Trailer Marine Transport Corp. v. Rivera Vazquez

• Decision Date: 26 September 1991
• Docket Number: Civ. No. 90-1374 (JP).
• Citation: 804 F. Supp. 408
• Parties: TRAILER MARINE TRANSPORT CORP., Plaintiff, v. Carmen M. RIVERA VAZQUEZ, Executive Director of the Automobile Accident Compensation Administration of Puerto Rico ("AACA"), et al., Defendant.
• Court: U.S. District Court — District of Puerto Rico

804 F. Supp. 408

TRAILER MARINE TRANSPORT CORP., Plaintiff, v. Carmen M. RIVERA VAZQUEZ, Executive Director of the Automobile Accident Compensation Administration of Puerto Rico ("AACA"), et al., Defendant.

Civ. No. 90-1374 (JP).

United States District Court, District of Puerto Rico.

September 26, 1991.

Nicolás Jiménez Torres, Jiménez, Graffam & Lausell, San Juan, P.R., for plaintiff.

Carlos Del Valle, Ramírez & Ramírez, Hato Rey, P.R., for defendant.

OPINION AND ORDER

PIERAS, District Judge.

The Court has before it the parties cross motions for summary judgment. Plaintiff is a corporation engaged in the transportation of goods by sea. The plaintiff challenges the constitutionality of Puerto Rico Law 26 (amendment to 9 L.P.R.A. § 2064 (1976)), which provides for the assessment by the Automobile Accident Compensation Administration ("AACA"), of a special premium upon van trailer vehicles engaged in maritime transportation. These van trailers enter the island on a temporary basis. Plaintiff claims that the special premium is unconstitutional because it obstructs the flow of interstate commerce. Plaintiff thus requests a judgment declaring Law 26 unconstitutional on its face pursuant to the Dormant Commerce Clause.¹

Federal jurisdiction is invoked pursuant to 28 U.S.C. § 1331 (1976), as the action arises under U.S. Const. art. I, § 8, cl. 3. Defendants contend that Law 26 is a health and safety regulation consistent with the Commerce Clause. For the reasons stated below, we grant the plaintiff's Motion for Summary Judgment and deny the defendant's Motion for Summary Judgment.

I. THE FACTS

The Automobile Accident Social Protection Act ("the Act"), 9 P.R. Laws Ann. § 2051 et seq. (Supp.1988) is social legislation with the purpose of creating a compulsory system for the compensation of automobile accident victims, irrespective of fault. This social legislation is implemented by AACA, and financed through the payment of registration fees by all vehicle owners. In 1989 the legislature enacted an amendment to the Act which provided for the assessment of a reduced fee upon trailers that would be in Puerto Rico for less than thirty days. H.R. 741, Act 27, Dec. 12, 1989 amendment to 9 L.P.R.A. § 2064 (1976). Rather than pay the regular annual $35.00 premium, the amendment permits transitory trailers to instead pay $15.00 for each chassis that is brought into Puerto Rico for less than a thirty-day period.

Plaintiff claims that the special premium burdens ocean carriers like itself, which utilize roll-on-roll-off ("RORO") vessels, rather than lift-on-lift-off ("LOLO") vessels. The plaintiff's roll-on-roll-off method of carrying trailers introduces into Puerto Rico a chassis² for each container it carries, because the plaintiff has no chassis permanently located in Puerto Rico.

In contrast, lift-on-lift-off vessels carry containers without the chassis, which would transform the vessel into a trailer. Large shore-based cranes lift the containers off the vessel and place them on a shore-based chassis where the container is coupled and secured to form a trailer. The trailers are placed in the yard to await delivery to the ultimate consignee. When the trailer is returned, the operation is reversed and the crane lifts the container off the chassis and loads it on board the vessel, leaving the chassis behind. The regular $35.00 annual AACA premium is paid for each chassis permanently established in Puerto Rico.

Plaintiff conducts business in Puerto Rico solely with the trailers that are transitorily brought aboard its barges. Because the plaintiff does not have a number of chassises permanently located on the island, it introduces into Puerto Rico a chassis for each container it carries. Plaintiff's trailers are carried aboard a roll-on-roll-off barge. Upon arrival of a barge in Puerto Rico, the trailers are rolled off of the barge by a tractor and are parked in a marshalling yard. Within a matter of a few hours or a few days, the trailers are then picked up by a trucker for final delivery to the ultimate consignee. Once the cargo is unloaded from the container, the trailers are then returned to the plaintiff's terminal for return voyage to the United States. The tractors used to haul and deliver the trailers are locally based vehicles, which upon their registration are licensed and provided with license plates by the Commonwealth authorities. The plaintiff does not own most of the trailers it carries. In the instances in which the plaintiff owns the trailer, it pays Maine state registration fees, but does not pay no-fault insurance, because Maine does not subject trailers to the same fees as its other motor vehicles. Plaintiff must pay the $15.00 premium for a thirty-day stay, or choose to pay the $35.00 premium for the entire year. The non-owned trailers have their home-state registration fees and AACA fees paid by their respective owners.

II. SUMMARY JUDGMENT STANDARD OF REVIEW

A motion for summary judgment is appropriate when:

The pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Fed.R.Civ.P. 56(c). Brennan v. Hendrigan, 888 F.2d 189, 191 (1st Cir.1989); see e.g., Medina-Muñoz v. R.J. Reynolds, 896 F.2d 5 (1st Cir.1990). A "genuine" issue is one that is dispositive, and must therefore be decided at trial. Mack v. Great Atlantic and Pacific Tea Co., 871 F.2d 179, 181 (1st Cir.1989); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986). A "material" fact is one which affects the outcome of the suit and must be resolved before attending to related legal issues. Mack v. Great Atlantic and Pacific Tea Co., 871 F.2d at 181.

Essentially, Rule 56(e) mandates that summary judgment be entered against a party who fails to establish the existence of an element essential to that party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986). Thus, the burden is first on the movant, to show "that there is an absence of evidence to support the non-moving party's case." Celotex Corp. v. Catrett, 477 U.S. at 325, 106 S.Ct. at 2554. Thereafter, the burden shifts to the nonmovant to establish the existence of a genuine material issue. Brennan v. Hendrigan, 888 F.2d at 191. The nonmovant, however, cannot rest upon mere allegation or denial of the pleadings. Fed.R.Civ.P. 56.

Although the parties in this case have filed cross-motions for summary judgment on the issue of liability,³ such motions "are not ordinarily to be treated as the equivalent of submission upon an agreed-upon record." Wiley v. American Greetings Corp., 762 F.2d 139, 140 (1st Cir.1985). Cross-motions for summary judgment

are no more than a claim by each side that it alone is entitled to summary judgment, and the making of such inherently contradictory claims does not constitute an agreement that if one is rejected the other is necessarily justified or that the losing party waives judicial consideration and determination whether genuine issues of material fact exist. If any such issue exists it must be disposed of by a plenary trial and not on summary judgment.

Id. at 140-41 (citation omitted). In the instant case, there are no genuine issues of material fact which require a plenary trial. An application of the dormant Commerce Clause jurisprudence mandates that the defendants' Motion for Summary Judgment be DENIED and that the plaintiff's Motion for Summary Judgment be GRANTED.

III. DORMANT COMMERCE CLAUSE

The Commerce Clause, Article I, § 8, cl. 3 of the U.S. Constitution gives Congress the power to "regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes." The Commerce Clause serves two distinct functions: (1) it acts as a source of Congressional authority and (2) it acts implicitly as a limitation on state legislative power. This latter implicit limitation is what is known as the dormant Commerce Clause. Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 6 L.Ed. 23 (1824). The purposes behind the Commerce Clause are the creation and nurturing of a common market among the states and the abolition of trade barriers. Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 55 S.Ct. 497, 79 L.Ed. 1032 (1935). Therefore, when a party makes a dormant Commerce Clause challenge, the Court must weigh the state interest in regulating its local affairs against the national interest in uniformity and in an integrated national economy. Hyde Park Partners, L.P. v. Connolly, 839 F.2d 837 (1st Cir. 1988). In performing this balancing test, the Court may consider not only the objectives which the state is pursuing but also the necessity of the means which the state has used to achieve this objective. If the objective can be achieved by means less burdensome (or less discriminatory) to interstate commerce, the balance weighs in favor of the national interest in free commerce. Dean Milk v. City of Madison, 340 U.S. 349, 71 S.Ct. 295, 95 L.Ed. 329 (1951) (local regulations preventing importation of milk were struck down because even though the state's objective of protection of residents against adulterated milk was permissible, the safety objective could have been achieved by less burdensome means — such as sending of inspectors to out-of-state pasteurization plants to make quality checks at the out-of-state producer's expense, rather than prohibiting importation of milk that had not been processed and bottled within five miles of the city of Madison, Wisconsin, so that only regularly inspected local plants could sell milk). See also, A & P Tea Co., Inc. v. Cottrell, 424 U.S. 366, 96 S.Ct. 923, 47 L.Ed.2d 55 (1976).

A state regulation which affects interstate commerce must meet each of the following requirements in order to be upheld:

1. the regulation must pursue a

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