National Carloading Corp. v. Phœnix-El Paso Express

• Decision Date: 01 April 1943
• Docket Number: No. 4237.,4237.
• Citation: 178 S.W.2d 133
• Parties: NATIONAL CARLOADING CORPORATION v. PHŒNIX-EL PASO EXPRESS, Inc.
• Court: Texas Court of Appeals

Page 133

178 S.W.2d 133

NATIONAL CARLOADING CORPORATION v. PHŒNIX-EL PASO EXPRESS, Inc.

No. 4237.

Court of Civil Appeals of Texas. El Paso.

April 1, 1943.

Rehearing Denied April 22, 1943.

Appeal from District Court, El Paso County; D. E. Mulcahy, Judge.

Suit by Phoenix-El Paso Express, Inc., against the National Carloading Corporation to recover certain undercharges in connection with motor freight transported by plaintiff's assignor. From a judgment for plaintiff, defendant appeals.

Reversed and remanded with directions.

Judgment affirmed, Sup., 176 S.W.2d 564.

Paul J. Coughlin, of New York City, Robert E. Quirk, of Washington, D. C., and Jones, Hardie, Grambling & Howell, of El Paso, for appellant.

Robert L. Holliday and Harold L. Sims, both of El Paso, for appellee.

McGILL, Commissioner.

In Acme Fast Freight, Inc., v. United States, D.C., 30 F.Supp. 968, affirmed in 309 U.S. 638, 60 S.Ct. 810, 84 L.Ed. 993, it was held that freight forwarders conducting businesses similar to appellant's were not common carriers by motor vehicle within the purview of the Motor Carrier Act of 1935, 49 U.S.C.A. §§ 301-327, and were not entitled to a certificate of public convenience and necessity under the so-called "grandfather" clause of Sec. 206(a), 49 U.S.C.A. § 306(a), or to establish and share in joint rates with common carriers by motor vehicle within the meaning of the Act under Sec. 216(c), 49 U.S.C.A. § 316(c). On January 4, 1940, the Interstate Commerce Commission found that appellant was neither a common carrier by motor vehicle nor a contract carrier under the provisions of the Act, and denied its application for a certificate of public convenience and necessity. On May 7, 1940, the Commission determined that the operations of appellant and its tariffs of so-called joint rates with motor carriers filed with the Commission were in all essential respects similar to those of the Acme, and ordered such tariffs stricken from its files. The effective date of this order was thereafter suspended from time to time by the Commission, and finally, by order of June 1, 1942, it was suspended until further order of the Commission.

This suit was instituted by appellee to recover from appellant $1,045 as under charges on nine shipments of freight alleged to have been transported from El Paso, Texas to Phoenix, Arizona, between July 28, 1937, and November 7, 1937, both dates inclusive, by Charles G. Schnaibel and E. C. Donahue, a co-partnership doing business as the Phoenix-El Paso Express. It was alleged that the cause of action had been assigned to appellee. Upon answers to special issues by a jury, the court rendered judgment in favor of appellee against appellant for $999.68, with interest and costs.

At time of the shipments the partnership of Schnaibel and Donahue was a common carrier by motor vehicle in interstate commerce, operating under a certificate of public convenience and necessity issued to it by the Interstate Commerce Commission. It had adopted Arizona Motor Transport Association Tariff No. 1, M.F.-I.C.C. No. 1 of H. M. Suter, Agent (Earl K. Cone Series), and Supplements thereto, on file with the Commission, as its established and published tariffs, and these were held to be applicable to such shipments. It had filed with the Commission concurrences in the joint tariffs of appellant then on file with the Commission, and had billed appellant for and received, as compensation for its services for transporting the shipments in question, a portion of appellant's joint rates equal to 45¢ per hundred pounds. Under the Arizona Motor Transport Association Tariff No. 1 the legal rate for this service was 85¢ per hundred pounds. Each shipment was made under a straight bill of lading or shipping order issued by appellant which stipulated that the property was "received subject to classifications and tariffs in effect" on the date of its issue. All of the shipments originated at points north and east of El Paso and came into Texas from other states.

The jury found that each of the shipments had been transported from El Paso to Phoenix by the partnership of Schnaibel and Donahue, doing business as the Phoenix-El Paso Express, and the amount that should have been charged therefor according to Arizona Motor Transport Association Tariff No. 1 and the difference between these sums and the amount received by appellee is the basis for the judgment.

Prior to October 1, 1935, the effective date of the Motor Carrier Act of 1935, appellant had established joint tariffs naming through routes and joint rates with a large number of motor carriers, including appellee's predecessors. These tariffs were issued in the name of appellant and provided for the movement of less than truckload shipments between points on the routes of various motor carriers, including appellee's predecessors, and other points served by appellant. Arrangements were also made between appellant and such motor carriers, including appellee's predecessors, for divisions of the revenues accruing from the joint rates. These were the tariffs which appellant published and filed with the Commission in an attempt to retain, during the pendency of its application for a certificate of public convenience and necessity, the benefits of the status previously enjoyed, in accordance with Sec. 217 of the Act, 49 U.S.C.A. § 317. Under the "grandfather" clause, Sec. 206 (a), 49 U.S.C.A. § 306(a), it is specially provided that "pending the determination of any such application the continuance of such operation shall be lawful." Sec. 209 (a), 49 U.S.C.A. § 309(a), contains substantially the same language.

Notwithstanding the decision in Acme Fast Freight, Inc., v. United States, supra, appellant contends that because of its previous status and these statutory provisions, its operations were lawful during the pendency of its application for a certificate of public convenience and necessity and that its tariffs were the tariffs in effect at the time of the shipments under Sec. 217(b), 49 U.S.C.A. § 317(b), since they had not been stricken by the Commission and since the language of Sec. 217(a), 49 U.S.C.A. § 317(a), that "Any tariff so rejected by the Commission shall be void and its use shall be unlawful," (italics curs), and the provisions of Sec. 216(f), 49 U.S.C.A. § 316 (f), requiring the Commission to make retroactive adjustment of divisions of joint rates which it has found to be unjust, clearly indicate that Congress had in mind the distinction between the prospective and retroactive operation of a statute, and intended that a rejected tariff should be void and its use unlawful only from and after the date of its rejection. Appellant further contends that since it had agreed with appellee's predecessors for a division of its joint rates equal to 45¢ per 100 pounds as full compensation for their services, both parties believing in good faith that its tariffs were legally on file, it is protected by such agreement and appellee is bound thereby. It is insisted that since the shipments from El Paso to Phoenix were parts of interstate shipments originating in Eastern States, the published joint tariff takes precedence over other rates and is the lawful tariff applicable to through shipments from the point of origin to the point of destination.

These contentions cannot be sustained. It is true that where a joint through rate is provided in a tariff published and filed with the Commission as provided by the Interstate Commerce Act, that rate takes precedence over other rates and is the lawful applicable rate. Baltimore & O. S. W. R. Co. v. Settle, 260 U.S. 166, 43 S.Ct. 28, 67 L.Ed. 189; Kanotex Refining Co. v. Atchison, T. & S. F. R. Co., 34 I.C.C. 271; and Id., 46 I.C.C. 495. It is also true that a schedule of rates contained in a tariff which is permitted or required to be filed with the Commission is conclusive upon the carrier and shipper so long as such tariff is permitted by the Commission to stand, although such rates may be held to have been unreasonable and discriminatory and reparation ordered. Keogh v. Chicago & N. W. R. Co., 260 U.S. 156, 43 S.Ct. 47, 67 L.Ed. 183. But it is only a "common carrier by motor vehicle" subject to the provisions of the Act that is authorized to apply for a certificate under the "grandfather" clause of Sec. 206(a) and is required to file its tariffs under Sec. 217(a); and it is only a "contract carrier by motor vehicle" that is authorized to apply for a certificate under Sec. 209(a), 49 U.S.C.A. § 309(a). The Acme decision and the orders of the Commission have authoritatively determined that appellant did not fall within either of these terms at time of the shipments. The record does not show that appellee's predecessors, or any "common carrier by motor vehicle" subject to the provisions of the Act, had established and filed with the Commission any tariff providing for joint through rates from point of origin to point of destination covering the services performed by appellant. The "concurrences" filed by appellee's predecessors could not have such effect, since by Sec. 216(c), 49 U.S.C.A. § 316(c), they could only establish through routes and joint rates with other "common carriers." Therefore it is not shown that there was on file with the Commission any tariff which would take precedence over Arizona Motor Transport Association No. 1, unless appellant's tariffs were in effect.

In Southern Pacific Co. v. United States, 272 U.S. 445, 47 S.Ct. 123, 124, 71 L.Ed. 343, 345, Mr. Justice Stone said: "The ordinary consequences that attend the filing of a schedule of rates with the Interstate Commerce Commission as demanded or permitted by statute (cf. Texas & P. R. Co. v. Mugg & Dryden, 202 U.S. 242, 26 S.Ct. 628, 50 L.Ed. 1011; Chicago & A. R. Co. v. Kirby, 225 U.S. 155, 32 S.Ct. 648, 56 L. Ed. 1033, Ann.Cas.1914A, 501), cannot be invoked by the carrier merely because it lodged a special tariff with the commission without statutory...