Legal Document

344 U.S. 298 73 Supreme Court Reporter 307 97 L.Ed. 337 AMERICAN TRUCKING ASS'NS, Incorporated et al.v.UNITED STATES al. EASTERN MOTOR EXP., Inc., versus UNITED SECRETARY OF AGRICULTURE Nos. 26, 35, 36. Argued Nov. 17 and 18, 1952. Decided Jan. 12, 1953. Rehearing Denied March 9, See 345 913, 638. [Syllabus from pages 298-299 intentionally omitted] Mr. Harry E. Boot, Washington, D.C., Wilber M. Brucker, Detroit, Mich., for American Trucking Associations, others. Howell Ellis, Indianapolis, Ind., Eastern Motor Express, Neil Brooks, Secretary of Agriculture the Ralph S. Spritzer, United States I.C.C. Burton K. Wheeler, Teamsters Union. Carl Helmetag, Jr., Philadelphia, Pa., Intervening Railroads. Justice REED delivered opinion Court. 1 These appeals attack new Interstate Commerce Commission rules governing use equipment by authorized motor carriers when is not owned carrier but leased owner or obtained interchange with another carrier. They were prescribed reported Ex Parte Number MC—43, Lease Interchange Vehicles Carriers, 52 M.C.C. 675. As will be seen portions we have quoted in Appendix, they principally require inspection; leased, control a minimum thirty days method compensation other than division revenues between lessor lessee; and, case carrier's equipment, authorization to exchange point actual transfer control. Thus practice using that brought into conformity regulation carrier-owned avoid evils had grown up practice. 2 Some six suits instituted test validity district courts under 28 Code KF62 §§ 2321—2325, Annotated KF65 U5 2321—2325. Three stayed orders one was moved pending disposition instant cases.1 came here on direct appeal two separate judgments denying injunctive relief prayed for; Southern District Indiana, States, 103 F.Supp. 694, Northern Alabama, 101 710. The issues there considered resolved against applicants concerned Commission's authority Carrier Act 1935, Act, Part II, 49 Statutes-at-Large 543, as amended, 54 919, § 301 seq., seq.; impact agricultural trucking guaranteed right augment their equipment; application Administrative Procedure 5 1001 protestants introduce additional evidence courts. Since only minor differences content cases appealed, may treated together. 3 I. Introduction.—We consider at outset existing conditions truck industry its developed during Commissioner's hearings because such background are meaningful. form permits certificates convenience necessity precondition interstate service virtue Act. Such authorization, except 'grandfather' clause, granted after showing fitness ability perform public need proffered service. And it specifically limits scope business permitted operations contract carrier, routes termini which served certificated common carrier.2 4 waives these agency limitations sizable portion industry, however. Most important exempt those involving used transportation products. By large, this category operated same person. It falls within jurisdiction over drivers' qualifications, hours safety.3 so no mandate owner-operators provide adequate nondiscriminatory service, adhere published rates, comply strict insurance requirements imposed general carriage.4 Because limiting character regulatory system, wide non-owned equipment. directions. first interchange. This includes arrangements whereby more through travel load order merge advantages certification serve different areas. In fashion, wholly partially loaded trailer exchanged established point, even an entire line without interruption, guise shift second leasing. relates operations. Carriers subject increasingly turned owner-operator truckers satisfy demands. variety arrangements, hire them conduct former's permit certificate. operators thus approved nonexempt property, great majority instances sever connections lessee end trip.5 6 nonowned illegal, either consideration.6 But overwhelming number satellite practices directly affect scheme interest necessary economic stability focus. appears, instance, while many reduced writing, oral leases common; some concluded trips made several exampt solicited themselves blank forms agency. strongly urged very informality contractual relationship operator creates inconsistent contemplates. Proof proceedings informal tenuous relationships lease evasions authority. driver employee sanctions violation geographical restrictions clearly difficult impose, especially single-trip lessor. may, well, become device circumvent conducting beyond territory entitled cover local shown before Commission. appeared, fact, entirely fictional, being created ad hoc trip made—and times wake specific denial area. 7 also alleged, incidents, safety observed lessors. fact bulk trip, leasing little opportunity desire inspect used, where agreement operator's appearance terminal. Enforcement violations would impose route standards. Hence, extent supervision rest periods, doctors' certificates, brakes, lights, tires, steering loading, normally accorded his own employees vehicles, drivers secured lease. himself called upon push time spent off road investment repairs slim profit margin.7 Further, absence written agreements has fixing lessee's responsibility accidents highly difficult. 8 Consequences noted. engaged mercy cost supply available him. he find unable undertake shipping obligations trucks willing make relatively unprofitable assume burdens less-than-carload Certification concern fit required convenience. To sustain obligation, integrated who finds competitor profitable ventures obliged rely miscellaneous freight compensating long carload hauls estimated margins. 9 Use tends obstruct normal rate regulation. Schedules traditionally grounded costs. picture depends largely far owning trucks. Not former able slight investment. current overhead involved operating solely administrative, bearing expense gas, oil, wages depreciation out share fee. refer owner's expenses determinative what 'reasonable' manifestly impossible too tenuous, short-termed informed each based revenue. 10 claimed demoralizing effect industry. Authorized advantageous expand required, nor risk empty return incurred. face fluid structure competition specializing offered often is, expenses. There pressure enter field hence efficient, safe designed promote. 11 II. Proceedings.—All us admit difficulties developed. years. early 1940, following complaints, Bureau held culminated statistical report 1943. maximum resources war postponed any action thereafter until 1947.8 year, however, Director reinstituted discussion, suggested regulations drafted, drew staff reports vehicles carriers. present January 1948, became apparent regarding proper solution unlikely. Its order, 13 Fed.Reg. 369, declared all respondents set forth investigated, four possible schemes regulation, rules. A qualified examiner heard 80 witnesses Washington St. Louis, issued proposed full Division followed June 1950, confirming examiner's findings amending proposals,9 petitions reconsideration, reopened argument. report, dated May 8, 1951, adopted Examiner's rules, affirming reiterating nature 12 III. Rules.—In final form, establish reduction contracts writing. Rule 207.4(a)(2), 743. vest exclusive possession of, for, rental, 207.4(a)(4), life must exceed employee. 207.4(a)(3). Finally, fix lessor, measured percentage gross 207.4(a)(5). writing driven whose travels. 207.5(a), (c). inspection takes possession, 207.4(c), well identification responsibility, 207.4(d), testing driver's familiarity Safety Regulations. 207.4(e). Records rented interchanged mandatory. 207.4(f). 14 IV. Authority.—Appellants focus principal provisions requiring thirty-day period measure revenue splitting. All agree abolish Unfortunate consequences predicated longer will—in sum, industry's fluctuating demand suffer costs accordingly go up. position benefit stabilization schedules, continued effectiveness functions dependent Needless say, ill equipped weigh predictions future. Nor our function act super-commission. So turn legal considerations us. 15 Here, appellants framed broadside asserted power. urge nowhere express delegation power control, regulate practices,10 further insisted provision granting implication Our function, does stop section-by-section search phrase 'regulation practices' among literal words statutory provisions. matter principle, might appellants' contentions if thought reasonable canon interpretation draftsmen acts delegating powers, practical realistic matter, can do include consideration every evil sought corrected. acquaintance affairs know prescience, minds Congress, exist. National Broadcasting company 319 190, 219—220, 63 997, 1010—1011, 87 1344; Phelps Dodge Corporation Labor Board, 313 177, 193—194, 61 845, 852, 85 1271. absenceMoreover, precisely reasons why agencies created, fond hope authors bring work expert's members legislatures cannot expected possess. Pennsylvania R. Co., 323 612, 65 471, 89 499. 16 Moreover, reject conclusion whole represent attempt arbitrarily; clear attendant purpose protect detrimental maintenance sound services consistent system. Sections 216(b) 218(a) filing just schedule rates demoralization structures generally probable concomitant practices. Section 204(a)(2) requires relating operation drivers. likewise threatened unrestricted continuous 204(a)(1), observance 208(a) 209(b), prohibitions rebates, 216(d), 217(b), 222(c), ignored proscribed. question aimed frustrate success undertaken Congress. Included duty '(t)o administer, execute, enforce part, connection therewith, prescribe regulations, procedure administration'. 204(a)(6). rule-making power, coterminous itself, extend 'transportation passengers property foreign commerce procurement facilities transportation,' vested 202(a). 203(a) (19). 18 We contention 204(a)(6) merely concerns procedures administrative. ignores distinct reference section enforcement. Furthermore, applicable transfers recognized 212(b). That 'pursuant prescribe.' strain logic experience look transfer, temporary nature, specified area; think dramatically supported take initiative securing cargoes, accept administrative approving names. unnatural construction sit idly wink lead 19 hold then promulgation despite General Tank Car El Dorado Terminal 308 422, 432, 60 325, 331, 84 361. grant rulemaking enforcement compels result. foreshadowed, course, validated railroads cars competing sea, spite inability ground page 616, 473. pointed 'unquestioned establishment (through) fruitless, correlative abrogate Association's rule prohibits interchange.' 619, 475. convinces power; exercise crucial phase endangered; here, practically affected trip-leasing. 20 fair analogy appears about corrected view jurisdiction. Then unstable economically, dominated ease competitive entry picture. result, overcrowded small units proved most minimal standards financial responsibility.11 Congress felt compelled preserve system over-competition, protecting clause.12 similarly threaten, though perhaps lesser degree, efficient today. 21 exercised, geared bounded supplements. defined constitutional purposes Commission, reliance Schecter Poultry 295 495, 529, 55 837, 843, 79 1570, Panama Refining Ryan, 293 388, 421, 241, 254, 446, misplaced. similar Federal Power Panhandle Pipe Line 498, 69 1251, 93 1499, controlling here. holding did production gathering natural gas Natural Gas effect. 504—505, 1255—1256. 22 V. Transportation Policy.—What said above answers companion invalid violate Policy U.S.C., preceding 1, 1. Regulation interests preservation inherent modes transportation, economically sound, safe, Rock Island Transit 340 419, 71 382, 95 391, Texas & Pacific 450, 409. overly-nice distinction law policy needed support hardly courts; represent, best, compromise flexibility conditions, alleged national interest, see applied problems conflicting considerations. mere contrary taken years active required,13 never restricted trip-leasing time,14 change function. 23 VI. Reasonableness Rules Exemptions Therefrom.—The basis answer various allegations certain arbitrary. For purposes, argument mean judgment. case, situation; marshalled plainly supports prescribed. 24 affirm aims federal exemptions both serve, 207.3( a), founded proposition unauthorized certificate extensions impossible. exemption extended railway operations, 207.3(b), confined municipalities contiguous areas, short trips, duplicates 207.3(c). exclusion substituted motor-for-rail transport rules' coverage 207.3(b) observation demoralized found, long-term lessors, inspected controlled railroads, identified name. context, unreasonable; certainly supervisory activities fields indicates need, standard paper equality. carriage plans merged 5, 207.3(d), been directed toward Allied Van Lines, proceeding, Evanston Fireproof Warehouse—Control—Allied 40 557, unique arrangement stockholding hauling agents company's name, already scrutinized operates supplied arrangement, since it, seems basis; guarantees coverage, Allied's 551, 563—566, promise protection seek correct. 25 VII. Preservation Right Augment Equipment. Appellants contend, protections 209(b) carriers' equipment.15 agree. provisos read blanket powers; increase volume traffic acquisition vehicles. Clearly, numerical limitation invalid, refusal secure safety, licensing not. Crescent Express 320 401, 408, 64 167, 170, 171, 88 127, sustaining limited seven-passenger 208 (requires specify rendered, could done type vehicle used.' equally circumstances 'limitation addition type'. 409, 171. 26 VIII. Agricultural Exemption.—As indicated above, exempts 'motor carrying consisting ordinary livestock, fish (including shell fish), commodities (not including manufactured products thereof), passengers, compensation'; 203(b)(6),16 appellants, particularly intervening Agriculture, drastically reduce significance Congress' intent. admit, apply contended preconditions wipe much heretofore in. substantial built haulers otherwise place departure, having unloaded farm produce carried; found prepared one-trip engagement route. thirtyday 27 unable, conclude danger constitutes 203(b)(6). commercial hereafter charges bringing generally. extends, words, products, carry property. statute allow compete non-agricultural off-the-farm use, therefore nothing implies truckers' haul standpoint Regulated receive carriage. balance factors, carried accordance congressional purpose,17 seem unreasonable invalid. IX. Agency Procedure.—We pause procedural objections interposed. object product fatally variance 35 requirement 7(c), 'the proponent shall burden proof', insist supplement hearing preponderating evidence. assuming 'proponent' actively requisite degree proof position, plain inapplicable proceedings. terms 'hearings conducted pursuant section'. Turning sections, invoke statute: 'Where record hearing, sections subsection.'18 short, s applies hearing. out, stems Act; contrast rate-making 216(e) 218(b). whatever substantiality evidence, fall failed 'burden proof.' 29 Similar reasoning 8(b) decisions 'include statement (1) conclusions' invoked inapplicable. turn, 'hearing * 7'. 30 X. Introduce Evidence Confiscation.—Finally, assign error introduction there. Their offer 'value Plaintiffs' rights' rights.' times, true, affecting heard; indeed, claim unconstitutionally confiscate enforced Court, bars so. Manufacturers 246 457, 488—490, 38 383, 392, 62 831; Joseph Stock Yards 38, 53 54, 56 720, 726—727, 1033; Baltimore Ohio 349, 362—369, 797, 804—808, 1209; New York 331 284, 334—335, 67 1207, 1233—1234, 91 1492. 31 construed avenue delay. confiscation substantial, import clear, patent, justify bar, substance show outlawing business; prove fail future resort periods. trial de novo automatically denied petition rehearing principles. place, truth multitude importance concerns. proceedings, notice desirability protect. 32 'Confiscatory' magic word. Whether should open door attacked. confiscation, cited, stands fundamentally footing case.19 Rate-making represents income; initial abolishment nearly direct. determined income produced, how charge. 33 true admonished original genuine. 'constitutional compensation', 727, 1033, drawn question. comparable claim. valid drive business. indicated, rooted supplements scheme, derives value going affected, therefore, Fifth Amendment, related, are, reach.20 novo, court err objection thereto. 34 Affirmed. Appendix. 36 Foreign augmenting (2) interchanging (3) renting private shippers. 37 207.3. Examptions.—Other 207.4(c) (d), relative apply— (a) regular points irregular serve; 39 (b) utilized part traffic, railroad moving stations billing; (c) performed exclusively municipality, municipalities, zone, Commission; 41 (d) plan proceeding arising 42 207.4. Augmenting equipment.—Other 207.5 conditions; 43 contract, lease, equipment— 44 Shall 45 signed parties thereto, duly execution contracts, leases, arrangements; 46 applies, less owner; 47 (4) complete assumption respect 48 (5) paid rental provided, computed commodify transported earned effective; (6) date circumstance begins, ends. duration coincide giving receipts paragraph section. Inspection equipment.—It taking inspected. 50 Identification equipment.—The acquiring properly correctly identify it. 51 (e) Driver equipment.—Before person assigned familiar with, employment result in, parts 192, 193, 195, 196 Regulations (Rev.) pertaining 'Driving Vehicles,' 'Parts Accessories Necessary Safe Operation,' 'Hours Service Drivers,' 'Inspection Maintenance,' furnish physical examination 191 'Qualifications or, lieu thereof, photostatic copy examination, retained file. (f) Record utilizing prepare keep manifest covering containing name address make, model, serial number, State registration origin, destination, affixed 207.5. equipment.—Common 207.2 movement conditions: Agreement providing interchange.—The describe interchanged; interchange; use; them, arrangements. Authority participating authorize movement, occurs. equipment.—Each operate respective necessity. 57 Through bills lading.—The move lading originating charged collected accounted manner Charges kept divisions joint proportions thereof accruing proportional rates. 58 provided rules; meet defects 59 BLACK, whom DOUGLAS concurs, dissenting. N Dec. Immigration Nationality Decisions grants broad implied powers outlined law. 473, L.ed. vague implications defeat Act's override expressed This, think, upholds. my run counter three respects: Atlantic congressionally choose whether purchased destoryed imposition burdensome restrictions. baron 203(b) II burdened restrictive substantially away intended confer exemption. C. Railroads special left advantages. reached advanced stage passed 1935.1 Early development along lines advantageous. others them. try disrupt free continue best themselves; effort regulated talking purchase restrict add demands required.2 While patently forbid safety,3 deprive safety. 66 put appropriate which, view, previously rejected V, composed Commissioners responsible distinguished affairs. makes violent repercussions industry; ruinous losses. curtailed destoyed. tendency eliminate ventures. be, Nation's motor-carrier efficiently accomplished few big companies large obtain governmental alteration ordained, ordaining. farmers Nation reasonably priced get market.4 When consideration, apprehension lest advantage.5 feeling, bill amended finally 203(b). Except cooperatives purposes; commodities. doubt 207.4 rather obviously valuable. forbids days, owners owners. completely prohibit trip-leasing.6 An illustration Florida citrus fruits. On delivering fruit northern states goods Florida. Unless fruits north back empty. 'Empty enterprise wall.' Carolina Freight Corp., 315 475, 488, 722, 729, 86 971. advantage haul. destruction 68 reason destructive colloquy took attorney asked wasteful With commendable candor said: 'It uneconomical empty, can—The difficulty comes, letting come place.' 'difficulty comes' agreed 'difficulty' cleared force agriultural raise high enough underlying exemption.7 exempted latter relate interesting amazing exemption, refused identical independent competition, strange arguing railroads' sustained, vigor engage preferences railroads. 70 fashion policies conflict mature consideration. reverse Courts aside Oklahoma-Louisiana (D.C.W.D.Okla.); Movers' Conference America (D.C.E.D.Mich.); Grayvan (D.C.N.D.Ill.), Apger (D.C.N.D.Ohio), respectively. 206—209. CFR, 191—196. school taxicabs, hotel park (4a) farmers, cooperatives, (7) newspapers, (7a) airlines, (8) (9) 'casual' transportation. 216(e), 217(b) 174. apparently generalize survey 1947 disclosed two-thirds variables, owned, shability already. filed intervenor brief urging affirmance, notable vehicle. relevant cited 'Leasing 40' Brief Attorney State. highway impaired rests admittedly speculation certainty. check indicate significant difference Order O.D.T. 3, revised, 501.5(d), 501.9, 501.10, 501.13, July 14, 1942, 5445 leasing, revenues; Emergency M—1, 11, 215.101, 215.105, 4429; M—6, November 1945, 176.10(a), 13595. 461. went heart problem. least days' revenues. provisions, recognizing originally drafted included, definition carriers, 'whether lease'. 203(a)(14), (15), 544, 545. 'added language (was) evasion constitute carriage, according particular inserted enable strike facts warrant it.' Cong.Rec. 5651. terminology stricken 898, 920, introduced qualification '(f)or clarity'. Thomson 321 19, 23, 394, 513. 11546. Agencies, S.Doc.No.152, 73d Cong., 2d Sess. 14—15, 22—35, 226; 12196, 12209; Hearings, Senate Committee Commerce, 1629, 74th 1st Sess., I, 78—80, 404—405, 410—411. 12207—12211; 12222—12225. Footnote supra. Dixie Common Application, 735; Greyvan 719. See, Ruling 4, August 1936, abandoned Court's Northeastern KF135 N59 Rosenblum Truck 50, 445, 671, '§ 208. Any 206 207 rendered *: Provided, terms, routes, termini, certificate, require.' 209. covered thereby substitute permit, facilities, Likewise farmer supplies farm'. (4a). Policy, refers 'fair impartial administered recognize each.' sets requirements: '(a) Notice.—General making Register (unless persons thereto named personally law) time, proceedings; proposed; description subjects involved. '(b) Procedures.—After section, afford interested participate submission data, views, arguments orally manner; presented, incorporate concise purpose.' participation satisfied. 313, noted itself distinguishes relation Compare principles Amendment related wage hour laws Darby, 312 100, 125, 657, 451, 462, 609. status quo; valid, disturbs profitability methods affected. Board Jones Laughlin Steel 43—45, 615, 627—628, 81 893; Currin Wallace, 306 13—15, 379, 386, 83 441; Royal Co-operative, 533, 572—573, 993, 1012—1013, 1446; North Securities Exchange 327 686, 707—710, 785, 797—798, 90 945; Light 329 90, 106 108, 133, 142—143, 103. 301, 301. 308(a) 309(b), 308(a), 309(b). Lines 408 170—171, 127. example, 1950: PERCENTAGES SELECTED FARM PRODUCTS TRANSPORTED TO PRINCIPAL MARKETS IN TRUCKS. Percent Hogs......... 79. Grape Fruit Cattle....... 76. Oranges Calves....... 78. Apples Sheep Lambs. 44. Tomatoes Shell Eggs... 93. Potatoes Dressed Poultry. Lettuce Live 99. Milk. Selected Commodities Leading Markets Rail Truck, 1939—1950, Department Economics (June 1951), Table Page 10. illustration, Congressman Walter Pierce Oregon said, 'Mr. Chairman, watched debate closely. wonder bill? am farmer, living 300 miles tidewater. wheat stock. ever terrific confiscatory came. 'The camel getting nose tent, means death him previous excessive rates.' 12216, 12217; 12197—12198. Trip Commission—railroad Lines. reflects belief '* better decide leave hands nullify intentions *.' 12225.

Classification Label: 7