Opinion
No. 75-949
Decided May 12, 1976.
Public Utilities Commission — Common carrier — Legality of tariff — Inquiry by commission — Scope — Commission rule-making powers — Discretionary.
APPEAL from the Public Utilities Commission.
In June 1973, Commercial Motor Freight, Inc., filed a complaint with the Public Utilities Commission of Ohio questioning the legality of Tariff 1-G, PUCO 51, filed with the commission by Duff Truck Line, Inc., and the legality of "operations conducted thereunder by Duff Truck Line, Inc."
The complaint alleges that, by its terms, the tariff provides that it "shall apply only when the shipments shall have had an immediately prior transportation by:
"1. rail TOFC service;
"2. common carrier by motor vehicle;
"3. contract carrier by motor vehicle;
"4. private carrier by motor vehicle."
It is further alleged that " * * * when transportation is to be performed under an irregular route certificate only after a reguired prior transportation, transportation under the irregular route certificate would be illegal in at least one of the following respects:
"1. it would result in a cross haul; or
"2. it would result in an interline of traffic between two carriers; or
"3. it would result in the tacking of an irregular route certificate to another regular or irregular route certificate." (All emphasis original.)
Commercial Motor Freight requested the commission to revoke all irregular intrastate authority of Duff Truck Line, Inc., "as said certificates are specifically set forth on the following provisions of said tariff: "Item 30(A)(1), the first page of said tariff" or issue an order cancelling (2) and (3); Item 30(B)(2); Item 30(C); Item 30(D)."
In its opinion and order, dated June 13, 1975, the commission made, inter alia, the following findings of fact;
"(4) Tariff 1-G (or reissues) is entitled a Pool Shipment Distribution Tariff and said document sets forth the particulars of a service which respondent holds itself out to perform from certain designated distribution points to various named destinations upon a shipper's compliance with the requirements detailed in the tariff.
"(5) Of particular importance herein are Items 30 A, B, C, and D of Tariff 1-G (or reissues) as implemented in conjunction with one or more of respondent's certificate authorities set forth on the face of said tariff. Items 30 A, B, C and D as specified in the subject tarff are as follows:
"The rates in this tariff apply only on pool shipments which are consigned to the shipper in care of the carrier at the distribution points named in Note 1 and only under the following conditions:
"(A) When the pool shipment has had immediate prior transportation by (1) rail common carrier in trailer-on-flatcar (TOFC) service; (2) common carrier by motor vehicle; (3) contract carrier by motor vehicle; or (4) private carrier by motor vehicle;
"(B) When 12,000 lbs. or more is tendered to the carrier at one of the distribution points named in Note 1 for (1) transportation to consignees at points named in this tariff or (2) release to another carrier for transportation beyond;
"(C) When the freight charges from point of origin of pool shipment to the distribution point prepaid by the consignor, except that a pool shipment consisting solely of lots or units for distribution to different addresses of the same consignee will be accepted from common carriers when the freight charges have not been prepaid, provided such freight charges are guaranteed by the consignor; and
"(D) When a bill of lading or delivery slip or warehouse receipt or similar shipping document, in triplicate, is furnished for each separate lot or unit included in the pool shipment, except that a charge of 60 cents shall be assessed for each separate lot or unit for which a shipping document is not furnished. This charge shall be paid by the consignor.
"NOTE 1 — Distribution points are: Cincinnati, Columbus, Dayton, Lima, Mansfield, Richfield or Toledo.
"(6) Of the forty some certificates of public convenience and necessity held by Duff Truck Line, Inc., said carrier holds a `from and to' base point property certificate at each of the distribution points named in the subject tariff.
"(7) Tariff 1-G (or reissues) provides for rates, charges, regulations and available service only from the named base distribution points to numerous destinations.
"(8) Duff, when furnishing the entire transportation of property from point of origin to point of destination through its distribution point, the transportation from the point of origin to the point of distribution is made under a certificate at the point of origin authorizing outbound movements and under applicable rates in effective tariffs filed by Ohio Motor Freight Tariff Bureau Agent in which Duff participates and the transportation from the point of distribution to the several points of destination is made under a different Duff certificate authorizing outbound movements from the point of distribution and under applicable rates in the tariff here in question.
"(9) Duff, in its operations under the tariff here in question holds itself out to and does receive at its several distribution points less than truckload lots of freight aggregating not less than 12000 lbs. from other regulated carriers for transportation beyond the distribution point to points of delivery within the state of Ohio.
"(10) Duff does not use its base point certificate for transportation of the less than truckload aggregating not less than 12000 lbs. from the point of origin to the point of distribution.
"(11) All transportation from the point of origin to the point or points of destination under the tariff here in question subject to the jurisdiction of the commission require a combination of at least two separate certificates and two separate tariffs.
"(12) The transportation performed under the tariff here in question from point of origin to points of distribution and from point of distribution to point of destination are in reality, and so understood by carriers and shippers, alike, is a through haul from origin to destination and not two separate and distinct movements one originating at the point of origin, and another originating at the point of distribution.
"(13) Transportation service from each of the distribution points named in the tariff in question is performed by Duff by authority of a separate irregular route certificate for transportation of property, only from that point as a point of origin of the shipment or to that point as a point of destination."
In its conclusion of law the commission, in part, stated:
"(3) Pursuant to Sections 4921.04, 4921.08, 4921.23, 4905.25, Revised Code, and Chapter 13 of the commission's Rules and Regulations, a motor common carrier must maintain on file with this commission schedules of all rates, fares, charges, services, and regulations pertaining to services which such carrier has established and which are in force between and among the points and places served under its particular certificate authority.
"(4) Pursuant to its authority to promulgate rules for the regulation and supervision of motor transportation the commission set forth the following in Rule 3.30 D: `Service may be rendered only from and to the territory or point of origin or final destination for which the irregular route certificate provides.'
"(5) Duff is the holder of thirty-eight irregular route certificates authorizing the transportation of the commodities described in each from and to the geographical area or point designated in each such certificate and that such certificates are confined to shipments originating at that point for delivery to other points within the state of Ohio, or shipments originating in other points and places within Ohio inbound to the geographical area or point designated in each certificate as a point of delivery thereof.
"(6) Duff is the holder of two regular route certificates authorizing the transportation of the commodities therein designated over the route or routes described therein between fixed termini which may not be operated in combination or conjunction with any of the above thirty-eight irregular route certificates or tariffs to make deliveries of freight off-route.
"(7) Duff under the irregular route certificates at each distribution point is not authorized by said certificate to accept freight for delivery under the tariff here in question to points of destination beyond the point of distribution transported to such point of distribution by authority of that certificate or any other certificate, regular route or irregular route, whether operated by Duff or any other regulated carrier in intrastate transportation."
The commission ordered Duff Truck Line, Inc., to "immediately cease and desist from the transportation of any property in intrastate movements which is one segment of the transportation required to move the said property from the point of origin to the point of destination, when such movement is in fact a through movement from point of origin to point of destination."
Duff Motor Line, Inc., filed an application for rehearing, which was denied by the commission in August 1975, and the cause is now before this court upon appeal from the order of the commission.
Messrs. Stiverson Alden and Mr. James R. Stiverson, for appellant. Mr. William J. Brown, attorney general, Mr. Charles S. Rawlings and Mr. Samuel C. Randazzo, for appellee.
Appellant, Duff Truck Line, Inc., contends that (1) a tariff complaint is not the vehicle for interpretation by the commission of operating authority; and (2) the commission has a "mandatory burden to promulgate rules and regulations governing tacking, cross-hauling, and interlining."
The court in the case of E.A. Schlairet Transfer Co. v. Pub. Util. Comm. (1963), 174 Ohio St. 554, 190 N.E.2d 910, had before it an order of the commission cancelling and rejecting a tariff providing a joint rate between different carriers, regular-route motor freight carriers and irregular-route motor freight carriers. In that case the commission, in its opinion and order rejecting the tariff, stated:
"If * * * by virtue of filing a tariff authorizing joint rates with an irregular route carrier, a regular route carrier is suddenly to be allowed to interchange freight with an irregular route carrier, at any point or terminus of the regular route where the irregular route carrier has base area authority, it is obvious that suddenly and by virtue only of the filing of such a tariff providing for joint rate, the regular route carrier will be able to `reach' and to serve many points in the state of Ohio for which he has never shown the existence of a public need * * * and for which, even if a need were established or assumed, other existing carriers were given no opportunity to improve service."
The issues before the court in Schlairet, as stated in the opinion, at page 555, were: "(1) Did the commission have the power and authority to entertain and reject the proposed joint rates? (2) If so, was the order of the commission in such respect unreasonable or unlawful?"
Observing that the " * * * general scope of the commission's powers with respect to motor transportation companies is outlined in Section 4921.04, Revised Code, and embraces supervision and regulation, the fixing and altering of rates, and the regulation of services to be performed," the court concluded that "the commission had jurisdiction * * * to entertain the proceedings."
Reviewing the language of the commission's opinion and order quoted above, the court concluded, at page 557, that the order of the commission was "based upon tenable and persuasive considerations" and that it could "not be denoted as unreasonable or unlawful."
It is evident that the commission, in the Schlairet case, in determining the validity of the tariff at issue there, considered the operating authority of the motor carrier. Thus, the underlying principle of the Schlairet holding is that a tariff may not be used as a means to expand operating authority. While there may be instances where a tariff complaint would not be an appropriate vehicle for interpretation of operating authority, the extent of authorized operating authority is relevant to an inquiry concerning validity of a tariff in any case where operations under a tariff would be expanded beyond authority granted by the commission.
Following Schlairet, this court concludes that the commission was authorized to consider the operating authority of appellant incident to the inquiry conducted pursuant to the tariff complaint.
Appellant's second contention, that the commission has a mandatory burden to make rules and regulations governing tacking, cross-hauling and interlining, is not well taken. The commission, as appellant states, possesses statutory authority to make such rules. That authority, however, is discretionary as was indicated in paragraph four of the syllabus of Braddock Motor Freight v. Pub. Util. Comm. (1963), 174 Ohio St. 203, 188 N.E.2d 162, which reads, in part:
"Under Sections 4921.04 and 4921.07, Revised Code, the Public Utilities Commission may adopt regulations to regulate motor transportation companies and, in doing so, may go beyond the bare statutory framework of Chapter 4921, Revised Code. * * *"
The decision whether to proceed by rule or adjudication generally is for an administrative agency in the first instance, as "* * * the choice made between proceeding by general rule or by individual, ad hoc litigation is one that lies primarily in the informed discretion of the administrative agency." Securities Exchange Comm. v. Chenery Corp. (1947), 332 U.S. 194, 203; National Labor Relations Board v. Bell Aerospace Co. (1974), 416 U.S. 267.
The closing remarks of Judge Zimmerman in the opinion in Schlairet provide as fitting a conclusion for this appeal as they did for that case:
"It is our conclusion that the order of the commission herein is based upon tenable and persuasive considerations, and that it may not be denoted as unreasonable or unlawful. The commission has the function of supervising and regulating motor transportation companies under the authority conferred upon it by the General Assembly, and we think that it has performed that function here within permissible limits. Of course, this court will not substitute its judgment for that of the commission in matters over which the commission has authority and control."
The order of the commission is affirmed.
Order affirmed.
O'NEILL, C.J., HERBERT, CORRIGAN, STERN, CELEBREZZE, W. BROWN and P. BROWN, JJ., concur.
I write separately only to emphasize what, in my view, the majority opinion, in which I join, concludes by implication. In E.A. Schlairet Transfer Co. v. Pub. Util Comm. (1963), 174 Ohio St. 554, the court affirmed an order of the Public Utilities Commission rejecting and cancelling proposed joint rates between regular route motor freight carriers and irregular route motor freight carriers. The rationale asserted by the commission in support of its decision in Schlairet was that a distinction exists between regular route and irregular route certificate authority.
Judge Zimmerman, writing for the court in Schlairet, stated:
"In its opinion, the commission defines a `regular route carrier' as a motor transportation company operating its vehicles over specified routes between fixed termini and on a fixed schedule in conformity with the specifications of its certificate of public convenience and necessity, and an `irregular route carrier' is defined as a motor transportation company operating its vehicles on call over any route of its selection from or to a point or base territory as specified in its certificate of convenience and necessity. It will be observed that the operations of these two classes of carriers are quite different."
The court, in Schlairet, clearly indicated that the authority granted by irregular route certificate is different from authority granted by regular route certificate, as the two certificates serve different purposes. This court recently reaffirmed this distinction in Sewell Motor Express Inc. v. Pub. Util. Comm. (1976), 45 Ohio St.2d 98, 100, albeit again by implication.
Based upon Schlairet, I conclude that the transportation of property in intrastate commerce from a point of origin to a point of destination is a through movement, which cannot be accomplished under Ohio law by the combination of one or more irregular route authorities with one or more regular route authorities, or with another irregular route authority. Otherwise, a carrier would be able to expand its business without first demonstrating the public convenience and necessity required by R.C. 4921.10.
W. BROWN and P. BROWN, JJ., concur in the foregoing concurring opinion.