C. G. Willis, Inc., argues in its exceptions that, inasmuch as most of Eastern's traffic consisted of unregulated bulk cargo, Dauntless could just as well operate its tugs with chartered barges hauling bulk commodities without any authority from us. This argument loses sight of the fact that the ability to carry both kinds of cargo permits an integrated service which not only benefits shippers, but also permits economies in operation which would not be possible otherwise.

Evidence was adduced by the vendees concerning Eastern's management policies prior to bankruptcy showing that its financial condition, which eventually resulted in receivership and bankruptcy, became progressively worse because of abnormal operating expenses and not because of a decrease in revenues due to a shortage of traffic. During the war, coal destined to the New England States which, under normal circumstances, would have moved out of Hampton Roads, Va., via deep-sea lanes, was loaded at rail-water terminals in the New Jersey and southern New York areas and routed through Long Island Sound. Numerous carriers engaged in this service, which was ordered by the Office of Defense Transportation. Some vessels were lost and little maintenance was done on the others because of the urgency of the service. Eastern did not accumulate any reserve for replacing its equipment, with the result that the cost of operating wornout and obsolete units during the postwar years, and the insurance premiums thereon, were considerably higher than they would have been with new or modern equipment. Liberal dividends were paid to stockholders, and substantial salaries were paid to the officers of the corporation during these later years. Willis contends in its exceptions that the resumption of Eastern's operations by a new and more responsible carrier with excellent resources will be tantamount to penalizing it (Willis) for maintaining service during the time when Eastern chose not to do so. The causes giving rise to the cessation of operations by Eastern have been given due consideration, but are found not to be controlling in this proceeding.

We have denied the application of a prospective purchaser of water-carrier operating rights where the effect of the institution of operations, under such rights, which had not been exercised over a long period, would have been the same as authorizing a new service in competition with existing carriers which had provided all the service that was required. Gulf-Canal Lines Inc., Purchase, 265 I. C. C. 669. A mere desire on the part of a prospective purchaser of operating rights to engage in what in effect amounts to a new service, unsupported by any evidence of a need therefor, does not afford a sufficient basis for a finding that the proposed transaction would be in the public interest. T. J. McCarthy S. S. Co. Purchase,

265 I. C. C. 611. In Upper Columbia River Towing Co. Purchase, 265 I. C. C. 759, 769, we said:

Among the factors to be considered in determining the question of consistency with the public interest are the immediate and prospective traffic requirements in the affected territory, the needs of the shippers, the ability of the prospective purchaser to provide the proposed service, the adequacy of the service of the existing carriers, whether the proposed service would divert traffic from them and impair their ability to serve the shipping public, and whether unsound economic conditions in the water-carrier industry would result from approval of the proposed transaction.

The facts in the present case differ from those in the McCarthy and Gulf-Canal Lines cases, and more or less coincide with those bearing upon the factors quoted from the Upper Columbia River case. The record herein therefore justifies the conclusion that the present and future traffic requirements in the stated area warrant the resumption of the service formerly carried on by Eastern. Traffic in bulk and nonbulk commodities is presently available, and so far as can be foreseen, will be available in the future. The financial condition of Dauntless to provide this service, especially the deep-sea barging, is not only established by the evidence, but virtually conceded by Willis in the exceptions. The exercise of the subject rights by Dauntless will not result in unsound economic conditions in the industry, but will provide additional service to the shipping public without impairing the ability of other water carriers in the area to continue their service. Dauntless has sufficient towing equipment to provide this service, but it does not own or control any barges except the one belonging to Coastwise Transportation Line, Inc., which as stated before, is controlled by bareboat charter. This vessel would be sufficient to accommodate only a minor part of the traffic formerly handled by Eastern. An official of Dauntless testified that the partnership intends to contract for the construction of 2 modern deep-sea barges that will cost about $275,000 each, in order to carry on the proposed operation. Financial statements of record indicate that this outlay, if wisely negotiated, can be made without jeopardizing its present financial condition or adversely affecting its service to the shipping public. Accordingly, the issuance of an amended certificate will be withheld pending a showing by Dauntless that it has built or purchased sufficient vessels whereby it will be ready, 1 year from the effective date of our order herein, to begin the service formerly conducted by Eastern.

As stated before, Dauntless is now authorized to operate as a common carrier by water by general towage between ports and points along the Atlantic coast and inland tributary waterways, including the New York State Canal system. Eastern's operating authority,

among other things, also permits the use of separate towing vessels in the performance of towage between ports and points along the Atlantic coast and inland tributary waterways, exclusive of the New York State Barge Canal system, from Maine to Pamlico Sound, inclusive. Counsel for Dauntless has agreed to the cancellation of whatever duplications might exist in the operating rights should the application herein be approved. All duplications will be eliminated if and when the superseding certificate is issued herein. See McAllister Lighterage Line, Inc., Purchase, 265 I. C. C. 483. The proposed transaction does not involve the guaranty or assumption of payment of dividends or fixed charges, and no increase in total fixed charges will result therefrom. The interests of carrier employees will not be adversely affected because Eastern has not operated for a considerable period.

We find that purchase by Chris Nielson, Charles M. Miller, Harry W. Miller, Carl Nelson, Hjordis Johnson, and Julie Taraldsen, doing business under the trade name and style of Dauntless Towing Line, is a transaction within the scope of section 5 (2) of the Interstate Commerce Act, as amended, that the terms and conditions proposed and the conditions herein prescribed are just and reasonable, and that the transaction will be consistent with the public interest.

We further find that Chris Nielson, Charles M. Miller, Harry W. Miller, Carl Nelson, Hjordis Johnson, and Julie Taraldsen, doing business under the trade name and style of Dauntless Towing Line, are fit and willing, and when they build or purchase the necessary vessels will be able, properly to perform the common-carrier service which Eastern Transportation Company is authorized to perform, and to conform to the provisions of part III of the act, and the requirements, rules, and regulations of the Commission thereunder; that transfer to them of the operating rights of Eastern Transportation Company authorizing operation by non-self-propelled vessels with the use of separate towing vessels in the transportation of commodities generally, and by towing vessels in the performance of towage, in interstate and foreign commerce, between ports and points along the Atlantic coast and inland tributary waterways (not including the New York State Barge Canal system) from Maine to Pamlico Sound, inclusive, subject to the condition as to the acquisition of vessels herein prescribed, is consistent with the public interest; and if the transaction, as herein authorized is consummated, Chris Nielson, Charles M. Miller, Harry W. Miller, Carl Nelson, Hjordis Johnson, and Julie Taraldsen, doing business under the trade name and style of Dauntless Towing Line, will be entitled to an amended certificate granting the operating rights heretofore indicated less all duplications. Suitable provisions

pre

will be made in our order herein for proper notice to this Commission of the consummation of the transaction, and for submission of journal entries. Upon receipt of such notice and compliance with the scribed condition, a certificate will be issued superseding the certificate heretofore issued said partnership in No. W-237, and the certificate heretofore issued to Eastern Transportation Company in No. W-600, which rights will be unified and all duplications eliminated.

An appropriate order will be entered effective 40 days from its date. 285 I. C. C.

FINANCE DOCKET No. 176161

AMERICAN COASTAL LINES, INC., PERMIT TRANSFER,

ETC.

Submitted March 12, 1953. Decided June 1, 1953

1. Application of National Container Corporation of Virginia (Marine Division) for transfer to it of the second amended permit and order dated May 23, 1950, issued in No. W-14, to American Coastal Lines, Inc., denied. Finance Docket No. 17616.

2. Application of National Container Corporation, a Delaware corporation, through ownership of stock of the Airdepot Realty Corp., owner of the stock of the National Container Corporation of Virginia, to acquire control of the operating rights of American Coastal Lines, Inc., while continuing control of the Marinette, Tomahawk & Western Railroad Company through stock ownership of the National Container Corporation of Wisconsin, dismissed. Finance Docket No. 17616 (Sub-No. 1).

F.C.Hillyer, T. C. Maurer, Daniel S. Dubbin, and Malcom D. Miller for applicants.

J. Roger Stanfield for an interested party.

Warren Price, Jr., L. A. Parish, Richard H. Specker, J. Carter Fort, Jr., James A. Bistline, Donald Macleay, John H. Eisenhart, Jr., L. Agnew Myers, Jr., and Robert H. Shertz for protestants and interveners in opposition.

REPORT OF THE COMMISSION

DIVISION 4, COMMISSIONERS JOHNSON, MITCHELL, AND ARPAIA BY DIVISION 4:

Exceptions to the report proposed by the examiner were filed and oral argument was heard. Exceptions and requested findings not specifically discussed nor reflected in our findings or conclusions have been considered and found not justified.

The National Container Corporation of Virginia, a Virginia corporation, through its Marine division, and the American Coastal Lines, Inc., applied jointly on January 14, 1952, under section 312 of the Interstate Commerce Act, as amended, for approval of transfer to the former, hereinafter called the Virginia company or the applicant, of the second amended permit and order dated May 23, 1950, issued to American Coastal Lines, Inc., herein sometimes called Coastal or

1 This report also embraces Finance Docket No. 17616 (Sub-No. 1), National Container Corporation of Virginia (Marine Division) Control.