tracts or agreements, (2) for the transportation of property, (3) for compensation. The element of compensation found in both of these definitions appears to be the principal feature distinguishing both common and contract carriage from private carriage. "Compensate," as defined by Funk and Wagnalls, means "to make suitable return to or for, as for services"; "to make amends for, make up for counterbalance." Compensation is defined, in part, as "that which compensates"; "whatever makes good loss or lack or counterbalances variation; payment." Unless these usual and accepted definitions are to be ignored, it is apparent that every retail store, which delivers merchandise to its customers, and every manufacturer who sells on a delivered basis and accomplishes delivery in his own equipment, is, in a sense, performing transportation for compensation, for prudent and successful business practices require that the selling price in such instances includes an amount "to make amends for, make up for, or counterbalance" the cost of the transportation furnished. After careful study, it seems clear to us that the transportation "for compensation" contemplated by both the common and contract definitions as distinguished from the transportation "for the purpose of sale, lease, rent, bailment, or in the furtherance of any commercial enterprise" contemplated by the private-carrier definition is transportation which is supplied with a purpose to profit from the effort as distinguished from a purpose merely to make good or recover the cost of transportation furnished in the furtherance of some other primary business or transaction.

Two recent decisions of the United States Circuit Court of Appeals of the Tenth Circuit support this view. In Interstate Commerce Commission v. Clayton, 127 Fed. (2d) 967, the court considered the carrier status of Wilford H. Clayton. At his home in Ucon, Idaho, he maintains a small coalyard where he normally keeps on hand about 10 tons or a truckload of coal. He has customers in Ucon and in the neighboring towns of Rigby, Coleman, Idaho Falls, Grant, and Iona, Idaho. He devotes from one-third to one-half of his time to selling coal and is the largest dealer in his community. He purchases coal from the Lone Pine Tree Mine at Rains, Utah, and transports it by truck to his home at Ucon. He pays for the coal with his own funds. He sells both for cash and on credit. He solicits orders for coal so transported, both before and after he transports it from the mine to his home. He does not purchase coal at the Lone Pine Tree Mine and transport it to fulfill any specific or particular order. Many orders are taken by his wife at Ucon while he is en route to or from the mine. When he returns to Ucon with a truckload of coal, he weighs the load, unloads in the customer's bin the amount he estimates will fill a particular order, again weighs the truck and the remainder

of the load of coal, and continues the process until his orders are filled. If any part of the truckload of coal remains, he stores it in his yard. From time to time, he fills orders from coal stored in the yard. He charges a uniform price in the several towns of $8.50 per ton, which price is determined by competitive conditions. The coal costs him $3 per ton at the mine, and the cost of transportation, including depreciation, gas, oil, tires, and repairs, is approximately $2.55 per ton. Thus, on each ton he makes a profit of $2.95. Finding him to be a private carrier rather than a carrier for hire, the court said, at page 969:

Clayton is engaged in the business of selling coal. He devotes one-third to one-half of his time to sales. He pays for the coal transported and owns it until he delivers it to a customer. He transports it for the purpose of sale. He does not buy and transport coal to fulfill any specific or particular prior order. He hauls sufficient coal to take care of what he estimates will supply his customers' requirements, but not on a prior order basis. Many times, from a truckload of coal, he fills orders received by his wife while he is engaged in transporting such coal. From coal on hand, the transportation of which is to his home has been completed, he frequently fills orders received subsequent to such transportation.

He always transports the coal to his home where he maintains a small coal yard and fills orders as received from the truck and coal stored in his yard. He makes no differentiation in price between coal delivered at Ucon and at the other nearby towns, although delivery to the other towns entails a longer haul. The price for which he sells is determined by competitive conditions.

He does not hold himself out to the general public to haul coal for compensation. He does not haul coal for compensation to fill particular orders or under individual contracts or agreements. He has indulged in no subterfuge or design to avoid the requirements of Part II of the Interstate Commerce Act. The cost of the coal and transportation is $5.57 per ton. He sells it for $8.50 per ton. Thus, he realizes a profit, both from the transportation and from the sale of the coal, the margin of profit being large enough to cover both.

We conclude he is engaged in the bona fide coal business; that he transports coal of which he is the owner for the purpose of subsequent sale and in furtherance of a commercial enterprise; and that the trial court was warranted in finding that he is a private carrier. [Emphasis supplied.]

On May 1, 1942, the day following the decision just discussed, two of the judges who participated therein, as members of the same court, also participated in the decision in A. W. Stickle & Co. v. Interstate Commerce Commission, 128 Fed. (2d) 155, which again presented a question of for-hire versus private carriage.

Before the incorporation of Stickle & Company, its 2 principal stockholders had been independently engaged in the sale of lumber on a commission basis. The corporation was the lessee of certain lumberstorage facilities and ostensibly engaged as a dealer in lumber but carried very little stock, never to exceed 35,000 or 40,000 feet. Less than 5 percent of its sales were filled from stored stock and not infrequently its storage facilities were unused for 2 weeks or more.

Generally, upon its receipt of an order, it arranged to purchase the lumber required to fill it from some mill or mills. Approximately 75 to 80 percent of the lumber handled by it on a normal market was purchased after receipt of orders therefor, but on an advancing or declining market the percentage varied between 40 and 85 percent, respectively. For a time Stickle & Company sold either at stated f. o. b. mill prices or at delivered prices made up of the stated f. o. b. mill price, plus a transportation charge which varied according to the distance from the mill to the point of delivery. Such transportation charges were set forth in a schedule of "trucking rates." The company owned and operated 10 motor vehicles which it used to transport lumber from mills in Texas, Arkansas, and Louisiana to destinations in Oklahoma, Texas, Kansas, Missouri, and Illinois.

After its plan of operation was brought in question, it was modified, and the company began to quote delivered prices which were different in various designated destination zones. In other words, the quoted prices represented the sum of the f. o. b. mill price of the lumber and a transportation charge which increased with the distance from the mill to the delivery zone. The quoted prices in the various zones ranged upward from the lowest in proportion to their distance from the mills.

Under the former plan, the customer agreed to pay a stipulated sum for the lumber, plus a stipulated amount for the transportation thereof. Under the latter plan, the customer agreed to pay a stipulated amount for both the lumber and the transportation thereof from the mill to his yard. Under the former plan, the driver of each truck was furnished a document designated as a "freight bill" which set forth the date, a description of the lumber, the location of the mill, the name and location of the consignee, and the amount of the charges to be paid. Under the modified plan, the designation of this document was changed to "loading tally." The major portion of Stickle & Company's capital investment was in its transportation facilities. The bulk of its pay roll went to its transportation employees. The amount charged for transportation was materially less than the transportation charges of duly authorized carriers for like services, but the total amount received from a purchaser of lumber over the cost at the mill, in other words, the company's profit plus its transportation charge, approximated the charges of authorized motor carriers. The court found that applicant was engaged primarily in the transportation of lumber for compensation, and consequently was a carrier for hire. Its reasoning is as follows, beginning at page 159:

The trial court found, in substance, that Stickle & Company is primarily engaged in the transportation of lumber for compensation under individual contracts with its customers; that the amount which Stickle & Company received from the customer for the lumber and the transportation thereof, in excess of

the amount Stickle & Company pays the mill for the lumber, approximates the amount a carrier, who has complied with Part II, supra, and has a certificate of convenience and necessity, would charge for transporting the same lumber; that the transportation by Stickle & Company is not an incident to a commercial enterprise; and that, on the contrary, the buying and selling of lumber is a means and device employed by Stickle & Company to enable it to engage in the transportation of lumber as a contract carrier without complying with the provision of Part II, supra, respecting common carriers and contract carriers. We think the stipulated facts and the evidentiary facts and the legitimate inferences deducible therefrom fully warrant the findings made by the trial court.

The three definitions set forth in § 203 (a), supra, must be read and construed together. Under the express provision of § 203 (a) (17) a private carrier means any person not included in the terms "common carrier" or "contract carrier" as defined in §§ 203 (a) (14) and 203 (a) (15). A carrier may not avoid the requirements of Part II, supra, by subterfuge or device, or by posing as a private carrier when, in substance and reality, he is engaged under individual contracts in transportation by motor vehicle of property in interstate commerce for compensation.* Ownership of the commodity transported is not the sole test. The primary test in §§ 203 (a) (14) and 203 (a) (15) is transportation for compensation.

We think it unimportant that the technical title to the lumber remains in Stickle & Company until the transportation is completed and the lumber delivered to the customer. Prior to the transportation of the lumber and normally before the lumber has been purchased by Stickle & Company, it has entered into a contract to sell the lumber to a customer and to transport it to his yard. The lumber is transported and delivered by Stickle & Company in fulfillment of that contract to sell and Stickle & Company receives both pay for the lumber and compensation for its transportation from the customer.

The transportation is not merely incidental to the business of selling lumber. It is a major enterprise in and of itself. The major portion of Stickle & Company's capital investment is in that enterprise, and the major portion of its pay roll goes to employees engaged in that enterprise. The amount which Stickle & Company receives from a customer for the lumber and the transportation thereof, in excess of the amount it pays the mill for the lumber, approximates the charge that would be made under established rates for the transportation of the lumber by a carrier who has complied with Part II, supra, and has a certificate of convenience and necessity.

[8] We conclude that, in substance and reality, Stickle & Company is engaged primarily in the transportation of lumber in interstate commerce by motor vehicle for compensation under individual contracts or agreements with its customers, and that it is a contract carrier by motor vehicle within the meaning of § 203 (a) (15), supra. [Emphasis supplied.]

When these two decisions, issued on consecutive days, by a threejudge court, two of whose members participated in both decisions,

This footnote, in the decision, cited: Dr. P. Phillips & Sons, Inc., Exemption Application, 30 M. C. C. 773.

:

4 This footnote, in the decision, cited Frost & Frost Trucking Co. v. R. Comm. of California, 271 U. S. 583; and Georgia Truck System, Inc., v. Interstate Commerce Commission, 123 Fed. (2d) 210, 211.

are read together, it is clear that the court, disregarding form, based its conclusion in each case on what it deemed to be the primary business of the operator in each instance. Had it been controlled by the fact that compensation for transportation was received in a form identifiable as such, it would, of necessity, have found that both operators were performing transportation for compensation within the meaning of section 203 (a) (14) and (15). Instead, in the Clayton case where a bona fide coal-dealer status was shown, the operator was found to be a private carrier, whereas in the Stickle case, where a bona fide noncarrier business was not established, the operator was found to be a carrier for hire. The only language in either report to even suggest that the operator's primary business was not the controlling consideration is the statement in the Stickle case, that "the primary test in sections 203 (a) (14) and 203 (a) (15) is transportation for compensation." Such statement is, however, nothing more than a reiteration of the statute. The important question is, what is the meaning of "for compensation"? Consistently with our view above, the court found, in effect, that transportation "for compensation" is that supplied with a purpose to profit from the transportation operation as such, rather than that supplied merely as an incident to some other primary business, even though in the latter case the cost of any incidental transportation which may be performed is recouped by a charge, which may or may not be identifiable as compensation for transportation as such.

It is also said that, if we fail to give controlling weight to the receipt of compensation for transportation identifiable as such, it would result in the absurd proposition that all carriage for hire would fall within the terms of the private-carrier definition, for technically every carrier is a "bailee" of the property transported and, with only rare exceptions, all transportation of goods is "for the purpose of sale, lease, rent, or bailment, or in furtherance of a commercial enterprise." Obviously, this is a most strained construction which, again, is avoided by a fair reading of the act as a whole or the three carrier definitions as a unit. When this is done, it is apparent that a private carrier within the meaning of section 203 (a) (17) is one "who transports property of which he is the owner, lessee, or bailee when such transportation is for the purpose of sale, lease, rent, or bailment, by the transporter, or in the furtherance of any commercial enterprise of the transporter other than transportation for compensation."

After careful reconsideration of the entire subject, we are convinced that we should continue as in the past to determine all issues of forhire versus private carriage on the basis of the operator's primary

42 M. C. C.