Opinion ID: 299349
Heading Depth: 1
Heading Rank: 5

Heading: Is Transporter A Carrier In Substance?

Text: 19 Are Carrier Burdens Borne? 20 But with the private carrier defined simply as transporters of property who are neither common nor contract carriers    the statute will yield up no better verbal guide to the reach of its licensing provisions than transportation `for compensation' or `for-hire'. Drum, supra, 368 U.S. at 376, 82 S.Ct. at 411, 7 L.Ed.2d at 365. 21 Of major importance here, these considerations led the Supreme Court to declare this pervasive theme: Because the definitions must, if they are to serve their purpose, impose practical limitations upon unregulated competition in a regulated industry, they are to be interpreted in a manner which transcends the merely formal (emphasis added). Drum, supra, 368 U.S. at 375, 82 S.Ct. at 411, 7 L.Ed.2d at 364. 22 In Drum the Court had to determine the applicability of the Motor Carrier Act to a transportation scheme devised by Oklahoma Furniture Manufacturing Company for the transportation of its own manufactured furniture. The system was for the lease of tractors from owner-operators and the payment to such lessor-owner-operators of a specified mileage rental and of a mileage fee as compensation for the driver. Tracing the development by the ICC of the two control and substance tests, and after assuming the record showed requisite controls by the shipper over the physical operations of the transportation, the Court held that in substance the shipper was really a for-hire carrier. In reaching this conclusion the Court tested the facts against the standard of whether the transporter had been willing to assume in significant measure the characteristic burdens of the transportation business, 368 U.S. at 376, 82 S.Ct. at 411, 7 L.Ed.2d at 365, or alternatively, whether the transporter had so far emancipated itself from the burdens of transportation that to permit it, on such terms, to secure a transportation service from these unlicensed owner-operators would be inconsistent with the statutory scheme. 368 U.S. at 380, 82 S.Ct. at 413, 7 L.Ed.2d at 367. On this approach the Court specifically upheld the ICC delineation of the significant burdens which the shipper did not bear because, through the scheme, they had been shifted to the lessor-owner-operator. 18 Accordingly the Court referred with approval to one of our very early cases which, with others, developed the substance test. 19