The opinion of the court was delivered by: SHAW
Plaintiff is a 'common carrier by motor vehicle' and a 'contract carrier by motor vehicle' as defined by the Interstate Commerce Act.
It had been engaged in interstate transportation of goods by motor vehicle prior to June 1, 1935 and since that date, and thereby became entitled upon timely application to the Interstate Commerce Commission to recognition of its so called 'grandfather rights' by issuance of a certificate of public convenience or necessity within territory and over routes previously served in 'bona fide operation.' § 206(a)(1) and (b) of the Act (49 U.S.C.A. § 306(a)(1) and (b)).
Upon timely application by plaintiff to the Commission and consideration by it of evidence submitted as to operations conducted prior to June 1, 1935 and since, 'grandfather rights' sought by plaintiff were recognized and certificate of public convenience and necessity No. MC 17006 together with permit No. MC 3582 were issued on October 22, 1943. These grants of authority to operate as a common and contract carrier remain in full force and effect.
Disagreement developed between plaintiff and the Interstate Commerce Commission concerning operations of plaintiff allegedly beyond the scope of the authority granted to it pursuant to certificate and permit issued as a result of the 'grandfather' proceedings. The differences remained unresolved as of January 15, 1960 and on that date defendant filed a complaint in the District Court (Civil Action No. 38-60) pursuant to § 222(b) of the Act (49 U.S.C.A. § 322(b)) alleging that plaintiff had engaged and was continuing to engage in interstate transportation of goods between certain points and places not authorized by the certificate and permit issued to it by the Commission. Injunctive relief was sought by the Commission. The District Court denied an application for a preliminary injunction from which an appeal was taken. By mandate of the United States Court of Appeals for the 3rd Circuit a temporary restraint issued out of the District Court on December 4, 1962 restraining the continuance of the operations by plaintiff of which defendant complained pending the making of findings of fact and conclusions of law by the District Court.
Thereafter, and while the litigation in Civil Action No. 38-60 was still pending, plaintiff instituted this action by complaint filed on November 14, 1962.
As above noted, Civil Action No. 38-60 was commenced by defendant by complaint filed on January 15, 1960. On January 27, 1960 plaintiff filed a petition with the Commission to reopen the 'grandfather' proceedings for the purpose of having the operating authority granted to it by order of the Commission, dated October 22, 1943, revised and clarified. This petition was denied by order of the Commission dated June 15, 1960 on the ground that 'no sufficient cause appears for waiving Rule 1.101(e) of the General Rules of Practice.' Plaintiff by its petition had requested waiver of Rules 1.101(e) and 1.102 of the Commission Rules of Practice.
On July 15, 1960 plaintiff filed another petition with the Commission requesting reconsideration of the order of June 15, 1960 and leave to present oral argument. This petition was also denied by order of the Commission dated December 7, 1960.
Thereafter plaintiff sought again by petition filed with the Commission on May 4, 1962 to reopen the 'grandfather' proceedings for the purpose of reformation and interpretation of its certificate of operating authority. This petition set forth in detail the factual basis upon which plaintiff felt that it was entitled to waiver by the Commission of the application of Rules 1.101(e) and 1.102 and for reformation and interpretation of the operating authority it had obtained as a result of the 'grandfather' proceedings. This petition was denied by order of the Commission dated September 4, 1962 wherein the reasons for denial are specifically and succinctly stated.
Thereupon, plaintiff sought review in this court by its complaint filed on November 14, 1962.
The basic issue in the controversy between plaintiff and the Commission stems from the contention on the part of the Commission that plaintiff, having only 'radial' authorization to operate between certain base points and places on the one hand and 'radial' destination points and places on the other, has, contrary to the limitations of such authorization, engaged in transportation between 'radial' destination points and places, known as 'cross hauling.' See Malone Freight Lines, Inc. v. United States, 107 F.Supp. 946 (D.C.N.D.Ala.1952), affirmed 344 U.S. 925, 73 S. Ct. 497, 97 L. Ed. 712 (1953); Interstate Commerce Commission v. G & M Motor Transfer Co., Inc., 64 F.Supp. 302 (D.C.W.D.N.C.1945); Garford Trucking v. United States, 64 F.Supp. 780 (D.C.N.J.1946).
Plaintiff asserts that the alleged 'cross haul' operations in which it is engaged are not beyond the scope of 'bona fide' operations which it conducted prior to June 1, 1935 and since that date, and that no question of the unlawful character thereof was raised prior to 1950. Plaintiff argues that it was entitled under its so called 'grandfather rights' to a certificate of public convenience and necessity authorizing such operations and that if its certificate does not, by the language in which it is phrased, confer such authority, plaintiff is then entitled to have the 'grandfather' proceedings reopened and its certificate revised to afford it the benefit of a substantial parity between 'bona fide' operations conducted prior to June 1, 1935, as continued to the date of issuance of its certificate and permit embracing its 'grandfather' rights. Plaintiff sought both interpretation of its certificate by the Commission to determine first, whether by the language used it had the operating authority which it claims to have been due to it, and, if not, revision thereof to incorporate such authority.
The specific contentions of plaintiff on which it predicates its claim for relief in this court may be briefly summarized as follows:
(1) That the action of the Commission by its final order dated September 4, 1962 denying plaintiff's petition to reopen the 'grandfather' proceedings was in effect a confiscation of property without due process of law in violation of the Constitution.
(2) That plaintiff is entitled to an order of this court directing the Commission to reopen the 'grandfather' proceedings and grant the hearing requested by plaintiff for reformation of its certificate.
(3) That in the alternative this court, after full hearing, interpret the certificates of plaintiff and declare plaintiff's rights thereunder in the light of proof of 'bona fide' operations in which it engaged prior to June 1, 1935 and since that date.
Because of the constitutional question raised, plaintiff made application to this court to supplement the record before it by oral testimony and other evidence. This application was denied and review was had on the basis of the administrative record.
The scope of review here is governed by the Administrative Procedure Act, 5 U.S.C.A. § 1009(e). Ace Lines, Inc. v. United States, 197 F.Supp. 591 (D.C.S.D.Iowa 1960); Acme Fast Freight, Inc. ...