Under agreement of October 31, 1939, as amended at the hearing, applicant would purchase vendor's interstate operating rights, and corresponding intrastate rights, between Beeville and Alice, over U. S. Highway 96, via Skidmore, approximately 56 miles. The only monetary consideration would be $1. It is further agreed, however, that upon consummation of the transaction the parties shall arrange connecting bus schedules at Alice for vendor's Laredo-Alice route and applicant's Alice-Beeville-Victoria-Houston route so as to provide a continuous run, by connection at Alice, between Laredo and Houston, serving all intermediate points, and shall solicit business for such routes. Although not specifically made a part of the contract, it was testified that, as further consideration for transfer of the above rights, applicant, through Bowen, has caused Highway to transfer to vendor, with approval of the Texas commission, its intrastate operating rights between Corpus Christi and Brownsville, over Texas Highways 16 and 96, via Kingsville, Raymondville, and Harlingen. The latter rights are included, among others, in Texas intrastate certificate of public convenience and necessity 851, issued May 23, 1939, and this route is included among other routes in Highway's registration application No. MC-53515, as amended July 5, 1939, describing operations in interstate or foreign commerce under the second proviso of section 206 (a). A part of Texas Highway 96 has been under construction, and this record does not indicate that Highway has ever conducted operations in interstate or foreign commerce over the Corpus Christi-Brownsville route. So far as the instant transaction is concerned, the transfer of these strictly intrastate operating rights is a part of the consideration here involved.

3

Applicant's balance sheet as of October 31, 1939, shows total assets of $1,255,928, consisting of: Current assets $199,942, principally cash $96,271, notes receivable $18,617, and accounts receivable $66,840; carrier operating property, less depreciation, $476,773; nonoperating property $1,053; organization $1,015; other intangible property $484,698; investment securities and advances-investments in West Texas Stockyards $100, South Plains Coaches, Inc., $36,750, and Highway Transportation Co. $2,100, and advances to Corpus Christi Union Bus Terminal $2,398; and deferred debits $51,099. Liabilities were: Current liabilities $149,849, representing notes payable $5,250, accounts payable $46,400, vouchers payable $51,893, and taxes payable $46,306; equipment obligations $202,700; deferred credits $471; capital stock $100,000; and surplus, unearned $583,226 and earned $219,682. Income statements for 1938 and the first 10 months of 1939 show net incomes of $160,424 and $117,433, respectively. No income statement

Certificate of registration issued to Highway in No. MC-53515, on September 20, 1939, does not include the route between Corpus Christi and Brownsville.

showing results of vendor's operations over the considered route was furnished, but vendor testified that the net incomes derived from such operations for the period May 1 to December 31, 1938, and for the first 10 months of 1939 were $858 and $624, respectively.

The rights which applicant would purchase are for operations over a route complementary to its present operations. Vendor has operated this segment as a so-called "stub" line, connecting at Alice with his main-line operations to and from San Antonio, Laredo, Brownsville, and Corpus Christi. Applicant also operates a stub line between Victoria and Beeville, 55 miles, connecting with its main-line operations between Houston and San Antonio, and between Houston and Corpus Christi, at Victoria, and with the considered route at Beeville. Although these two routes physically connect, the parties have not coordinated their schedules and no through-fare arrangements have been made. Passengers traveling on applicant's and vendor's lines between Houston and points north and west thereof, on the one hand, and Alice, Brownsville, and Laredo, on the other, have usually been carried over the more circuitous routes via Corpus Christi. Upon approval herein, it is proposed to route such passengers, on through fares, over the shorter route via Beeville, resulting in savings of approximately 30 route miles, with attendant reduction in transit time.

We find that purchase by Bowen Motor Coaches of the previously described operating rights of Joe Amberson, doing business as Union Bus Lines, between Beeville and Alice, over U. S. Highway 96, via Skidmore, including the right to a certificate in No. MC-59205, covering such rights herein authorized to be unified with rights otherwise confirmed in applicant, upon the terms and conditions above set forth, which terms and conditions are found to be just and reasonable, will be consistent with the public interest, and that the conditions of section 213 have been or will be fulfilled.

An appropriate order will be entered.

No. MC-F-1033

CONSOLIDATED FREIGHTWAYS, INC.-PURCHASEE. B. HARDY

Submitted February 20, 1940. Decided April 18, 1940

Purchase by Consolidated Freightways, Inc., of operating rights of E. B. Hardy, doing business as Hardy Truck Line, approved and authorized.

Donald A. Schafer for applicant.

Ralph M. Wallace for protestant.

REPORT OF THE COMMISSION

DIVISION 4, COMMISSIONERS PORTER, MAHAFFIE, AND MILLER BY DIVISION 4:

Consolidated Freightways, Inc., a Washington corporation, of Portland, Oreg., by application filed October 18, 1939, as amended, seeks authority under section 213, Motor Carrier Act, 1935, to purchase the operating rights of E. B. Hardy, of Glendive, Mont., doing business as Hardy Truck Line, for $500. Hearing has been held, at which Northwest Freight Lines opposed the application and introduced evidence. The parties waived service of a report and recommended order by the examiner.

Pursuant to authority granted under section 210a (b), applicant has leased vendor's operating rights for a period expiring July 2, 1940, at a rental not exceeding $10 per month.

Applicant's corporate history, affiliations, and operations as a motorvehicle common carrier of general commodities in Washington, Oregon, California, Idaho, Nevada, Montana, North Dakota, and Minnesota, and pending section 207 applications to extend its operations in certain of the same States, in interstate or foreign commerce, are described in Consolidated Freight Lines, Inc., Com. Car. Application, 11 M. C. C. 131, Consolidated Freightways, Inc.-Lease-Mont. Transport, 25 M. C. C. 428, and cases therein cited. Applicant owns and operates in excess of 20 motor vehicles.

Vendor claims rights to operate, pursuant to pending "grandfather" application in No. MC-21402,1 as orally amended at the hearing in

1 On April 2, 1938, in No. MC-FC-3398, arrangements were made to substitute vendor In lieu of his father, L. A. Hardy, doing business as Hardy Truck Line, as applicant in No. MC-21402.

that proceeding on August 11, 1939,2 as a motor-vehicle common carrier of general commodities, in interstate or foreign commerce, over approximately 160 miles of regular routes in Montana, between Glendive and Sidney, via Burns and Crane, also via Bloomfield, Richey, and Lambert, and between Sidney and Fairview, serving all intermediate points, and of dressed poultry, livestock, and wool, over irregular routes, between Sidney and points within 75 miles thereof south of the Missouri River.

Under agreement of September 2, 1939, as modified by agreement of December 13, 1939, both of which were also signed by vendor's father, applicant would purchase vendor's above-described claimed rights under the "grandfather" clause, and Montana intrastate certificate MRC-1204, for $500, of which $50 has been paid and the remainder is payable in cash upon our approval of the transaction and approval of transfer of the intrastate rights by the Montana commission. Applicant represents that the purchase price would be paid out of its cash account and that no increase in its intangible-property account would result.

Applicant's balance sheet as of October 31, 1939, shows total assets of $1,754,682, consisting of: Current assets $452,988; carrier operating property, less depreciation, $1,011,159; nonoperating property $3,552; franchises and goodwill $154,060; investment securities and advances, associated companies $49,227 and other $18,393; and deferred debits $65,303. Liabilities were: Current liabilities $405,884; deferred payment contracts $40,090; equipment and other long-term obligations $177,392; deferred liabilities, tire contract, $44,200; dividend scrip payable $26,578; reserves $40,069; capital stock, preferred $501,375 and common $115,379; and surplus $403,715. Income statements of applicant show net incomes for 1937 and 1938 of $41,559 and $99,375, respectively, and for the first 10 months of 1939, before provision for Federal income tax, $193,559.

Vendor's balance sheet as of October 31, 1939, shows total assets of $1,985, consisting of: Current assets $485; carrier operating property, less depreciation, $1,000; and organization and franchises $500. Liabilities were: Notes payable $411; accounts payable $75; and soleproprietorship capital $1,499. Income statements of vendor and his

As originally filed, vendor or his predecessor claimed, in addition to the operations above described, rights to operate over regular routes principally between Glendive and Minneapolis-St. Paul, Minn., via Jamestown and Fargo, N. Dak., and Fergus Falls and St. Cloud, Minn.; between Glendive and Billings, via Miles City, Mont.; between Minneapolis-St. Paul and Moorhead, via Duluth and Motley, Minn.; between St. Cloud and Motley; and between Jamestown and Fort Peck, Mont., via Minot and Williston, N. Dak., and Glasgow, Mont.; serving all intermediate and certain off-route points. These additional routes are substantially duplicated by applicant's own operations, except between Minneapolis-St. Paul and Moorhead, via Duluth, between St. Cloud and Motley, and between Jamestown and Fort Peck, but the instant transaction involves purchase by applicant only of the above-described amended claimed "grandfather" rights of vendor.

predecessor for 1938 and the first 10 months of 1939 show deficits of $938 and $462, respectively.

The operating rights which applicant would purchase are over routes complementary to its present routes, connecting at Glendive. It was testified that approximately 75 percent of the interstate traffic originated by, or destined to, points served by vendor is interchanged with applicant at that point. Approval of the instant transaction would permit applicant to perform a direct through service on such traffic, and it would be particularly advantageous in enabling utilization of present lay-over equipment at Glendive. Vendor, with limited capital, has not been able consistently to provide the service demanded of his operations. The unification would result in single responsibility to shippers and would simplify tracing of shipments and settlement of damage claims. There is another motor carrier of property operating between Glendive and Fairview.

Protestant, an individual, who serves Glendive and has been interchanging traffic moving to and from points north thereof with vendor, states that if the transaction be approved he will be injuriously affected by the loss of an independent interchange carrier. As previ ously indicated, there is another motor carrier operating over the considered routes, and there is no evidence of record indicating that protestant would be unable to arrange for interchange of traffic either with applicant or with the other carrier. Protestant's contention does not warrant withholding the authority here sought. BuckinghamPurchase-Hagerman, 25 M. C. C. 579, 581.

We find that purchase by Consolidated Freightways, Inc., of the previously described operating rights of E. B. Hardy, doing business as Hardy Truck Line, over regular routes, between Glendive and Sidney, via Burns and Crane, also via Bloomfield, Richey, and Lambert, Mont., and between Sidney and Fairview, Mont.; and over irregular routes, of dressed poultry, livestock, and wool, between Sidney and points within 75 miles thereof south of the Missouri River, including the right to operate pending determination of the vendor's "grandfather" application in No. MC-21402, and the right to any certificate covering such rights which may hereafter be issued as a result of such application, herein authorized to be unified with rights otherwise confirmed in applicant, with duplications eliminated, upon the terms and conditions above set forth, which terms and conditions are found to be just and reasonable, will be consistent with the public interest, and that the conditions of section 213 have been or will be fulfilled. An appropriate order will be entered.