AW SCHAFFER v. United States

• Decision Date: 22 March 1956
• Docket Number: Civ. No. 624.
• Citation: 139 F. Supp. 444
• Parties: A. W. SCHAFFER, d/b/a Schaffer Transportation Company, and American Trucking Associations, Inc., Plaintiffs, v. UNITED STATES of America and Interstate Commerce Commission, Defendants.
• Court: U.S. District Court — District of South Dakota

139 F. Supp. 444

A. W. SCHAFFER, d/b/a Schaffer Transportation Company, and American Trucking Associations, Inc., Plaintiffs, v. UNITED STATES of America and Interstate Commerce Commission, Defendants.

Civ. No. 624.

United States District Court D. South Dakota, N. D.

March 22, 1956.

COPYRIGHT MATERIAL OMITTED

Donald A. Morken, Minneapolis, Minn. (R. G. May, Sioux Falls, S. D., with him on the brief), for plaintiff A. W. Schaffer.

Peter T. Beardsley, Fritz R. Kahn, Washington, D. C., for American Trucking Associations, Inc.

H. Neil Garson and Robert W. Ginnane, Washington, D. C., for Interstate Commerce Commission.

James E. Kilday and Edward Knuff, Washington, D. C. (Stanley N. Barnes, Asst. Atty. Gen., and Clinton G. Richards, U. S. Atty., Sioux Falls, S. D., with them on the brief), for the United States.

Robert J. Bernard, Chicago, Ill., and H. F. Chapman, Sioux Falls, S. D., R. W. Cronon, St. Paul, Minn., Joseph H. Hays, Chicago, Ill., and Carl Helmetag, Jr., Philadelphia, Pa., James G. Lane, Boston, Mass., Amos N. Mathews and James W. Nisbet, Chicago, Ill., for Intervening Railroads.

Before VOGEL, Circuit Judge, and MICKELSON and DEVITT, District Judges.

MICKELSON, Chief Judge.

This statutory three-judge court action was brought by the plaintiffs to set aside the report and order of the Interstate Commerce Commission pursuant to Sec. 205(g) of the Interstate Commerce Act, 49 U.S.C.A. § 305(g), Sec. 10, of the Administrative Procedure Act, 5 U.S.C.A. § 1009 and Secs. 1336, 1398, 2284, 2321 to 2325, of the Judicial Code, 28 U.S.C. §§ 1336, 1398, 2284 and 2321-2325, incl. That report and order was entered by the Commission in Docket No. MC-93529 (Sub. No. 2), A. W. Schaffer Extension — Granite.

The applicant, A. W. Schaffer, d/b/a Schaffer Transportation Company, sought authority to operate as a common carrier by motor vehicle in interstate or foreign commerce, over irregular routes, in the transportation of granite, manufactured and rough:

(1) From points in Grant County, South Dakota, to points in West Virginia, Maryland, Connecticut, Massachusetts, Vermont, Texas, Arkansas, Louisiana, Wyoming, North Dakota and the District of Columbia;

(2) From points in Vermont to points in South Dakota, Minnesota, North Dakota, Montana, Wyoming, Colorado, Wisconsin, Illinois, Missouri, Iowa, Nebraska, Kansas, Oklahoma, Arkansas, Texas and Louisiana.

The original hearing on the application before an examiner for the Commission was held June 13, 1952. Prior to the issuance of the examiner's recommended report and order, applicant petitioned for a further hearing. By order dated September 9, 1952, the matter was reopened for further hearing, which was held on December 2, 1952, before the same examiner. Protests against the application were filed by rail carriers in New England territory on June 14, 1951; by Texas Railroad Association and Class 1 Rail Carriers in Southwestern Line territory on June 18, 1951; and by Trunk Line Central territory railroads, except the C. & O. Ry. Co., on July 9, 1951. Wm. Dingmann, d/b/a Granite City Transfer, of St. Cloud, Minn., appeared in opposition to the application in addition to the protesting railroads. At the further hearing, in addition to the parties noted above appearing in opposition to the application, Class 1 Western Rail Carriers also intervened in opposition thereto.

On February 10, 1952, the examiner issued his report and recommended order that the authority requested by the applicant be granted.

Exceptions to the examiner's report and recommended order were filed by Class 1 Western Trunk Line Rail Carriers, by Wm. Dingmann, d/b/a Granite City Transfer, and by the eastern railroads, except the C. & O. Ry. Co.

Thereafter the Commission, Division 5, with Commissioner Elliott dissenting, issued its report and order, decided May 24, 1954, granting the authority sought by the applicant and as recommended by the examiner except that it denied the authority from Grant County, South Dakota, to points in the states of Maryland, Connecticut, Massachusetts, Vermont and the District of Columbia, because of motor carrier service then in existence furnished by Wm. Dingmann, d/b/a Granite City Transfer, the protesting motor carrier.

Following the report and order of Division 5, a petition for reconsideration, and, in the alternative, a petition for a hearing de novo, was filed by the eastern railroads. A similar pleading was filed by the Class 1 Western Trunk Line Rail Carriers.

By order entered Nov. 12, 1954, the Commission, Division 5, granted the petitions for reconsideration but denied the petitions in all other respects. The entire Commission thereafter took up the matter and on Feb. 7, 1954, entered its order with an accompanying report, denying the application. This is the report and order which is challenged by the plaintiffs herein.

On March 7, 1955, Barre Granite Ass'n, Jones Bros., and Rock of Ages Corporation of Barre, Vermont, filed a petition for intervention, oral argument and reconsideration. Schaffer on the same date filed a petition for oral argument and reconsideration. On March 9, 1955, plaintiff, American Trucking Ass'n, filed a petition for leave to intervene and for reconsideration. Replies to these petitions were filed by eastern railroads, except the C. & O. Ry. Co., and by the Class 1 Western Trunk Line Rail Carriers.

On May 16, 1955, the Commission entered an order permitting the parties seeking intervention to intervene and denying the petitions in all other respects.

On August 8, 1955, plaintiffs filed the instant complaint in this court, seeking to set aside the Commission's report and order of Feb. 7, 1954, which denied authority, and the order of May 16, 1955, which permitted the parties seeking intervention to intervene and which denied the petitions for reconsideration.

The transcript of testimony before the Commission consists of 341 pages and 24 exhibits, in addition to numerous voluminous pleadings which were filed with the Commission for its consideration.

The principal issues raised in this case are whether there is a reasonable and rational basis for the orders predicated upon the findings of the Commission and whether the Commission's actions in the premises complies with the Congressional mandate as set forth in Part 2 of the Interstate Commerce Act, 49 U.S.C.A. §§ 301-327, and the National Transportation Policy, 49 U.S.C.A. note preceding section 1.

The scope of judicial review of the decisions of independent administrative bodies, in this case the Interstate Commerce Commission, is now well settled and is no longer open to question. The rule may be stated in various ways, one of which is, that findings of fact and permissible conclusions thereon, based upon substantial evidence, are final, conclusive and binding upon the Court. I. C. C. v. Union Pacific R. Co., 222 U.S. 541, 547-548, 32 S.Ct. 108, 56 L.Ed. 308. In U. S. v. Pierce Auto Freight Lines, Inc., 327 U.S. 515, 536, 66 S.Ct. 687, 698, 90 L.Ed. 821, the Supreme Court said that the function of a reviewing court "* * * is limited to ascertaining whether there is warrant in the law and the facts for what the Commission has done. Unless in some specific respect there has been prejudicial departure from requirements of the law or abuse of the Commission's discretion, a reviewing court is without authority to intervene."

In the development of the doctrine and rule of administrative finality, courts have uniformly held that it is the exclusive province and function of administrative agencies to draw legitimate inferences of fact and make findings and conclusions of fact, to appraise conflicting testimony or other evidence, to judge the credibility of witnesses and the evidence adduced by the parties, and to determine the weight of the evidence. Illinois Cent. R. Co. v. I. C. C., 206 U.S. 441-454, 27 S.Ct. 700, 51 L.Ed. 1128; I. C. C. v. Union Pacific R. Co., supra; Alton R. Co. v. U. S., 315 U.S. 15-23, 62 S.Ct. 432, 86 L.Ed. 586. And what has just been said holds true even though the court believes that the decision of the administrative body lacks wisdom; though the court would weigh the evidence differently and reach a different conclusion from that of the agency; or that the final decision is inconsistent with prior determinations arising under analogous or similar basic circumstances. Rochester Telephone Corp. v. U. S., 307 U.S. 125, 146, at p. 139, 59 S.Ct. 754, 83 L.Ed. 1147; I. C. C. v. Northern Pac. R. Co., 216 U.S. 538, 544, 30 S.Ct. 417, 54 L.Ed. 608; Illinois Cent. R. Co. v. I. C. C., supra, 206 U.S. at page 454, 27 S.Ct. at page 704; U. S. v. Pierce Auto Freight Lines, Inc., supra.

Sec. 10 of the Administrative Procedure Act, 5 U.S.C.A. § 1009, has codified the limitations of a judicial review of administrative decisions, and that act is controlling. See Riss & Co., Inc., v. U. S., 341 U.S. 907, 71 S.Ct. 620, 95 L.Ed. 1345; Wong Yang Sung v. McGrath, 339 U.S. 33, 70 S.Ct. 445, 94 L. Ed. 616; Acme Fast Freight v. U. S., D.C., 116 F.Supp. 97.

Plaintiffs in this case mainly urge that the Commission's conclusion is not supported by substantial evidence and therefore is unsupported by the record, is arbitrary and contrary to law. They also ask this Court to consider and make findings with respect to the fact that the public is entitled to service by both forms of transportation, trucks and rail.

In final analysis the Commission was required to determine that the proposed service of applicant is or will be required by the present or future public convenience and necessity under 49 U.S. C.A. § 307(a).

The extent of the Commission's authority in matters concerning the grant or denial of a certificate of public convenience and necessity has been considered in numerous judicial decisions and appears to be well settled. In an early leading case, Chesapeake & O. Ry. Co. v. U. S., 283 U.S. 35, 42, 51 S.Ct. 337. 339, 75 L.Ed. 824, the Supreme Court said:

"There

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