Source: https://supreme.justia.com/cases/federal/us/315/50/
Timestamp: 2019-04-26 16:29:02+00:00

Document:
Justia › US Law › US Case Law › US Supreme Court › Volume 315 › United States v. Rosenblum Truck Lines, Inc.
United States v. N. E. Rosenblum Truck Lines, Inc.
1. A truckman who, on July 1, 1935, and until February 1936, was engaged in hauling exclusively for common carriers under agreements with them, helping them to move their overflow freight, and who was not serving the public directly, but only performing part of the complete common carrier service which those common carriers offered to the public, is not entitled to a permit as a contract carrier under the "grandfather" clause of § 209(a) of the Motor Carrier Act of 1935. P. 315 U. S. 54.
2. By the Act, Congress did not intend to grant multiple "grandfather" rights on the basis of a single transportation service. P. 315 U. S. 54.
3. Where the literal meaning of words in a statute produces an unreasonable result plainly at variance with the policy of the legislation, the legislative purpose will be followed. P. 315 U. S. 55.
4. The fact that "carriers" within the meaning of the Act need not deal directly with the public, but may act through brokers, does not affect the conclusion in this case. P. 315 U. S. 56.
Appeals from decrees of a District Court of three judges which, in two cases heard and decided together, set aside orders of the Interstate Commerce Commission denying applications for permits under the Motor Carrier Act of 1935.
These are direct appeals by the United States and the Interstate Commerce Commission from final decrees of a specially constituted three-judge district court [Footnote 1] which sustained appellees' separate petitions to annul, set aside, and enjoin an order of the Commission entered July 1, 1940, denying appellees' separate applications under the so-called "grandfather clause" of Section 209(a) of the Motor Carrier Act of 1935, 49 Stat. 543, 552, 49 U.S.C. § 309(a), [Footnote 2] for a permit authorizing operations as a contract carrier by motor vehicle.
of the general and the shipping public were taken out by the common carriers, and in some instances charged to the appellees. They occasionally paid small cargo damage claims not covered by insurance. The drivers of appellees' trucks were their employees. The specificity with which the common carriers directed the routes to be followed is in some doubt, but the drivers were requested to "sign in" at certain registration stations enroute.
The greater portion of the traffic of the common carriers which appellees served was carried in the carriers' own vehicles. Appellees' equipment was secured on oral arrangements to handle overflow freight. The freight so handled was always solicited by the common carrier, accumulated at its terminal, loaded and unloaded by its employees, and moved from consignor to consignee on that carrier's way bills. The record is silent as to whether appellees' trucks bore the name of the common carrier on whose behalf they were operated.
After February, 1936, appellees ceased hauling for common carriers by motor vehicle and began hauling for individual shippers in their own right.
"was operated solely under the direction and control of the common carriers and under the latter's responsibility to the general public and the shippers,"
"as to such operations, applicants [appellees] do not qualify as carriers by motor vehicle within the meaning of the Act, and are consequently not entitled to a certificate or a permit under the 'grandfather' clause of Section 206(a) or 209(a) thereof. [Footnote 4]"
The point of divergence between the Commission and the court below seems to have been whether the evidentiary facts supported the Commission's ultimate conclusion that appellees operated solely under the control of the common carriers. Because of our views as to the proper construction of the Act, we need not determine whether substantial evidence supports that conclusion of the Commission. In any event, the evidence clearly shows that, on the critical date, and from then until February, 1936, appellees helped the common carriers move their overflow freight and, as to each job, were an integral part of a single common carrier service offered to the public by the common carrier for whom they hauled.
multiple "grandfather" rights on the basis of a single transportation service. Presumably, the common carriers which appellees served were entitled to common carrier "grandfather" rights over the entire line. It was the common carriers who offered the complete transportation service to the general public and the shipper. To hold that appellees, who performed part of that complete transportation service for those common carriers under agreements with them, acquired contract carrier "grandfather" rights over the same line entitling them also to serve the public is to ascribe to Congress an intent incompatible with its purpose of regulation. The result would be to create in this case two services offering transportation to the public when there had been only one on the "grandfather" date, without allowing the Commission to determine if the additional service was in the public interest. And instances can readily be imagined where a single common carrier might utilize the services of several operators such as appellees. Automatically to grant contract carrier rights to such operators might result in such a wholesale distribution of permits as would defeat the very purpose of federal regulation.
310 U. S. 534, 310 U. S. 543, and cases cited. We conclude that the Commission rightly determined that appellees were not contract carriers within the meaning of the Act prior to February, 1936.
Appellees make no contention that they were common carriers during the period in question, and we are clear that they were not, for the Congressional intent to avoid multiple "grandfather" rights on the basis of a single transportation service is equally applicable to prevent appellees from being considered either as contract or as common carriers within the meaning of the Act. The reasonableness of this interpretation of the Act is apparent. Since appellees' operations -- namely, serving the common carriers -- on the critical date did not make them "carriers" within the meaning of the Act, and thus subject to regulation under it, it follows that they are free to engage in such operations without securing the authorization of the Commission. [Footnote 11] But those operations cannot be the basis for appellees' automatically securing permits to serve the public in their own right -- a service which they were not performing on the "grandfather" date.
public. It is not present when a carrier deals through a broker.
* Together with No. 53, United States et al. v. Margolies, doing business as Manhattan Truck Lines, also on appeal from the District Court of the United States for the Eastern District of Missouri.
Convened pursuant to the Urgent Deficiencies Act of 1913, 38 Stat. 220, 28 U.S.C. §§ 47 and 47a, and Section 205(h) of the Motor Carrier Act of 1935, rearranged by the Transportation Act of 1940, 54 Stat. 899, as Section 205(g) of Part II of the Interstate Commerce Act.
In both of these cases, it was the appellee's predecessor in interest who was operating on July 1, 1935. The predecessor of appellee in No. 52 was Rosenblum the individual, and the predecessor of appellee in No. 53 was an individual, Baulos.
§ 202(a), 49 U.S.C. § 302(a).
§ 206(a), 49 U.S.C. § 306(a).
§ 209(a), 49 U.S.C. § 309(a).
Section 209(b), 49 U.S.C. § 309(b). Section 218(b), 49 U.S.C. § 318(b).
The Commission has taken the position that, while there may be destructive or unfair competition with common carriers when truck operators contract to do work in connection with transportation for common carriers which serve shippers directly, "it is not the truck operator who carries it on. Rather, it is the carrier for whom he works. . . ." Scott Bros. Inc., 4 M.C.C. 551, 559.
"§ 203(a)(15). The term 'contract carrier by motor vehicle' means any person, not included under paragraph (14) of this section, who or which, under special and individual contracts or agreements, and whether directly or by a lease or any other arrangement, transports passengers or property in interstate or foreign commerce by motor vehicle for compensation."
The Commission has so held. Dixon, 21 M.C.C. 617; Smythe, 22 M.C.C. 726.
Section 203(a)(18), 49 U.S.C. § 303(a)(18), defines "broker" substantially as one who sells or offers for sale any transportation. Section 211(a), 49 U.S.C. § 311(a), requires that brokers be licensed, and that the carriers they employ have either a certificate or a permit issued under the Act.

References: v. 
 v. 
 § 209
 § 309
 v. 

§ 202
 § 302

§ 206
 § 306

§ 209
 § 309
 § 309
 § 318
 § 303
 § 311