Churchill Truck Lines, Inc. v. Transportation Regulation Bd. of Iowa Dept. of Transp., 2-61565

• Decision Date: 24 January 1979
• Docket Number: No. 2-61565,2-61565
• Parties: CHURCHILL TRUCK LINES, INC., Plaintiff-Appellant, v. TRANSPORTATION REGULATION BOARD OF the IOWA DEPARTMENT OF TRANSPORTATION(Successor in Interest to the Iowa State Commerce Commission), Defendant-Appellee, Arledge Transfer, Inc., Intervenor In Support of Transportation Regulation Board.
• Court: Iowa Supreme Court

Page 295

274 N.W.2d 295

CHURCHILL TRUCK LINES, INC., Plaintiff-Appellant, v. TRANSPORTATION REGULATION BOARD OF the IOWA DEPARTMENT OF TRANSPORTATION(Successor in Interest to the Iowa State Commerce Commission), Defendant-Appellee,

Arledge Transfer, Inc., Intervenor In Support of Transportation Regulation Board.

No. 2-61565.

Supreme Court of Iowa.

Jan. 24, 1979.

Larry D. Knox, of Austin, Myers, Peterson & Gaudineer, Des Moines, for appellant.

T. Scott Bannister, of Iowa Dept. of Transp., Transp. Regulation Board, Des Moines, for appellee.

Thomas E. Leahy, Jr., of Grefe & Sidney, Des Moines, for intervenor.

Considered by REES, P. J., and McCORMICK, ALLBEE, McGIVERIN and LARSON, JJ.

LARSON, Justice.

This appeal arises out of competing claims by Arledge Transfer, Inc. and Churchill Truck Lines, Inc. to obtain certain operating rights presently held by BN Transport, Inc. The Transportation Regulation Board (then Iowa State Commerce Commission) approved the joint application of BN and Arledge for transfer of these rights to Arledge and denied Churchill's unilateral application to obtain them. Churchill sought judicial review in district court, and the order of the board was affirmed. Arledge intervened and joined with appellee board. Upon appeal of that judgment, we affirm the trial court.

For several years prior to February 11, 1974, BN Transport, Inc. was the holder of a certificate of convenience and necessity granted under chapter 325, The Code, and operated among several cities in Iowa. This operation was unprofitable, and on that date it joined with Arledge Transfer, Inc. in filing with the board a combined application for approval of a contract for transfer of the certificate to Arledge under the procedure of § 325.25, The Code (1975). Churchill filed a unilateral application for transfer of the certificate to it. Both applications were considered at the same board hearing.

Section 325.25 provided that no certificate of convenience and necessity could be sold, transferred, leased or assigned until the carrier had operated under it continuously for 90 days or more. It further provided that:

(N)or shall any contract or agreement with reference to or affecting any such certificate be made except with the written approval of the commission. Nor shall any person be permitted to take over any such certificate unless he or it shall possess all the qualifications of and meet all the requirements and assume all the obligations imposed upon an original applicant.

Churchill contends the proceedings of the board in approving the transfer and denying Churchill's unilateral application were defective in two respects: The board lacked jurisdiction to proceed with the transfer application of BN and Arledge because it had not published notice of the proceedings; and the actions of the board were illegal because they were unreasonable, arbitrary, and capricious and were not supported by sufficient evidence.

I. Jurisdiction of the board.

Section 325.25, The Code (1975), includes no express requirement for notice of a hearing on a proposed transfer. Section 325.13, however, did require published notice upon the filing of an original application for a certificate of convenience and necessity. That section provided:

Upon the filing of the application, the commission shall fix a date for hearing thereon and cause a notice addressed to the citizens of each county through or in which the proposed service will be rendered, to be published in some newspaper of general circulation in each county, once each week for two consecutive weeks.

Churchill acknowledges this section applies to first-time permit issuances and is not by its own terms applicable to transfers of certificates. It contends, however, that the language of § 325.25 requiring that a proposed transferee "possess all the qualifications of and meet all the requirements and assume all the obligations imposed upon an original applicant" imposes the notice requirements of a new application upon these proceedings for a transfer of the certificate.

No notice of the proposed transfer was published, but a "courtesy" notice of the pending joint application was sent by the board to all certified carriers in Iowa. This "courtesy" notice was sent to advise the carriers who might have "interlining" or tariff dealings with the present certificate holder. Churchill received such notice, filed a written resistance to the proposal, and appeared in opposition to it at the hearing. Churchill concedes it was not impaired in its ability to respond to the proposal and that it was not prejudiced in any manner by the failure to provide published notice; it contends only that the board was deprived of jurisdiction.

The statutes, when read together, show that publication of notice is not required by the transfer section. Such notice for an original application must be provided by the board it is not a "requirement" of the applicant. Although the practice has been for the applying carrier to provide the money and mechanics for such publication, the duty is that of the board under the statute to "cause" a publication; the applicant's involvement is mechanical only and partially a result of a desire to place on it the financial responsibility for publication costs. It is done pursuant to a board order for notice.

The board has followed the practice of processing transfer applications without publication of notice as here urged by Churchill. The transfer section has been in existence since 1924 in substantially the same form as it was at the time of the board hearing on this proposal. The board has never interpreted the statute to require notice of a proposed transfer. Interpretations by an agency charged with implementation of a statute, particularly over a long period of time, and without legislative intervention, is evidence of compatibility of that agency's interpretation with legislative intent. See Iowa Nat. Ind. Loan Co. v. Iowa State Dept. Rev., 224 N.W.2d 437, 440 (Iowa 1974); section 4.6(6), The Code. Another matter which may be considered in construing the statute is the consequences of a particular construction. Section 4.6(5), The Code. To give the transfer statute the interpretation urged by Churchill, that all duties and responsibilities of a proposed transferee and the procedures under § 325.25, would be identical to those of an applicant for issuance of a new certificate under § 325.7 and 325.13, would make the transfer section meaningless; every proposed transfer would be, in effect, a cancellation of the existing certificate and issuance of a new one, with all of the additional matters to be considered regarding the need for the proposed service. This does not appear to be the intent of the legislature. The matter of "necessity" for the service had been previously determined on the original issuance. Public notice would be required to make that determination; it would not be required to make a determination of "fitness" of a transferee. Consideration of a proposed transferee could reasonably include financial ability under § 325.8, The Code; safety compliances under § 325.18; payment of hearing expenses under § 325.19; and liability insurance coverage under § 325.26. These would bear on the "qualifications, requirements and obligations" of the carrier; whether the board had caused publication of notice would not bear on any of them.

If all the requirements and procedures of a new application, including notice, were to be applicable in a transfer application, the legislature could easily have said so. It did not, and we conclude this was not the intent.

This was also the conclusion of the South Dakota supreme court in Application of Transport, Inc., 75 S.D. 340, 64 N.W.2d 313, 315 (1954). In considering whether the "convenience and necessity" prerequisites, and the hearing requirements of a new application were also to be required on transfer...