State ex rel. Tidewater-Shaver Barge Lines v. Kuykendall, TIDEWATER-SHAVER

• Decision Date: 17 July 1953
• Docket Number: TIDEWATER-SHAVER,No. 32239,32239
• Citation: 42 Wn.2d 885,259 P.2d 838
• Court: Washington Supreme Court
• Parties: STATE ex rel.BARGE LINES et al. v. KUYKENDALL et al.

Page 885

42 Wn.2d 885

259 P.2d 838

STATE ex rel. TIDEWATER-SHAVER BARGE LINES et al. v. KUYKENDALL et al.

No. 32239.

Supreme Court of Washington, Department 1.

July 17, 1953.

Don Eastvold, Atty. Gen., Robert L. Simpson, Asst. Atty. Gen., Olympia, for appellants.

Lenihan & Ivers, Seattle, for intervenor.

Robert D. McMullen, Vancouver, Thomas J. White and Norman E. Sutherland, Portland, Or., for respondents.

WEAVER, Justice.

This is an appeal from a judgment of the superior court reversing and setting aside an order of the Washington public service commission.

The matter involved is the establishment of permanent transportation rates for bulk petroleum products distributed from Pasco, East Pasco, and Attalia, Washington, by motor vehicle common carriers to points in eastern Washington.

Attalia is on the upper Columbia river, fourteen miles down river from Pasco, and ten miles down river from East Pasco. At the time of the hearing, and of presentment of the matter to the superior court, it was known that Attalia would cease to exist at some time in the future. It would be inundated by the waters of McNary Dam, then under construction on the Columbia river. The problem before the commission was not the rates from Pasco and East Pasco after Attalia had ceased to exist, but the rates which would be effective until Attalia could no longer operate as a distribution point for such products.

During the period involved, petroleum product 'tank farms' were located at Attalia and Pasco for pertroleum products transported there by water from marine terminals in Portland, Oregon, and Vancouver, Washington. A petroleum products pipe line from Salt Lake City, Utah, was completed in the fall of 1950. It terminated at East Pasco, four miles down river from Pasco.

Truck rates were established from Attalia to eastern Washington in 1938. At that time, Pasco had no bulk storage facilities. It was not a point of deposit for bulk petroleum received from the Columbia river barge lines.

Subsequently, the Port of Pasco built storage facilities for bulk petroleum products arriving by river. It then became necessary to publish motor freight carrier rates from Pasco. In September, 1941, the department of public service, after a hearing, published such rates (cause No. 7487) based upon a partial recognition of Attalia and Pasco as contiguous, competitive points of origin. The published rates were based upon a finding:

'That due to the geographical location of Pasco (14 miles distant from Attalia), it is entitled to a recognition of this advantage at least for destinations in local territory; that for distances up to 50 miles from Pasco, the Pasco rate should be the Attalia rate less 1cents [per hundred pounds]; for distances over 50 miles and up to 100 miles from Pasco the rate should be the Attalia rate less 1/2cents [per hundred pounds]; and for distances over 100 miles that the rates from Attalia and Pasco should be on a parity.'

In consolidated causes Nos. T-8180 and T-8181 (hearing held October 26, 1948; commission's findings and order entered June 27, 1949) the commission recognized and applied the 'Washington truck scale' which had been prepared and presented to the commission by the Pacific Inland Tariff Bureau, Inc. The bureau represented the motor vehicle carriers of bulk petroleum products. It is an intervenor on this appeal.

The 'truck scale', thus applied by the commission to many situations (with a few exceptions, including Attalia and Pasco), fixed rates based primarily upon the carriers' cost of operation and established rates determined solely upon mileage from point of origin to destination.

The commission found

'The rate proposed by the trucks (Exhibit 5) from Pasco to Spokane was the scale rate of 24 1/2cents and from Attalia to Spokane the scale rate of 26 1/2cents. The present rate is 26cents in both instances. At the hearing the rates from Pasco and Attalia to Spokane were amended to 26cents and 27cents respectively. * * * Proposed rates on the whole, from Pasco and Attalia to points in Eastern Washington are based on scale rates. We found in our Order FH-7487 [quoted supra] of September 23, 1941, re the prescription of rates from Pasco to points in Eastern Washington, that for distances up to 50 miles from Pasco the Pasco rates should be the Attalia rates less 1cents; for distances over 50 miles and up to 100 miles from Pasco the rates should be the Attalia rates less $1/2cents and for distances over 100 miles that the rates from Attalia and Pasco should be on a parity.' (Italics ours.)

The commission further found:

'The record shows that there is no present substantial movement of petroleum products from Pasco; that navigation to Pasco is now so difficult that the barge line has discontinued service to that point; that Attalia will be closed to navigation by the Dam [McNary] construction; that it is probable that the river above Umatilla will be closed to navigation for a period of approximately three years, or more, during the construction of the McNary Dam, and that the only point of permanent competition is through Umatilla, Oregon.'

Although urged to apply the 'truck scale' to rates from Pasco and Attalia, the commission refused to do so, and reaffirmed the theory of rates it had adopted in cause No. 7487, quoted supra, saying:

'We shall follow that principle here [Pasco rates based upon Attalia rates with a differential for distances under 100 miles] which is also consistent with the proposal of the trucks relative to establishing the same rates from Richmond Beach and Seattle to certain points in Western Washington over 50 miles from either origin point. The distances between Seattle and Richmond Beach are approximately the same as the distance between Pasco and Attalia.'

Subsequent to the 1949 order, quoted supra, the Pacific Inland Tariff Bureau, Inc. petitioned the commission to reduce the rates from Pasco in order that the carriers could participate in the traffic which would move from East Pasco (four miles from Pasco), as a result of the completion of the pipe line from Salt Lake City. August 9, 1950, the commission entered an order (cause No. T-8520) authorizing the reduction and establishing temporary rates. However, it departed from its former determinations in that it made Pasco the base point from which mileage was figured; but it kept the former differential between Pasco and Attalia for distances under one hundred miles, and retained a parity of rates between them for distances over one hundred miles.

Having succeeded in changing the base point from Attalia to Pasco, the Pacific Inland Tariff Bureau, Inc., in 1951, petitioned the commission to establish suggested permanent rates from Attalia and Pasco (including East Pasco), to points in eastern Washington. The suggested rates were on an actual mileage basis from each point of origin to each point of destination, as determined by the 'truck scale.' Establishing the suggested rates would: (1) eliminate the parity of rates from Attalia and Pasco; (2) discard the theory of parity of rates fro contiguous competitive points of origin (except as to Pasco and East Pasco); and (3) increase all rates from Attalia to a basis one and one-half cents to two cents per hundred pounds higher than Pasco, except to a few points in southeast Washington, to which the Pasco rate would be higher because of greater distance. (Parenthetically, it would appear that, by the 1950 and 1951 petitions, the bureau was attempting to accomplish in two steps that which the commission refused to do in the 1949 order in consolidated causes Nos. T-8180 and T-8181.) Respondents appeared and opposed the application.

After a hearing on the petition, the commission entered its findings and order on August 23, 1951 (cause No. T-8492) establishing the permanent rates substantially as requested. The rates established for Pasco applied to East Pasco also, although they are at least four miles apart, which would appear inconsistent with the theory of the 'truck scale' which is based upon mileage from point of origin.

September 18, 1951, respondents, feeling themselves aggrieved by the commission's order of August 23, 1951, filed their petition for a writ of review in the superior court of Thurston county. The writ...