Opinion ID: 277315
Heading Depth: 2
Heading Rank: 2

Heading: Youth Standby and Young Adult Tariffs

Text: 49 As to both these tariffs the Board concluded that the circumstances and conditions of service were dissimilar on the grounds that reduced rates for youths have traditionally been part of the transportation rate scheme, that the tariffs are a promotional device directed at a homogenous group of persons which because of its financial dependence does not normally use air transportation, that the reduced rate permitted a greater utilization of existing facilities, and that approval was consistent with the Board's policy of allowing airline managment to exercise its discretion more freely. The petitioner contend that the tariffs can be justified only on the impermissible consideration of the status of the traffic, and are therefore unjustly discriminatory. 50 As noted earlier, reduced rates for children have traditionally been part of the rate scheme in the transportation industry, and they have never been attacked as unjustly discriminatory. The Board has, however, ruled that children under 12 who are not accompanied by an adult may be charged regular fare. Full Fares for Unaccompanied Children, 24 C.A.B. 408 (1956). In reaching that conclusion, the Board found that the costs of transportation was equal to that of adults, and therefore the airlines could charge them full fare. 24 C.A.B. at 410. 31 The Board argues here that the decision by necessary implication held that reduced rates for children under 12 are not unjustly discriminatory. We have examined the opinion with great care, and find it lacking in cogency. Consequently, we are extremely hesitant to rely on it for anything other than its exact holding. But we are not presented with the issue of whether the time-honored practice of giving reduced-rates for children under 12 is unjustly discriminatory. 51 The tariffs before us provide for reduced rates for youths between the ages of 12 and 22. The only way in which a determination that reduced rates for children under 12 are not unjustly discriminatory bears on the tariff before us is if such tariffs are not unjustly discriminatory because age is per se a distinguishing condition which, in and of itself, renders the conditions and circumstances of service dissimilar. We do not construe the Board's decision in Full Fares for Unaccompanied Children to stand for that proposition, 32 and on the basis of the history of rate regulation in the transportation industry, we do not believe such a proposition to be valid. While the ICC in two early cases did state in dicta that commutation tickets could be issued to children of school age, Commutation Tickets for School Children, 17 I.C.C. 144 (1909); Bitzer v. W-V. Ry., 24 I.C.C. 255 (1912), when read in the context of the decision itself and against the background of rate policy which required reduced rates to be available to all, we do not find those statements persuasive. Aside from being dicta, the Commission disposed of the actual issue before it on the basis of its decision in In Re Party Rate Tickets, 12 I.C.C. 95 (1907) which held that reduced rates for party tickets could only be issued if they were available to all, and that factors relating to the type of passenger or his status could not be considered. Accord Smith v. Northern P. R.R., 1 I.C.C. 611 (1887); 33 see ICC v. Baltimore & O.R.R., 145 U.S. 263, 12 S.Ct. 844, 36 L.Ed. 699 (1892). Further, section 22 of the ICC Act excises commutation tickets from the unjust discrimination provisions of section 2. We therefore believe that the Commission's bare statement without analysis and in dicta is an insufficient predicate upon which to base such a radical departure from the general rules of rate making. In view of the absence of any logically supportable rationale consistent with the general limitations on the factors which are relevant to a determination of whether the circumstances and conditions of service are substantially similar, we are constrained to conclude that age alone is, as a general rule, not a relevant consideration. In so concluding we are not intimating that the time-honored exception for children under 12 is unjustly discriminatory. Rather, we limit our holding solely to the question as it concerns special services available only to those between the ages of 12 and 22. 52 When the Board dismissed the petitioners' complaints against the youth tariff, it noted that the tariff raised an issue of unjust discrimination in that it was applicable only to a limited age group. But it observed that the question of discrimination was merely one of degree, and concluded that limiting the tariff to those between the ages of 12 and 22 was reasonable and not arbitrary. It also found that it was necessary to limit the applicability of the tariff in order to preserve its promotional aspects because of the diversion from regular fare traffic which would otherwise result. Arguing that the question of unjust discrimination caused by a tariff limited in applicability on the basis of age is merely a question of degree does not aid in the analysis. All questions of discrimination under the Act are questions of degree as the statute only prohibits unjust discrimination. As indicated earlier, whether a discriminatory tariff is unjust is determined by whether the conditions and circumstances are substantially similar. 53 The Board here argues that extending reduced rates to those between the ages of 12 and 22 is justified as the classification corresponds to those youths who are still in school, frequently at great distances from home, and correspondingly in need of rapid transportation during the long holiday periods. The essential difficulty with this position is that it is predicated solely on the status of the traffic, and is unrelated to transportation. Further, is marks a radical departure from the Board's previous position as it has consistently held, to date, that students are not entitled to reduced rates merely because they are students. Capital Group Student Fares, 25 C.A.B. 280 (1957); Caribair Student Standby Fares, Order No. E-21667, 34 Jan. 12, 1965; Field Trip Group Fare for School Children, Order No. E-19599, May 21, 1963. Finally, the argument is postulated on a factual assertion that is clearly contradicted by the record. The tariffs are not available during the peak holiday travel periods of Easter, Thanksgiving, Christmas, and New Years. These traditional holiday periods correspond generally to the long vacation periods afforded college students. Thus, during the period in which the Board argues that reduced rates are needed, they are not available. We are therefore forced to conclude that the orders of the Board dismissing the complaints not only can not be supported by these considerations dealing with the status of those eligible under the tariff, but are not supported by the arguments advanced by the Board. 54 Nor do we believe that requiring the tariff to be limited in order to preserve its promotional aspects lends added support to the orders here under review. This is little more than arguing that promotion is a valid consideration in determining whether a tariff is unjustly discriminatory. Limiting the class of persons eligible under the tariff is merely a means of securing that added factor in the ultimate determination. While the Board is charged with promoting the air transportation industry, it is doubtful, in view of the specific statutory language prohibiting unjust discrimination and undue preference and prejudice, that promotion alone is a sufficient justification for an otherwise unjustly discriminatory rate. Heretofore, the Board has consistently held that the promotional aspects of a tariff alone did not render the circumstances and conditions of service dissimilar. Thus, it has held that the discriminatory aspect of reduced rates were not counter-balanced by the promotional aspects of such reduced rates to students, Capital Group Student Fares, supra, to freight forwarders, International Airfreight Forwarders, 27 C.A.B. 658 (1958), to groups of two or more traveling on a group excursion plan, Group Excursions Fares, 25 C.A.B. 41 (1957), 35 to travel agents and tour conductors, Free & Reduced-Rate Transp. Case, 14 C.A.B. 481 (1951); ATC Resolution re Travel Agents & Tour Conductors, 23 C.A.B. 1552, 29 C.A.B. 1344, 29 C.A.B. 1345, 31 C.A.B. 900 (1959), to teachers, Frontier Airlines Reduced Fares for Teachers, 38 C.A.B. 1148 (1963), to U.N. Employees, Reduced Fares for U.N. Employees, Order No. E-19519, Apr. 23, 1963, and to men over 65 and women over 62, Ozark Air Lines Senior Citizen Excursion Tariff, Order No. E-21973, Mar. 31, 1965. 36 In those cases where the Board has found rate differentials not unjustly discriminatory, it has done so on the basis of transportation related factors and competition, and not solely on the promotional aspects of the tariff. Certificated Air Carrier Military-Tender Investigation, supra, (reduced rates were justified by reduced cost and competition); Capital Group Student Fares, 26 C.A.B. 451 (1958) 37 (Reduced rates for groups of 25 and over justified on the basis of lower costs); Deferred Airfreight Case, 23 C.A.B. 651 (1956) (different rate for deferred freight which was avaiable to any shipper who was willing to wait the extra delivery time); Nonpriority Mail Rate Case, 34 C.A.B. 143 (1961) (reduced rates for the standby transportation of first-class mail). 55 Thus, on the basis of the Board's own analysis in prior decisions, these tariffs may not be justified on the ground of their promotional aspects alone. Since we have concluded that in the circumstances here present neither age nor factors relating to the status of the traffic may be considered in determining whether the circumstances and conditions of service are substantially similar, the validity of the Board's order rests on the promotional effect of these tariffs. While the Board appears to have rested its decision on all of these elements, we do not think the orders before us may be justified solely on the promotional aspects of the tariffs. For even though the question of unjust discrimination is one of fact for determination by the Board, and while we recognize that the genius of the administrative practice is its adaptability and flexibility to the rapidly changing social and economic situation, see American Trucking Ass'n. v. Atchison, T. & S.F. Ry.,387 U.S. 397, 87 S.Ct. 1608, 18 L.Ed.2d 847, (May 29, 1967), we do not believe that such a radical change in policy can be justified without any evidentiary basis or rational justification. City of Lawrence v. CAB, 343 F.2d 583 (1 Cir. 1965). 56 Therefore, we set aside and reverse the orders of the Board in Cases No. 23,410, youth tariff, and 23,411, young adult tariff, and remand the cases to the Board for further proceedings not inconsistent with this opinion. 38