United States v. Rock Island Motor Transit Co.
340 U.S. 419 (1951)

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U.S. Supreme Court

United States v. Rock Island Motor Transit Co., 340 U.S. 419 (1951)

United States v. Rock Island Motor Transit Co.

No. 25

Argued November 7, 1950

Decided February 26, 1951

340 U.S. 419

Syllabus

1. The Interstate Commerce Commission authorized a railroad's motor carrier affiliate to acquire two other motor carriers. The first acquisition was approved by the Commission under § 213 (now § 5) of the Interstate Commerce Act, and a certificate of convenience and necessity was issued under § 207. The certificate contained the condition that the Commission might impose such further restrictions as may be necessary to insure that the service should be auxiliary or supplementary to the train service of the railroad. The second acquisition was approved under § 5 of the Act by a report and order which did not contain this condition, but no certificate of convenience and necessity had been issued under § 207.

Held: the Commission had power, in a subsequent proceeding not under § 212, to modify the certificate covering operations under the first acquisition, and to impose like conditions on the certificate to be granted in respect of the second acquisition, so as to confine the motor carrier operations to service auxiliary to, and supplemental of, rail service. Pp. 340 U. S. 422-436, 340 U. S. 444-448.

(a) The Commission has power at the time of its approval of an application to limit the authority to be granted by certificates of convenience and necessity for the operation of motor carriers, whether the certificate is issued on an original application under § 207 or after acquisition under § 5 of the Interstate Commerce Act. P. 340 U. S. 430.

(b) At the time of issuance of a certificate, if the Commission reasonably deems the restriction useful in protecting competition, or for other statutory purposes, the Commission may require a railroad-affiliated motor carrier to perform only those services that are auxiliary and supplemental to the rail service. Pp. 340 U. S. 430-431.

(c) The restriction of a railroad motor-carrier affiliate to operations which are auxiliary and supplemental to rail service is a logical method to insure the maximum development of the two transportation agencies -- rail and motor -- as coordinate transportation

Page 340 U. S. 420

services in accordance with the Declaration of Policy in the Motor Carrier Act of 1935 and with the National Transportation Policy. P. 340 U. S. 431.

(d) Specific statutory authority for such restriction is found in the requirements of the proviso in § 213(a) of the Motor Carrier Act of 1935 and § 5 of the Interstate Commerce Act as amended in 1940. Pp. 340 U. S. 431, 340 U. S. 436.

(e) Since competition, public interest in the preservation of the inherent advantages of rails and motors, and use of motor service by railroads in their operations, are the basis for allowing acquisitions of motor routes by railroads under the National Transportation Policy, it is consonant with that policy to reserve the right to make further limitations, restrictions or modifications to insure that the service remain auxiliary or supplemental. Pp. 340 U. S. 434-435.

(f) Such reservation of power in the Commission to modify the certificate does not offend against the provision of § 212 that a certificate "shall remain in effect until suspended or terminated" under that section. P. 340 U. S. 435.

(g) The specific requirement of the National Transportation Policy that the inherent advantages of all modes of transportation be retained, or of § 5 that acquisition of motor routes by railroads shall require special findings and may be subject to special conditions, is not overridden by the general provisions of §§ 208, 216 (c)

and 217(a). Pp. 340 U. S. 435-436.

2. The Commission ordered that the certificate covering the first acquisition be modified so that future operations thereunder would be subject in substance to the following conditions: (1) the service of the motor carrier shall be limited to service which is auxiliary to, or supplemental of, train service of the railroad; (2) the motor carrier shall not render any service to or from any point not on a rail line of the railroad; (3) no shipments shall be transported by the motor carrier between any of the designated "key points," or through, or to, or from, more than one of said points; (4) all contracts between the motor carrier and the railroad shall be subject to revision by the Commission; (5) the Commission may impose such further conditions as it may find to be necessary to insure that the service shall be auxiliary or supplemental to rail service.

Held. the new conditions are within the limits covered by the reservation of power in the certificate to impose such further limitations as might be found necessary "to insure that the service shall be auxiliary or supplementary to the train service" of the railroad. Pp. 340 U. S. 436-444.

Page 340 U. S. 421

(a) Such added conditions are not changes in or revocations of a certificate in whole or in part, but a carrying out of the reservation in the certificate. United States v. Seatrainlines,329 U. S. 424, distinguished. Pp. 340 U. S. 442-443.

(b) The meaning of auxiliary and supplemental is not limited by the Commission's practice at any particular time, but embraces such requirements as may fairly be said to fall within the meaning which the Commission has given to the terms. P. 340 U. S. 443.

3. The Commission had the power also to place in the certificate to be issued in connection with the second acquisition the modified conditions of the certificate covering the first acquisition, since the order approving the second acquisition was not a final order. Pp. 340 U. S. 444-448.

(a) The certificate is the final act or order that validates the operation, and, until its form and contents are fixed by delivery to the applicant, the power to frame it in accordance with statutory directions persists. P. 340 U. S. 448.

4. In view of the National Transportation Policy and § 5 of the Interstate Commerce Act, approval of the acquisition of a motor carrier by a railroad may be conditioned by the Commission on the purchaser's willingness to accept a narrower certificate than that possessed by the seller. Pp. 340 U. S. 448-449.

5. By the Commission's modification of the certificate of the railroad's motor carrier affiliate, to insure that its operations would be auxiliary and supplemental to rail service, the motor carrier was not deprived of property without due process of law. P. 340 U. S. 449.

90 F.Supp. 516, reversed.

A three-judge District Court set aside and permanently enjoined enforcement of an order of the Interstate Commerce Commission. 90 F.Supp. 516. On appeal to this Court, reversed, p. 340 U. S. 449.

Page 340 U. S. 422

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