if any, to which this statutory requirement has been met, we must determine whether the new operation will serve a useful purpose responsive to a public demand or need; whether this purpose can and will be served as well by existing carriers; and whether it can be served by applicant without endangering the operation of existing carriers contrary to the public interest. Pan-American Bus Lines Operation, 1 M.C.C. 190, 203 (1936).

Shippers contend that protestant Watkins is unable to provide equipment when required and does not always supply appropriate van trailers. Watkins indicates 95 loads it handled for shippers (15 of which applicant could have transported pursuant to its present authority) over a period during which a number of its 15 specified service failures are alleged to have taken place. Watkins would have us conclude that the service failures are insignificantly small in number and have little probative value absent a showing that shippers tried and failed to find alternate means of transportation for the considered shipments. In advancing these and like arguments that there is a substantial amount of motor carrier service available to meet shippers' needs, Watkins begs the question of whether or not it is capable of providing shippers appropriate dry van equipment when needed. A finding of inadequacy of existing service need not be predicated upon the existence of a high percentage of service failures as contrasted with satisfactory movments. Considering the facts that protestant has neither sought to explain its service failures nor affirmatively indicated its ability to meet shippers' requirements for equipment, we must conclude that protestant is unable to meet those requirements. Our conclusion in this regard is bolstered by Watkins' own traffic exhibit which demonstrates that the weight of the loads it transported for shippers averaged well below the 40,000 to 42,000 pounds shippers wish to load in dry van trailers.

Protestants, Ryder, Bowman, and M.R.&R., operate and could provide shippers substantial appropriate equipment to handle their clay. Taking into account shippers' demonstrated transportation requirements, including the need for the services of a carrier able to provide a flexible, multiple delivery service over statewide or multistate areas, however, we deem these protestants' pertinent operating authority to be quite limited. Parenthetically, while Bowman holds authority to serve all points in four named States, we are constrained to conclude that (particularly in light of Bowman's failure to address itself to Waverly's assertion that it has shown no interest in providing service to points other than Norfolk, Va.) the fragmentation of the authority granted applicant that would result

from deletion of the four States is not warranted. Protestants assert that they interline with numerous other common carriers (none of which is named) to provide service to points which they are unauthorized to serve. As none of these carriers is a party to this proceeding, we are unable to determine whether such carriers hold appropriate authority, operate suitable equipment, or are actually interested in, and available for, the transportation of the considered traffic. Kroblin Refrigerated Xpress, Inc., Ext.-North Dakota, 89 M.C.C. 657, 659 (1962); Rowley Interstate Transp. Co., Inc.-Investigation, 110 M.C.C. 285, 292 (1969); and West Motor Freight, Inc., Extension-Fleetwood Foods, 118 M.C.C. 50, 55 (1973). We note additionally that in cases such as the present, in which shippers require the performance of scheduled deliveries, occasionally at times other than during normal working hours, opposing carriers which must rely on interlining carriers to effect delivery are often unable to promise that timely deliveries will in fact be made. Ryder, Bowman, and M.R.&R. uniformly avow that they require shippers' clay traffic to help them balance their operations in the Southeast. However, protestants have in the past provided very limited service for shippers and have failed to show that they are able to meet shippers' demonstrated transportation requirements. In these circumstances, we must conclude that a grant of authority to applicant would provide shippers with a needed service while doing little or nothing to impair the present operations of these protestants.

Our conclusions differ with those of the review board with respect to the opposition of protestant Mercury. We believe that the contiguous States and areas to which Mercury holds out pertinent service should be excepted from the destination territory applicant will be granted authority to serve. Mercury operates and is able to provide in a timely manner the type of equipment shippers require. Its traffic exhibits indicate that it has indeed been providing shippers equipment capable of handling their 40,000- or 42,000pound consignments. This protestant holds out the services shippers. require and, pursuant to its relevant irregular, regular and off-route point authority, is able to provide shippers the requisite flexible, multiple-delivery service over a broad territory. Complaints of delays encountered in the use of Mercury's service are unsubstantiated, and we have not been shown that Mercury's observance of gateways in North Carolina and South Carolina in the performance of service for shippers has produced, or would produce, unduly circuitous operations. We see authorize service duplicative of that presently held out by Mercury.

no reason to

Several other matters require consideration. First, inasmuch as a number of protestants are serving nonparty shippers of clay located in Thomas County, plantsite restrictions will be imposed in the grant of authority to applicant in order to protect protestants' established interests by precluding applicant from holding out service to such shippers., Fox-Smythe Transp. Co. Extension-Oklahoma, 106 M.C.C. 1, 17 (1967). Additionally, we note that, contrary to the implications of the board's grant, the award of authority to serve Chicago, Ill., and Indianapolis, Ind., carries with it implied authority to serve the commercial zones of those cities. Commercial Zones and Terminal Areas, 54 M.C.C. 21, 108-109 (1952). Finally, we point out that we have granted no authority duplicative of that presently held by applicant.

FINDINGS

On reconsideration, we find that the present and future public convenience and necessity require operation by applicant, in interstate or foreign commerce, as a common carrier by motor vehicle, over irregular routes, of clay (except in bulk), (1) from the plantsite of Waverly Mineral Products Co., in Thomas County, Ga., to Chicago, Ill., Indianapolis, Ind., points in New York north of New York Highway 7, and points in Colorado, Kansas, and Nebraska, and (2) from Quincy, Fla., and from the plantsite of the Floridin Company in Thomas County, Ga., to points in New York north of New York Highway 7, and points in Arkansas, Colorado, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, Ohio, Oklahoma, Tennessee, Texas, Vermont, and Wisconsin; that applicant is fit, willing, and able properly to perform such service and to conform to the requirements of the Interstate Commerce Act and the Commission's rules and regulations thereunder; that this decision is not a major Federal action significantly affecting the quality of the human environment within the meaning of the National Environmental Policy Act of 1969; that a certificate authorizing such operations should be granted; and that the application in all other respects should be denied.

Upon compliance by applicant with the requirements of sections 215, 217, and 221(c) of the act, and with the Commission's rules and regulations thereunder, within the time specified in the order entered concurrently herein, an appropriate certificate will be issued.

An appropriate order will be entered.

No. MC-C-7840

THE MILLENBURG TOURS, INC. v. LILLIAN HOFMEISTER

Decided January 30, 1976

Defendant found to have been engaged in operation as a broker of transportation by motor vehicle, in interstate or foreign commerce, of passengers, in tour service, beginning and ending at Baltimore, Md., in violation of section 211 of the Interstate Commerce Act. Cease and desist order entered.

Charles Gillian, Jr., and S. Harrison Kahn for complainant and intervener in support of complainant.

Edwin J. Wolf for defendant.

REPORT OF THE COMMISSION

DIVISION 1, COMMISSIONERS MURPHY, GRESHAM, AND MACFARLAND

MACFARLAND, Commissioner:

Exceptions to the initial decision of the joint board were filed jointly by complainant and interveners, and a reply was filed by defendant.

By complaint filed March 9, 1972, The Millenburg Tours, Incorporated, of Baltimore, Md., alleges that the defendant, Mrs. Lillian Hofmeister, of Baltimore, is conducting operations as a broker of passenger transportation in violation of section 211 of the Interstate Commerce Act. Monumental Motor Tours, Inc., and Wieland Tours Co., Inc., both of Baltimore, intervened in support of the complaint.

In its initial decision served February 22, 1974, the joint board found that defendant did not require authority under the provisions of section 211 of the act. It found that tour groups may be organized without a license if the operations were not conducted for compensation and concluded that the complainants did not sustain the burden of proof necessary to show that defendant's operations were conducted for profit or otherwise were of a character requiring brokerage authority.

On exceptions, complainant and interveners contend that the joint board erred in concluding that the defendant's activities were not for compensation. They argue that there is nothing in the Interstate Commerce Act which defines compensation or requires that an endeavor be profitable. They submit that the only issue involved in the instant proceeding is whether defendant's activities are such as would require a broker's license as contemplated by the Interstate Commerce Act. In reply, defendant contends that the joint board's findings are correct and should be affirmed.

The evidence, the initial decision and recommended order of the joint board, and the pleadings have been considered. Although we disagree with the joint board's ultimate conclusions, we find the statement of facts in the initial decision to be substantially correct in all material respects. A brief summary of the factual situation will be included herein for clarity of discussion.

FACTUAL BACKGROUND

Defendant holds no authority from this Commission. Around 1970, she began to arrange for the transportation of passengers, by motor carrier. Transportation arrangements were made on most occasions with the Baltimore and Annapolis Railroad Company (B & A), a certificated motor common carrier of passengers although other motorbus operators were used as well. From approximately January 1, 1973, through July 15, 1973, defendant advertised by local newspapers and through word of mouth, and conducted 34 public tours' in interstate commerce. Transportation services were provided on these occasions by B & A, and charges on the public tours were paid directly by defendant to the carrier. Advance reservations were also made as of the date of the hearing for an additional 28 trips in interstate commerce to be conducted from July 28, 1973, through December 16, 1973. Defendant states that originally the only charge made was the rate furnished by the B & A. Defendant received no commission or other compensation from the public tours, and on these tours purchased her own ticket. She states that the complained of operations were conducted as a "hobby" and were on a nonprofit basis. Originally if monies

'As defendant describes these "public tours" they are apparently arranged in a manner similar to that described in Tauck Tours, Inc., Extension-New York, N. Y., 54 M.C.C. 291, 300-303 (1952). Defendant would sell individual tour "tickets" to the passengers and employ the charter service of an authorized motor carrier for the transportation involved. The price charged each passenger is calculated by dividing the expenses of the tour by the minimum number of tickets to be sold.