Interstate Commerce Com'n v. Allen E. Kroblin, Inc.

• Decision Date: 30 June 1953
• Docket Number: Civ. A. No. 615.
• Citation: 113 F. Supp. 599
• Parties: INTERSTATE COMMERCE COMMISSION v. ALLEN E. KROBLIN, Inc.
• Court: U.S. District Court — Northern District of Iowa

113 F. Supp. 599

INTERSTATE COMMERCE COMMISSION v. ALLEN E. KROBLIN, Inc.

Civ. A. No. 615.

United States District Court N. D. Iowa, E. D.

June 30, 1953.

James A. Murray, Associate Chief Counsel, Interstate Commerce Commission, Washington, D. C., Donald R. Partney, Atty., Interstate Commerce Commission, Kansas City, Mo., and Asa Merrill, Atty., Interstate Commerce Commission, New York City, for plaintiff.

Craig H. Mosier, of Mosier & Mosier, Waterloo, Iowa, for defendant.

Charles W. Bucy, Associate Sol., Washington, D. C., Henry A. Cockrum, and Harry Ross, Jr., Attys., Office of Sol., United States Department of Agriculture, Washington, D. C., for the Secretary of Agriculture, amicus curiae.

GRAVEN, District Judge.

The issue in this case is whether or not the interstate transportation by truck of New York dressed and eviscerated poultry is within the scope of the so-called "agricultural" exemption of the Interstate Commerce Act. Section 303(b) (6) of 49 U.S. C.A.; Section 303(b) (6) of Title 49 of the United States Code. In the United States Statutes at Large, Chapter 498, 49 Statutes 543, 544, that Section appears as Section 203(b) (6). In the legislative history that Section is referred to as Section 203 (b) (6). For that reason it will be referred to herein by that number.

In this action the Interstate Commerce Commission claims that the defendant is engaged in transporting New York dressed and eviscerated poultry in interstate commerce without a certificate of public convenience and necessity. The Commission asks that the defendant be enjoined from so doing until he obtains such certificate. The defendant admits that it is so engaged and that it does not have a certificate of public convenience and necessity. It claims that under the provisions of Section 203(b) (6) it is not required to have such certificate. The defendant having admitted that it is engaged in interstate transportation of property by motor vehicle, the burden is upon it to establish that its activities come within the exemption. U. S. v. Krinvic Bros., D.C.E.D.Pa.1942, 47 F.Supp. 481; U. S. v. Chadwick, D.C.E.D.Pa.1940, 39 F.Supp. 204. The Secretary of Agriculture asked for, and was given, permission to appear as amicus curiae. Counsel for the Secretary of Agriculture also filed written briefs and participated in the oral arguments. The position of the Secretary of Agriculture is the same as that of the defendant and is opposed to that of the Interstate Commerce Commission. The written briefs filed and the oral arguments made in behalf of the plaintiff, the defendant, and the amicus curiae were all outstanding and a credit to the legal profession.

Section 203(b) (6), above referred to, in its present form exempts from the certificate provisions of the Act:

"* * * (6) motor vehicles used in carrying property consisting of ordinary livestock, fish (including shell fish), or agricultural (including horticultural) commodities (not including manufactured products thereof), if such motor vehicles are not used in carrying any other property, or passengers, for compensation".

While Section 203(b) (6) includes fish as well as horticultural commodities, it is commonly and generally referred to as the agricultural exemption.

This particular case is but one engagement of a much larger battle that has been raging for many years. The battle commenced when legislation was proposed granting regulatory powers to the Interstate Commerce Commission as to interstate transportation by motor vehicles and has continued ever since. By the Motor Carrier Act of 1935, now Part II of the Interstate Commerce Act, 49 U.S.C.A. ž 301 et seq., Congress granted the Interstate Commerce Commission such regulatory powers. The battle has been, and is being, waged as to what regulatory powers the Interstate Commerce Commission should have as to the interstate transportation by motor vehicles of products generally referred to as agricultural commodities, and as to the exact scope of Section 203(b) (6). Those engaged in interstate transportation by motor vehicle who operate under certificates of public convenience and necessity issued by the Interstate Commerce Commission under the Act are generally referred to as regulated or certificated carriers. Those who are so engaged without being required to obtain such certificates are generally referred to as unregulated or uncertificated carriers. The battle referred to has been waged on the floors of the House and the Senate, before Congressional Committees, before the Interstate Commerce Commission, and in the Courts. In that battle the regulated motor vehicle carriers and the railroads have, in general, contended for very limited exemptions from the certificate provisions of the Act and for a strict construction of the provisions providing for exemptions. Farm groups, other groups interested in the scope of the coverage of Section 203(b) (6), the unregulated carriers, and the Department of Agriculture have in general advocated a broad statutory exemption from the certificate provisions of the Act and for a liberal construction of the exemption provision as enacted.

The controversy has largely resolved around the matter of the exemption in favor of commercial truckers engaged in hauling farm and other commodities. There has been little controversy as to the exemptions in favor of farmers who use their own trucks to haul their produce to market and in hauling supplies to their farms.

Chapter 1 of the Motor Carrier Act of 1935 declared the National Transportation Policy. This same statement of policy was, by Act of September 18, 1940, c. 722, Title I, ž 1, 54 Stat. 899, inserted before Part I of the entire Interstate Commerce Act, 49 U.S.C.A. note preceding section 1, to become the policy of the entire Act. That statement of policy is as follows:

"It is hereby declared to be the national transportation policy of the Congress to provide for fair and impartial regulation of all modes of transportation subject to the provisions of this Act, so administered as to recognize and preserve the inherent advantages of each; to promote safe, adequate, economical, and efficient service and foster sound economic conditions in transportation and among the several carriers; to encourage the establishment and maintenance of reasonable charges for transportation services, without unjust discriminations, undue preferences or advantages, or unfair or destructive competitive practices; to cooperate with the several States and the duly authorized officials thereof; and to encourage fair wages and equitable working conditions;ÔÇöall to the end of developing, coordinating, and preserving a national transportation system by water, highway, and rail, as well as other means, adequate to meet the needs of the commerce of the United States, of the Postal Service, and of the national defense. All of the provisions of this Act shall be administered and enforced with a view to carrying out the above declaration of policy."

It has been and is the view of the Interstate Commerce Commission that since the Motor Carrier Act was remedial legislation the Act as a whole should be liberally construed to carry out its over-all purpose and policy. It has been, and is, the position of the Interstate Commerce Commission that a liberal construction of the exemptions from the Act would tend to defeat and negative the over-all purpose and policy of the Act and that the carrying out of such purpose and policy requires a strict construction of its exemptions. It is also the view of the Interstate Commerce Commission that the existence of a large number of carriers engaged in interstate transportation who are not subject to the certificate provisions of the Act tends to break down and seriously impair the general regulatory authority and powers assigned to it by Congress.

In 1952 the Senate Committee on Interstate and Foreign Commerce held committee hearings on a number of bills, including S. 2357. That bill as originally introduced provided for a narrowing of the scope of the agricultural exemption. The hearings were reported at pages 371 to 522 of a document entitled "Domestic Land and Water Transportation Hearings Before The Committee on Interstate and Foreign Commerce, United States Senate, Eighty-Second Congress, Second Session." That document will hereafter be referred to as Senate Hearings S. 2357 or as S.H. -2357. At those hearings statements were made which indicate some of the problems presented by the existence of unregulated carriers. In S.H.-S.2357, on page 403, the following appears:

"Senator Bricker. * * * On the other hand, you have got a competitive situation here between those who have to pay the charges of regulation, who have to be confined to certain routes, who have to enter into contracts, * * * with those who have absolutely no regulation, no responsibility to any public authority at all, and it largely comes under the exemption here of agricultural products * * *."

It has been, and is, the view of the Department of Agriculture that by enacting the agricultural exemption Congress intended it to be of aid to those engaged in agriculture and such Congressional intent should not be frustrated by administrative and judicial construction and interpretation.

In 1950 under S.Res. 50, 81st Congress, 2d Session, extensive hearings were held by the Senate Committee on Interstate Commerce relating to transportation matters, including the agricultural exemption. The report of those hearings will hereafter be referred to as S.Res. 50.

Ever since the passage of the Act there has been present the "brooding omnipresence" of "trip leasing." "Trip leasing" and matters connected with it are an important part of the background of the general battle that has been waged in connection with the agricultural exemption. That background is also explanatory of some of the attitudes and positions taken by the Interstate Commerce Commission, the Department of...