that it had been advised in 1949 that its certificate may not have authorized service at those intermediate points on its regular routes which were not specifically listed; and that, if such were the case, the certificate was faulty. Consequently, it sought a revision which would definitely state that the service at all intermediate points was authorized. In effect, it claimed no new intermediate-point service rights but asked that the commission specifically approve what it alleged it had been doing since before June 1, 1935.

 After canvassing the entire record, the examiner stated:

 
"The evidence adduced at the further hearing is not sufficient of its own weight alone to support applicant's present claims. * * *
 
"Though the recorded evidence at further hearing is not sufficient, the issues in the proceeding are such that resort must and should be had to the basic 'grandfather' application in order to reach a determination. * * *"
 
"Wherever in the following route descriptions the expression 'principal intermediate points' is used it should be understood that included therein are also the junction points between highways which are shown * * *."

 He felt that this analysis supported Branch's claimed intent to continue service at all highway segment terminal points as well as named intermediate points, even though those highway segment terminal points were not listed among the intermediate points in the certificate. Lancaster and York were among such highway segment terminal points on Branch's Reading-Baltimore Route No. 38. The examiner then noted that the commission had never required all-inclusive evidence of intermediate-point service in grandfather applications. His ultimate finding followed the statutory formula to the effect that Branch was on June 1, 1935, and continuously since that time has been, in bona fide operation as a common carrier serving all the intermediate points on the described routes.

 Upon exceptions by the protestants, Division 5 of the commission thoroughly reviewed all the evidence. Its report of March 17, 1952, states that Branch had always considered that it was authorized to serve all intermediate points and that its certificate does not reflect all the operating rights established by Branch and to which it is entitled. Regarding the examiner's resort to the grandfather application, it said that statements therein have no probative value but that the application must be considered in order to ascertain the scope of the claimed grandfather rights. As to Branch's burden of proof, it said that the testimony was too indefinite to establish grandfather rights at any of the intermediate points not then specifically authorized, but it then adverted to its rule that, in order to obtain authority to serve all intermediate points on a regular route, a grandfather applicant need not show service at every point. If a sufficient number of intermediate points have been served, authority to serve all points should be granted. There followed its ultimate finding that Branch was, on June 1, 1935, and continuously since has been in bona fide operation as a motor common carrier over the routes and in the manner set out in its appendix C, which authorized service at all ...


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