ICC v. J-T Transport Co., Inc. - 368 U.S. 81 (1961)
U.S. Supreme Court
ICC v. J-T Transport Co., Inc., 368 U.S. 81 (1961)
Interstate Commerce Commission v. J-T Transport Co., Inc.
Argued October 17-18, 1961
Decided December 4, 1961
368 U.S. 81
Under § 209(b) of the Interstate Commerce Act, as amended in 1957, the Commission denied applications for operating permits filed by contract motor carriers, supported by shippers and opposed by common carriers. In one case, the shipper claimed that a contract carrier's operations could be better integrated with its production of parts for airplanes. In the other case, the shippers claimed that the services of common carriers were unsatisfactory, and that their rates were prohibitive on less than truckload shipments of canned goods. Three-judge district courts held that the Commission had incorrectly applied the Act, as amended, set aside the Commission's orders, and remanded the cases for further consideration.
Held: the judgments are affirmed. Pp. 368 U. S. 83-93.
(a) Under § 209(b), as amended, the adequacy of existing services is a criterion to be considered by the Commission in passing upon such an application, but it is not determinative. Under § 203(a)(15), as amended, the "distinct need" of shippers for the new contract service must be weighed against the adequacy of existing services. P. 368 U. S. 88.
(b) By indulging in a presumption that the services which existing common carriers render the public would be adversely affected by a loss of "potential" traffic, even if they had not handled it before, and by assigning to the applicants the burden of proving the inadequacy of existing services, the Commission favored the protestants' interests at the expense of the shippers' in a manner not intended by Congress. Pp. 88-90.
(c) The proper procedure is for the applicant first to demonstrate that the undertaking it proposes is specialized and tailored to a shipper's "distinct need." The protestants then may present evidence to show that they have the ability and the willingness to meet that specialized need. If that is done, the burden then shifts to the applicant to demonstrate that it is better equipped to meet the distinct needs of the shipper than the protestants. P. 368 U. S. 90.
(d) Under the Act, as amended in 1957, the standard is not whether existing services are "reasonably adequate." It is whether a shipper has a "distinct need" for a different or a more select or a more specialized service which the protesting carriers cannot fill. Pp. 368 U. S. 90-91.
(e) The Commission erred in ruling that the desire for lower rates offered by the applicant was not relevant to the shippers' needs, since the matter of rates is one factor to be weighed in determining whether the shipper has established a "need" for more "economical" service, within the meaning of the National Transportation Policy. Pp. 368 U. S. 91-92.
(f) Under the statute, as amended, a shipper is entitled to have his "distinct needs" met. The adequacy of existing services for normal needs and the willingness and ability of an existing carrier to render the service are not conclusive, since the "distinct need" of the shipper may not be served by the existing services, if the new service is better tailored to fit the special requirements of the shipper's business, the length of its purse, or the select nature of the delivery service that is desired. Pp. 368 U. S. 92-93.
185 F.Supp. 838; 188 F.Supp. 160, affirmed.