American Trucking Associations v. United States Railway Labor Executives Association v. United States

• Decision Date: 09 December 1957
• Docket Number: Nos. 6 and 8,s. 6 and 8
• Citation: 78 S.Ct. 165,2 L.Ed.2d 158,355 U.S. 141
• Parties: AMERICAN TRUCKING ASSOCIATIONS, Inc., et al., Appellants, v. UNITED STATES of America et al. RAILWAY LABOR EXECUTIVES' ASSOCIATION et al., Appellants, v. UNITED STATES of America et al
• Court: U.S. Supreme Court

355 U.S. 141

78 S.Ct. 165

2 L.Ed.2d 158

AMERICAN TRUCKING ASSOCIATIONS, Inc., et al., Appellants,

v UNITED STATES of America et al.

RAILWAY LABOR EXECUTIVES' ASSOCIATION et al., Appellants,

v. UNITED STATES of America et al.

Nos. 6 and 8.

Argued Oct. 23, 1957.

Decided Dec. 9, 1957.

[Syllabus from pages 141-142 intentionally omitted] Mr. Peter T. Beardsley, Washington, D.C., for appellants American Trucking Ass'ns et al.

Mr. Edward J. Hickey, Jr., Washington, D.C., for appellants Railway Labor Executives' Ass'n et al.

Mr. Robert W. Ginnane, Washington, D.C., for appellee Interstate Commerce Commission.

Mr. A. B. Howland, Des Monies, Iowa, for intervening appellee Rock Island Motor Transit Co.

Mr. Justice CLARK delivered the opinion of the Court.

These appeals involve, among subsidiary issues, the basic question of whether the Interstate Commerce Commission in a proceeding under § 207(a)¹ of the Interstate Commerce Act wherein a railroad subsidiary seeks a certificate permitting it to provide ordinary motor carrier service at or near the parent railroad's line, is required by § 5(2)(b)² of the Act, and the National Transportation Policy, 49 U.S.C.A. note preceding section 1 to restrict such motor carrier service to that which is auxiliary to, or supplemental of, the parent railroad's services. A three-judge District Court sitting in the District of Columbia upheld the action of the Commission in issuing a certificate without such restrictions. 144 F.Supp. 365. We agree with the conclusion of the District Court that under the circumstances of this case the action of the Commission was well founded.

At the time we noted probable jurisdiction of the appeals, 1956, 352 U.S. 816, 77 S.Ct. 36, 1 L.Ed.2d 43, counsel in No. 8 were invited to discuss the issue of appellants' standing to sue. None of the parties now question that standing, and our examination of § 17(11)³ and § 205(h)⁴ of the Act leads us to conclude that appellants may properly bring this action. See Brotherhood of Railroad Trainmen v. Baltimore & O.R. Co., 1947, 331 U.S. 519, 67 S.Ct. 1387, 91 L.Ed. 1646.

In 1938 the Commission authorized Rock Island Motor Transit, a wholly owned subsidiary of the Chicago, Rock Island and Pacific Railroad, to purchase the property and operating rights of the White Line Motor Freight Company, between Silvis, Illinois, and Omaha, Nebraska. 5 M.C.C. 451. The operating certificate, issued in 1941, restricted Motor Transit to service to or from points on the Rock Island Railroad, subject to any further restrictions the Commission might impose 'to insure that the service shall be auxiliary or supplementary to the train service * * *.' No. MC 29130. Three years later the Commission allowed Motor Transit to purchase property and operating rights of the Frederickson Lines, covering routes between Atlantic, Iowa, and Omaha. 39 M.C.C. 824. Prior to issuing an operating certificate for the Frederickson routes, however, the Commission reopened both proceedings and imposed five conditions on Motor Transit's operation over the combined routes.⁵

Although Motor Transit succeeded in its efforts to have this order set aside by a three-judge District Court, 90 F.Supp. 516, we upheld on appeal, the power of the Commission to impose the conditions, and reversed the order of the District Court. United States v. Rock Island Motor Transit Co., 1951, 340 U.S. 419, 71 S.Ct. 382, 95 L.Ed. 391. Pursuant to our holding, a certificate was issued in September 1951, containing the restrictions as originally ordered. ⁶

Soon thereafter Motor Transit filed with the Commission the present application for a certification of unrestricted operations. Authority was requested to serve the points along the White Line and Frederickson routes as well as certain off-line points, all of which parallel generally the lines of the parent railroad between Chicago and Omaha. The application was substantially granted in November 1954.⁷ 63 M.C.C. 91. Operations were authorized, free of the prior conditions, between Silvis, Illinois, and Omaha. The application was denied insofar as it sought authority between Silvis and Chicago; the Commission pointed out that Motor Transit already possessed such authority.

The order was attacked in the District Court by American Trucking Associations, Inc., its Regular Common Carrier Conference, and nine motor carriers—all appellants in No. 6. The Railway Labor Executives' Asso- ciation and two organizations which since have become members thereof—all of whom are appellants in No. 8—intervened in opposition to the order. Answers were filed by the United States and the Commission. Intervenors in support of the order included Motor Transit, a committee of its employees, the Iowa State Commerce Commission, and numerous Chambers of Commerce and shipper organizations. These appeals were taken from the order of the District Court upholding the certificate as granted.

Appellants advance three reasons why the order should be stricken. They say, in general, that the Commission is required not only in acquisition proceedings under § 5(2)(b) but also in certification proceedings under § 207 to limit service by a rail-owned motor carrier to that which is auxiliary to or supplemental of the rail service of its parent; that the Commission is without power to void restrictions previously imposed in acquisition proceedings on the subterfuge of a subsequent § 207 application; and, even if such contentions have no validity, that the evidence was insufficient and the findings inadequate to support the certification order of the Commission.

I.

By § 5(2)(b), which was formerly § 213(a)(1) of the Motor Carrier Act of 1935, 49 Stat. 555, the Congress authorized consolidation, merger, acquisition, or lease of carriers if found by the Commission to be 'consistent with the public interest.' However, in transactions involving a motor carrier where a railroad or its affiliate is an applicant, the Congress directed the Commission 'not (to) enter such an order unless it finds that the transaction proposed' not only is in the public interest but 'will enable such (railroad) carrier to use service by motor vehicle to public advantage in its operations and will not unduly restrain competition.' The Commission has interpreted this mandate of the Congress to confine acquisition of a motor carrier by a railroad or its affiliate to 'operations * * * which are auxiliary or supplementary to train service.'⁸ We specifically approved this long administrative practice in United States v. Rock Island Motor Transit Co., supra. It will be remembered that the acquisitions of the White Line and Frederickson routes by Motor Transit, wherein 'auxiliary or supplemental' restrictions were imposed, were pursuant to this section of the Act.

The present proceedings, however, were instituted under § 206 et seq., of the Act, which involve applications for certificates of public convenience and necessity. Motor Transit had been carrying on scheduled peddle operations over the entire White Line and Frederickson routes regardless of the volume of traffic available. By this application it sought to secure a certificate covering the same general routes without the restrictions imposed in the § 5(2) (b) proceedings. Such a certificate would enable it to haul, inter alia, the more profitable truckload traffic, thus supplementing the expensive peddle service.⁹

Section 207, which defines the showing on which issuance of a certificate of public convenience and necessity is predicated, makes no reference to the phrase 'service * * * in its operations' used in § 5(2)(b), nor is there any language even suggesting a mandatory limitation to service which is auxiliary or supplementary.

The legislative history of the Motor Carrier Act of 1935 gives no indication that § 213(a)(1), the predecessor of § 5(2)(b), was to be considered a limitation on applications under § 207. Congressional debate was largely confined to the subject of acquisitions, and no reference to railroad operation of motor carriers appears in either of the Committee Reports. S.Rep. No. 482, H.R.Rep. No. 1645, 74th Cong., 1st Sess. Certain amendments were proposed in 1938, including one by Senator Shipstead which would have added to § 207 the same language which in § 213(a) of the Motor Carrier Act and § 5(2)(b) of the Interstate Commerce Act had been construed as a limitation to auxiliary or supplementary service. The Senator withdrew his amendment after Commissioner Eastman of the Interstate Commerce Commission expressed the view that 'in interpreting and applying the provisions of section 207(a) * * * the Commission should read the act as a whole and take cognizance of this policy' of restricting certificates to auxiliary or supplementary service. See Hearings before Senate Committee on Interstate Commerce on S. 3606, 75th Cong., 3d Sess., pp. 26—30, 141—142.

In interpreting § 207, the Commission has accepted the policy of § 5(2)(b) as a guiding light, not as a rigid limitation. While it has applied auxiliary and supplementary restrictions in many § 207 proceedings, the Commission has occasionally issued certificates to railroad subsidiaries without the restrictions where 'special circumstances' prevail, namely, where unrestricted operations by the railowned carrier are found on specific facts and circumstances to be in the public interest.¹⁰ At least three of these cases had been decided when the Congress extensively revised the Interstate Commerce Act by enactment of the Transportation Act of 1940, 54 Stat. 898, in which § 213 of the Motor Carrier Act was substantially re-enacted into § 5(2)(b) of the Interstate Commerce Act, while § 207(a) was left unchanged.

We conclude, therefore, that the Congress did not intend the rigid requirement of § 5(2)(b) to be considered as a limitation on certificates issued under § 207 Nor is this contrary to our holding in United States v. Rock Island Motor Transit Co., supra, an...