Prater v. Department of Public Service of Washington

• Decision Date: 20 August 1936
• Docket Number: 26251.
• Court: Washington Supreme Court
• Parties: PRATER et al. (INLAND EMPIRE DAIRY ASS'N, Intervener v. DEPARTMENT OF PUBLIC SERVICE OF STATE OF WASHINGTON et al. (WASHINGTON MOTOR FREIGHT ASS'N et al., Interveners.

60 P.2d 238

187 Wash. 335

PRATER et al. (INLAND EMPIRE DAIRY ASS'N, Intervener v. DEPARTMENT OF PUBLIC SERVICE OF STATE OF WASHINGTON et al. (WASHINGTON MOTOR FREIGHT ASS'N et al., Interveners.

No. 26251.

Supreme Court of Washington, En Banc.

August 20, 1936

Appeal from Superior Court, Spokane County; William A. Hunek, Judge.

Injunction suit by Harry Prater and Floyd Prater, copartners doing business under the name and style of Prater Brothers, C. F Kly, and John F. McHugo, doing business under the name and style of the McHugo Transfer Company, and another, against the Department of Public Service of the State of Washington Ferd J. Schaaf, Director, Frank Purse, Supervisor of Public Utilities, and W. D. Lane, Supervisor of Transportation, and others, wherein complaints in intervention were filed by the Inland Empire Dairy Association, the Washington Motor Freight Association, the Northern Pacific Railway Company, and others. From a decree granting the writ, defendants appeal.

Reversed and remanded, with directions to dismiss.

G. W Hamilton, Don Cary Smith, Frederick J Lordan, and Will M. Derig, all of Olympia, for appellants.

James P. Neal, of Olympia, Charles H. Miller, of Seattle, on the merits, Thomas Balmer, of Seattle, amici curiae.

Nuzum & Nuzum, Paul F. Schiffner, Richard S. Munter, and H. E. T. Herman, all of Spokane, for respondents.

BLAKE Justice.

In 1935, the Legislature passed an act dealing comprehensively with the problem of the transportation of property over the public highways of the state by motor vehicles. Laws 1935, c. 184, p. 883.

Section 1 of the act (page 883) reads as follows: 'Section 1. The business of operating as a motor carrier of freight for hire along the highways of this state is declared to be a business affected with a public interest. The rapid increase of motor carrier freight traffic and the fact that under the existing law many motor trucks are not effectively regulated have increased the dangers and hazards on public highways and make it imperative that regulation should be employed to the end that the highways may be rendered safe for the use of the general public; that the shippers of the state may be provided with a stabilized service and rate structure; that the use of the highways for the transportation of property may be regulated to the extent required by the convenience of the general public.'

Section 2 (page 884) is devoted to definitions of terms used in the act. It defines:

'(e) The term 'common carrier' means any person who undertakes to transport property for the general public by motor vehicle for compensation, whether over regular or irregular routes, or regular or irregular schedules, including motor vehicle operations of carriers by rail or water and of express or forwarding companies.

'(f) The term 'contract carrier' means any person, not included under paragraph 'e' of this section, who under special and individual contracts or agreements transports property by motor vehicle for compensation.

'(g) The term 'special carrier' means any person engaged exclusively in the transportation of logs, piling, poles, pulpwood, coal, minerals, sand, gravel, rock and other building materials in vehicles especially constructed and equipped for handling such commodities and operating for compensation.'

Section 3 (page 885) specifies certain vehicles and operations to which the act is not applicable.

Section 4 (page 886) provides that it shall be unlawful for any person to operate as a 'motor carrier' except in accordance with the provisions of the act.

Section 5 (page 886) provides that no common, contract, or special carrier shall operate without first obtaining a permit from the department of public service. The terms upon which permits may be granted are specified. Certificates of convenience and necessity are abolished.

Section 6 (page 887) provides for the application for permits.

Section 7 (page 888) prescribes the fees to be paid for permits.

Section 8 (page 888) provides for the form of permits and the scope of operation to which the holder is entitled thereunder.

Section 9 (page 888) is not pertinent to our problem in this case.

Section 10 (page 888) authorizes the department of public service to establish reasonable classifications of the groups of carriers included in the terms common, contract and special carriers.

Section 11 (page 889) provides: 'The department is hereby vested with power and authority, and it is hereby made its duty, to supervise and regulate every 'common carrier' in this state; to fix, alter and amend just, fair, reasonable and sufficient rates, charges, classifications, rules and regulations of each such carrier; to regulate the accounts, service and safety of operations thereof; to require the filing of annual and other reports and of other data thereby; and to supervise and regulate such 'common carriers' in all other matters affecting their relationship with both the shipping and the general public.'

Section 12 (page 889) provides: 'The department is hereby vested with power and authority, and it is hereby made its duty, to supervise and regulate every 'contract carrier' and 'special carrier' in this state; to fix, alter and amend just, fair and reasonable classifications, rules and regulations and minimum rates and charges of each such 'contract carrier' and 'special carrier;' to regulate the accounts, service and safety of operations thereof; and require the filing of annual and other reports and of other data thereby; and to supervise and regulate such 'contract carriers' and 'special carriers' in all other matters affecting their relationship with both the shipping and the general public.'

Sections 13 to 18, inclusive (pages 889-891), are not pertinent to the problem presented in this case.

The pertinent portions of section 19 (page 892) are as follows:

'No 'common carrier' or 'contract carrier' shall collect or receive a greater, less or different remuneration for the transportation of property or for any service in connection therewith than the rates and charges which shall have been legally established and filed with the department, or as are specified in the contract or contracts filed, as the case may be, nor shall any such carrier refund or remit in any manner or by any device any portion of the rates and charges required to be collected by each tariff or contract or filing with the department. * * *

'The department may refuse to accept any time schedule or tariff or contract that will, in the opinion of the department, limit the service of a carrier to profitable trips only or to the carrying of high class commodities in competition with other carriers who give a complete service and thus afford one carrier an unfair advantage over a competitor.'

A résumé of the balance of the act (sections 20 to 48, inclusive, pp. 893-905) is not necessary to the disposition of the issues raised in this case.

Pursuant to the authority vested in it under the act, the department of public service promulgated its order M. V. No. 22787, whereby it established rates to be charged for the transportation of certain commodities between various termini within the state. The order contains the following finding: 'Based upon the record in these proceeding and our varied experience in discharging the regulatory duties imposed upon the department by the motor freight transportation laws of 1921 and 1933 and after considering all relevant matters properly Before us we find that the minimum rates for contract carriers and the just, fair, reasonable and sufficient rates for common carriers should be the same when the service rendered the shipper is substantially the same.'

The effective date of the order was March 1, 1936. Subsequently, the department, by order M. V. No. 22963, changed the effective date to April 1, 1936.

In contemplation of the provisions of chapter 184, Laws of 1935, the plaintiffs are all 'contract carriers,' engaged in transporting, under contracts with particular persons, firms, and corporations, commodities between certain fixed termini within the state. They carry no commodities other than those carried under their contracts.

By their complaint, plaintiffs sought an injunction against the enforcement of the order, on the ground that it and the law under which it was promulgated infringed their constitutional rights in the use of the highways.

Complaints in intervention were filed by the following: Inland Empire Dairy Association, a shipper who had a contract for hauling with one of the plaintiffs; Washington Motor Freight Association, a corporation whose members are all 'common carriers,' in contemplation of the provisions of the act; Henry A. Scandrett et al., trustees of the property of Chicago, Milwaukee, St. Paul & Pacific Railroad Company, Northern Pacific Railway Company, Great Northern Railway Company, Union Pacific Railroad Company, and Spokane, Portland and Seattle Railway Company, all common carriers by railroad.

A hearing was had and a decree entered permanently enjoining the enforcement of order M. V. No. 22787.

We understand the decree to be predicated on the theory that the provisions of chapter 184, Laws of 1935, [187 Wash. 341] p. 883, under which the order was promulgated, are unconstitutional; that the enforcement of the order would deny plaintiffs their constitutional guaranty of equal protection of law, impair the obligation of their contracts, and deprive them of their property without due process of law.

On the trial below, the following pertinent facts were developed There are 3,797 miles in the state highway system, of which 1,151 miles are improved with hightype paving, 1,908 miles paved with bituminous and oil mixes, 497 miles with graveled...