regular and irregular routes, in New Jersey, New York, Connecticut, Rhode Island, Massachusetts, and New Hampshire. No exceptions were filed to the recommended order; but by order of August 30, 1937, the effective date thereof was postponed until September 7, 1937, and, on the latter date, the taking effect of the order was stayed pending further order of the Commission. On December 3, 1938, division 5 approved the substitution of Millis Transportation Co., Inc., as applicant in lieu of J. M. Walker & Son, Inc., as described in footnote 1. Subsequently, on February 3, 1939, the proceeding was reopened for further hearing solely with respect to the questions of bankruptcy and cessation of operations. Further hearing was held, and a second report and recommended order denying the application because of an interruption of service were issued by an examiner. Exceptions were filed by applicant to this recommended order. Thereafter, in our prior report herein, 28 M. C. C. 442, we found that applicant, Millis Transportation Co., Inc., because of an interruption of service resulting from the bankruptcy of its predecessor, had failed to establish the right to a certificate or permit under the "grandfather" clauses of sections 206 (a) and 209 (a) of the act, and entered an order denying the application.

Upon petititon of applicant, by order of September 29, 1941, the proceeding was reopened for further hearing, and the order denying the application was vacated and set aside. The facts concerning applicant's and its predecessor's operations are set forth in the prior report and will be repeated here only for.clarity of discussion. The proceeding presents the question whether the interruption of service was one over which applicant's predecessor had no control within the meaning of the respective exceptions in sections 206 (a) and 209 (a) of the act. On May 6, 1937, applicant's predecessor was operating under contract with two shippers, Walker Freight Service, Inc., a freight forwarder, and the Rubberoid Company, a manufacturer of roofing materials. In April 1938, Walker Freight Service, Inc., was adjudicated an involuntary bankrupt. It was indebted to applicant's predecessor in the amount of approximately $36,000, and the predecessor was indebted to its creditors in the amount of approximately $40,000, exclusive of notes on equipment. The predecessor made certain attempts to adjust its affairs, but on July 6, 1938, it also was adjudicated an involuntary bankrupt. By order of July 7, 1938, the court appointed a receiver for the predecessor and authorized the receiver, among other things, to continue the operations. On July 9, 1938, the receiver was specifically ordered by the court not to continue the operations.

Applicant was organized on November 1, 1938, and on November 7, 1938, arrangements were made with the receiver to purchase the oper

ating rights, if any, of the predecessor. The substitution of applicant herein in lieu of the predecessor was approved on December 13, 1938. Four vehicles were purchased, and applicant commenced hauling for the Rubberoid Company on January 12, 1939, and for the Gulf Refining Company in April. At the time of the last hearing, these were the only shippers being served by applicant.

The extent of the operations conducted immediately prior to the adjudication of bankruptcy of the predecessor is not definitely shown; but it is clear that all operations had ceased on July 10, 1938, that none was resumed until January 12, 1939, when applicant as successor in interest commenced transporting for the Rubberoid Company, and that there was an interruption of service of 6 months resulting from the bankruptcy of the predecessor.

Applicant maintains (1) that the original order of the examiner served on August 9, 1937, became effective as the order of the Commission by operation of law and was a final determination of the application, that thereafter no continuity of operation need be established, and that it is entitled to a permit authorizing the operations as recommended by the examiner; and (2) that the Commission's decision in Gregg Cartage & Storage Co. Common Carrier Application, 21 M. C. C. 17, upheld by the United States Supreme Court in Gregg Cartage & Storage Co. v. United States, 316 U. S. 74, is not applicable to the instant case. These contentions will be discussed separately.

The basis of applicant's first contention is that the twentieth day after the service (August 9, 1937) of the original recommended order of the examiner fell on Sunday, August 29, 1937, and that the order of the Commission, division 5, postponing the effective date was not entered until Monday, August 30, 1937. Applicant also maintains that the taking effect of the original recommended order of the examiner was recognized by the Commission in the order of December 13, 1938, authorizing the substitution of applicant in lieu of its predecessor.

At the time the original recommended order of the examiner was issued, the provisions of section 205 (a) of the Interstate Commerce Act pertinent to the matter of filing exceptions read, in part, as follows:

Copies of such recommended order shall be served upon the persons specified in paragraph (f), who may file exceptions thereto, but if no exceptions are filed within 20 days after service upon such persons, or within such further period as the Commission may authorize, such recommended order shall become the order of the Commission and become effective, unless within such period the order is stayed or postponed by the Commission [Emphasis supplied.]

Similar provisions are now contained in section 17 (5) of the act, as amended. In addition, section 204 (a) (6) of the act imposes the

duty upon the Commission to administer, execute, and enforce all provisions of the act and to prescribe rules, regulations, and procedure for such administration. The Commission, in its Rules of Practice, has provided that when the time prescribed for doing any act expires on a Sunday or a legal holiday, such time shall extend to and include the next succeeding day that is not a Sunday or legal holiday. It is clear that, under the provisions of the act and the legally promulgated rules of this Commission, the recommended order of August 9, 1937, did not become effective by operation of law, since the taking effect of such order was seasonably postponed and then stayed by appropriate orders issued by the Commission. Sherwood Bros., Inc., v. District of Columbia, 113 Fed. (2d) 162.

Secondly, applicant contends that certain facts present in the instant case, which are not apparent in the Gregg case, distinguish it from the latter; and that the principle set forth in the Gregg case with respect to interruptions of service due to bankruptcy is not applicable here. Such differences of facts briefly are said to be as follows: (a) That the receiver here originally was granted authority by the court to continue operations, but that such authority was revoked by the court on its own motion 2 days after it had been granted, thereby making the failure of the receiver to continue operations a matter beyond his control, while, in the Gregg case, the receiver had no such authority and sought none, indicating no desire to continue the operations; (b) that the application for substitution here was approved by the Commission and the purchaser resumed operations, while, in the Gregg case, the application for substitution was never approved by the Commission and the predecessor never resumed operations; and (c) that, at the time of the bankruptcy, of the sale of operating rights, and of the application for substitution, the operating rights of the predecessor here had been determined, while no such determination had been made in the Gregg case.

With respect to difference (a), applicant stresses the lack of intention of the receiver of the Gregg operation to continue service and attempts to impute to the receiver of the predecessor here such an intention from the facts that he had authority to operate, that this authority was revoked on the court's own motion, and that it would have been futile for the receiver to attempt to have the court reverse itself. We fail to see where any desire of the receiver to continue the operations is present in such facts. There is no showing that the receiver tried to continue the operation or to have the court grant him authority to do so. In connection with a similar situation in the Gregg case, the Supreme Court, in its opinion in that case, said at page 82:

Furthermore, the interruption of service was the deliberate act of those who for the time being stood in the position of applicant and owned its rights.

The federal receiver or trustee could have been authorized to conduct the business of the bankrupt for a limited period, if in the best interest of the estate. * The creditors and their representatives, however, failed to seek authority, evidently regarding the rights, not worth the expense and

risk of continuing business. [Emphasis supplied.]

The same reasoning is applicable here, and it may be presumed, from the revocation by the court of the authority of the receiver to operate, that continued operation was not "in the best interests of the estate." With respect to difference (b), it is stated that the operating rights claimed in the Gregg case expired by reason of the continuing cessation of service after the sale, but that applicant here resumed operations within a reasonable time subsequent to the sale and approval of the substitution by the Commission. We do not agree with applicant's statement that in the Gregg case the cessation after the sale governed the Commission's decision therein, for it was stated definitely that "the break in the continuity of operations is to be ascribed to the bankruptcy for the period after as well as before the sale [emphasis supplied]." Here, during the period of receivership and the sale of operating rights, the receiver, on the behalf of the predecessor's creditors, stood in the position of the predecessor as applicant, and was bound to continue operations in order to keep alive any "grandfather" rights to which the predecessor might have been entitled.

In connection with difference (c), applicant also maintains that the original recommended order became effective as the order of the Commission by operation of law; that therefore the application had been finally determined; that the Commission by its order approving the substitution of applicant in lieu of the predecessor granted the former the rights described in the original report and recommended order; and that, under the act, it (applicant) need not show continuous operations after the final determination of the application. We have hereinbefore rejected the contention that there has been a final determination of the application, and, since the further contentions here are predicated thereon, no further discussion of them is required. The approval of a transfer does not require the presentation of evidence of operating rights but has the effect of placing the transferee in the same position as the transferor, and applicant herein could be in no better position than its predecessor would have been had not the transfer been approved. Compare Summit Fast Freight, Inc., Common Carrier Application, 33 M. C. C. 145.

Considerable argument is devoted by applicant in its exceptions to the reasons why it considers that the decision in the Gregg case results in an unconstitutional construction of the act. In view of the decision

of the Supreme Court in that case, previously cited and discussed in part, no further discussion of this matter is deemed necessary.

Applicant's position in the matter has been discussed in detail. We see no basis for a finding that the facts here warrant a conclusion different from that reached in the Gregg case. No final determination of the application resulting in the issuance of a certificate or permit has been made, and there has been an interruption in service for a period of 6 months resulting from the bankruptcy of the predecessor. Following the Gregg case, we conclude that such interruption was within the control of the predecessor. Because of this interruption, the conditions of sections 206 (a) and 209 (a) of the act requiring continuous operations, except for interruptions in service beyond the control of the carrier, have not been fulfilled; and therefore we have no alternative but to deny the application.

On further hearing, we find that applicant, because of the described interruption of service, has failed to establish its right to a permit or a certificate under the "grandfather" clause of section 209 (a) or 206 (a) of the act; and that the application should be denied.

An appropriate order will be entered.

42 M. C. C.