McCormack, or all of the States in the preceding series, as concluded by the Commission.
Plaintiff, a New York Corporation having its main office in New Jersey, has operated since 1949 as a common carrier by motor vehicle of liquid commodities in bulk pursuant to various certificates of the Commission, and today operates in approximately 26 states. The Sub. 70 Certificate was issued in 1948 in Docket No. MC 52458 to the T.I. McCormack Trucking Co., Inc., and obtained along with the corporate stock by the present owner who has continuously operated the corporation ever since.
The authority granted in the certificate was not disputed until 1952. Then, in four proceedings during the next seven years
in which McCormack protested pending awards to its competitors, various Divisions of the Commission indicated that McCormack's base territory did not include any points in Pennsylvania, New Jersey, New York or Connecticut, which were situated in excess of 100 miles from Columbus Circle.
The Commission decision and Order which plaintiff now challenges resulted from three further proceedings that were consolidated and heard together on May 23, 1960, 89 M.C.C. 5. Two proceedings dealt with applications by McCormack itself for new certificates.
The third was an investigatory proceeding instituted by the Commission under Sections 204(a) and 212(a) of the Interstate Commerce Act, (the Act) after McCormack's "fitness" had been challenged in the application proceedings. It had been alleged that McCormack was engaging in for-hire transportation in Interstate Commerce in violation of Sec. 206(a) of the Act.
Following the consolidated hearing, the examiner held McCormack to be in violation of Sec. 206, supra, and recommended that it be ordered to cease using as base points any places in Pennsylvania, New Jersey, New York or Connecticut which were more than 100 miles from Columbus Circle. For reasons discussed below, the Commission agreed with his interpretation and entered such an order.
From that decision, plaintiff appeals, contending it is so unreasonable, arbitrary, and lacking support in the record evidence and applicable law that this Court should set it aside. Plaintiff further contends that the Commission's erroneous interpretation operates to rescind part of his certificated authority, thereby depriving him of a property right contrary to Section 212 of the Act, 49 U.S.C. § 312. Plaintiff asks us to reverse the decision below and to declare his operations to be within the territorial prescription of the Sub. 70 Certificate. In the alternative, plaintiff asks us to remand this matter to the Commission for further consideration in accordance with our opinion.
The ultimate question before the Court is a simple one: Namely, to how many States does the restriction, "within 100 miles of Columbus Circle" refer? However, that question is complicated by a threshold dispute over the Commission's procedure. The Commission resorted to matters outside the four corners of the certificate to aid its interpretation. McCormack contends that this resort contravened the Commission's own well-established rule for construing permits and certificates.
The rule in question arose from the need to protect legitimate expectations based on Commission actions. In order to afford the certainty and continuity essential for both carriers and the shipping public in such an extensively regulated industry, reliance on the language of an operating certificate must not go unrequited. Accordingly, absent a patent ambiguity on the face of the document, the Commission will not permit reference to extraneous matters to show that the service apparently permitted by the terms of the certificate in fact exceeds the authority actually granted. Andrew G. Nelson, Inc. v. United States, et al., 355 U.S. 554, 558, 2 L. Ed. 2d 484, 78 S. Ct. 496 (1958).
The Commission delineates the extent of this rule in its Report, 89 M.C.C. at 9.
"One cardinal rule is that the certificate must speak for itself. In the absence of patent ambiguity the Commission refuses to consider extraneous matters, including the record which gave birth to the certificate in question. And this rule is followed regardless of whether the practical result is to confer upon the carrier more or less authority than may have been intended to be granted originally. . . . Moreover, the Commission has consistently held that a validly issued certificate may authorize transportation . . . not contemplated at the time (it was granted) Jones, Interpretation of Certificate, 64 M.C.C. 527, and service within a larger territory than intended . . . Wright v. Central Freight, 66 M.C.C. 396. As pointed out by the Commission in Manhattan Coach Lines, Inc. v. Adirondack Transit Lines, Inc., 42 M.C.C. 123, 126. Any other rule would contribute an intolerable uncertainty to the finality of any right granted."
Our starting point, then, is the propriety of the Commission looking behind this certificate rather than relying solely on its language. The Commission's grounds for adopting the disputed procedure and not following the aforementioned rule were based on its decision that the certificate was ambiguous as set forth in its Report, 89 M.C.C. at pp. 8-16.
The Commission weighed three possible conclusions: (1) that the certificate is clear and unambiguous in applying the 100 mile limitation to New York State alone. (McCormack's position throughout this litigation); (2) that the certificate is clear and unambiguous in applying the 100 mile limitation to all the named states (the position of the Examiner); and (3) that the certificate is ambiguous since the limitation can reasonably be construed to apply either to New York State alone or to all the named States, 89 M.C.C. at 8.
The Commission rejected both position (1) and (2) and, choosing alternative (3), found the certificate sufficiently ambiguous to warrant consulting antecedent records.
McCormack had offered three reasons for finding the certificate unambiguous.
First, McCormack argued that the Commission should not contradict Commission statements by examiners in earlier litigation to the effect that the Sub. 70 Certificate was free from any ambiguity.
The Commission dismissed this argument on the grounds that the scope of the Sub. 70 Certificate was only a collateral issue in those cases and that since it was not fully litigated then, their holdings were not controlling.
Second, McCormack offered expert witnesses including a linguist and several lawyers with long experience before the of its interpretation. The Commission who argued in support of its interpretation. The Commission conceded the competency of their testimony and even spent some time defending it against criticism by the Board of Inquiry. But the Commission still found the certificate ambiguous.
McCormack's main argument was that proper application of the rules of grammar normally used by the Commission clearly compelled upholding McCormack's interpretation of the certificate and thereby precluded a finding of ambiguity.
McCormack relied primarily on a grammatical principal of statutory construction known as the "Doctrine of the Last Antecedent". As the Commission explained it at 89 M.C.C. 13:
"According to the doctrine of the last antecedent, relative words, phrases, and clauses
are applied to the words and phrases immediately preceding
and should not be construed as extending to more remote words or phrases
unless such extension is clearly required by the context of the language in question. 50 Am. Jur. Statutes, Sec. 269 (1944). Where a comma separates a modifying clause from the word or clause immediately preceding, the presence of the comma is an indication that the modifying clause was intended to modify all the preceding clauses and not merely the last antecedent clause. * * * No such comma separates "within 100 miles of Columbus Circle, N. Y." from the last antecedent, 'New York ' in McCormack's Sub. 70 Certificate."
The Commission admitted the general applicability of the doctrine to language of the type before it. However, the Commission refrained from using the doctrine in this instance because it concluded from the case law that the doctrine should be employed only after language had already been found ambiguous on the basis of more direct evidence. "[The] ambiguity of the language in question is at least impliedly recognized by resort to legislative history, the probable purpose of the legislature, considerations of public policy, or judicial notions of common sense." 89 M.C.C. at 15.
The Commission further noted that the doctrine seldom was decisive in construing a statute, and was rebuttable by a very slight indication of contrary intent. Ibid. Therefore, the Commission resorted to the prior record after finding the certificate ambiguous. The Commission admitted that the propriety of thus looking behind the certificate hinged on the soundness of its conclusions about the Doctrine of the Last Antecedent. It then reasoned that if the certificate was ambiguous enough to allow use of the doctrine of the last antecedent, it was also ambiguous enough to warrant resort to the document's "legislative history." Id at 16.
On the basis of the record in the original certification proceeding, the Commission found that the plaintiff's predecessor-in-interest neither applied for, nor produced evidence for, nor expected, nor believed it received at the time the authority plaintiff now claims. Ibid.
However, the Commission added that "(If) such an examination (of the certification proceeding) did not clearly reveal the actual intent of the Commission, we would be obliged to find the doctrine of the last antecedent controlling, there being no other relevant guide to interpretation." Ibid.
On the basis of its findings, the Commission concluded that the 100-mile limitation in the certificate does modify all the named States and that operations thereunder must be so limited.
The appropriate dimensions of this Court's scrutiny in reviewing Commission Orders is well established. The Court will not set aside or modify such orders if they are taken within the scope of the Commission's statutory authority, are not completely unreasonable, and are based on adequate findings supported by substantial evidence from the record. United States v. Pierce Auto Freight Lines, 327 U.S. 515, 535-536, 90 L. Ed. 821, 66 S. Ct. 687 (1946). Moreover, if there is warrant in the law and the facts for the agency's action, we must be careful not to set it aside "simply because we might have reached a different conclusion on the same record. We must give due credit to the expertness of the Commission in the field Congress has confided to it." National Bus Traffic Association v. United States, 143 F. Supp. 689, 695-696 (1956) (3 Judge Court, Third Cir., per Chief Judge Biggs), aff'd [per curiam] 352 U.S. 1020, 77 S. Ct. 859, 1 L. Ed. 2d 595.
The defendant seeks to extend this familiar restriction on our scope of review. They urge that particular solicitude should be given to the Commission's interpretation of its own certificates. Several cases are cited wherein courts explicitly refrained from voiding Commission orders for reasons of "semantic preference and composition," (Defendant's Brief p. 11 and cases cited therein). See infra, note 11. However, we think those holdings can be more fully understood as bearing on the substantive questions of interpretation to which we now turn.
McCormack's first two arguments to the Commission in regard to the Certificate's ambiguity may be dealt with briefly.
We accept the Commission's conclusion that earlier Commission reports stating the certificate was "unambiguous" are not controlling since they discussed the issue only collaterally. There is an even more conspicuous difficulty with the plaintiff's attempt to use those earlier cases. The examiners therein only found the certificate unambiguous after finding that it clearly meant the exact opposite of the interpretation plaintiff now advances. That is to say the examiners had construed the Sub. 70 authority to clearly restrict McCormack's operations in precisely the same measure as the Order plaintiff has challenged. Plaintiff, in effect, is asking the Commission to contradict the real thrust of these decisions in the guise of requesting they be followed on the question of ambiguity; the request was properly denied.
Second, in regard to the plaintiff's expert witnesses, the Commission was bound to consider such evidence where competent. But the Commission is also clearly free to "disbelieve or disregard, evidence as it seems unconvincing; it may give as much or as little weight to the evidence as it deems proper." (Citing cases). Loving v. United States, 32 F. Supp. 464, 467 (W.D. Okla. 1940) aff'd 310 U.S. 609, 84 L. Ed. 1387, 60 S. Ct. 898. In this instance, the Commission far from disregarding the testimony, considered it meritorious, though not conclusive. Therefore, we must defer to the Commission's evaluation and use of that evidence unless we find the Commission's other bases for its conclusion insufficient.
We turn to McCormack's main contention, namely, that the Commission erred in finding sufficient ambiguity to consult the prior record. McCormack argues that the Commission: (1) misapplied the Doctrine of the Last Antecedent; and (2) ignored the more fundamental rules of grammar and punctuation applicable to such language.
The Government's reply is also twofold. First, they contend that the Doctrine was properly subordinated to the legislative history of the certification record. Second, it is argued that even if other rules of punctuation and grammar should have been given more weight, the courts consistently refuse to overturn a Commission's interpretation of its own certificate on such grounds.
Both parties continue to discuss the Doctrine and the rules of punctuation and grammar separately. This has produced considerable confusion as to whether we are dealing with only one or with several different rules of construction. Fortunately, the confusion is unnecessary. At bottom, the Doctrine of the Last Antecedent and those "additional rules of punctuation and grammar" urged by McCormack are one and the same.
The fact that these grammatical aids have been gradually ensconced as a canon of statutory construction should not obscure the identity between the two forms. In either case we simply have the long standing rule that a modifying phrase refers only to the last antecedent phrase or word which it can reasonably modify. The rule of punctuation is merely a supplementary guide which tells us that if the modifier is intended to relate to more than the "last antecedent", a comma is used to set off the modifier from the entire series. Therefore, the following discussion applies equally to the Doctrine and to the rules of grammar and punctuation per se.
As noted previously, the Commission thought the applicability vel non of the Doctrine was decisive in this proceeding but concluded that it could only be used after the disputed language had already been deemed ambiguous and more direct tools had failed. See p. 8 supra, note 6. The Government argues McCormack is now hoist by its own petard; if there was sufficient ambiguity to apply the Doctrine, then there also was sufficient ambiguity to resort to the prior record without violating the Commission's procedural rules. The final thrust of this argument is that once that record was properly admitted, its indication of the intended scope of authority superseded any contrary result suggested by the Doctrine. "Such rules of grammar must yield to the intention of the Commission which was found in the record of the certification proceeding." Defendants' Joint Brief, p. 19.
The Government repeatedly stresses this contrast between the inferior position normally accorded rules of punctuation and grammar in statutory construction and the paramount role accorded the statute's legislative history. As a general rule, the whole context of a statute, including the legislative history itself should be examined to determine the drafter's intent. While the legislature is presumed familiar with the ordinary conventions of wording, punctuation and grammar, it is clear that many statutes are drafted with something short of perfection. The legislative history, on the other hand, offers direct compelling testimony of the intended meaning; where its use is appropriate, its guide is paramount. Further, since the ordinary principles of statutory construction apply to the interpretation of licensing certificates, the "legislative history" of a certificate controls in most instances. 89 M.C.C. at 10.
However, in the case sub judice, the authority offered by defendants for this proposition, misses the point by ignoring the very source of the controversy before us: the Commission's own rule strictly limiting use of "legislative history."
Canons of statutory construction have sometimes been developed to promote objectives of our legal system which transcend the wishes of a particular legislature; similarly, rules adopted by the Commission for construing certificates are based on policies which may sometime transcend the intent of a particular certification proceeding. The Commission has said so itself in explaining the rule in question. See pp. 5-6, supra. This cardinal policy of refusing to consult prior records cuts across the usual sequence of interpretive tools. That sequence is not sacrosanct; in the fact of a concrete overriding policy, it should not be applied mechanically to constrain the interpreter.
In considering the ambiguity of the Sub. 70 Authority on its face, the prior record was simply not available. And since no other guides were available, the usually subordinate rules of grammar were perfectly proper and pertinent aids in interpretation. In fact, the Commission recognized their pertinency in its rejection of the Bureau of Inquiry's claim that the certificate unambiguously contained a broader restriction. "Adoption of the Bureau's position would be tantamount to a finding that the Commission consistently flouts accepted rules of grammar in framing grants of operating authority. Any such finding would be contrary to fact." 89 M.C.C. at 11. Surely it is not contended that the ordinary rules of grammar and punctuation entailed in the Doctrine of the Last Antecedent are not logical tools to utilize in one's initial reading of disputed language.
Moreover, such indications of the normal reading to be given the certificate are precisely what a layman shipper would rely on in his operations. It must be remembered that the importance of vindicating such reliance is the basis of the rule requiring patent ambiguity before admitting prior proceedings.
The earlier opinions which the Commission relied upon, to the effect that the Doctrine of the Last Antecedent can only be used as a last resort on language already judged "ambiguous," must be read in light of the above analysis. Normally, there is no bar (as exists here) to immediately consulting the legislative history. Since the history would control in case of a conflict, these decisions held that the Doctrine need not be utilized until more important tools fail and the language remains ambiguous.
Where the legislative history is inconclusive or otherwise unavailable, however, the Doctrine may indeed be dispositive. Kales v. City of Oak Park, 315 Mich. 266, 23 N.W. 2d 658. In effect, this was the situation facing the Commission when it examined the certificate on its face.
Under such circumstances, we are of the opinion that a proper understanding of the Doctrine of the Last Antecedent and the rules which it comprehends required their application in the initial determination of ambiguity.
The second half of the Government's reply is based on the judicial self-restraint traditionally exercised when the Commission's interpretation of a certificate is challenged on grounds of grammar or punctuation.
Defendants' brief cites many decisions in which the Courts refused to overturn the Commission on such grounds. They argue these cases not only show the slight weight to be give rules of composition, but also indicate that even if the Commission gave them inadequate weight in the instant matter, its conclusion should not be disturbed.
The short answer to this is that the cited decisions fall within a category from which the Commission itself has excluded the Sub. 70 Authority investigation. With one exception, these cases dealt with descriptions of the commodities which could be shipped, rather than with the authorized territory of operations. The interpretation of such "commodity descriptions" is undeniably an area wherein the Commission's great familiarity with customary trade usage and with industrywide understanding of prior Commission interpretations is critical. In the cited cases, this expertise provided an independent basis of interpretation apart from either the rules of grammar and punctuation, on the one hand, or from express statements of the draftsman's intent, on the other.
The Commission's candid descriptions of the phrases here in dispute explain why the normal reasons for deferring to its expertise in trade parlance do not apply.
"We realize that Dart and Pierce v. Converse, supra, are not controlling precedents for the disposition of this proceeding since strict adherence to the rules of grammar in those proceedings would have been inconsistent with the Commission's settled practice of using other terms in granting general commodities authority. As previously indicated, there is no Commission policy with respect to granting a larger or smaller origin territory under language similar to that used in McCormack's certificate. 89 M.C.C. at 14.
Earlier, the Commission stated even more explicitly the ordinary nature of the disputed wording:
"In addition to these general rules of construction, the Commission is guided in its interpretation * * * by the trade or other specialized usage of particular words and phrases or by certain basic language in the objectives of motor carrier regulation. The disputed language in McCormack's certificate is non-technical in nature. There is no apparent reason for example, why a similar territorial description in a statute or a contract should be given any different meaning, * * * no policy or presumption favoring a liberal or strict construction for the purpose of granting a larger or smaller quantum of operating authority. 89 M.C.C. at 10.