Court Opinion

ID: 8741942
Source: CourtListenerOpinion
Date Created: 2022-11-26 10:51:37.283922+00
Date Added: 2024-06-11T17:00:26.898920
License: Public Domain

CLARIE, District Judge
(dissenting).
I respectfully disagree with the majority, as to the propriety of the Commission’s denial of a rehearing. Accordingly, I would remand the proceeding to the Commission for further hearing and grant leave to the Petitioners to introduce additional evidence.
Lombard s application was initiated on the usual standard form furnished by the Commission. It set forth the operational activities of the vendor carrier, Ayer, during the six months immediately preceding the application; but it did not provide for the inclusion of any earlier activities. This application provided the basis for the submission of evidence when the matter came before the Commission’s hearing examiner. While a minimum of testimony was received from Lombard and the protesting carriers relating to the operations of Ayer, prior to the six-month period, no documentary evidence was presented for any time prior to August 1, 1960.
The examiner found that beginning August 12, 1960, the date of the interline agreement, Ayer’s operations were subject to the control and management of Lombard. Therefore, the period between August 12, 1960 and February 1, 1961 was held not to be representative of Ayer’s actual operations and not entitled to be considered as evidence on the application. The only period remaining for which data had been furnished, was the first eleven (11) days of August. Thus the subsequent finding that Ayer’s provisional routes were dormant was predicated upon an analysis of unsubstantial evidence, a mere eleven (11) days of the vendor’s operations. This is particularly significant because it was at a time during the summer respite, when business activities did not provide a representative indicia of normal operations.
This brief period alone provided the basis for the Commission’s finding of dormancy; a fact admitted by counsel for the Commission before this Court. It is also set forth in the following excerpts from the Commission’s written decision :
“With respect to the examiner’s finding that the exhibit disclosed no service in the Lawrence, Lowell and Hav-erhill area (the northeastern area), during the first 11 days of August, but showed an abrupt change thereafter, * * * ” Lombard Bros., Inc. — Purchase—Everett M. Millis, *9108-9 NC-F-7793 (Sept. 20, 1962). (Emphasis added).
“As to the first, our painstaking review of the entire record permits of no conclusion other than that these rights were virtually dormant for an extended period prior to August 12, 1960.” Lombard, supra 10-11 (Emphasis added).
“Whereas evidence of operations in the first 11 days of August discloses a continuation of vendor’s service to or from points on its regular routes as far west as Orange, with some few operations to points near the regular route within the narrow area west of U. S. Highway 3 and north of U. S. Highway 30 [sic; should be 20], the evidence of operations performed thereafter shows that this pattern underwent a decided change.” Lombard, supra, 11. (Emphasis added).
In the dynamic and changing industry of over-the-road trucking, an analysis of a mere eleven (11) days is a grossly inadequate basis on which to deny or grant such an application. The finding of dormancy is not substantiated in fact or law. The majority opinion concedes “that the trial examiner had only sketchy evidence on which to base his conclusions * * ■*_» “Sketchy evidence” is not a sound basis on which to sustain or deny legal rights.
“A finding is supported by the evidence only when the evidence is so substantial that from it an inference of the existence of the fact found may be drawn reasonably. A mere scintilla of evidence sufficient to justify a suspicion is not sufficient to support a finding upon which legal rights and obligations are based. That requires ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’ Consolidated Edison Co. [of New York] v. National Labor Relations Board, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938).” Matter of Stork Restaurant, Inc. v. Boland, 282 N.Y. 256, 273-274, 26 N.E.2d 247, 255 (1940).
“Substantial evidence is more than a mere scintilla. * * * It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Consolidated Edison Co. of New York v. National Labor Relations Board, supra, at 229, 59 S.Ct. at 217, 83 L.Ed. 126.
Where specially constituted district courts, such as this, are required to review orders of the Interstate Commerce Commission, the scope of review is limited, and if the Commission did not exceed the statutory limits of its discretion, and its findings are adequate and supported by evidence, courts will not upset its orders. McLean Trucking Co. v. United States, 321 U.S. 67, 87-88, 64 S.Ct. 370, 88 L.Ed. 544 (1943).
“Here, as in the case of orders of other administrative agencies under comparable statutes, judicial review is limited. It extends no further than to ascertain whether the Commission made an allowable judgment in its choice of the remedy. As applied to this particular type of case, it is whether the Commission abused its discretion * * Jacob Sieg-el Co. v. Federal Trade Commission, 327 U.S. 608, 611-612, 66 S.Ct. 758, 760, 90 L.Ed. 888 (1946).
Cognizant of this limitation on our review, this cause should be remanded for further consideration.
Lombard’s subsequent application to the Commission for a rehearing, to permit the introduction of additional evidence was denied on the ground that Lombard had failed to avail itself of the opportunity to present such evidence at the original hearing. In view of the examiner’s finding that the critical period from August 12, 1960 to February 1, 1961, was contaminated by Lombard’s assumption of control, it became material to the eventual decision to investigate the period prior to the commencement of the interlining arrangement. In a very real *911sense, then, the earlier period became “newly relevant”.
Lombard’s counsel had advised the applicants, based on their interpretation of the Commission’s past decisions, that the relationship between Lombard and Ayer as demonstrated on the application form was legally valid. The majority concedes that the parties “were careful not to engage in certain of the practices that have previously led the Commission to find ‘control’.” Thus Lombard was taken by surprise and left naked with only eleven (11) days of proof, when the examiner rejected that period from consideration;1 and that rejection was after the hearing had been concluded.
Unless it is to be assumed that the policy of the Commission 2 adopts a punitive aspect when it is found that the applicants violated the rules of the Commission, the denial of a rehearing appears arbitrary and an abuse of the discretion committed to the Commission by the statute. The record discloses that Lombard is a reputable and substantial motor carrier with extensive routes in several states, operating with the approval and under the aegis of the Commission. Since the instant denial, subsequent applications for the purchase and acquisition of additional routes by Lombard have been approved by the Commission.3 The record is devoid of any subsequent action by the Commission of a punitive nature with respect to Lombard’s existing certificates. It is apparent that the denial of the rehearing is limited to the single instance of unlawful control of Ayer during the six months preceding the filing of the application. And if such action can be characterized as “punitive” at all, it is m the sense that the six-month period was eliminated from consideration with regard to the application and nothing else, and most certainly not the denial of a rehearing.
As part of its application for a rehearing, Lombard submitted an abstract of representative shipments by Ayer from June 1959 to May 1960. It reflected Ayer’s operations by showing the shipments of one day for each month during the period. It does not appear that this was anything more than a limited sampling of the evidence which would be produced at a rehearing. This sampling has been deemed to be an “offer of proof” and the majority has explored its weight and sufficiency and found that it does not buttress Lombard’s claim for a rehearing. However, considering the limited size of Ayer’s operation, both as to equipment and capital assets,4 it does not appear as a matter of law that the facts submitted justify a reviewing court to substitute its judgment and analysis for that of the Commission’s.
The granting of a rehearing would provide the petitioners with an opportunity to show whether or not the irregular routes were active prior to the finding by the Commission of control by the vendee. In remanding this proceeding to the Commission for further reference, it would not be my intention to influence the Commission’s ultimate decision in this case. It should not necessarily affect the merits of the Commission’s holding, unless after the evidence had been received, it was of the opinion that the facts warranted any change in its findings.
I would set aside the order of the Commission and direct it to take further proceedings consistent with this opinion.

. It clearly seems that this is not a situation where counsel awaited a favorable decision on the strength of its initial offer of evidence as in United States v. Northern Pacific Ry., 288 U.S. 490, 53 S.Ct. 406, 77 L.Ed. 914 (1933). Although the issue of dormancy was raised by the protestant carriers at the hearing, counsel relied, in good faith, on its first offer because of the past precedents of the Commission.

. Nowhere in the record does it appear that the Commission intended to adopt a punitive policy.

. E.g., Lombard Bros., Inc. — Purchase (Portion) — McDevitt Transportation Co. (Nov. 4,1963) No. MC-E-8520.

. What should be expected from a Lilliputian of the industry, which agrees to sell its operating rights for $10,000 and part of its real property for $10,000?