been granted upon application therefor. The issue herein cannot be decided upon the basis of unexercised action which might have avoided any contractual arrangement with Dixie. The simple fact remains that Gibbs did not render service over the described routes prior to 1932. It did enter into lease agreements with Dixie for the commencement of such operation, and, after entering into the leases, began both intrastate and interstate service between McKenzie and Huntington and over route 60 between Paducah and Wickliffe. These agreements may not have constituted direct and specific leases of interstate rights for limited periods, but most certainly the parties contemplated service both in intrastate and interstate commerce by Gibbs as a result of the effectiveness of the leases.

Where only State authority is necessary to the conduct of the operation, the basic relation of the parties is not changed by the fact that passengers or property are transported in interstate as well as intrastate commerce, nor is the situation altered by the subsequent effectiveness of the Federal regulatory statute. The record reflects acquiescence of Meyer in the superior right of Reynolds over a long time. Their respective positions were recognized by the State regulatory authority and by the courts. In view of all the circumstances, we conclude that Reynolds should be authorized to operate in interstate commerce between Elkins and Parsons and that the application of Meyer in that respect should be denied. Inter-Carolinas Motor Bus Co. Com. Car. Application, 28 M. C. C. 665, and Virginia Stage Lines, Inc., Common Carrier Application, 31 M. C. C. 110.

Meyer has filed an original and supplemental petition, to which Reynolds replied, seeking further hearing in this proceeding in order to introduce certain described evidence not available at the time of the hearing herein. In our opinion, this evidence, if introduced, would add nothing of material value to the facts now before us. Accordingly, the petitions for further hearing will be denied.

We find, in No. MC-59155, that Reynolds Transportation Company was on June 1, 1935, and continuously since has been, in bona fide operation, in interstate or foreign commerce, as a common carrier by motor vehicle, of passengers and their baggage, and of express, mail, and newspapers in the same vehicle with passengers, between Elkins and Parsons, W. Va., over U. S. Highway 219, serving all intermediate points; and that, by reason of such operations, it is entitled to a certificate authorizing continuance thereof, in addition to the operations for which authority has heretofore been granted.

We find, in No. MC-1003, that applicant has failed to establish any right, under the "grandfather" clause of section 206 (a) of the act, to a certificate as a common carrier by motor vehicle, over a regular route, between Elkins and Parsons, W. Va., in interstate or foreign commerce, and that the application, so far as it seeks such authority, should be denied.

42 M. C. C.

Upon compliance by Reynolds Transportation Company with the requirements of sections 215 and 217 of the act and with our regulations thereunder, an appropriate amended certificate will be issued to it. An order will be entered denying the applications so far as herein considered, except to the extent granted herein.

COMMISSIONER LEE was necessarily absent and did not participate in this proceeding.

INVESTIGATION AND SUSPENSION DOCKET NO. M-1990 OLEOMARGARINE AND CANNED GOODS TO OR FROM CINCINNATI AND GEORGIA POINTS

Submitted December 12, 1942. Decided June 4, 1943

1. Proposed reduced contract-carrier rating on oleomargarine, in less than truckloads, between Cincinnati, Ohio, and certain points in Georgia, found just and reasonable.

2. Proposed reduced contract-carrier volume commodity rates, on canned goods to Cincinnati from certain points in Georgia, found unjust and unreasonable. Proposed rates ordered canceled, and proceeding discontinued, without prejudice to the filing of new schedules in conformity with the views expressed.

R. A. Ellison for respondent.

J. F. Kirkman, Edward D. Mohr, and P. H. Goodwyn for protestants.

REPORT OF THE COMMISSION

DIVISION 3, COMMISSIONERS MILLER, PATTERSON, AND JOHNSON

BY DIVISION 3:

No exceptions were filed to the order recommended by the examiner, but the taking effect thereof was stayed by us. Our conclusions differ somewhat from those recommended.

By schedules filed February 26, 1942, to become effective March 30, 1942, respondent motor contract carrier, Joseph O. Emmett, of Covington, Ky., doing business as B Line Express, proposed to establish a reduced rating on oleomargarine, in less than truckloads, between Cincinnati, Ohio, and certain points in Georgia, and reduced minimum volume commodity rates on canned goods to Cincinnati from Griffin, Montezuma, Oglethorpe, and Zebulin, Ga. Upon protest of the Southern Motor Carriers Rate Conference, an incorporated

association of motor common carriers, hereinafter called the conference, and the southern rail carriers, operation of the schedules was suspended until October 30, 1942. On July 31, 1942, in Nos. MC-FC16883, and MC-FC-16883-A, C. B. Fischbach, of Akron, Ohio, doing business as Fischbach Trucking Company, was authorized to acquire the entire operation of Emmett. Fischbach adopted the schedules of Emmett, effective August 1, 1942, and is accordingly substituted as respondent herein. Fischbach has filed contracts which supersede those formerly in effect between the shippers and Emmett, but no contracts are on file which reflect the proposed rating and rates. Rates will be stated in amounts per 100 pounds.

The schedules of minimum rates and charges, maintained by Emmett when these proposals were suspended, were published in his schedule MF-I. C. C. No. 4, and supplements thereto. This schedule provided class and commodity rates subject to a rule which read as follows: "Whenever a commodity rate is established, it removes the application of the class rate to or from the same points on that commodity." Classification ratings were provided on commodities to apply in connection with the class rates. The suspended items are published in supplement 4 to MF-I. C. C. No. 4.

At the time of the suspension, the minimum rating maintained on oleomargarine, in less than truckloads, was column 85 (85 percent of first class). The proposal herein is to reduce this rating to column 70 (70 percent of first class). On July 7, 1942, the respondent filed schedule MF-I. C. C. No. 5, which became effective August 7, 1942, and canceled MF-I. C. C. No. 4 except the suspended items. The rating of column 85 on oleomargarine was continued in effect in schedule MF-I. C. C. No. 5, but the class rates were generally increased 6 percent. As above indicated, the period of suspension expired October 20, 1942, and since that date the respondent has maintained two ratings, namely, the suspended rating of column 70 filed February 26, 1942, and the column 85 rating in schedule MFI. C. C. No. 5, filed July 7, 1942. The minimum rates in schedule MF-I. C. C. No. 4, however, had been canceled before the proposed rating became effective, and the schedule contained no reference to another schedule for the application of rates. There were therefore no rates in connection with the proposed rating, and, consequently, it had no effect and did not conflict with the column 85 rating and rates in schedule MF-I. C. C. No. 5. In the circumstances, the issue as to the reasonableness of the proposed rating would ordinarily be moot, but, as this situation may have been created inadvertently, we shall proceed to determine the lawfulness of the proposal.

The protestant conference carriers generally maintain rates on oleomargarine, in less than truckloads, between the points involved

on the basis of third class (70 percent of first class). Prior to March 18, 1942, Emmett's minimum class rates were approximately the same as the corresponding class rates of the conference carriers. On that date, the conference rates were subject to a general increase of 6 percent, but Emmett's were not. The sole objection of the protestants is to the disparity in the class rates and not to the proposed reduction in the rating. As above indicated, the respondent now maintains class rates substantially the same as the conference carriers, and, if the proposed rating were now established, the respondent's rates would be on the same basis as the conference carriers.

Less-than-truckload class rates on canned goods from Montezuma, Oglethorpe, and Zebulon to Cincinnati were maintained by Emmett at the time of the suspension. Most articles of canned goods were rated column 37 (37 percent of first class), but a few were accorded higher ratings ranging from 55 percent to 70 percent of first class. The column 37 rate was 70 cents from Montezuma and Oglethorpe and 68 cents from Zebulon. From Griffin, he maintained a commodity rate on a large list of commodities, including canned goods, of 64 cents, minimum 10,000 pounds. Without canceling those rates, he proposed to establish commodity rates of 53 and 50 cents, minima 10,000 and 36,000 pounds, respectively, from Griffin, and 54, 54, and 50 cents, minimum 36,000 pounds, from Montezuma, Oglethorpe, and Zebulon, respectively. These commodity rates were suspended herein.

Schedule MF-I. C. C. No. 5, above mentioned, so far as here material, is a reproduction of schedule MF-I. C. C. No. 4 and its supplements, except for the suspended matter, but with the class rates increased approximately 6 percent. Thus, since October 30, 1942, when the suspension period expired, the respondent has maintained two schedules of minimum rates on canned goods, the one originally suspended naming the commodity rates, and schedule MF-I. C. C. No. 5, the latest published, naming commodity rates from Griffin and class rates from the other points. Under the rules in the schedules providing for the application of commodity rates, the latter are applicable. With respect to the rates from Griffin, however, the respondent now maintains minimum commodity rates of 53 cents, minimum 10,000 pounds, and 50 cents, minimum 36,000 pounds, in the schedule which was originally suspended, and a commodity rate of 68 cents, minimum 10,000 pounds, established in schedule MF-I. C. C. No. 5. These commodity rates are in conflict. In Petroleum Products, Wyoming Points to Missoula, Mont., 32 M. C. C. 453, division 2 found that, where conflicting minimum rates have been filed with the Commission at different times by the same motor contract carrier, the rates in the latest published schedule are the legal minimum rates. Consequently, in accordance with the doctrine in that proceeding, the commodity

rate of 68 cents, minimum 10,000 pounds, is the legal minimum rate. See Rubber Products Between Southern and Ohio Points, 41 M. C. C. 93. In view of the alinement of the rate from Griffin with the other commodity rates proposed, its lawfulness will be considered herein.

The highway distances to Cincinnati from Griffin, Zebulon, Montezuma, and Oglethorpe are 515, 526, 603, and 605 miles, respectively. The rail rates, minimum 36,000 pounds, on canned goods from the first two points are 53 cents, and from the latter two, 57 cents, and the corresponding conference rates, minimum 36,000 pounds, are 61 and 66 cents, respectively. The proposed rates, minimum 36,000 pounds, are designed to be competitive with the rail carload rates; and the proposed rate of 53 cents, minimum 10,000 pounds, from Griffin was the same as that maintained by an individual motor common carrier. These competitive rates include increases of 3 cents, approximately 6 percent, under the general increase of March 1942.

From January 1 to May 31, 1942, Emmett's total operating expenses were $14,858.68. During this period, his vehicles traversed 137,800 miles and transported 1,267 tons in 245 loaded trips, or an average of 10,342 pounds a trip per vehicle. No trips were made with empty vehicles. Based on these data, his average costs were 10.78 cents a truck-mile and 20.8 mills a ton-mile. This carrier could not transport a load of 36,000 pounds of canned goods in any of his vehicles. Presumably, 2 vehicles would have been used in transporting a volume shipment of 36,000 pounds, but the record does not disclose how much more than 18,000 pounds could be loaded in a single vehicle. The proposed rates of 50 and 54 cents, based on loads of 20,000 pounds, would yield revenues ranging from 17.8 to 19.4 cents a truck-mile, and, based on loads of 18,000 pounds, would yield revenues ranging from 16 to 17.4 cents a truck-mile. These revenues are clearly compensatory in relation to the costs of Emmett. The proposed rate of 53 cents, based on a minimum load of 10,000 pounds, would yield 10.3 cents a truck-mile. Emmett stated that, if just 10,000 pounds were received at Griffin, he would haul that load to Atlanta, Ga., and there transfer from another truck, in-bound from other points in the South, approximately 2,000 pounds of north-bound freight, so that the north-bound truck would have a load of approximately 12,000 pounds. Emmett's average load was, as above mentioned, slightly in excess of 10,000 pounds, and there is no substantial evidence that this additional lading would be available. There is no evidence that Emmett's cost per 100 pounds for transporting a shipment of 36,000 pounds of canned goods in more than 1 vehicle would have been less than the cost of transporting single truckload shipments. Volume minimum weights in excess of truckload capacity are unreasonable in the absence of proof that such quantities can be transported in more than one unit of equip