Skjonsby Truck Line, Inc. v. Elkin, 10224

• Decision Date: 22 October 1982
• Docket Number: No. 10224,10224
• Citation: 325 N.W.2d 271
• Court: North Dakota Supreme Court
• Parties: SKJONSBY TRUCK LINE, INC., Fargo, North Dakota, Plaintiff and Appellant, v. Richard ELKIN, Bruce Hagen, and Leo Reinbold, as members of the North Dakota Public Service Commission; Matador Service, Inc., Jim's Hotshop Service, Dan Dugan Transport Company, K & K Trucking, Inc., Hi-Line Trucking, Inc., Getter Trucking, Inc., Suhr Transport, Lawrence Transportation, M & O Construction and Black Hills Trucking, Inc., Respondents and Appellees. Civ.

Page 271

325 N.W.2d 271

SKJONSBY TRUCK LINE, INC., Fargo, North Dakota, Plaintiff and Appellant, v. Richard ELKIN, Bruce Hagen, and Leo Reinbold, as members of the North Dakota Public Service Commission; Matador Service, Inc., Jim's Hotshop Service, Dan Dugan Transport Company, K & K Trucking, Inc., Hi-Line Trucking, Inc. Getter Trucking, Inc., Suhr Transport, Lawrence Transportation, M & O Construction and Black Hills Trucking Inc., Respondents and Appellees.

Civ. No. 10224.

Supreme Court of North Dakota.

Oct. 22, 1982.

Van Osdel, Foss & Miller, Fargo, for plaintiff and appellant; argued by Todd Foss, Fargo.

Daniel Kuntz, Asst. Atty. Gen., Public Service Com'n, Bismarck, for respondent and appellee Public Service Com'n; argued by Daniel Kuntz, Asst. Atty. Gen., Bismarck.

Hovland & Gambucci, Minneapolis, Minn., for respondent and appellee Hi-Line Trucking; argued by Frederick E. Whisenand, Jr., Williston.

McIntee & Whisenand, Williston, for respondents and appellees Getter Trucking, Inc., Suhr Transport, Lawrence Transp., M & O Const.; argued by Frederick E. Whisenand, Jr., Williston.

Fleck, Mather, Strutz & Mayer, Bismarck, for Kjelbertson Const. Co.; no appearance.

ERICKSTAD, Chief Justice.

This is an appeal by Skjonsby Truck Line, Incorporated (Skjonsby) from a judgment of the District Court of Burleigh County, dated April 2, 1982, affirming an order of the Public Service Commission (PSC), dated October 19, 1981. We reverse.

Skjonsby possesses Special Certificate of Public Convenience and Necessity Number 641 which, in relevant part, authorizes Skjonsby to transport "heavy construction equipment and other bulky objects ..." and "contractors equipment ... and related contractors materials and supplies ...." The certificate was originally issued in 1948 to E. Verl Maxwell and Gordon Gifford d/b/a G & M Transfer of Fargo. Skjonsby purchased the certificate in 1964; and in 1965 the PSC amended the certificate to include the provision authorizing transport of "contractors equipment ... and related contractors materials and supplies ...."

On June 2, 1981, Skjonsby filed a tariff with the PSC wherein Item 30 provided rates for the transportation of commodities "directly related to the development, exploration and production of oil and gas wells." On June 15, 1981, the PSC issued an Order of Suspension and Investigation and Notice of Hearing to determine whether or not Skjonsby's certificate authorized Skjonsby to transport those commodities referred to under Item 30 of its tariff. Subsequent to the hearing the PSC issued, on October 19, 1981, Findings of Fact, Conclusions of Law and Order, whereby it reissued Skjonsby's certificate to include express language prohibiting Skjonsby from transporting "oil field drilling rigs." Skjonsby appealed that aspect of the PSC's order to the district court, which subsequently affirmed the order.

On appeal to this Court from the district court's judgment Skjonsby has raised, among others, the following issue, our conclusion to which is dispositive of this appeal:

Whether or not the PSC, after stipulating that the proceedings would not include the issue of public necessity and convenience, based its determination on that issue and thereby violated Skjonsby's right to adequate notice and a fair hearing.

In its notice of hearing the PSC stated that the following three issues would be considered:

"1. Should the transportation of 'bulky objects' as set forth in Special Certificate No. 641 include the authority to transport commodities directly related to the development, exploration and production of oil and gas wells?

"2. Should the transportation of contractors equipment, related contractors materials and supplies as used in Special Certificate No. 641 include the authority to transport commodities directly related to the development, exploration and production of oil and gas wells?

"3. Does Public Convenience and Necessity require the transportation of oil field commodities, including commodities directly related to the development, exploration and production of oil and gas wells, by Skjonsby Truck Line, Inc. pursuant to Special Certificate No. 641."

It is undisputed that on June 26, 1981, Skjonsby and the PSC agreed that issue three would be withdrawn from consideration in the proceedings initiated by the PSC. At the hearing on July 7, 1981, Mr. Robert W. Senger, the hearing examiner and director of the Motor Carrier Division of the PSC, stated:

"On the 2nd day of July, 1981, the Commission received a motion to strike Issue No. 3 of the Order of Suspension and Investigation and Notice of Hearing from John R. Davidson, counsel for Getter Trucking, Inc. since the Commission has already agreed not to address Issue No. 3, the Commission will not issue an Order striking Issue No. 3 from its Order, and I'll now state that the Commission will not address Issue No. 3."

Subsequent to that statement Skjonsby's counsel, Mr. Richard P. Anderson, requested a clarification by the examiner:

"MR. ANDERSON: Now then, it's also my understanding that we are here just to address the definitional points set forth in Issues 1 and 2. Is that correct?

"THE EXAMINER: Yes."

Subsequent to the hearing the PSC entered the following pertinent findings of fact upon which it based its determination that Skjonsby's certificate did not authorize it to transport oil drilling rigs:

"The transportation of oil field drilling rigs requires the use of large amounts of expensive specialized equipment.... Thus the transportation of drilling rigs in North Dakota is a very unique and specialized service requiring both necessary equipment and experience unlike that generally used in transporting other heavy equipment or machinery.

"Skjonsby operates approximately 7 trucks and 26 trailers, the majority of which are located in Fargo. Although some of this equipment could be used in transporting certain parts of an oil field drilling rig, Skjonsby does not have the necessary specialized equipment to transport an entire oil field drilling rig or to set-up or dismantle such a rig. Furthermore, Skjonsby does not have enough equipment to both actively participate in the transportation of oil field drilling rigs and also meet its statewide common carrier responsibility.

"Skjonsby also does not have the necessary experience to transport oil field drilling rigs. Although Skjonsby has transported drilling rigs in the past, those rigs were more in the nature of water drilling rigs rather than the much larger and heavier oil field drilling rigs.

"We take official notice of the fact that in recent years this Commission issued a number of certificates to qualified Applicants to transport oil field drilling rigs. Each of those Applicants were supported by testimony from shippers that a need existed for additional carriers of oil field drilling rigs. During that time Skjonsby did not transport nor solicit the transportation of oil field drilling rigs pursuant to Certificate No. 641. It would be highly prejudicial to existing common motor carriers engaged in the transportation of oil field drilling rigs who have made substantial investments to enable themselves to provide that service to the public, if we were now to interpret Certificate No. 641 to authorize the transportation of oil field drilling rigs.

"For the above-mentioned reasons we find Certificate No. 641 does not authorize the transportation of oil field drilling rigs.

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"Although Skjonsby has not solicited the transportation of oil field equipment and supplies, it has transported, to a very limited degree, such materials and supplies. Skjonsby also has the equipment and skill to transport most oil field commodities, excluding drilling rigs. While we might, in some instances, be inclined to amend a certificate of public convenience and necessity which has not been vigorously exercised to the full extent of its authority, we do not find it is in the public interest that Certificate No. 641 be amended at this time to exclude oil field equipment and supplies other than to prohibit the transportation of oil field drilling rigs. Skjonsby provides a publicly needed statewide service. In recent years, Skjonsby has experienced some financial difficulty in providing this service. Limiting its future operations to exclude oil field transportation may have a financial impact on the carrier such that it is no longer able to provide transportation for other commodities."

The foregoing findings of the PSC demonstrate that it based its determination upon such factors as the present ability of Skjonsby to provide the service of hauling oil drilling rigs, the present need for the service of transporting oil drilling rigs, and the effect on other carriers if Skjonsby received authorization to transport oil drilling rigs. Those factors are expressly enumerated by Section 49-18-14, N.D.C.C., as matters properly to be considered by...