signees. The present rates are 30 cents, minimum 20,000 pounds, under which split deliveries are not permitted, and 58 cents, in less than truckloads, based upon classification-exceptions ratings which are approximately 30 and 60 percent of first class, respectively. These exceptions ratings are applicable generally throughout central territory over the lines of the bureau carriers. Ratings in the national motor freight classification (East) on this commodity, in boxes, are fifth class, minimum 30,000 pounds, and third class, in less than truckloads. The proposed truckload rates are approximately 28 and 33 percent of first class, respectively. The bureau, in support of its position that the proposed rates are unreasonably low, points out that the operating costs of motor carriers are increasing, and urges that the establishment of these rates will disrupt the present uniform rate structure in central territory, and will result in preference of shippers at St. Louis and prejudice to shippers at certain other points. In a sense, any commodity rate will be said to be disruptive of the class-rate level. There is no showing that the alleged prejudiced points are served by the respondents, or that the transportation conditions from the various origins are similar. The proposed 27-cent rate, which includes one pick-up and one delivery, is proposed to meet the competition of a motor contract carrier. Based on the minimum, it would yield 20.4 cents a loaded truck-mile for the 265-mile haul from St. Louis to Louisville. No evidence as to costs was submitted by either party, but, in view of the respondent's past experience in transporting the commodity, the testimony of its vice president that the proposed rate would be reasonably compensatory is entitled to weight. The respondent has transported this commodity from St. Louis in less than truckloads to Louisville, and in truckloads to a more distant point in Kentucky. We conclude that this proposed rate is not below a minimum reasonable basis. The proposed split-delivery rate of 32 cents includes "delivery service to more than one but not to exceed eight consignees." It was arrived at by adding, to the one-delivery rate hereinbefore considered, the rate of 5 cents which is the rate charged by the local cartage companies at Louisville for the distribution of pooled shipments. The only evidence offered in support of this rate is the testimony of the respondent's vice president that it can make split deliveries from overthe-road vehicles profitably for the same amount charged by the local cartage operators, and a showing that the bureau carriers, the respondent included, maintain a rate of 32 cents, the same as the split-delivery rate here proposed, from St. Louis to Louisville on glass bottles, minimum 15,000 pounds, including not more than five deliveries at destination without additional charge. Whether or not the delivery charges of the local cartage carriers at Louisville are proper criteria for measuring the reasonableness of line-haul rates, which include delivery from over-the-road vehicles, is left to conjecture. The respondent's representative had made no study of its delivery costs. As already indicated, the deliveries proposed apparently may be made not only in Louisville, but also in five contiguous municipalities, such as New Albany, Ind. The record does not indicate that the local carters make delivery at those points for the same charge. The compared rate on bottles is not in issue herein, but its reasonableness may be open to question. The record discloses no other instance of the maintenance of similar split-delivery rates in central territory. The 27-cent rate includes one delivery; the 32-cent rate, two to eight deliveries. The 5-cent difference in the two rates would, therefore, represent the revenue accruing to the respondent for deliveries in excess of one, but the actual amount received for each delivery would vary inversely as the number of deliveries increased. Thus, on a 20,000-pound shipment to two consignees, the respondent would receive $10 for making one extra delivery, whereas on a similar shipment to eight consignees its revenue would amount to $1.43 for each of the seven deliveries in excess of one. The bureau contends that the proposed split-delivery rate is an apparent attempt to establish truckload rates on shipments which are, in fact, less-than-truckload shipments. The evidence is insufficient to permit a determination of that issue. However, the theory justifying the establishment of a lower rate for truckload than for less-than-truckload quantities is that the truckload rate ordinarily contemplates the receiving, transporting, and delivering of a single shipment from one consignor to one consignee, on one bill of lading, at a cost generally lower than that of handling a number of smaller shipments. Where, as here, delivery would be made to as many as eight consignees, located at as many as six contiguous but separate municipalities, there would be a departure from the theory of a single shipment. Obviously, the expense of making the additional deliveries under these circumstances would exceed the cost of the delivery of a single shipment at one address. The respondent has not met the burden of showing that the 5-cent spread between the two rates would adequately compensate it for the additional service that would be provided under the 32-cent rate. The record affords no basis for the determination of a reasonable rate for the proposed service. We find that the proposed rate of 27 cents is just and reasonable, but that the proposed rate of 32 cents has not been shown to be just and reasonable, and is therefore unlawful. An order will be entered requiring cancelation of the suspended schedules to the extent found unlawful, and discontinuing the proceeding. No. MC-3697 BLACKHAWK LINE, INCORPORATED, (JOSEPH KRUGER, RECEIVER) REVOCATION OF CERTIFICATE Submitted April 4, 1942. Decided March 23, 1943 Upon petition seeking revocation of respondent's certificate, because of alleged cessation of operations thereunder, found, that operations have been resumed by respondent's successor in interest. Petition seeking revocation of certificate denied. Warren Woods and Charles B. McInnis for petitioner. George S. Alberts for respondent. Henry P. Goldstein and A. R. Eldred for interveners. REPORT OF THE COMMISSION DIVISION 5, COMMISSIONERS LEE, ROGERS, AND PATTERSON BY DIVISION 5: Exceptions were filed by petitioner, respondent, and intervener, Quaker City Bus Co., hereinafter called Quaker, to the order recommended by the examiner. Our conclusions differ from those recommended. By petition filed April 8, 1941, Silver Dart Lines, Inc., alleges that respondent, Blackhawk Lines, Incorporated, ceased all motor-carrier operations authorized in a certificate of public convenience and necessity issued to it by the Commission on July 25, 1940, wherein it was authorized to operate, in interstate or foreign commerce, as a common carrier by motor vehicle of passengers and their baggage, and of express and newspapers in the same vehicle with passengers, between Boston, Mass., and New York, N. Y., over specified routes, with service at all intermediate points. It prays that the described certificate be revoked. Quaker intervened in behalf of respondent. Rail carriers in officialclassification territory also intervened but introduced no evidence. Following an informal investigation of respondent's "grandfather” application, on March 29, 1938, the Commission, division 5, issued a certificate to it. That certificate was superseded and canceled by an amended certificate issued July 25, 1940.1 The latter certificate reads in part as follows: 1 Amended certificate was issued to reflect a slight change or correction in respondent's corporate name. It is ordered, That this certificate shall remain in force for such period as the said carrier shall continue to perform the services herein authorized, unless revoked in accordance with the provisions of the Motor Carrier Act, 1935. Respondent began operations in 1932 or 1933. After 1936 its operations resulted in a deficit each year until, in December 1940, its financial condition had reached the point where discontinuance of all operation was imminent. After a trip on February 5, 1941, all motorcarrier operations were discontinued, and, on March 5, 1941, a petition in involuntary bankruptcy was filed in the District Court of the United States for the District of Massachusetts by certain of the creditors. On March 24, 1941, Joseph Kruger was appointed receiver. The only vehicles which the bankrupt had owned were repossessed by mortgage holders. The receiver sold for $125 the bankrupt's remaining assets, consisting of furniture. The terminal and office were then closed and personnel dismissed. The receiver obtained an order from the referee in bankruptcy on April 11, 1941, authorizing the former to resume operations for a 30-day period, but the next day it was decided to solicit bids from prospective purchasers. Quaker was the successful bidder. On May 12, 1941, in No. MC-F-1546, Quaker and respondent jointly filed an application under section 5 of the Interstate Commerce Act seeking authority for the purchase by Quaker of the operating rights of respondent for $7,000. A hearing was held thereon, and subsequently further hearing was held covering No. MC-F-1546 jointly with the instant proceeeding. By consent of both parties the record in the prior hearing in No. MC-F-1546 was incorporated by reference into the record herein. On May 12, 1941, Quaker also filed a petition for temporary authority under section 210a (b), which was granted by the Commission, division 4, on June 4, 1941, the order requiring that operation be instituted June 6, 1941. Operations were not instituted, and that authority expired. Temporary authority was again sought by petition filed June 11, 1941, and granted June 21, 1941. Pursuant thereto, Quaker performed operations over the routes described in the certificate over a period of 180 days beginning on June 25, 1941. Subsequent to the issuance of the report and recommended order of the examiner in this proceeding, the Commission, in Quaker City Bus Co.-Purchase-Blackhawk Line, Inc., 38 M. C. C. 603, approved the purchase by Quaker of operating rights of respondent herein. The transaction there authorized was consummated on November 4, 1942, and Quaker has reinstituted operations between the points and over the routes described in the certificate. The question presented is whether the described discontinuance of operations automatically caused a revocation of respondent's certificate under the above-quoted provision of its certificate. That it does not was determined in Smith Bros. Revocation of Certificate, 33 M. C. C. 465. In that proceeding, the Commission affirmed the prior findings of division 5 in 22 M. C. C. 524 and 26 M. C. C. 219, and concluded (1) that, irrespective of a self-executing forfeiture term or condition in a certificate, a certificate continues in full force and effect unless and until terminated in accordance with the provisions of section 212 (a) of the act, (2) that the cessation of all operations by a carrier, in circumstances such as are present in the instant proceeding, must be construed to be a "willful failure," as that term is used in section 212 (a), to comply with the term or condition in its certificate, namely, that it shall remain in force for such period as the carrier shall continue to perform the services therein authorized, and (3) that a certificate may not be revoked without entering an order giving the holder thereof at least 30 days in which to comply with the term, condition, or limitation of such certificate found by us to have been violated by such holder. From the foregoing, it is evident that, while respondent's cessation of operations must be construed to be a "willful failure" to comply with the quoted condition in its certificate, nevertheless we may not revoke that certificate without entering an order in the manner specified above and not then if respondent has fully complied with such terms or conditions as may have been violated. For this reason, the entry of such an order in this proceeding would be futile, as we have been advised that operations have been resumed by Quaker as a result of the Commission's approval of respondent's operating rights. Although this advice is contained in a letter received from counsel representing Quaker, we see no need in the circumstances of reopening this proceeding in order to verify this information. We find that, although respondent at one time failed to comply with all terms and conditions contained in the certificate issued to it, such noncompliance with the terms and conditions of the certificate has since ceased, and that respondent's successor in interest, Quaker City Bus Co., has complied with the terms and conditions stated in the certificate; and that the petition for revocation of the certificate issued in this proceeding should be denied. An appropriate order will be entered. 42 M. C. C. |