1. Under the "grandfather clause" of the Motor Carrier Act of
1935, the Interstate Commerce Commission's authorization of
operation as a common carrier by motor vehicle within a specified
"territory" may permit service to all points in part of the area
and to designated points in other parts. P.
315 U. S.
480.
2. The precise delineation of the area or the specification of
localities which may be served is for the Commission, and only
where error is patent may its determination be set aside. P.
315 U. S.
480.
Page 315 U. S. 476
3. A holding out to serve a specified area does not, in itself,
constitute "
bona fide operation" within the meaning of the
Act; actual and substantial service is required. P.
315 U. S.
480.
4. In the authorization of operation as a common carrier under
the "grandfather clause," there is no statutory warrant for
applying to irregular route carriers a different or stricter test
as to commodities which may be carried than is applied to regular
route carriers. P.
315 U. S.
484.
5. In authorizing operation as a common carrier under the
"grandfather clause" by an irregular route carrier in this case,
the Interstate Commerce Commission determined that only certain
commodities could be carried and that some could be transported
only between designated points in the territory.
Held that
the basic or essential findings required to support the
Commission's order were lacking. P.
315 U. S.
488.
(a) If an applicant for common carrier rights under the
"grandfather clause" has, during the critical period, carried a
wide variety of general commodities, he cannot necessarily be
denied the right to carry others of the same class merely because
he has never carried them before; nor can he necessarily be
restricted to those commodities which he carried with more
frequency and in greater quantities than he did others. P.
315 U. S.
483.
(b) Nor does the fact that some of the articles were carried
before June 1, 1935, but not since, necessarily mean that they
should be excluded from the permit. P.
315 U. S.
484.
(c) The questions are whether the applicant's service within the
territory was sufficiently regular, and whether his coverage of
commodities was sufficiently representative to support a finding
that he was in "
bona fide operation" as a "common carrier"
of the group of commodities or of the class or classes of property
during the critical period. P.
315 U. S.
484.
(d) If the applicant establishes that he was a "common carrier"
of a group of commodities or of an entire class or classes of
property and was in "
bona fide operation" during the
critical period in a specified territory, restrictions as to
commodities within such classes which may be moved in any one
direction or between designated points are not justified. P.
48.
(e) Once the applicant has established his common carrier status
as respects particular commodities, shipments to any parts of the
authorized territory, or to any of the authorized points therein,
should be permitted in the absence of evidence that the
applicant,
Page 315 U. S. 477
as respects carriage between specified points, had restricted
its undertaking. P.
315 U. S.
487.
38 F. Supp. 549 affirmed.
Appeal from a decree setting aside an order of the Interstate
Commerce Commission.
MR. JUSTICE DOUGLAS delivered the opinion of the Court.
This is an appeal under § 210 (28 U.S.C. § 47a) and § 238 of the
Judicial Code as amended (28 U.S.C. § 345) to review a final decree
of a district court of three judges (28 U.S.C. § 47) which set
aside (38 F.Supp. 549) an order of the Interstate Commerce
Commission (24 M.C.C. 305) granting appellee a certificate of
public convenience and necessity as a common carrier by motor
vehicle under the so-called "grandfather clause" (§ 206(a)) of the
Motor Carrier Act of 1935 (49 Stat. 543, 551, 49 U.S.C. § 306), now
designated as Part II of the Interstate Commerce Act. 54 Stat.
919.
Appellee's predecessor applied for such a certificate
authorizing operation as a "common carrier" by motor
Page 315 U. S. 478
vehicle of "general commodities" [
Footnote 1] between all points
"in South Carolina, North Carolina, Delaware, New Jersey,
Connecticut, Rhode Island, Massachusetts, those in Virginia east of
and including the Shenandoah Valley, those in Maryland and
Pennsylvania on and east of U.S. Highway 11, and those in New York
east of Binghamton and south of Albany, and between Cherryville
(N.C.) and Boston, Mass. through Henderson, N.C. Richmond, Va.
Baltimore, Md., Philadelphia, Pa., and New York, over irregular
routes."
The Commission authorized the issuance of a certificate, but
restricted its scope in three ways: (1) It cut down the
geographical area which could be served by appellee and in parts of
that area limited the service to designated points. (2) It allowed
appellee to haul only certain specified commodities out of a larger
list previously hauled. (3) It did not permit appellee to haul all
of those specified commodities between all of the points in the
authorized territory, but allowed it to haul only certain
commodities between given points. Its finding containing those
restrictions (24 M.C.C. p. 309-310) reads as follows:
"We find that applicant's predecessor in interest was on June 1,
1935, and continuously since it and its predecessor have been in
bona fide operation as a common carrier by motor vehicle
in interstate or foreign commerce (1) of cotton yarn from all
points in Gaston, Lincoln, Cleveland, Rutherford, McDowell, Burke,
Catawba, Alexander, Iredell, Rowan, Davidson, and Davie Counties,
N.C., to Hagerstown, Md., New York, N.Y., Pawtucket and Providence,
R.I., all points in Pennsylvania on and east of U.S. Highway 11,
and points in Middlesex, Union, Essex, Hudson,
Page 315 U. S. 479
Passaic, Bergen, Somerset, and Morris Counties, N.J., (2) of
asbestos textile products from Charlotte, N.C., to Philadelphia and
North Wales, Pa., Trenton, Newark, Passaic, and Paterson, N.J., New
York, N.Y., Middletown, Conn., Providence and Pawtucket, R.I., and
Boston and Hudson, Mass., (3) of supplies and materials used in the
manufacture of asbestos textile products from Harrison and Perth
Amboy, N.J., to Charlotte, N.C., and empty spools and boxes in the
reverse direction, (4) of petroleum products in containers from
Sewaren, N.J., and Marcus Hook, Pa., to Columbia and Greenville,
S.C., and to all points in North Carolina, (5) of linoleum from
Paulsboro, N.J., Marcus Hook, Pa., and East Walpole, Mass., to
points in North Carolina and to Spartanburg and Greenville, S.C.,
(6) of canned goods from Baltimore, Md. to Shelby, N.C., (7) of
beer and ale from Newark, N.J., to Gastonia and Wadesboro, N.C.,
and (8) of roofing and screen wire from York, Pa., to all points in
North Carolina, all over irregular routes; that applicant is
entitled to a certificate authorizing continuation of such
operation, and that the application in all other respects should be
denied."
The District Court held that such restrictions were not
authorized by the statute. It said:
"It is, of course, reasonable to limit the certificate to the
type of service rendered by the carrier during the grandfather
period, and to limit the territory to that within which substantial
service of that type has been rendered; but it is unreasonable to
limit the certificate of one who has functioned as a general
carrier to the specific commodities carried and the specific points
served. The law cannot reasonably be construed as authorizing such
limitation."
It further noted that such restrictions have not been imposed on
regular route carriers, and that Congress has
Page 315 U. S. 480
made no such distinction between them and irregular route
carriers like appellee.
I. We think the Commission was justified in the restrictions
which it placed on the geographical scope of appellee's operations.
Sec. 206(a) of the Act authorizes the Commission to issue a
certificate without a showing of public convenience and necessity
if the carrier or its predecessor in interest was
"in
bona fide operation as a common carrier by motor
vehicle on June 1, 1935, over the route or routes or within the
territory for which application is made, and has so operated since
that time."
Sec. 208(a) requires that the certificate specify
"the routes over which, the fixed termini, if any, between
which, and the intermediate and off-route points, if any at which,
and in case of operations not over specified routes or between
fixed termini, the territory within which, the motor carrier is
authorized to operate."
It is clear from these provisions that the power of the
Commission to authorize future operations within a designated
"territory," rather than over specified routes or between fixed
termini, fits the peculiar requirements of irregular route
operators such as appellee. Authority to operate within a specified
"territory" may include permission to service all points in that
area. On the other hand, it may be restricted to designated points
therein. Or, as in the instant case, it may extend to all points in
a part of that area and to selected localities in another part. The
precise delineation of the area or the specification of localities
which may be serviced has been entrusted by the Congress to the
Commission.
Alton R. Co. v. United States, ante, p.
315 U. S. 15. The
Act provides the test of "
bona fide operation." That
standard carries the connotation of substantiality. It also makes
clear that a holding out to serve a specified area is not alone
sufficient. It is "actual, rather than potential or simulated,
service" which is required.
McDonald v. Thompson,
305 U. S. 263,
305 U. S. 266.
Substantial, as
Page 315 U. S. 481
distinguished from incidental, sporadic, or infrequent, service
is required. Substantial service actually rendered may have been
confined to narrow limits.
Loving v. United
States, 32 F. Supp.
464,
aff'd, 310 U.S. 609. Ability to render the
service throughout the wide reaches of the territory, which the
applicant professed to be willing to serve, may not have existed.
Furthermore, the characteristics of the transportation service
rendered are relevant to the territorial scope of the operations
which the Commission may authorize.
Alton R. Co. v. United
States, supra. In addition, the Commission, in determining the
precise territory which may be served by a particular carrier,
cannot be unmindful of its responsibility to coordinate the various
transportation agencies which constitute our national
transportation system. S.Rep. No. 482, 74th Cong., 1st Sess.;
H.Rep. No. 1645, 74th Cong., 1st Sess. This does not mean that the
right to the statutory grant may be withheld or cut down because
the Commission disapproves to the competitive conditions which may
be created if the application is granted. But its responsibility to
bring greater order and stability to the transportation system than
had earlier obtained (S.Doc. No. 152, 73d Cong., 2d Sess.) is an
additional reason for its insistence upon a showing of substantial
service in that territory which is sought to be covered by a
certificate under the "grandfather clause."
As we indicated in
Alton R. Co. v. United States,
supra, the purpose of the "grandfather clause" was to assure
those to whom Congress had extended its benefits a "substantial
parity between future operations and prior
bona fide
operations." We cannot say that that was denied in this case if the
limitations on the territorial scope of the operations are alone
considered. While service to and from all points in the States
included in the application was not allowed, the reduction was
determined by the standard of substantiality of service. And
consideration
Page 315 U. S. 482
was given to the characteristics of irregular route carriers and
their role in the national transportation system. That involved a
weighing of specific evidence in light of the complexities of this
transportation service. The judgment required is highly expert.
Only where the error is patent may we say that the Commission
transgressed. That is not this case.
II. We have doubts, however, as to the restrictions which the
Commission has placed on the articles which appellee may carry.
Sec. 203(a)(14) defined [
Footnote
2] the term "common carrier by motor vehicle" as one who
"undertakes . . . to transport passengers or property, or any
class or classes of property, for the general public in interstate
or foreign commerce by motor vehicle for compensation, whether over
regular or irregular routes."
The Commission ruled that, since a "common carrier" may
transport only a "class or classes of property," the authority
granted under the "grandfather clause" of § 206(a) "should reflect
any limitation in the undertaking" of the common carrier "as
indicated by the service actually rendered on and since the
statutory dates." It accordingly proceeded to eliminate commodities
which, though of the same general class as the others, had been
carried before, but not after, June 1, 1935. It further restricted
future operations to those commodities which, prior and subsequent
to June 1, 1935, had been carried in substantial amounts and with a
degree of regularity. We
Page 315 U. S. 483
would not disturb those conclusions if only a question as to the
weight of the evidence was involved. But we are not satisfied that
the Commission applied the proper criterion in reaching its
conclusion that only specified commodities could be carried in the
future.
Sec. 206(a) requires a showing that the applicant or its
predecessor, was "in
bona fide operation as a common
carrier" on June 1, 1935, and "since that time." By § 208(a), the
certificate must specify "the service to be rendered" by the
carrier. As we have noted, a "common carrier by motor vehicle" was
defined in § 203(a)(14) as one who "undertakes" to transport
"passengers or property, or any class or classes of property, for
the general public." That definition is the same for irregular and
regular route carriers. It is plain that a carrier's holding out
and actual performance may be limited to a few articles only. That
is to say, he may be a common carrier only of a restricted number
of commodities.
See Galveston Truck Line Corp., 22 M.C.C.
451, 467. Or the service actually rendered may have been confined
to such a few commodities that his holding out or willingness to
carry a much larger class may be disregarded.
Loving v. United
States, supra, was such a case. On the other hand, if the
applicant has carried a wide variety of general commodities, he
cannot necessarily be denied the right to carry others of the same
class merely because he never carried them before. And where he has
carried a wide variety of general commodities, he cannot
necessarily be restricted to those which he carried with more
frequency and in greater quantities than the others.
See
H.B. Church Truck Service Co., 27 M.C.C.191, 197; Highway Motor
Freight Lines, Inc., 23 M.C.C. 621, 636. The Commission may not
atomize his prior service, product by product, so as to restrict
the scope of his operations, where there is substantial evidence in
addition to his holding out that he
Page 315 U. S. 484
was in "
bona fide operation" as a "common carrier" of a
large group of commodities or of a whole class or classes of
property. There might be substantial evidence of such an
undertaking though the evidence as to any one article was not
substantial. The broad sweep of his prior service may indeed have
made the carriage of any one commodity irregular and infrequent.
Yet, viewed as a whole, rather than as a group of separate and
unrelated items, his prior activities may satisfy the test of
"
bona fide operation" as a "common carrier" within the
scope of his holding out. The fact that some of the articles may
have been carried before, but not after, June 1, 1935, may, of
course, indicate an abandonment of the prior undertaking.
See
United States v. Maher, 307 U. S. 148. But
it does not necessarily mean that they should be stricken from the
certificate, since the natural and normal course of his business
may reveal a continuous undertaking to transport any or all
commodities embraced within the group or the class. That is to say,
he may have been a common carrier of a large group of general
commodities or of an entire class of property both before and after
the critical date, though the specific commodities carried varied
considerably. The questions are whether his service within the
territory in question was sufficiently regular and whether his
coverage of commodities was sufficiently representative to support
a finding that he was in "
bona fide operation" as a
"common carrier" of the group of commodities or of the class or
classes of property during the periods in question.
The Commission in this case authorized the carriage of about a
dozen kinds of commodities, though, in prior operations, about
three times that number had been carried. It is not our function to
weigh the evidence. Hence, we intimate no opinion as to whether
more commodities should have been included had the proper criterion
been employed. But we conclude that there is no
Page 315 U. S. 485
statutory warrant for applying to irregular route carriers a
different or stricter test as to commodities which may be carried
than is applied to regular route carriers. The difference between
those types of carriers may well justify a sharp delimitation of
the far-flung territory which an irregular route carrier may
profess to serve. But, once the territory has been defined, the
statutory test of whether an applicant was a "common carrier" by
motor vehicle in "
bona fide operation" during the critical
periods is the same for the irregular and the regular route
carrier. We are not confident that the Commission has approached
the problem in that way. For it has repeatedly stated, beginning
with Powell Brothers Truck Lines, Inc., 9 M.C.C. 785, 791, 792,
that:
"Authority to transport general commodities throughout a wide
territory over irregular and unspecified routes pursuant to the
'grandfather' clause of the act should be granted to a carrier only
when such carrier's right thereto has been proved by substantial
evidence. To do otherwise would create the very ills which
regulation is designed to alleviate -- namely, congestion of
highways, destructive rate practices, and unbridled competition.
Common carriers which are expected to maintain regular service for
the movement of freight in whatever quantities offered to and from
all points on specified routes cannot operate economically and
efficiently if other carriers are permitted to invade such routes
for the sole purpose of handling the cream of the traffic available
thereon in so-called irregular route service."
And see Merchants Parcel Delivery Co., Inc., 21 M.C.C.
93; Langer Transport Corp., 23 M.C.C. 302; Lett & Co. of
Indiana, Inc., 26 M.C.C. 159.
Insofar as that view establishes a different test for
commodities which may be carried by irregular route operators than
for commodities which may be carried by
Page 315 U. S. 486
regular route operators, it is erroneous as a matter of law. For
facts sufficient to establish that a person is a "common carrier"
by motor vehicle in "
bona fide operation" in the one case
are sufficient in the other. The statutory differences lie only in
the territorial scope and pattern of the operation.
III. It follows from what has been said that a restriction on
commodities which may be carried between specified points may not
always be justified. If the applicant had established that it was a
"common carrier" for a group of commodities or for an entire class
or classes of property and was in "
bona fide operation"
during the critical periods in a specified territory, restrictions
on commodities which could be moved in any one direction or between
designated points would not be justified. The fact that a
particular commodity had never been transported between certain
points in that territory would not mean that authority to haul it
between them should be withheld. Likewise, if the applicant could
establish that it was a "common carrier" only of a limited number
of commodities, there would normally be no statutory sanction for
limiting the carriage of particular commodities in that group to
specified points in the authorized area. Presumptively, one who had
established his status of "common carrier" would be entitled to
carry all of the commodities embraced in his undertaking to all
points to which any shipments of any articles were authorized. On
the other hand, an applicant's status may vary from one part of the
territory to another, or be different in northbound shipments than
in southbound shipments. Thus, in this case, the Commission found
that practically all of appellee's northbound shipments consisted
of cotton yarn, though a few shipments of other commodities such as
tires and tubes, asbestos textile products, spools, and empty boxes
were also made northbound. With the exception of tires and
tubes,
Page 315 U. S. 487
the Commission authorized the shipments of those products on
northbound trips. Assuming that finding to be justified under the
tests which we have described, it does not necessarily follow that
the northbound destinations of those particular commodities should
be restricted to the localities designated by the Commission. Once
the common carrier status of appellee had been established as
respects those commodities, shipments to any parts of the
authorized territory, or to any of the authorized points therein,
should have been permitted in absence of evidence that the appellee
as respects carriage between specified points had restricted its
undertaking to particular commodities. That problem is clearer in
this case as respects south-bound shipments. The record is plain
that appellee held itself out as being willing and able to carry a
wide variety of commodities on its return trips to its home base in
North Carolina. And the record shows that it carried many different
kinds of articles on those south-bound journeys. But the Commission
drastically limited its rights in that regard. Thus, it was
permitted to carry beer from Newark, N.J., to two points in North
Carolina, but not from Baltimore, Md. In absence of evidence that
it had thus limited its undertaking as respects beer, the mere fact
that it previously had not carried beer from Baltimore would be
immaterial. If it had established by substantial evidence that it
was a "common carrier" of beer on southbound trips, it would be
entitled to carry it from any of the northern points to any of the
southern destinations. For there was no evidence in this case that
it had restricted its undertaking as respects beer to shipments
from Newark, unless the fact that it had carried beer only from
that point is to be conclusive. But to say that that was conclusive
or controlling would be to disregard the natural and normal course
of business shown by this record. So far as south-bound shipments
are concerned,
Page 315 U. S. 488
it is plain that a wide variety of articles was transported
consistently with appellee's holding out that it would carry any of
the articles from any of the points. Appellee's "
bona fide
operation" may possibly be limited only to those articles actually
carried. But where it was actively soliciting whatever it could get
at any of the points, it does violence to its common carrier status
to make the origin or destination of future shipments conform to
the precise pattern of the old. Such a pulverization of the prior
course of conduct changes its basic characteristics. There is no
statutory sanction for such a procedure.
IV. To appellee, such matters involve life or death. Empty or
partially loaded trucks on return trips may well drive the
enterprise to the wall. A restriction in this case of the
commodities which may be carried from any one point on south-bound
trips is a patent denial to appellee of that "substantial parity
between future operations and prior
bona fide operations"
which the Act contemplates.
Alton R. Co. v. United States,
supra. Its prior opportunity should not be restricted beyond
the clear requirements of the statute. For this Act should be
liberally construed to preserve the position which those like
appellee have struggled to obtain in our national transportation
system. To freeze them into the precise pattern of their prior
activities as was done here not only may alter materially the basic
characteristics of their service; it also may well be tantamount to
a denial of their statutory rights.
The precise grounds for the Commission's determination that only
certain commodities could be carried and that only a few could be
transported between designated points are not clear. It is
impossible to say that the standards which we have set forth were
applied to the facts in this record. Hence, as in
Florida v.
United States, 282 U. S. 194,
282 U. S. 215,
the defect is not merely one of the absence of a "suitably complete
statement" of the reasons for the decision;
Page 315 U. S. 489
it is the "lack of the basic or essential findings required to
support the Commission's order."
And see United States v.
Baltimore & Ohio R. Co., 293 U. S. 454,
293 U. S. 464;
United States v. Chicago, M., St. P. & P. R. Co.,
294 U. S. 499,
294 U. S.
510-511. Congress has made a grant of rights to carriers
such as appellee. Congress has prescribed statutory standards
pursuant to which those rights are to be determined. Neither the
Court nor the Commission is warranted in departing from those
standards because of any doubts which may exist as to the wisdom of
following the course which Congress has chosen. Congress has also
provided for judicial review as an additional assurance that its
policies be executed. That review certainly entails an inquiry as
to whether the Commission has employed those statutory standards.
If that inquiry is halted at the threshold by reason of the fact
that it is impossible to say whether or not those standards have
been applied, then that review has indeed become a perfunctory
process. If, as seems likely here, an erroneous statutory
construction lies hidden in vague findings, then statutory rights
will be whittled away. An insistence upon the findings which
Congress has made basic and essential to the Commission's action is
no intrusion into the administrative domain. It is no more and no
less than an insistence upon the observance of those standards
which Congress has made "prerequisite to the operation of its
statutory command."
Opp Cotton Mills, Inc. v.
Administrator, 312 U. S. 126,
312 U. S. 144.
Hence, that requirement is not a mere formal one. Only when the
statutory standards have been applied can the question be reached
as to whether the findings are supported by evidence. That is why
we cannot say that the Commission would be justified in placing the
same restrictions on the certificate in this case had a correct
construction of the Act been taken.
We express no opinion on the scope of the certificate which
should be granted in this case. That entails not
Page 315 U. S. 490
only a weighing of evidence, but the exercise of an expert
judgment on the intricacies of the transportation problems which
are involved. That function is reserved exclusively for the
Commission.
United States v. Maher, supra; Alton R. Co. v.
United States, supra. Our task ends if the statutory standards
have been properly applied.
Affirmed.
[
Footnote 1]
With the exception of
"commodities of unusual value, those in bulk, those requiring
special equipment such as tank or refrigerator trucks, those
injurious to other lading, livestock, automobiles and high
explosives."
[
Footnote 2]
In 1940, Congress amended § 203(a)(14) to read:
"The term 'common carrier by motor vehicle' means any person
which holds itself out to the general public to engage in the
transportation by motor vehicle in interstate or foreign commerce
of passengers or property or any class or classes thereof for
compensation, whether over regular or irregular routes. . . ."
Act of Sept. 18, 1940, c. 722, § 18(a), 54 Stat. 920. The
earlier definition of "common carrier" was in force at the time of
the hearing of this case before the Commission.
MR. JUSTICE JACKSON, dissenting.
MR. JUSTICE FRANKFURTER and I are unable to agree with this
disposition of the case.
It overturns the exercise of a discretion which Congress has
delegated to the Interstate Commerce Commission upon grounds which
seem to us so unsubstantial as really to be a reversal on
suspicion. The function of determining "grandfather" rights
delegated in this case is not unlike the function dealt with in
Gray v. Powell, 314 U. S. 402, in
which we said that Congress could have legislated specifically as
to individual exemptions, but
"found it more efficient to delegate that function to those
whose experience in a particular field gave promise of a better
informed, more equitable adjustment of the conflicting
interests."
We held that this delegation will be respected and that, unless
we can say that a set of circumstances deemed by the Commission to
bring a particular applicant within the concept of the statute
"is so unrelated to the tasks entrusted by Congress to the
Commission as in effect to deny a sensible exercise of judgment, it
is the Court's duty to leave the Commission's judgment
undisturbed."
While the Court pays lip service to this principle, the
Commission's decision is upset because, as the opinion states,
"[w]e have doubts;" "[w]e are not confident;" and "[w]e are not
satisfied." The opinion proceeds as it might do with a burden upon
the Commission, although we supposed the burden to be upon those
who
Page 315 U. S. 491
complain of an administrative decision to satisfy the Court that
the decision is wrong -- particularly one dealing with an exemption
from a general duty.
We do not agree that a remand to the Commission to make specific
findings of the kind required in
Florida v. United States,
282 U. S. 194,
282 U. S. 215,
is appropriate. In the
Florida case, the Commission
undertook to revise intrastate railroad rates under control of the
state and over which, as Chief Justice Hughes said, "the Commission
has no general authority." 282 U.S. at
282 U. S. 212.
It was required to support its jurisdiction to revise rates not
within its general control by specific findings as to whether those
rates in any way constituted a burden on interstate commerce. The
Court had earlier established the rule that an order of the
Commission should not be given precedence over a state rate statute
otherwise valid "unless, and except so far as, it conforms to a
high standard of certainty."
Illinois Central R. Co. v. Public
Utilities Commission, 245 U. S. 493,
245 U. S. 510.
And, in this connection, the Court pointed out that even an act of
Congress is not to be construed to supersede or suspend the
exercise of the reserved powers of the state, even where the
Constitution permits, "except so far as, its purpose to do so is
clearly manifested." It is one thing to require the Interstate
Commerce Commission to be explicit in finding jurisdictional facts
before it invades conceded state power. It is a wholly different
thing to read with a hostile eye the Commission's findings that a
claim for exemption from conceded federal regulatory authority has
not been sustained.
Furthermore, if, after this case is returned to the Commission,
the Commission should leave no room for doubt that, in making the
challenged order, it acted upon correct notions of law, it may yet
be upset because the Court says its findings are not sustained by
the evidence, it
Page 315 U. S. 492
had better be said now. We have here a small record and simple
facts which are all before us, giving adequate basis for concluding
whether these facts as found by the Commission warranted the order.
On this record, it is plain what the Commission has done. The only
question is -- can it do what it has done? To send the case back to
the Commission to be reconsidered or to say that it has already
been considered in the light of the legal views which the Court
expresses, and then, perhaps, to say that, in any event, the order
is not warranted on the record before us, is really to invite the
Commission to express abstract views on law. What this amounts to
is that the Court refuses to tell the Commission what it thinks
about the evidence until the Commission tells what it thinks about
the law. We cannot regard this as the most helpful use of the power
of judicial review.
Congress, by the Motor Carrier Act of 1935, cast upon the
Commission the task of regulating the motor carrier industry. By
the enactment, Congress asserted that the public interest in the
motor carrier enterprise had become paramount to private interests.
The highly individualistic nature of the business and the easy
terms upon which equipment could be obtained had promoted a quick
growth, accompanied by intense and uneconomic competition, both
within itself and with other transportation systems. It was not
expected that a sprawling, chaotic, and cutthroat industry that had
developed entirely in the private interest would be reduced to an
orderly and regularized system of transportation in the public
interest without stepping on a good many individual toes.
*
Page 315 U. S. 493
In trying to limit the injury caused by transition from a purely
private enterprise to a regulated public service industry, the
general plan was to preserve to private owners the transportation
values evidenced by actual conditions of operation on June 1, 1935,
and to exempt them from meeting the requirements of "public
convenience and necessity" as to such operation. Those who obtained
such "grandfather" rights are not, however, limited to them. They
may expand their territory or extend their service by proving that
public convenience and necessity will be served thereby. Thus, the
scramble for "grandfather" rights represents the effort to preempt
territory and service privileges without submitting to the test of
the public interest. Public regulation would be defeated at its
very outset if the Commission permitted the bulk of the industry to
escape the public interest test by inflated claims under the
"grandfather" clause. The nature of the general task of reducing
the claims of "grandfather" rights to defined and reasonable limits
consistent with the plan of public regulation is disclosed by the
record in this case.
The motor carrier here asked as a matter of right that the
Commission certify its "grandfather" privileges to include the
carriage of general commodities in a territory comprising
substantially the Atlantic seaboard from South Carolina to
Massachusetts. That there was some disparity between its hopes and
its experience was indicated by the fact that, on June 1, 1935, it
was operating eight trucks, and, by 1936, the number of usable
vehicles had fallen to four. After a change of ownership, the
number was increased, and at the time of hearing, the applicant was
operating seventeen carrying units.
This carrier did not operate at stated times or over regular
routes, but was an irregular route carrier. The backbone of its
business consisted of carriage of cotton
Page 315 U. S. 494
yarn from points of origin in the South to points of
distribution in the North. Incidental to this carriage, it was
ready to accept cargo of almost any kind to complete its loads and
particularly to provide earnings on return trips. If satisfactory
terms could be arrived at, it was willing to carry almost anything
almost any place. On the basis of such general holdings out, this
carrier sought certificates that would entitle it as a matter of
right to carry nearly everything within the territory
described.
The Commission cut down the claims of the applicant by the use
of the standard which the Act prescribes: namely,
bona
fide operation as a common carrier by motor vehicle. The
Commission reduced the territorial claim to that which the carrier
actually served with some regularity, and lopped off territory
which had been served only occasionally or by isolated trips. It
limited the commodities to be carried to those carried in
substantial volume during the period before and after June 1, 1935.
We find no basis upon which we can say as matter of law that these
general methods of reducing nebulous and extravagant claims to a
compass which the Commission could properly certify as representing
bona fide operation are improper or other than those
contemplated by the statute.
The Court is "not confident" that the Commission applied to this
irregular route carrier the same test as to commodities that is
applied to regular route carriers. We cannot be so confidently
unconfident. The Commission seems to have made only the distinction
between irregular and the regular route carriers that results from
the differences inherent in the two types of enterprise. The
Commission has tested both by the regularity and substantiality of
their actual operations. It is a test with which they may have
unequal ability to comply, but to reach different results on such
different facts does not imply
Page 315 U. S. 495
either the use of different legal standards or discriminatory
administration.
The administrators of the Motor Carrier Act must be aware, as
the framers of it were, that
"the grandfather clause as of June 1, 1935, has been fixed in
fairness to
bona fide motor carriers now operating on the
highway and limited so as to prevent speculation which is highly
important."
Report of the Committee on Interstate and Foreign Commerce,
H.R.Rep. No. 1645, 74th Cong., 1st Sess., p. 4. When a carrier
claims grandfather rights to serve the entire Atlantic seaboard as
a general common carrier with equipment consisting, on the critical
date, of eight trucks, the Commission is obviously forewarned that
it must guard against granting franchise privileges that will
result in their having a speculative value to the carrier, rather
than a service value to the public. The Commission was quite right
to take the measure of the territory and service of such a
claimant, and to give him a certificate covering his actual
substantial operations. We should not substitute our own wisdom or
unwisdom for that of administrative officers who have kept within
the bounds of their administrative powers.
A.T. & T. Co. v.
United States, 299 U. S. 232,
299 U. S.
236.
*
See Report of Joseph B. Eastman, Federal Coordinator
of Transportation, on the Regulation of Transportation Agencies
other than Railroads. Sen.Doc. No. 152, 73rd Cong., 2nd Sess., p.
13
et seq.
See also Report of the Committee on Interstate Commerce
on the Motor Carrier Act, 1935, Sen.Rep. No. 482, 74th Cong., 1st
Sess.