Mississippi Public Service Com'n v. Merchants Truck Line, Inc.

• Decision Date: 22 April 1992
• Docket Number: No. 07-CC-59556,07-CC-59556
• Parties: MISSISSIPPI PUBLIC SERVICE COMMISSION & Jones Truck Lines, Inc. v. MERCHANTS TRUCK LINE, INC., Shippers Express, Inc., & AAA Cooper Transportation.
• Court: Mississippi Supreme Court

Page 778

598 So.2d 778

MISSISSIPPI PUBLIC SERVICE COMMISSION & Jones Truck Lines, Inc. v. MERCHANTS TRUCK LINE, INC., Shippers Express, Inc., & AAA

Cooper Transportation.

No. 07-CC-59556.

Supreme Court of Mississippi.

April 22, 1992.

Wm. Bruce McKinley, Fred W. Johnson, Jr., Pyle Dreher Mills & Woods, James C. Mingee, III, Jackson, for appellants.

John A. Crawford, Harold D. Miller, Jr., Butler Snow O'Mara Stevens & Cannada, Jackson, for appellees.

Before ROY NOBLE LEE, C.J., and ROBERTSON and McRAE, JJ.

McRAE, Justice, for the Court:

This case involves a petition by Jones Truck Lines, Inc. ("Jones") seeking a certificate of convenience and necessity to enable it to engage in intrastate shipping. Having denied two previous Jones petitions, the Mississippi Public Service Commission ("PSC") granted Jones' instant request. Protesting carriers Merchants Truck Line, Inc., Shippers Express, Inc.,

and AAA Cooper Transportation (hereinafter referred to collectively as "protesting carriers") appealed to the Circuit Court of Hinds County. The circuit court reversed, holding that the PSC's ruling was not supported by substantial evidence. Jones, along with the PSC, has appealed. Each party has framed the issues somewhat differently. For purposes of this appeal, we have distilled the various issues to their neutral essence and phrased them in accordance with the parties' arguments as follows:

I. ARE THE FIRST TWO RULINGS OF THE PSC RES JUDICATA, AND IF SO, IS THE RES JUDICATA BAR LIFTED BY A MATERIAL CHANGE IN CIRCUMSTANCES OCCURRING SUBSEQUENT TO THE DENIAL OF JONES' FIRST TWO PETITIONS?

II. DOES THE RECORD CONTAIN SUBSTANTIAL EVIDENCE THAT A GRANT OF AUTHORITY TO JONES IS BOTH "CONVENIENT" AND "NECESSARY"?

III. IF THE RECORD LACKS SUBSTANTIAL EVIDENCE TO SUPPORT JONES' PETITION, MAY THE PSC BASE ITS RULING ON EXTRINSIC FACTS?

We reverse and hold that the PSC's Order granting Jones a certificate of Public Convenience and Necessity was justified by substantial evidence appearing in the record.

PROCEEDINGS BELOW

In 1983, Jones filed an application with the PSC ("Jones I") for a Certificate of Public Convenience and Necessity as a restricted common carrier by motor vehicle, intrastate, transporting general commodities between all points and places over irregular routes within the State of Mississippi. The PSC denied the application. Jones appealed the denial to the Circuit Court of Hinds County, but the Circuit Court affirmed the denial.

On December 19, 1984, Jones filed a second application ("Jones II"). The PSC entered a final denial on December 12, 1985, and Jones did not appeal the ruling.

On June 24, 1986, Jones filed its third petition ("Jones III"), the one out of which the instant appeal arises. The PSC granted the petition on October 24, 1986. Following an appeal by the protesting carriers, the circuit court reversed the PSC's ruling and ordered cancellation of the certificate. In his Opinion and Order, the circuit court judge stated:

Although this court can find no Mississippi authority directly on point, the Mississippi Supreme Court has held that in zoning cases, once a factual decision has been made, that decision is res adjudicato [sic] in the absent [sic] of proof of a material change. There is no reason for not applying this doctrine to decisions of the Public Service Commission. Indeed the need for public confidence in its officials demands consistency. Appellee [Jones and PSC] apparently accepts this fact by arguing that the evidence shows a material change following the previous denials of identical applications.... This court has reviewed the record, the abstracts of both Appellants and Appellees, and finds no substantial evidence of a material change subsequent to December 12, 1985, the date of the denial of the second application, that would justify the granting of the petition.

The circuit court judge expressed his regrets concerning "the delay in reaching a decision in this matter," but the delay is understandable considering the size of 2080-page record. At the hearing of the Jones III petition, the PSC heard extensive testimony from a representative of Jones, representatives of each protesting carrier, eleven public witnesses appearing on behalf of Jones, and nine public witnesses appearing on behalf of the protesting carriers.

LAW

I. ARE THE FIRST TWO RULINGS OF THE PSC RES JUDICATA, AND IF SO, IS THE RES JUDICATA BAR LIFTED BY A MATERIAL CHANGE IN CIRCUMSTANCES OCCURRING SUBSEQUENT TO THE DENIAL OF JONES' FIRST TWO PETITIONS?

If the PSC's denial of Jones' first two claims are res judicata, then Jones was Since res judicata is an affirmative defense, it is waived if not timely pled. State ex rel. Moore v. Molpus, 578 So.2d 624, 641 (Miss.1991); Wholey v. CalMaine Foods, Inc., 530 So.2d 136, 138 (Miss.1988); see MRCP Rule 8(c). The protesting carriers never raised the issue at the hearing below, so they are estopped from asserting it on appeal. In reversing the PSC's grant of a certificate to Jones, the circuit court stated:

entitled to proceed on its third application only upon demonstrating that a material change in circumstances occurred between the time of the second denial and the filing of the third petition. See Bowe v. Bowe, 557 So.2d 793, 794 (Miss.1990) (material change in circumstances removes res judicata bar); Clark v. Myrick, 523 So.2d 79, 84 (Miss.1988) (same); City of Jackson v. Shell Oil Co., 347 So.2d 340, 341 (Miss.1977) (same). If no res judicata bar applied, then Jones was entitled to proceed in its third petition as if the previous proceedings had not occurred.

This court recognizes that any one small change coupled with other factors that existed at the time of the prior denial and continuing to the present would be sufficient to sustain the Commission's order. The court is simply not able to find any substantial evidence of any material change.

Since the protesting carriers failed to raised the res judicata defense at the PSC hearing, Jones was not obligated to demonstrate a material change in circumstance. The circuit court erred, therefore, in reversing on these grounds.

Owing to the protesting carriers' waiver, there is no need for us to determine whether a material change in circumstances occurred subsequent to the prior Jones proceedings. By the same token, we need not address the questions of whether the doctrine of res judicata applies generally to hearings before the PSC, and, if so, whether the doctrine could have applied in this particular case.

II. DOES THE RECORD CONTAIN SUBSTANTIAL EVIDENCE THAT A GRANT OF AUTHORITY TO JONES IS BOTH "CONVENIENT" AND "NECESSARY"?

The protesting carriers concede that granting a certificate to Jones might inure to the public convenience, and the record justifies their concession. ¹ They insist, however, that Jones has not shown that such a grant is justified by public necessity. In Dixie Greyhound Lines v. Mississippi Public Service Commission, 190 Miss. 704, 200 So. 579 (1941), this Court stated:

The term public convenience and necessity used throughout the statute here under consideration, is not to be confused with the idea of public convenience or necessity. It may be convenient to have a bus going in each direction every hour of the day from the various stations along a route, but the public necessity does not so require.

Id., 200 So. at 585.

Miss.Code Ann. Sec. 77-7-45 sheds light on how the PSC should go about determining whether an application for authority is justified by the public convenience and necessity. The statute provides:

In determining whether the Certificate shall be granted, the Commission shall, among other things, give due consideration to the present transportation facilities over the proposed route of the applicant Contrary to the protesting carriers' assertions, the record does contain information of the type indicated in Sec. 77-7-45. In fact, a large part of it was supplied by the protesting carriers themselves. The protestant's Exhibit 86, for example, consists of a list of all intrastate carriers doing business in Mississippi. Exhibit 87 lists the three carriers whose authority is synonymous with that sought by Jones. Exhibit 75f provides a detailed statistical breakdown of traffic volume by carrier for the period 1981-85. Jones' Exhibit I details the applicant's financial status. The record does not contain evidence concerning "the condition of the highway over the proposed route, or routes," but Jones does not seek authority to operate over a particular route: The Jones application proposes operation "[b]etween all points and places over irregular routes within the State."

the volume of traffic over such route, the financial condition of the applicant, and the condition of the highway over the proposed route, or routes.

The legislature's grant of permission to consider "other things" comes into play as well. The PSC may have considered, in connection with this issue, the evidence put on by Jones concerning the financial condition of current and past intrastate carriers.

John Karlberg, President and Chief Executive Officer of Jones Truck Lines, testified that

the challenge that we have as an industry with insurance and, while on a national basis we have not received any rate increases predicated on the escalating insurance, we have had a lot of feedback from our customers being concerned about financial stability in general. And not only have we seen the demise of some carriers--at least one carrier here in Mississippi--but on a national basis, we have seen the demise of many carriers. In several instances, in spite of the Commission--either the ICC or the Mississippi Commission--granting increases, these carriers still failed to a large degree due to the escalation of their insurance costs. One of the things that we intend to demonstrate in our application today is that Jones Truck Lines has the financial stability to adjust to these large premium increases which we...