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Timestamp: 2019-07-23 16:26:57
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Matched Legal Cases: ['§ 15', '§ 15', '§ 1', '§ 15', '§ 15', '§ 6', '§ 1300', '§ 6']

TRANS ALASKA PIPELINE RATE CASES, 436 U. S. 631 - Volume 436 - 1978 - Full Text - US Supreme Court Center - USSC Cases - Nolo
US Supreme Court Center > Volume 436 > TRANS ALASKA PIPELINE RATE CASES, 436 U. S. 631 (1978) > Full Text
The primary question presented in these cases is whether the Interstate Commerce Commission is authorized by § 15(7) of the Interstate Commerce Act, as added, 36 Stat. 552, and amended, 49 U.S.C. § 15(7), [Footnote 1] to suspend initial tariff schedules of an interstate carrier subject to Part I of the Act, 24 Stat. 379, as amended, 49 U.S.C. §§ 1-27 (1970 ed. and Supp. V). In addition, we are asked to decide whether, if the Commission is so authorized, it has additional authority summarily to fix maximum interim tariff rates which will be allowed to go into effect during the suspension period and to require carriers filing tariffs containing such rates, as a further condition of nonsuspension, to refund any amounts collected which are ultimately found to be unlawful. We hold that the Commission has statutory authority to suspend initial tariff schedules, and that it has power ancillary to that authority to establish maximum interim rates and associated regulations -- including refund provisions -- as it has done in these cases.
In 1968, massive reservoirs of oil were discovered at Prudhoe Bay in the Alaskan Arctic. Two years later, plans crystallized to build a pipeline from Prudhoe Bay to the all-weather port of Valdez on Alaska's Pacific coast. After protracted environmental litigation was ended by special Act of Congress, [Footnote 2] construction of the Trans Alaska Pipeline System (TAPS) began in 1974. In May and June, 1977, seven of the eight owners of TAPS, [Footnote 3] anticipating completion of TAPS in mid-1977, filed tariffs with the Interstate Commerce Commission [Footnote 4] setting out the rules and rates governing transportation
Acting pursuant to § 15(7) of the Interstate Commerce Act, the Commission [Footnote 10] found that the protests lodged against the
Four pipeline owners, petitioners here, [Footnote 16] filed a petition for review of the Commission's suspension order in the Court of Appeals for the Fifth Circuit. That court determined: (1) that the Commission had the statutory authority to suspend
Petitioners sought review in this Court and filed applications for a stay of the Commission's suspension order, all relief having been denied by the Fifth Circuit. On October 20, 1977, we granted the applications for a stay, 434 U.S. 913, and we issued a supplemental stay order on November 14, 1977. 434 U. S. 949. Thereafter we granted certiorari to consider the three issues decided by the Court of Appeals. 434 U.S. 964. We affirm. [Footnote 17]
Id. at 51. See H.R.Rep. No. 923, 61st Cong., 2d Sess., 4 (1910), quoting President Taft's special message to Congress on the Interstate Commerce Act; [Footnote 18] S.Rep. No. 355, 61st Cong., 2d Sess., 8 (1910); [Footnote 19] United States v. Chesapeake & Ohio R. Co., 426 U. S. 500, 426 U. S. 513, and n. 10 (1976) (Chessie); Dixon, The Mann-Elkins Act, 24 Q.J.Econ. 593, 602-603 (1910)
First, petitioners' claim that the Commission is without authority to suspend initial rates is not limited to situations in which proposed initial rates are in some sense reasonable; it is a claim that a carrier can impose any rate it chooses. [Footnote 20] Nor have petitioners pointed to any mechanism which would tend to make initial rates reasonable, and Congress, in 1910, concluded that the reparations provisions of the Commerce
Accordingly, far from reaching an "absurd resul[t]'" which would "`thwart the obvious purpose of the statute,'" Brown, supra, at 380 U. S. 571, a literal reading of the word "new" in § 15(7) is necessary to curb mischief flowing from unchecked initial rates, which is in every way identical to that flowing from unchecked changes in rates to which the Mann-Elkins Act is concededly addressed. Given the equivalence of the harms resulting from unchecked initial and changed rates, only unequivocal statements in the legislative history of the Act would support any limitation on the scope of the suspension power. Petitioners, however, have been able to offer only isolated remarks made in floor debates in favor of their position. [Footnote 23] These show at most that the primary area
of congressional concern was the situation in which railroads increased their preexisting rates. There is nothing to show that Congress intended to limit the suspension power to this situation, however, and, indeed, other isolated remarks show quite clearly that Representative Mann, at least, thought both initial and changed rates could be suspended. [Footnote 24] Therefore, we conclude that the word "new" must be given its literal interpretation, which embraces the rates that are the subject of this litigation. [Footnote 25]
The immediately preceding paragraph of the same Circular provided that "Changes in Rates" had to be filed on 30 days' notice, which suggests that the Commission was aware that the 30-day requirement of § 6(3), and indeed that § (3) itself, was inapplicable to initial rates for "new roads." The rule announced in Circular 2-A became Rule 44 of Tariff Circular 14-A in 1907 and Rule 57 of Tariff Circular 15-A in 1908, a numerical designation which has been retained to this day. See 49 CFR § 1300.57 (1977). [Footnote 27]
with every other. Instead, the Act must be construed not only by its language but by its purposes if sense is to be made of the verbal accretions of many years. Under this proper standard of construction, there is little to commend the argument that the word "change" was meant to narrow "new." To the contrary, the opposite construction -- that "new" was intended to clarify the meaning of "change" -- is more justified given the purposes of the Hepburn and Mann-Elkins Acts. Indeed, when Congress did enact comprehensive tariff schemes in Parts II, [Footnote 29] III, [Footnote 30] and IV [Footnote 31] Of the Interstate Commerce Act, which cover (respectively) motor carriers, common carriers by water, and freight forwarders, it indicated unequivocally in the language of the suspension provisions that initial rates were "new" rates capable of being suspended, and yet references to "changed" rates appear in those Parts in each place they appear in Part I. [Footnote 32]
Petitioners do not apparently disagree that the Commission can suspend a tariff because it falls on the wrong side of the line of reasonableness, but they would prevent the Commission in suspending a tariff from stating, as it did here, where the tentative dividing line lies. Such a statement, they say, is ratemaking. ut this is untenable: no principle of law requires the Commission to engage in a pointless charade in which carriers desiring to exercise their § 6(3) rights are required to submit and resubmit tariffs until one finally goes below an undisclosed maximum point of reasonableness and is allowed to take effect. The administrative process, after all, is not modeled on "The Price is Right." What the Commission did here, therefore, far from being condemnable, is an intelligent and practical exercise of its suspension power which is thoroughly in accord with Congress' goal, recognized in Arrow, 372 U.S. at 372 U. S. 664-666; see United States v. SCRAP, 412 U. S. 669, 412 U. S. 697 (1973), to strike a fair balance between the needs of the public and the needs of regulated carriers. Indeed, the Commission might well have been derelict in its duty had it insisted on charade once it had determined that there was a way TAPS could operate without harm to the
In response, we note first that we have already recognized in Chessie that the Commission does have powers "ancillary" to its suspension power which do not depend on an express statutory grant of authority. We had no occasion in Chessie to consider what the full range of such powers might be, but we did indicate that the touchstone of ancillary power was a "direc[t] relat[ionship]" between the power asserted and the Commission's "mandate to assess the reasonableness of . . . rates and to suspend them pending investigation if there is a question as to their legality." 426 U.S. at 426 U. S. 514. Applying this test, we found in Chessie a direct relationship which justified the Commission in insisting that the proceeds of proposed general railroad rate increases be used to pay for deferred maintenance. If such a use was made of the proceeds,
This passage, which declares that Congress sought to protect the public in "all cases" in which a hearing had not been concluded by the termination of the suspension period, certainly cannot be read to indicate that Congress placed any
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