Case Name: TELISCHAK TRUCKING, INC., v. PUBLIC SERVICE COMMISSION
Court: Michigan Court of Appeals
Jurisdiction: Michigan
Decision Date: 1968-04-03
Citations: 11 Mich. App. 23
Docket Number: Docket No. 3,068
Parties: TELISCHAK TRUCKING, INC., v. PUBLIC SERVICE COMMISSION.
Judges: McGregor, P. J., concurred with Quinn, J.
Reporter: Michigan appeals reports; cases decided in the Michigan Court of Appeals.
Volume: 11
Pages: 23–38

Head Matter:
TELISCHAK TRUCKING, INC., v. PUBLIC SERVICE COMMISSION.
Opinion op the Court.
1. Carriers — Regulation—Burden op Proof — Orders—Reasonableness — Public Service Commission.
The burden of showing by clear and satisfactory evidence that an order of the public service commission under statute providing for regulation of all motor carriers for hire is unlawful or unreasonable is upon the complaining party (CLS 1961, § 479.20).
2. Appeal and Error — Regulation of Motor Carriers — Public Service Commission — Statutes—Abuse of Discretion.
To declare an order of the public service commission made under statute regulating all motor carriers for hire unlawful, there must be a showing that the commission failed to follow some mandatory provision of the statute or was guilty of an abnse of discretion in the exereise of its judgment.
3. Carriers — Regulation—Certificate of Convenience and Necessity — Intended Use Rule.
Under the “intended use rule” of interpreting carrier’s certificate of convenience and necessity only those commodities whieh are intended at the time of movement for use in the particular type of activity, enterprise, or plaee specified in the description and which at the time of movement are without further processing or manufacturing in a form and condition to be so used may be transported.
References por Points in Headnotes
[1] 13 Am Jur 2d, Carriers § 28.
[2] 2 Am Jnr 2d, Administrative Law § 633.
[3-6] 13 Am Jur 2d, Carriers § 77 ei seg_.
[7-11] 2 Am Jur 2d, Administrative Law §§ 456-458.
4. Same — Authority.
Authority to haul pipe and pipeline laying and construction materials, supplies, equipment and machinery, incidental to or used in connection with the construction, repairing, or dismantling of pipelines, between various points in the State held, not to authorize transportation of commodities requiring an intermediate manufacturing process prior to ultimate use.
5. Same — Certificate of Convenience and Necessity — Alteration.
Order of public service commission that carrier cease and desist from transportation of cement except as specifically authorized in its certificate of convenience and necessity and making findings of extent of authority in certificate is not an order altering or modifying the certificate where the commission, the trial court, and the Court of Appeals have all found that the larger authority claimed by carrier is not contained in the certificate (CL 1948, §§ 479.14, 479.18).
Dissenting Opinion.
Levin, J.
6. Carriers — Certificate of Authority — Public Service Commission.
The public service commission acts in a quasi-judicial capacity in construing a motor carrier’s certificate of authority and it must state why it reached the conclusion it did, and a court on appeal decides whether the explanation is reasonable and according to the law.
7. Appeal and Error — Administrative Agency Order — Grounds.
An administrative agency’s order cannot be upheld unless the grounds upon which the agency acted in exercising its powers were those upon which its action can be sustained.
8. Same — Administrative Agency — Grounds for Decision.
A reviewing court, in dealing with a determination or judgment which an administrative agency alone is authorized to malee, must judge the propriety of such action solely by the grounds invoiced by the agency.
9. Public Service Commission — Administrative Procedure Act— Keasons for Decision.
The public service commission is exempted from the administrative procedure act but is subject to the judicially imposed requirement that it state reasons for its decision (CLS 1961, §84.101).
10. Appeal and Error — Public Service Commission.
The function of a reviewing court is to review reasons advanced by the public service commission, not to select among the competing reasons postulated or to search out a plausible basis for the commission’s action.
11. Same — Public Service Commission — Bemand—Clarification of Carrier’s Certificate of Authority.
Review of public service commission order which had failed to state the reasons for its decisions as to authority conferred upon plaintiff motor carrier under its certificate should require remand to the commission for clarification of its opinion.
Appeal from Ingham, Salmon (Marvin J.), J.
Submitted Division 2 October 4, 1967, at Lansing.
(Docket No. 3,068.)
Decided April 3, 1968.
Complaint by Telischak Trucking, Inc., a Michigan corporation, against Public Service Commission appealing an order of the commission requiring plaintiff to cease and desist from transporting cement, except as specifically authorized in its authority. The Cement Carriers Association and its individual members, George F. Alger Co., L. J. Beal & Son, Inc., D. J. & Z. Trucking Co., Davis Cartage Co., Hans Yroom Cartage Co. Inc., Pless Cartage Company, James House & Sons Cartage, Mackinaw Company, Michigan Transportation Co., A. P. Posnik & Company, and Rex Transportation Co. intervened as defendants. Affirmed. Plaintiff appeals. Affirmed.
Mihelich, Elmer, Dank £ Kendall, for plaintiff.
Franlc J. Kelley, Attorney General, Robert A. Derengoslci, Solicitor General, and David P. Van Note, Assistant Attorney General, for defendant.
Robert A. Sullivan (Ronald J. Mastej, of counsel) for intervening defendants.

Opinion:
Quinn, J.
Pursuant to CLS 1961, § 479.20 (Stat Ann 1965 Cum Supp § 22.585), plaintiff filed complaint in Ingham county circuit court to appeal an order of Michigan public service commission requiring plaintiff to cease and desist from transporting cement, except as specifically authorized in plaintiff's authority.
The pertinent language of the order appealed from is as follows:
"It is therefore our finding that under the portion of Telischak's authority complained of herein respondent may transport only commodities intended for use in the construction, repair and dismantling of pipelines and that such service is restricted to service for the oil and gas industries.
"It is also our finding that respondent may transport only commodities intended to be used directly in such construction, repair or dismantling and that such authority does not authorize transportation of commodities requiring an intermediate manufacturing process prior to such ultimate use.
"It is therefore ordered:
"(1) [This part of the order is not pertinent to decision.]
"(2) That respondent, Telischak Trucking, Inc., be and the same is hereby ordered to cease and desist from the transportation of cement except as specifically authorized, in its authority."
The trial court judgment affirmed the order of the commission except as to "such service is restricted to service for the oil and gas industries", and restrained the commission from enforcing that part of its order not affirmed. Under the statute cited above, plaintiff appeals such affirmance. No one appeals that part of the judgment which restrains the commission from enforcing its order restricting service to the oil and gas industries.
The proceedings before the commission which resulted in the order appealed from were instituted on complaint of intervening defendants that plaintiff was hauling illegally bulk cement from Essexville, Michigan, to Flint. The consignees in Flint were 2 Catsman companies, one of which manufactured cement pipe, among other products, but neither of which was engaged in the construction or dismantling of pipelines. Although plaintiff has other certificates of convenience and necessity specifically authorizing transport of bulk cement from Monroe county and from Wyandotte to other points in Michigan, it has no authority to haul bulk cement from Essexville to Flint unless such authority is found -in the language quoted in footnote 1, supra. Plaintiff purchased the certificate which contains this language in 1955 but hauled no bulk cement under it until August 1963.
The statute under which plaintiff filed its complaint provides in part:
' "In all actions under this section the burden of proof shall be upon the complainant to show by clear and satisfactory evidence that the order of the commission complained of is unlawful or unreasonable, as the case may be."
The Supreme Court said in Giaras v. Michigan Public Service Commission (1942), 301 Mich 262, 269:
"To declare an order of the commission unlawful there must be a showing that the commission failed to follow some mandatory provision of the statute or was guilty of an abuse of discretion in the exercise of its judgment."
This test was reiterated in Bejin Cartage Company v. Public Service Commission (1958), 352 Mich 139, and in City of Ishpeming v. Public Service Commission (1963), 370 Mich 293. The inquiry then is, has plaintiff met the statutory burden?
Instead of advancing clear and satisfactory proof that the order complained of is unreasonable, plaintiff argues that the only limitation in its certificate is a commodity limitation and that by application of the "intended use rule" employed by the Interstate Commerce Commission in interpreting its certificates to the language of plaintiff's certificate here involved, the plain and unambiguous meaning of the latter is that plaintiff may transport commodities which are used as pipe construction materials to any point in Michigan if it is demonstrated that such materials are pipe construction materials.
Assuming that the only limitation in plaintiff's certificate is a commodity limitation, the foregoing argument fails because it ignores some essential language in the Interstate Commerce Commission's description of the intended use rule. In Great Western Motor Lines, Inc., and Eugene G. Sharp—Investigation of Operations and Practices (1964), 96 MCC 522, 526, the commission said:
"Basically, the test is rather simple. Commodity descriptions governed by the test are those which identify the commodities authorized to be trans ported by reference to their intended future use. Strictly speaking, under the test, only those commodities specified in the description which are intended, at the time of movement, for use in the particular type of activity, enterprise, or place specified in the description and which, at the time of movement are, without further processing or manufacturing in a form and condition to he so used, may be transported."
Here, at time of movement of bulk cement from Essexville to Flint, the commodity was not in a form for use as "pipe and pipeline laying and construction materials, supplies, equipment and machinery, incidental to or used in connection with the construction, repairing or dismantling of pipelines" without further processing or manufacturing.
In addition, a reading of all the language of the authority here in issue convinces us that the Michigan public service commission's finding that plaintiff may transport only commodities intended to be used directly in such construction, repair, or dismantling and that such authority does not authorize transportation of commodities requiring an intermediate manufacturing process prior to such ultimate use is not unreasonable, but is rather the most reasonable finding on this record.
The only possible showing that the order is unlawful is plaintiff's argument that in effect the order of the commission altered or modified its certificate and such alteration or modification is only possible by proceeding under CL 1948, § 479.18 (Stat Ann § 22.583), and the proceedings here were brought under CL 1948, § 479.14 (Stat Ann § 22.579). The argument is untenable for the reason its validity depends on the assumption that plaintiff's certificate contains authority which Michigan public service commission, the trial court and this Court have found is not contained in such certificate.
Affirmed, with costs to defendants and intervening-defendants.
McGregor, P. J., concurred with Quinn, J.
The pertinent language of plaintiff's authority reads:
"Pipe and pipeline laying and construction materials, supplies, equipment and machinery, incidental to or used in connection with the construction, repairing or dismantling of pipelines between various points in the State of Michigan."