AAA Cooper Transp. v. Louisiana Public Service Com'n, 93-CA-0126

• Court: Supreme Court of Louisiana
• Citation: 623 So.2d 1262
• Docket Number: No. 93-CA-0126,93-CA-0126
• Parties: AAA COOPER TRANSPORTATION and Saia Motor Freight Lines, Inc., v. LOUISIANA PUBLIC SERVICE COMMISSION and Texas Louisiana Cartage, Inc.
• Decision Date: 03 September 1993

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623 So.2d 1262 AAA COOPER TRANSPORTATION and Saia Motor Freight Lines, Inc.,
v.
LOUISIANA PUBLIC SERVICE COMMISSION and Texas Louisiana Cartage, Inc. No. 93-CA-0126. Supreme Court of Louisiana. Sept. 3, 1993.

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Joseph H. Kavanaugh, B. Troy Villa, New Orleans, Carolyn Devitis, Baton Rouge, for applicant.

Janet S. Boles, Baton Rouge, Jay J. Harris, Denham Springs, for respondent.

DENNIS, Justice. ^*

In this case, the Nineteenth Judicial District Court rendered judgment in favor of AAA Cooper Transportation and Saia Motor Freight Line, Inc., and against the Louisiana Public Service Commission (Commission), and Texas-Louisiana Cartage, Inc. (TLC), holding that the grant of authority by the Commission changing TLC's common carrier certificate from a limited to an unlimited one was arbitrary and capricious, because the evidence did not reasonably support a finding that a material promotion of the public convenience and necessity clearly required that change in the certificate. Accordingly, the district court overturned and vacated the Commission's order at the cost of the Commission and TLC.

In its oral reasons for judgment issued from the bench the trial court stated:

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The law is that you have to show a need and that the carriers in that specific area are not meeting that need.

I have to find that the Public Service Commission was arbitrary and capricious. In this specific instance, the carrier had 48- to 50-foot trucks. They are alleging that the standard is different when they already have a certificate. I do not find that to be correct. They would have to meet the same criteria in that anyone coming into that market would have to meet. And I find that the Louisiana Public Service Commission was arbitrary and capricious in granting that certificate.

The Commission and TLC appealed. In this civil case, this court's jurisdiction, in the sense of judicial power, extends to both law and facts. La. Const. Art. V, Sec. 5(C) (1974); South Central Bell v. Public Service Commission, 594 So.2d 357 (La.1992); United Gas Pipe Line Co. v. La. Pub. Serv. Comm., 241 La. 687, 130 So.2d 652 (1961); Southern Bell Tel. & T. Co. v. La. Pub. Serv. Comm., 239 La. 175, 118 So.2d 372 (1960); Vicksburg, S & P Ry. Co. v. Railroad Comm'n of Louisiana, 132 La. 193, 61 So. 199 (1913). However, we consider the case only under the self-imposed limited judicial review standard that this court has adopted in Public Service Commission cases. Accordingly we will determine whether the Commission's action was arbitrary, unreasonable, capricious or not based correctly on the law and supported by the evidence. South Central Bell v. La. Pub. Serv. Comm., supra; Gulf States Utilities v. La. Pub. Serv. Comm., 578 So.2d 71 (La.1991), cert. den., --- U.S. ----, 112 S.Ct. 637, 116 L.Ed.2d 655 (1991); South Central Bell v. La. Pub. Serv. Comm., 352 So.2d 964 (La.1977), cert. den., 437 U.S. 911, 98 S.Ct. 3103, 57 L.Ed.2d 1142 (1978).

La.R.S. 45:164, in pertinent part, provides:

No motor carrier shall operate as a common carrier without first having obtained from the commission a certificate of public convenience and necessity, which shall be issued only after a written application made and filed, a public hearing, due notice given to applicant and all competing common carriers, and a finding by the commission that public convenience and necessity require the issuance of a certificate. No new or additional certificate shall be granted over a route where there is an existing certificate, unless it be clearly shown that the public convenience and necessity would be materially promoted thereby. (emphasis added)

We affirm the district court's judgment. The applicant motor carrier's common carrier certificate allows it to use only 48 foot and 57 foot vans. In this proceeding, the applicant seeks to have the common carrier certificate amended to remove the restriction, thereby allowing it to compete with other common carriers holding certificates that allow them to use smaller vans and to more efficiently and economically carry goods. The district court correctly concluded that a removal of the restriction would constitute a grant of new or additional authority to conduct expanded common carrier operations and therefore requires that the applicant obtain a new or additional common carrier certificate by clearly showing that the public convenience and necessity would be materially promoted thereby. Further, the district court correctly concluded that the evidence in this proceeding does not support a reasonable finding that the applicant discharged this burden of proof.

The appellants in this court, the Commission and TLC, argue that TLC's application to remove from its common carrier certificate the provision requiring it to use only 48 foot and 57 foot vans is not an application for new or additional common carrier operating authority. Therefore, they contend, the standards provided by law in La.R.S. 45:164 for the issuance of new or additional common carrier certificates do not apply in the present case. Instead, they argue that the less stringent burden of proof required of persons seeking a contract carrier permit should apply in this case. In other words, they urge, TLC is entitled to amend its certificate without carrying the heavy burden imposed by La.R.S. 45:164 upon a common carrier seeking a new or additional certificate in competition with other certificated common carriers, viz., that it must be "clearly shown that the public convenience and necessity would be

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materially promoted thereby." Id. We disagree.

La.R.S. 45:164 sets forth in separate paragraphs the requirements for obtaining a common carrier certificate or a contract carrier permit. The statute does not expressly provide for the "amendment" of either a common carrier certificate or a contract carrier permit. However, we believe the statute clearly implies that any change in a common carrier's certificate that enables it to engage in new or additional competition with other common carriers requires it to show that the change clearly and materially promotes the public convenience and necessity. The interpretation argued for by appellants, on the other hand, leads to absurd consequences and does not conform to the purpose of the law. Under appellants' interpretation, a common carrier would be able to circumvent and defeat the public convenience and necessity requirement designed to protect the public interest by simply labelling his application as a request for an "amendment" rather than a "new or additional certificate".

A certificate of public convenience and necessity is in the nature of a privilege granted in the public interest. See State ex rel. Hutton v. City of Baton Rouge, 217 La. 857, 47 So.2d 665 (1950). See, generally, Greater Wilmington Transp. Auth. v. Kline, 285 A.2d 819 (Del.Super.1971); Kon v. City of Ann Arbor, 41 Mich.App. 307, 199 N.W.2d 874 (1972; 60 C.J.S. Motor Vehicles Sec. 84(1). It therefore should be construed in favor of the public and strictly against the recipient of the grant. Interstate Commerce Commission v. Crouch Freight Systems, Inc., 577 F.2d 679 (10th Cir.1978); Towns Truck Lines, Inc. v. Cotton State Exp., Inc., 266 Ala. 131, 94 So.2d 402 (1957); Hodges Transfer Co., Inc. v. Ala. Pub. Serv. Comm., 376 So.2d 680 (Ala.1979), app. dis., 446 U.S. 961, 100 S.Ct. 2934, 64 L.Ed.2d 819 (1980). Accordingly, the services in which a certificate holder may engage, or which he is under obligation to perform, depend on the services authorized or required by the certificate. See Magnolia Petroleum Co. v. Walker, 125 Tex. 430, 83 S.W.2d 929 (1935), cert. den., 296 U.S. 623, 56 S.Ct. 144, 80 L.Ed. 442 (1935) as interpreted in Dye Trucking Co. v. Miller, 397 S.W.2d 507 (Tex.Civ.App.1965). See, generally, Walter v. Bd. of R.R....