United States v. J. B. Montgomery, Inc.
Opinion of the Court
delivered the opinion of the Court.
This appeal tests the validity of an order of the Interstate Commerce Commission issued under § 212 (c) of the Interstate Commerce Act as amended in 1957, 71 Stat. 411, 49 U. S. C. § 312 (c),
I.
Prior to 1957 appellee operated under a contract carrier permit originally issued in 1943 under the “grandfather” clause contained in § 209 (a) of the Motor Carrier Act, 1935, 49 Stat. 543, 552.
In 1957, at the behest of the Commission, the Congress amended the statutory definition of a contract carrier, § 203 (a)(15) of the Interstate Commerce Act, so as to thereafter read:
“The term ‘contract carrier by motor vehicle’ means any person which engages in transportation*392 by motor vehicle of passengers or property in interstate or foreign commerce, for compensation (other than transportation referred to in paragraph (14) and the exception therein), under continuing contracts with one person or a limited number of persons either (a) for the furnishing of transportation services through the assignment of motor vehicles for a continuing period of time to the exclusive use of each person served or (b) for the furnishing of transportation services designed to meet the distinct need of each individual customer.”4
In order to protect existing contract carrier permits, Congress enacted § 212 (c) which, as we have indicated, provided for the revocation of such a permit in appropriate proceedings before the Commission and the issuance of a common carrier certificate. In so doing, however, the Congress provided that the resulting common carrier certificate “shall authorize the transportation, as a common carrier, of the same commodities between the same points or within the same territory as authorized in the permit.”
In 1958 these proceedings were begun under this section and, after extended hearings, the Examiner found that the permit should be revoked and the common carrier certificate issued covering the same commodities and without restrictions. In addition he recommended the inclusion of authority for carriage of “materials, equipment, and supplies used by manufacturers of rubber and rubber products, from Chicago, and points in Illinois
“Restriction: The. authority granted immediately above is restricted to shipments moving from, to, or between wholesale and retail outlets, . . .”
The validity of this restriction is the sole challenge raised in this proceeding.
II.
The Commission contends that § 212 (c), read in the light of its background, is a “grandfather clause.” Its purpose, therefore, is merely to continue, without expanding, the authority of those contract carriers whose operations are lawful under United States v. Contract Steel Carriers, Inc., 350 U. S. 409 (1956), by revoking their contract carrier permits and issuing in lieu thereof common carrier certificates. The Commission concludes that, while the Congress specified only a continuance of the commodity and territorial limitations, Congress also intended that the effects of the “Keystone restriction” in the old permit be carried forward in the new one. Even if this is incorrect, the Commission says that it remains free to impose the restriction by reason of its general power under the Interstate Commerce Act to confine carrier operations within appropriate limits.
The difficulty with this argument is that the “Keystone restriction” under which appellee operated permitted it to carry commodities “dealt in, or used by” certain businesses without limitation, except that appellee was re
The legislative history indicates that the Commission in its presentation to the Congress on § 212 (c) represented through its Chairman that the legislation would disturb no property rights of the contract carrier. Indeed, it asserted that such carriers would have “greater opportunity.”
We do not believe that appellee waived its rights by not proving that it had exercised the claimed privileges under its contract carrier permit. The permit has no restriction on its face in this regard, and such proof was understandably not presented in light of the recommendation of the Examiner that a common carrier permit include no restrictions whatever. At this late date it would be unfair to strip appellee of its claimed rights upon this basis.
Nor do we believe that the Commission can impose the restrictions on a rule of “substantial parity” under its general powers. Since § 212 (c) specifically commands that the Commission “shall” authorize the same carriage as was included in the contract carrier permit, we are unable to place § 212 (c) authority under the general power of other unrelated sections, such as § 208, where specific power is granted to assure “substantial parity.” The appellee carried on certain operations under its contract carrier permit. Congress intended that these operations be continued under the common carrier permit.
Affirmed.
“The Commission shall examine each outstanding permit and may within one hundred and eighty days after ... [August 22,1957] institute a proceeding either upon its own initiative, or upon application of
This provision is now substantially contained in 49 U. S. C. § 309 (a)(1) :
“Except as otherwise provided in this section and in section 310a of this title, no person shall engage in the business of a contract carrier*391 by motor vehicle in interstate or foreign commerce on any public highway or within any reservation under the exclusive jurisdiction of the United States unless there is in force with respect to such carrier a permit issued by the Commission, authorizing such person to engage in such business: Provided, That, subject to section 310 of this title, if any such carrier or a predecessor in interest was in bona fide operation as a contract carrier by motor vehicle on July 1, 1935, over the route or routes or within the territory for which application is made and has so operated since that time . . . the Commission shall issue such permit, without further proceedings, if application for such permit was made to the Commission as provided in paragraph (b) of this section and within one hundred and twenty days after October 1, 1935
The phrase “Keystone restriction” comes from the title of the proceeding, Keystone Transportation Co. Contract Carrier Application, 19 M. C. C. 475. Such restrictions were approved by this Court in Noble v. United States, 319 U. S. 88 (1943).
71 Stat. 411, 49 U. S. C. § 303 (a) (15). The former § 203 (a) (15) stated the definition as follows: “The term ‘contract carrier by motor vehicle1 means any person which, under individual contracts or agreements, engages in the transportation (other than transportation referred to in paragraph (14) and the exception therein) by motor vehicle of passengers or property in interstate or foreign commerce for compensation.” 54 Stat. 920.
During the hearings before the Subcommittee of the Senate Interstate and Foreign Commerce Committee the following colloquy ■occurred between Mr. Barton, transportation counsel of the committee, and Mr. Clarke, then chairman of the Interstate Commerce Commission:
“Mr. Barton: . . .
“Mr. Clarke, do you think there is any constitutional difficulty in changing, as we say, as you propose, a contract carrier to a common-carrier status?
“Mr. Clarke: No; I can see none. It isn’t taking away from them anything that they have; it isn’t disturbing any property rights of the contract carrier. It is giving him greater opportunity. He can still serve his contract shippers, but through the conversion provisions of the bill he would also have the opportunity to serve the general public as well as the obligation.” (Emphasis added.) Hearings before the United States Senate Subcommittee on Surface Transpor*395 tation of the Committee on Interstate and Foreign Commerce, 85th Cong., 1st Sess., Surface Transportation — Scope of Authority of I. C. C., p. 35.
Id., at 182.
Concurring Opinion
concurring.
I agree with what I understand to be the basic premise of the Court’s holding — that the Commission may, under § 212 (c), carry over “Keystone” restrictions in converting a contract carrier’s permit into a common carrier certificate, but may not impose any new limitations on the scope of the carrier’s operations.
Appellee contends that the language of § 212 (c), comments by members of Congress, and the traditional notion that a common carrier serves the “public” suggest a congressional intent to preclude the continuance of Keystone restrictions in the certificates of converted carriers. Although this argument is not without force, it leads to the conclusion that the Commission is powerless to prevent even the widest expansion of the previous activities of a converted carrier, resulting from the replacement of its contract carrier permit by a common carrier certificate. Absent what I regard as compelling evidence that Congress intended so to cripple the supervisory power of the Commission, I am constrained to read § 212 (c) as consistent with other statutory provisions dealing with national transportation and to conclude that the Commission may limit the entry of the converted carriers into types of carriage previously proscribed to them.
Nonetheless, there appears to be no persuasive support in the language of § 212 (c), legislative history, or policy for permitting the Commission to inhibit activities open to the carrier before conversion. Congress
The determinative consideration in fixing the limit to the Commission’s power is, according to these principles, the authorization conferred by the contract carrier permit; absent dormancy or abandonment, the extent of appellee’s actual prior operations should be irrelevant. Since in the proceedings before the Commission appellee contended that § 212 (c) is inconsistent with any Keystone restriction and the Commission’s position was that it is fettered in imposing such restrictions only by the concept of “substantial parity,” the questions of dormancy or abandonment were not dealt with in the Commission proceedings, but the Commission should be free to consider any such issue on remand.
On these bases I concur in the judgment of the Court.
Reference
- Full Case Name
- UNITED STATES Et Al. v. J. B. MONTGOMERY, INC.
- Cited By
- 16 cases
- Status
- Published