State ex rel. Utilities Commission v. Carolina Coach Co., s. 465
| Decision Date | 19 July 1963 |
| Docket Number | Nos. 465,467,466,s. 465 |
| Citation | 132 S.E.2d 249,260 N.C. 43 |
| Court | North Carolina Supreme Court |
| Parties | STATE of North Carolina ex rel. UTILITIES COMMISSION and the Greyhound Corporation v. CAROLINA COACH COMPANY and Queen City Coach Company. STATE of North Carolina ex rel. UTILITIES COMMISSION and the Greyhound Corporation v. CAROLINA COACH COMPANY. STATE of North Carolina ex rel. UTILITIES COMMISSION and Carolina Coach Company v. The GREYHOUND CORPORATION. |
Newsom, Graham, Strayhorn & Hedrick, Durham, for Greyhound Corp.
Allen & Steed, Raleigh, for Carolina Coach Co.
Joyner & Howison, Raleigh, for Queen City Coach Co.
Carolina, Greyhound and Queen City are common carriers of passengers, their baggage, mail, and light express, in the same vehicle with passengers, by motor vehicle operating over interstate and intrastate franchise routes within the State of North Carolina.
Prior to the institution of the instant proceedings these carriers had, among others, the following franchise routes, respectively:
(a). Carolina--(1) Between Raleigh and Charlotte by way of Durham, Burlington, Greensboro, Lexington, Salisbury and Concord, over U. S. Highways 70 and 29; (2) Between Raleigh and Charlotte via Sanford, Biscoe and Albemarle, over U. S. Highways 1 and 15 and N. C. Highway 27.
(b). Greyhound--(1) Between Raleigh and Winston-Salem via Pittsboro, Asheboro and Lexington, over U. S. Highways 64 and 52; (2) Between Winston-Salem and Charlotte via Mocksville, Statesville and Mooresville, over U. S. Highways 158, 64 and 21 (c). Queen City--(1) Between Asheboro and Mount Pleasant over N. C. Highway 49. Mount Pleasant is 45 miles southwest of Asheboro and 26 miles northeast of Charlotte. After the instant proceedings were filed, but before orders were entered, the Commission granted Queen City franchise authority between Mount Pleasant and Charlotte over Highways 49 and 29. Queen City had previously operated between Mount Pleasant and Charlotte under an agreement with Carolina.
The franchise routes referred to are not described with absolute accuracy. Technical correctness of location is not important in the determination of these appeals.
In the early 1940s the Atlantic Greyhound Corporation (which has since merged with the Greyhound Corporation) had acquired interstate authority between Charlotte and Winston-Salem via Lexington over Highways 29 and 52, but did not have intrastate authority between Charlotte and Lexington over Highway 29. Carolina had the intrastate authority for this segment. Greyhound had both intrastate and interstate service north of Winston-Salem, the interstate extending to New York and other metropolitan areas; it also had interstate and intrastate service south and west of Charlotte, the interstate service extending to Miami, New Orleans and other southern metropolitan areas. The route between Winston-Salem and Charlotte via Lexington, over Highways 52 and 29, is shorter and requires less travel time than the route by way of Statesville over Highways 158, 64 and 21. To enable Greyhound to transport certain intrastate passengers over the Lexington route and at the same time to protect Carolina with respect to certain of its routes and passengers, a lease agreement was voluntarily entered into between Carolina and Greyhound, dated 1 August 1947. Carolina leased to Greyhound the privilege of transporting over the Lexington route intrastate passengers originating at or moving through Charlotte destined for Winston-Salem and points beyond, and intrastate passengers, originating at or moving through Winston-Salem and destined for Charlotte or points beyond. On its part Greyhound agreed: (1) to operate with closed doors between the corporate limits of Lexington and the corporate limits of Charlotte and not to pick up or discharge any intrastate passengers at any intermediate points along said route; (2) not to pick up intrastate passengers at Lexington or at intermediate points between Lexington and Charlotte, destined to Charlotte or to any intermediate points between Charlotte and Lexington or to any intrastate points beyond Charlotte; (3) not to pick up any intrastate passengers at Charlotte, moving over this route, or at intermediate points between Charlotte and Lexington destined for Lexington or intermediate points between Charlotte and Lexington or to points between Lexington and Winston-Salem; (4) not to operate through service without change of buses between Raleigh and Charlotte by way of Lexington over Highways 64 and 29, 'or compete with Carolina for intrastate traffic moving between Raleigh * * * and Charlotte * * *, irrespective of points of origin or destination'; (5) not to exchange between its schedules, operated over its present franchise route through Lexington and over the leased route, intrastate passengers at Lexington irrespective of the point of origin or destination of such passengers, and to deliver to Carolina at Lexington all intrastate passengers moving by Greyhound into Lexington, irrespective of point of origin, destined to points between Lexington and Charlotte, and to deliver to Carolina at Charlotte all intrastate passengers moving by Greyhound into Charlotte, irrespective of the point of origin, destined to points between Charlotte and Lexington; (6) not to seek any intrastate franchise or permission to operate over the route leased during the term of this agreement, or any renewal thereof, except under the terms of this agreement. The term of the lease agreement was three years with an automatic extension of three years upon renewal of Carolina's franchise by the Utilities Commission. The effectiveness of the lease agreement was conditioned upon its prior approval by the Utilities Commission. Upon the joint petition of Carolina and Greyhound the Commission entered an order of approval. When the Carolina franchise became permanent by virtue of the Bus Act of 1949, the parties to the lease agreement contracted in writing that it would terminate only upon cancellation of Carolina's franchise by the Utilities Commission. This extension agreement was approved by the Commission.
Greyhound and Carolina operated under the terms of the lease agreement without any question as to its validity until 1960. In the meantime the State Highway Commission had begun to greatly improve N. C. Highway 49 from Charlotte to Asheboro, and by 1960 the improvements were nearing completion. As improved, Highway 49 was in excellent condition for bus travel, and the route by way of Asheboro over Highways 64 and 49 constituted the shortest and fastest route between Raleigh and Charlotte. It is much shorter than any other established through route. By reason of the improvement of Highway 49, a Raleigh-Charlotte franchise via Asheboro became very desirable. But before the improvements were made Highway 49 was ill adapted to bus service, both because of the condition of the highway and the sparseness of the population along the route. Queen City had the franchise between Mount Pleasant and Asheboro and operated over Highway 49 one round trip daily.
On 13 September 1960 Greyhound advised Carolina by letter that it considered the lease agreement of doubtful validity and requested that it be cancelled by mutual consent. By letter of 30 September Carolina declined to cancel. Greyhound then advised the Utilities Commission that it considered the lease agreement void, did not desire to continue service under its provisions, and requested instructions. The Commission directed Greyhound to render service as before, until such time as the Commission should authorize it to discontinue.
Both Carolina and Greyhound applied to the Utilities Commission for franchise authority to operate 'no change' service between Raleigh and Charlotte via Asheboro over Highways 64 and 49.
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Case No. 465. On 5 October 1960 Greyhound applied for intrastate franchise authority over the route between Asheboro and Charlotte on Highway 49 (Queen City's route), to combine such operation with the operation being conducted by Greyhound between Asheboro and Raleigh on Highway 64, so as to provide through service from Raleigh to Charlotte and vice versa, but restricted between Asheboro and Charlotte against passengers whose entire ride is between these two points.
Carolina and Queen City filed protests and were allowed to intervene.
After hearing, the Utilities Commission granted Greyhound's application, but with greater restrictions. The certificate authorizes Greyhound to operate through service between Raleigh and Charlotte via Asheboro over Highways 64 and 49, but 'restricted from Asheboro to Charlotte to operations with closed doors and without authority to serve any intermediate points.'
Carolina grounds its protest and appeal on its contentions that (1) Greyhound's application is barred by the lease agreement, and (2) public convenience and necessity does not require the granting of this authority to Greyhound.
Prior to the order in this case the through bus transportation between Raleigh and Charlotte had been over Carolina's northern route via Greensboro and Lexington, and Carolina's southern route via Sanford. Greyhound and Queen City's services were not in any real sense competitive. Greyhound's shortest route, controlled solely by it, was via Lexington, Winston-Salem and Statesville. Queen City had no service between Raleigh and Charlotte except in combination with Carolina or Greyhound. Carolina was anxious to retain the Raleigh-Charlotte traffic, and in the lease agreement Greyhound had promised not to compete with Carolina for intrastate traffic moving between Raleigh and Charlotte irrespective of the points of origin or destination.
It is Carolina's position that the lease agreement, solemnly executed by Greyhound and approved by the Commission, bars Greyhound from applying for the Raleigh-Charlotte authority. On the other hand Greyhound contends that it is void.
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