highly specialized service rendered by them and that such service was actually confined to a limited class of customers, and that under the circumstances said carriers could properly be considered as serving a 'limited number of persons'. In its decision, the Commission was careful to point out that its determination was limited to the particular facts of that case, and that such determination should in no way be considered binding in proceedings where the facts and circumstances differed materially from those in Armored.
The Commission, in the Saldutti proceedings distinguished the Armored case, as follows (at page 5 of its report):
'* * * Although respondent's operations are conducted in a limited area, it serves a variety of shippers, performs varied transportation services, handles a number of dissimilar commodities, and operates several different types of motor vehicles. In the Armored Motor Service case, it was found that respondents provided a highly specialized and unusual service for a limited class of customers, and that respondents properly could be considered as serving a 'limited number of persons' 77 M.C.C. at 439. Upon the facts presented here and in the absence of any special or unusual circumstances such as were found to exist in the Armored Motor Service case, we conclude that respondent, operating as it does under contracts with at least 20 shippers, is not conducting operations 'under continuing contracts with one person or a limited number of persons'.'
We are satisfied the Commission gave consideration to all relevant factors bearing on the issue of 'limited number' and that there is substantial evidence in the record to support the Commission's conclusion that Saldutti does not operate under continuing contracts with a 'limited number of persons' within the meaning of section 203(a)(15) of the Act; that its operations are those of a common carrier; and are otherwise lawful.
Since there is substantial evidence to support the Commission's conclusion that Saldutti does not meet the basic criterion of operating under continuing contracts with a 'limited number of persons', a consideration of the other criteria laid down in section 203(a)(15) becomes unnecessary. However, the Commission did consider the testimony adduced by Saldutti on these issues and found that there was neither an assignment of motor vehicles nor specalized service within the meaning of section 203(a)(15). Again, our examination of the record satisfies us that the Commission's conclusion in this regard was supported by substantial evidence.
With respect to the 'assignment of motor vehicles for a continuing period of time to the exclusive use of each person served', the record shows that what Saldutti does is to furnish to each of its customers the type of vehicle needed for the particular commodity to be transported. Such equipment is made available as needed. There is no assignment of any specific piece of equipment for the exclusive use of a particular shipper.
As to the rendering of 'transportation services designed to meet the distinct need of each individual customer', the record discloses that the Commission gave full consideration to the nature of the services performed by Saldutti and concluded they did not fulfill the requirement of 'distinct need'. The Commission's observation that the services rendered by Saldutti were not such as could be performed only by a contract carrier was not error. If the services relied upon by a contract carrier to show 'distinct need' are of a type commonly performed by common carriers of the same or similar commodities, this would tend to indicate that such services do not meet the distinct needs of a shipper. Certainly the case of U.S.A.C. Transport, Inc. v. J-T Transport Co., Inc., reported in I.C.C. v. J-T Transport Co., 368 U.S. 81, 82 S. Ct. 204, 7 L. Ed. 2d 147 (1961), cited by Saldutti, does not preclude the Commission from giving consideration to the nature of the services rendered by a carrier in determining status under section 203(a)(15) of the Act.
Another contention made by Saldutti is that the Commission erred in considering '* * * certain information contained in (its) records, of which (it has) taken official notice * * *'. Saldutti claims it is unaware of the material which was considered by the Commission or what bearing it might have on the issues, and contends that a consideration of such records under those circumstances deprives Saldutti of due process. There is no substance to this argument because the Commission report makes clear that the 'records' of which the Commission took official notice were those filed by Saldutti itself pursuant to Commission regulations. It is also well established that a regulatory agency has the right to take official notice of reports filed with it by a regulated company. Market Street R. Co. v. Railroad Commission, 324 U.S. 548, 561-562, 65 S. Ct. 770, 89 L. Ed. 1171 (1945); Wisconsin v. Federal Power Commission, 91 U.S.App.D.C. 307, 201 F.2d 183, 186-187 (1952), cert. den. 345 U.S. 934, 73 S. Ct. 795, 97 L. Ed. 1362.
It is also to be noted that there is considerable merit to the Commission's argument that Saldutti's failure to question, in the petition for reconsideration filed with the entire Commission, the conclusion of Division 1 that Saldutti should be converted from a contract to a common carrier, now precludes Saldutti from raising the issue in this Court. See United States v. L. A. Tucker Truck Lines, 344 U.S. 33, 73 S. Ct. 67, 97 L. Ed. 54 (1952); United States v. Capital Transit Co., 338 U.S. 286, 70 S. Ct. 115, 94 L. Ed. 93 (1949); Gateway Transportation Co. v. United States, 173 F.Supp. 822 (W.D.Wis.1959). However, in view of the determination above, we find it unnecessary to decide this point.
It now remains for us to consider the scope of the common carrier certificate intended to be issued to Saldutti in lieu of its contract carrier permit.
Section 212(c) of the Act requires the Commission to issue to a carrier converted from a contract to a common carrier a certificate which 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.'
Under paragraph 1 of its permit, Saldutti was authorized to transport general commodities 'received from, or delivered to, port facilities, or places of storage before or after a movement by water, for persons who are commonly known as exporters, importers, brokers or steamship agents'.
In connection with the Saldutti conversion, the Examiner recommended, and the Commission approved, a rephrasing of the language of paragraph 1 of the permit, which was intended to make clear that Saldutti, as a common carrier, would be authorized to transport general commodities 'having a prior or subsequent movement by water' only. Saldutti contends that its present permit authorizes it to transport general commodities to and from port facilities regardless of whether the goods ever had a water movement, and that the change in language deprives it of the right of transport 'the same commodities between the same points' in violation of section 212(c) of the Act.
This argument calls into play rules of grammatical construction. Saldutti claims that the restriction, 'before or after a movement by water' modifies only 'places of storage' and not 'port facilities'; that if the Commission intended the phrase, 'before or after a movement by water', to also modify 'port facilities', it would have manifested this intent by inserting a comma after the word 'storage'. The absence of this comma, says Saldutti, indicates that traffic destined to or originating at port facilities is unrestricted.
Under section 212(c) of the Act, a converted carrier is entitled to receive at the hands of the Commission a certificate that maintains parity with the operating authority contained in its contract carrier permit. The controlling factor is the operating rights authorized by the present permit. The Commission found the restriction 'before or after a movement by water' to be clear and unambiguous, and that it applied to 'places of storage', as well as to 'port facilities', and that, as so interpreted, it insured parity between Saldutti's past and proposed future operations. This interpretation is buttressed by Saldutti's own witness, Mr. Chirls , who, in answer to a question put to him by the Examiner, admitted that all shipments transported by Saldutti had a prior or subsequent movement by water.
Saldutti also claims that since the issuance of its permit in 1953, and prior thereto under its 'grandfather' grant, it always believed that its authority to serve port facilities included the right to do so regardless of whether a water movement was involved. Saldutti says that during this period it was in frequent communication with the Commission and that never once has this right been challenged. The Commission's failure to correct Saldutti in its mistaken belief regarding the scope of its authority does not estop the Commission from asserting the proper interpretation of the permit in an appropriate proceeding. See Bird Trucking Co. v. United States, 159 F.Supp. 717 (W.D.Wis.1955).
Another argument concerning Saldutti's authority as a common carrier is addressed to paragraph 2 of the certificate.
Under paragraph 2 of its permit, Saldutti had authority to transport, within certain geographical limits, the following commodities:
'Absorbent cotton, acids, acid compounds, asphaltum, cement, chalk, chemicals, chemical compounds, distilled pine products, drugs, enamels, gases, greases, lacquers, lime, metals, minerals, natural and synthetic resins and gums, naval stores, oils, paint, pitch, plaster, soap, solvents, surgical dressings, tallow, tar, varnishes, wax, and whiting, in containers only; leather and rope; and equipment, materials and supplies, used by persons engaged in the manufacture, production, distribution, or sale of the aforesaid commodities; for persons who are engaged in the manufacture, production, distribution, or sale of the aforesaid commodities.'
In the proposed common carrier certificate, the same commodities authorized by the permit are repeated in the certificate. The only change made by the Commission was to rephrase the language beginning with the word 'equipment' in the permit, to read as follows in the certificate: 'equipment, materials and supplies used in the manufacture, production, distribution, or sale of the aforesaid commodities.'.
Saldutti objects to this change of language because it still carries over into the certificate a limitation in the permit regarding the persons for whom Saldutti can provide service.
It argues that had it originally been a common carrier, it would have been entitled to general commodity authority without such limitation, and that it was entitled to a grant of such authority in the conversion proceeding under section 212(c) of the Act. No cases are cited in support of this last proposition.
There is no authority under section 212(c) of the Act to issue a certificate for the transportation of commodities not authorized in the permit of the carrier. Since paragraph 2 of the permit does not authorize Saldutti to transport 'general commodities', the Commission would have no right to incorporate such authority, or to otherwise enlarge Saldutti's operations, in the certificate to be issued in the conversion proceeding.
However, Saldutti is not left without a remedy on the question of the scope of its common carrier certificate. If, as Saldutti contends, the operations on which its original authority from the Commission was based, would entitle it to 'general commodities' authority as a common carrier, the remedy is to petition the Commission to re-open the 'grandfather' proceedings. See J. B. Montgomery, Inc., Modification of Permit, 83 M.C.C. 457 (1960).
The law is clear that the Commission's interpretation of a carrier's permit or certificate is binding on the courts unless clearly erroneous, arbitrary or capricious. Andrew G. Nelson, Inc., v. United States, 355 U.S. 554, 78 S. Ct. 496, 2 L. Ed. 2d 484 (1958); Southwest Freight Lines, Inc., v. Interstate Commerce Commission, 184 F.2d 149 (8 Cir. 1950); United Truck Lines v. Interstate Commerce Commission, 189 F.2d 816 (9 Cir. 1951). We cannot say, on the present record, that the Commission's interpretation of Saldutti's authority under paragraphs 1 and 2 of the permit is clearly erroneous, unreasonable, capricious, or arbitrary.
Upon a review of the entire record in this case we are satisfied the order of the Commission must be affirmed. In our opinion said order is supported by substantial evidence and is in accord with applicable law. A court cannot substitute its judgment for that of the Commission, but can only ascertain whether there is warrant in the law and facts for the order under review. Shein v. United States, 102 F.Supp. 320 (D.N.J.1951) aff'd 343 U.S. 944, 72 S. Ct. 1043, 96 L. Ed. 1349.
An appropriate order may be submitted.