St. Johnsbury Trucking Co. v. United States, 945.

• Citation: 99 F. Supp. 977
• Decision Date: 05 September 1951
• Docket Number: No. 945.,945.
• Parties: ST. JOHNSBURY TRUCKING CO., Inc. v. UNITED STATES et al.
• Court: U.S. District Court — District of Vermont

99 F. Supp. 977

ST. JOHNSBURY TRUCKING CO., Inc. v. UNITED STATES et al.

No. 945.

United States District Court D. Vermont.

September 5, 1951.

Sterry R. Waterman, of St. Johnsbury, Vt. (Francis E. Barrett, Neal J. Holland, both of Boston, Mass., and John H. Downs, of St. Johnsbury, Vt., on the brief), for plaintiffs.

Edward J. Hickey, Jr., Department of Justice, of Washington, D. C., and Joseph A. McNamara, U. S. Atty. for District of Vermont, of Burlington, Vt. (John F. Sonnett, U. S. Department of Justice, William J. Hickey, Sp. Asst. to the Atty. Gen., H. G. Morison, Asst. Atty. Gen., James E. Kilday and John F. Baecher, Sp. Assts. to the Atty. Gen., all of Washington, D. C., on the brief), for defendant United States.

Edward M. Reidy, Associate Chief Counsel, Interstate Commerce Commission, of Washington, D. C. (Gordon C. Locke and Daniel W. Knowlton, Chief Counsel, Interstate Commerce Commission, both of Washington, D. C., on the brief), for defendant Interstate Commerce Commission.

Reubin Kaminsky, of Hartford, Conn. (Hugh M. Joseloff, of Hartford, Conn., on the brief), for defendants Marvin J. Haigis and Kneeland G. Nichols, doing business as Tri-State Motor Lines.

Before CHASE, Circuit Judge, and FOLEY, and GIBSON, District Judges.

GIBSON, District Judge.

In their complaint, the plaintiffs request that the decision of the Interstate Commerce Commission rendered on March 7, 1946 and the certificate of public convenience and necessity issued April 16, 1947 by the Commission to Messrs. Haigis and Nichols, doing business as Tri-State Motor Lines, be annulled and set aside. The following facts are undisputed.

On February 15, 1941, Messrs. Haigis and Nichols received a certificate authorizing the transportation of general commodities, with usual exceptions, over irregular routes between Brattleboro, Vermont, on the one hand, and on the other, points and places in New Hampshire, Vermont and Massachusetts. Messrs. Haigis and Nichols were the successors to the grandfather's rights of one Raymond Pierce of Brattleboro.

Shortly after the certificate of February 15, 1941 was issued by the Interstate Commerce Commission to Haigis and Nichols, one of the plaintiffs in this case, Gay's Express, Inc., filed a complaint with the Interstate Commerce Commission claiming that said Haigis and Nichols were operating beyond the scope of that certificate.

After a hearing on this complaint before a joint board and an appeal to the Interstate Commerce Commission, the Commission, Division 5, on April 7, 1944, found that Messrs. Haigis and Nichols were indeed operating beyond the scope of their February 15, 1941 certificate, and entered an order that they cease and desist from such violations. This cease and desist order finally took effect August 15, 1944. However, in that same decision, the Commission found that Messrs. Haigis and Nichols' illegal operations had been conducted at all times in good faith under the belief that such operations were within the authority granted by the February 15, 1941 certificate.

On May 12, 1944, Messrs. Haigis and Nichols filed with the Commission an application asking the right to conduct regular route operations as a common carrier by motor vehicle of general commodities, with usual exceptions, over certain designated routes in southern Vermont, southwestern New Hampshire and northeastern Massachusetts.

This application, final action on which by the I. C. C. is the basis of this complaint, was referred to a joint board for hearing, and at the hearing the plaintiffs in this action were allowed to intervene, and opposed the application. The joint board issued a recommended report and order, after hearing, in April, 1945. The joint board's report and proposed order recommended that the application of Haigis and Nichols be denied. Thereafter, the applicants, Haigis and Nichols, filed exceptions to the recommended order of the joint board. After consideration of the transcript of the proceedings before the joint board, the joint board's recommended report and order, and the applicants' exceptions and the protestants' replies thereto, Division 5 of the Commission, on March 7, 1946, entered a report and order authorizing regular route operations by Messrs. Haigis and Nichols over certain parts of Massachusetts, Vermont and New Hampshire, thus substantially granting the Haigis-Nichols application.

On June 3, 1946, certain of the plaintiffs filed petitions for reconsideration by the full Commission of the report and order of Division 5. Upon consideration of the record of the proceedings and of the parties' arguments thereto, the full Commission, on November 4, 1946, denied the petitions for reconsideration.

On December 17 and 20, 1946, certain of the plaintiffs filed petitions for further hearing and consideration with the Interstate Commerce Commission. The basis of these petitions was to direct the Commission's attention to a prosecution instituted by the Commission on July 19, 1946 against Messrs. Haigis and Nichols in the United States District Court for the District of Massachusetts and the violation of the Commission's cease and desist order in the Gay's Express case hereinbefore referred to. This prosecution had resulted in a plea of guilty by Messrs. Haigis and Nichols. After consideration of this matter, the Commission denied the petition for reconsideration on February 10, 1947. On March 26, 1947, the plaintiffs again petitioned the Commission for further consideration of the records of this proceeding and for oral argument, on the main count that one of the applicants, i. e. Nichols, had indicated an intention to sell his operating rights upon issuance of the certificate of public convenience and necessity. After considering this matter, the Commission denied the petition on April 7, 1947, and on April 16, 1947 the Commission issued the certificate of public convenience and necessity authorizing the regular route operations about which the plaintiffs complain.

The complaint starting this action was filed on December 31, 1947. The plaintiffs, in their complaint, claim that the final order of the Commission is arbitrary and capricious because there was no substantial evidence on which the Commission could — (a) Have found that Messrs. Haigis and Nichols were fit, willing and able to operate the route if their application was granted; (b) have found that the proposed service will be required by present or future public convenience and necessity; (c) have found that the plaintiffs did not offer adequate services for the transportation of general commodities, particularly in view of past war conditions.

The plaintiffs further claim that the final order of the Commission was arbitrary and capricious because — (a) It refused to hear or consider evidence as set forth in a petition for a re-hearing, of a criminal conviction of Haigis and Nichols in June, 1946 in the United States District Court for the District of Massachusetts for illegal operations and violation of a cease and desist order; (b) It refused to hear or consider certain evidence set forth in a petition for rehearing, tending to indicate that Haigis and Nichols did not intend to comply with the terms in their certificate of public convenience and necessity because Nichols desired to procure the certificate in order that he might sell it.

(1) The plaintiffs' claim that the Commission was arbitrary and capricious in finding that the proposed service of Haigis and Nichols was required by the present or future public convenience and necessity is completely untenable.

This Court must sustain the Commission if its findings are supported by substantial evidence on the record considered as a whole. Universal Camera Corp. v. N.L.R.B. 340 U.S. 474, 493, 71 S.Ct. 456; Capital Transit Company v. United States, D.C., 97 F.Supp. 614, 618. That they were is apparent of record provided Exhibit 7 was properly received in evidence. There was oral testimony by representative shippers to show the need for the services and that, despite the fact that competitive services were available to supply the need partially, such services were inferior to those of the applicants. Exhibit 7 shows that the applicants carried approximately 8,000 shipments over the routes in question between January 14, 1940, through June 19, 1944, and the objection to it was that this transportation was not in accordance with the certificate they held under "grandfather" rights. However, the Commission found that these operations were conducted in good faith and if that finding is supportable, Exhibit 7 was properly received and considered. Crichton v. United States, D.C., 56 F.Supp. 876; A. B. & C. Motor Transp. Co. v. United States, D.C., 69 F.Supp. 166. It was based upon findings made by the Commission in prior proceedings before it in which one of the plaintiffs and Haigis and Nichols were parties and in which that issue was raised and decided. Gay's Express, Inc. v. Haigis and Nichols, 43 M.C.C. 277. The effect of the decision was that Haigis and Nichols had conducted these operations in good faith in the belief that they were within their rights. The Commission could take notice of its own records. National Fire Ins. Co. of Hartford v. Thompson, 281 U.S. 331, 336, 50 S.Ct. 288, 74 L.Ed. 881; Nahtel Corp. v. West. Virginia Pulp & Paper Co., 2 Cir., 141 F.2d 1; Crichton v. United States, supra. It is not circumscribed by strict rules of evidence, Interstate Commerce Comm. v. Louisville & N. R. Co., 227 U.S. 88, 93, 33 S.Ct. 185, 57 L.Ed. 431. Moreover, the applicants were not seeking to show "grandfather" rights under Section 306 (a) of Title 49 U.S.C.A. which must be supported by "bona fide" operations before June 1, 1935. Instead, they sought to obtain an amplified certificate under 49 U.S. C.A. § 307 (a). That requires proof (1) that the applicant is fit, willing and able to perform the proposed service and (2) that this service is, or will be, required...