Railroad Commission of Texas 

Auqtin, Texas 

Gentlemen: 

Zinion'No. O-3485 

: Concerning rates to be 

charged by contract carriers and 

records to be kept by them. 

In your letter of April 25, 1941, you request our opinion (1) 

as to whether~ contract carriers who transport goods for 

Montgomery-Ward Company are bound by law to observe a rate 

structure involving, as a minimum, 

the cummon carriers, and (2') 

the rates and ratings .of 

whether they are required to 

keep records such as bills of lading and waybills on which 

the articles transported are described and rated. You further 

tell ua that "For the purposes of y,ur opinion, you may use as 

a factual basfs the statements and contentions of Mr. Stallings 

which are set forth in the enclosed memorandum signed by our 

Mr. McNamee, Director of our Rate Division." The statements 

and contentions which you refer to are as follows: 

"1. That their contract carriers generally are limited under 

theirpermits to deliver,ies of merchandise sold by their 

retail stores to their customers within the s,tore-trading radius 

(usually 50 miles), to the homes and places designated by 

their customers for delivery of the merchandise; with the full 

privilege of picking up and returning such items as repossessed 

articles, exchanged merchandise, and merchandise returned to 

the store for credit; 

"2 # That their contract carriers 

over any and all highways, county 

necessary to reach the customers" 

delivery; 

" 3 0 That their contract carriers 

under their permits, operate 

roads, lanes and thelike, 

residences, or place of 

have no designated routes or 

schedules which they can and do follow: 

"4- That their contract carriers deliver in nearly all cases 

uncrated merchandise requiring in many instances such specialized equipment as furniture\pads,: d:ollfeq hbiseg, :?ete,. ;'::~:Y~:~ :: 

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- . 

Railroad Commission of Texas, Page 2, O-3485 

"5. That their contract carriers must perform special 

services such as fnstalling stoves and furniture in the customers' 

homes; setting upa connecting 'and turning on electric refrigerators; laying linoleum, moving customers' furniture to make 

room for the articles purchased from Montgomery-Ward and Company; 

“6. Collecting the purchaseprice of merchandise on C.O.D. 

deliveries and making adjustments with customers; 

“7. Checking merchandise to see that it is not scratched or 

otherwise damaged; removing dust or dirt before placing of the 

merchandise in customers' homes; 

“8. That their contract carriers must act as representatives 

or agents of Montgomery-Ward and Company in rendering many 

specialized services required in theefficient operation of retail stores; must be familiar with Montgomery-Ward and Company's 

methods of operation; 

*9. That their contract carriers must make emergency deliveries: 

"10. .That very few of their contract carriers have terminal 

facilities, the merchandise being loaded at the retail store 

or warehouse where there are no scales for weighing the merchandise 

or facilities for crating, or specially handling the merchandise; 

"11. The merchandise is delivered on basis of the sales tickets 

given to the customer, upon general directi,ons from the store 

for each delivery, the articles being loaded SO that they 

may be handled in order as the home or place of delivery iS 

reached; 

"12. That the trucks of the contract carriers in most instances 

have IMontgomery-Ward' painted on the sides in specified colors. 

"In contrast with the service required of their contract 

carriers Mr. Stallings pointed out that the common carriers: 

"(a) Are interested only in over-the road hauls; 

"b) Do not render the specialized services above enumerated; 

"(c) Operate on regular or time schedules; 

"(d) Are not able or willing to follow radius operations as 

distinguished from over-the-road hauls; 

"(e) Do not have the specialized equipment that is necessary 
Railroad Commission of Texas, Page 3, 0-3485 

and do not haul shipments uncrated; 

"(f) Do not and would not install the merchandise in the 

homes of their customers.a 

Section 6aa of Article glib, Vernon's Annotated Civil Statutes 

reads as follows: 

"The Commission is hereby vested with power and authority and 

it is hereby made its duty to prescribe rules and regulations 

covering the operation of contract carriers in competition with 

common carriers over the highways of this State and the 

Commission shall prescribe minimum rates, fares, and charges 

to be collected by such contract carriers which shall not be 

less than the rates prescribed for co'zmnon carriers for substantially the same service." 

Your first question was the subject of two opinions of the 

Attorney General addressed to Honorable ,C, V. Terrell, Chairman 

of the Railroad Coasaission of Texas, dated February 4, 1932, 

and February 25,.1932, and with which opinions we substantially 

agree. From the first of those opinions we quote: 

"I am of-the opinion that in fixing minimum rates'for contract 

carriers, the Commission is required to do so in relation to 

rates prescribed for both rail and highway common carriers. 

Any other construction of the language in question would 

defeat the declared purpose of the Act. Not only was the law 

designed in the interest of highway safety and protection, but 

in order 'that ddscrimination in rates charged may be eliminated' and-!that the various transportation agencies of the 

State may be adjusted and correlated so that public highways 

may serve the best interests of the general public.s (See 

Declaration of Policy, Section 21 of the Act.)" - 

_ 

In the second of such opinions, it was said: 

"It is my opinion, therefore, and you are so advised, that the 

Commission is prohibited from fixing lower contract carrier 

rates than the rates prescribed for common carriers for 

substantially the same service; and further, with the exception 

above pointed out, that such contract rates should not be 

higher than, but identical with, the common carrier rates prescribed for substantially the same service. 

"In view of what has been said, it is my opinion that the 

contract carrier must take the rate prescribed fo,r the common 
Railroad Commission of Texas, page 4, O-3485 

carrier service most substantially similar. As stated 

above, whether this be the freight or express rate is a 

question of fact in each case.n 

In view of the rather comprehensive treatment given the 

subject in those opinions we do not deem it necessary 

to discuss your first question exhaustively. 

first question in the affirmative. 

We answer your 

We now pass to a consideration of your second question. In 

Section 4a of Article qllb it is provided, among other things, 

that "the Commission is hereby vested with power and authority 

and it is hereby made its duty . . . to require the filing of 

such monthly, annual and other reports and other data of motor 

carriers as the Commission may deem necessary, . . . and to 

supervise and regulate motor carriers in all matters affecting 

the relationship between such carriers and thz ahipping.public 

whether herein specifioall~e~~~~o~~do;rA~~~~le A&;i;;; 

provision is contained in 

Section 13b of said Act reads: 

"The Commission is hereby vested with power and authority 

and it 'is hereby made its duty to require all motor carriers 

to keep a set of accounts strictly in accordance with such 

classification of accounts and rules in respect thereto as 

may be established by the Commission and to file reports and 

such other data as the Commission may deem necessary, and which 

said accounts shall be open to the inspection of the Commission 

or its representatives at all times." 

You have advised us that on April 199 1933, the Railroad 

Commission of Texas made and promulgated the following general 

order 

"IT IS HERESY ORDERED by the Railroad Commission of Texas that 

every truck-loan-and.less than truck-load shipment of freight 

transported by Motor Carriers between pointsinthis State shall 

be accompanied by a 'Waybill' showing a complete description 

of the freight being=transported; the origin and destination 

thereof; the namesind addresses of the shipper, consignee and 

issuing carrier, as well as .the weight of the shipment and the 

rate being, or to be assessed9 and on shipments, in the course 

of transportation of which, are handled by two or more lines 

not under the same management and control, the route of movement, 

including the names of the participating carriers and the point 

or points of interchange shall also be shown. Where two or 

more teucks are used to transport a single shipment, a separate 

waybill shall accompany each of such trucks and shall, with 

respect to that portion of the shipment loaded in or on such 
Railroad Commission of Texas, page 5, 0-3485 

truck,, show al3 information herein provided and in addition 

thereto, shall bear specific reference to the bill of lading 

covering the entire shipment. A combination waybill and 

freight (expense) bill will be considered as in full compliance 

with this order, provided all required information is shown. 

"Effective May 190 1933, subject to further orders of the 

Commission." 

The statute itself does not in specific terms require of such 

carriers to keep and have records such as bills of lading or 

waybills on which the articles transported are described and 

rated. However, it is our opinion that in making the order 

of April 19, 1933, the Railroad Commission was acting within 

the power thus given it in the Motor Carrier Act and that 

such order thereafter had and now has the force and effect of 

a statute. In answer to your second question we beg to 

advise that in our opinion contract carriers may be required to 

abide by the terms of the general order of April 19$ 1933. 

Yours very truly 

ATTORNEY GENERAL OF TEXAS 

s/ Glenn R. Lewis _ 

BY 

Glenn R, Lewis 

APPROVED JUNE 6, 1941 A,ssistant 

s/ Grover Sellers 

FIRST ASSISTANT 

ATTORNEY GENERAL 

GRL:LM/cg 

APPROVED OPINION COMMITTEE 

By BWB, Chairman