No. MC-C-365

DIXIE FREIGHT LINES, INC., v. GEORGE STRANGE FREIGHT LINES, INC.

Submitted December 15, 1943. Decided July 3, 1944

Divisions accorded complainant out of joint motor common carrier rates on property originating at points north and east of Atlanta, Ga., and destined to points on defendant's lines in Alabama found unjust, unreasonable, and inequitable. Basis for just, reasonable, and equitable divisions prescribed for future.

C. E. Walker for complainant.

J. S. Hinton and Sid B. Jones for interveners in support of complainant.

Maurice F. Bishop for defendant.

REPORT OF THE COMMISSION

DIVISION 3, COMMISSIONERS MILLER, ROGERS, AND PATTERSON BY DIVISION 3:

No exceptions were filed to the order recommended by the examiner, but we stayed its effectiveness. Our conclusions differ from those recommended.

By complaint filed February 23, 1943, Dixie Freight Lines, Inc., alleges that the divisions of joint motor common carrier rates between it and defendant, George Strange Freight Lines., Inc., are unjust, unreasonable, and inequitable, in violation of section 216 (c) of the Interstate Commerce Act, and that defendant operates in violation of section 204 of the act. Complainant asks that we prescribe just, reasonable, and equitable divisions for the future and require defendant to cease and desist from the alleged violations of section 204. The violations of section 204 are obscurely alleged, no evidence in respect thereof was adduced, and they will not be further considered. Miller Motor Express and Malone Freight Lines, Inc., intervened at the hearing, in support of complainant.

Complainant is a motor common carrier of general commodities operating over regular routes between Birmingham, Ala., and Atlanta, Ga., and between Atlanta and Montgomery, Ala. Similar operations are conducted by defendant between Birmingham and Mobile, Ala., over routes through Montgomery. Defendant is a successor to Motor

Terminal & Transportation Company, Inc. which it acquired by purchase in April 1942.

Complainant and defendant interchange traffic at Montgomery and, prior to January 15, 1943, they, including defendant's predecessor, divided joint rates on the basis of a prorate of the first-class rates to and from Montgomery. This basis has been in effect generally since 1936, and is at present observed by complainant and its other connections. In January 1943, defendant informed complainant that, effective January 15, 1943, on south-bound traffic, it would expect 10 percent in addition to the first-class rate prorate as its share of the joint revenue and that on traffic defendant could receive at Birmingham, which is delivered to it at Montgomery, it would expect a division based on a first-class rate prorate to and from Birmingham. It appears, however, that divisions were increased only on traffic originating at eastern and northern points beyond complainant's lines and in which the latter participates as an intermediate carrier from Atlanta to Montgomery. On traffic originating at points on complainant's lines and consigned to points on defendant's lines, the revenues are divided on a straight first-class rate prorate.

Motor rates from northern and eastern points to Alabama are, generally speaking, divided on the basis of 60 percent to the lines north and east of Atlanta, and 40 percent to the lines south of Atlanta. None of the parties expressed dissatisfaction with that basis of divisions and, as noted, the issues presented by the complaint and the evidence relate only to the divisions of the revenue which accrue to the lines south of Atlanta.

Defendant contends that the increase in its division of joint revenue on south-bound traffic is warranted because the cost of making deliveries at Mobile is greater than terminal costs at Atlanta. No data were submitted to support this contention. The complaint brings in issue not only divisions of rates to Mobile, but to all points on the defendant's lines south of Montgomery.

Section 216 (c) of the act makes it the duty of carriers parties to joint rates to establish just, reasonable, and equitable divisions thereof as between the carriers participating therein. The evidence of complainant herein raises a prima facie presumption that the basis of divisions observed by complainant and defendant prior to January 15, 1943, and which is generally observed by motor common carriers operating between Georgia and Alabama, is just, reasonable, and equitable. The meager showing of defendant fails to rebut this presumption. A carrier which demands higher divisions of joint rates than those generally received by other carriers performing a similar service should be prepared to submit substantial evidence in rebuttal of evidence indicating that such divisions are unlawful.

Upon this record we find that the divisions accorded complainant out of joint rates from points north and east of Atlanta, Ga., to points on defendant's lines are unjust, unreasonable, and inequitable. We further find that for the future just, reasonable, and equitable divisions of the proportion of the revenue from such traffic accruing to complainant and defendant shall be determined by use of a prorate of their first-class rates to and from Montgomery, Ala.

An appropriate order will be entered.

43 M. C. C.

No. MC-78227 (Sub-No. 1)

JAY L. MILLER EXTENSION OF OPERATION-IOWA AND ILLINOIS

Decided July 27, 1944

On reconsideration, findings in prior report, 23 M. C. C. 131, with respect to dairy products affirmed. Modification of finding found not necessary. Issuance of an appropriate permit approved upon compliance by applicant with certain conditions.

Appearances as shown in prior report.

REPORT OF THE COMMISSION ON RECONSIDERATION

DIVISION 5, COMMISSIONERS LEE, ROGERS, AND ALLDREDGE

BY DIVISION 5:

In our prior report herein, 23 M. C. C. 131, (decided May 10, 1940), we granted applicant, Jay L. Miller, doing business as Miller Transportation Co., of Rock Island, Ill., a permit authorizing certain operations as a contract carrier by motor vehicle, among which was the transportation of dairy products, from Des Moines, Marengo, and Grinnell, Iowa, to points in Illinois south of U. S. Highway 6, and on or north of Illinois Highway 10 between the Mississippi River and Urbana, and on or west of U. S. Highway 45 between Urbana and Kankakee, and on and north of Illinois Highway 17 extending between Kankakee and the Illinois-Indiana State Line, from Iowa Falls, Mason City, Hampton, Centerville, Muscatine, Ottumwa, Waterloo, Dubuque, Clinton, and Keokuk, Iowa, to all points in Illinois on and north of a line consisting of Illinois Highway 10 from the Mississippi River to Urbana, U. S. Highway 45 between Urbana and Kankakee, and Illinois Highway 17 from Kankakee to the Illinois-Indiana State line; and from Cedar Rapids, Oelwein, Ottumwa, and Reinbeck, Iowa, to Forest Park, Ill., and points in the Chicago commercial zone as defined in 1 M. C. C. 673.

Applicant sought to file a schedule of minimum charges which contained charges on shipments of eggs and dressed poultry from and to points described hereinabove. Some question arose as to the right of applicant to transport eggs and dressed poultry pursuant to authority to transport "dairy products," and applicant petitioned for reconsideration, requesting that the findings in our report be clarified to authorize the transportation of dairy products, including eggs and

dressed poultry. Pursuant to such petition, we have reopened the matter for reconsideration in this respect and have vacated the order entered May 10, 1940, which denied, in part, the application, to the extent that such order may deny authority to transport eggs and dressed poultry.

In No. MC-78227, under the "granfather" clause of section 209 (a) on the Interstate Commerce Act, a permit was issued to applicant on February 23, 1942, authorizing operation, in interstate or foreign commerce, as a contract carrier by motor vehicle, of poultry, eggs, dairy products, fresh meats, canned foods, and packing-house products, supplies, and equipment, from Chicago and Blue Island, Ill., to points in Iowa on and east of U. S. Highway 69; and also from Des Moines, Grinnell, and Marengo, Iowa, to points in Illinois on and north of U. S. Highway 6, over irregular routes. The authority granted in the instant case was intended as an extension of such operations.

Applicant and representatives of shippers for whom the proposed service will be performed testified that the term "dairy products,” as used in the application means butter, cream, cheese, eggs, and dressed poultry. The shippers purchase butter, milk, cream, eggs, and live poultry at various points in Iowa, and ship butter, eggs, and dressed poultry from the stations in Iowa to their branch stores and jobbing houses in Illinois. No cheese apparently is produce in Iowa by these shippers, but the term "dairy products" includes cheese as well as butter, cream, eggs, and dressed poultry, and applicant would be expected to transport all of these commodities if the occasion should arise.

In prior reports of the Commission in both rail- and motor-carrier proceedings involving rate matters "dairy products" are referred to as including butter, frozen butter, butter grease, fresh, frozen, or desiccated eggs, oleomargarine, dressed poultry, and rabbits. See Dairy Products from W. T. L. to Official Territory, 214 I. C. C. 727; National Poultry, Butter & Egg Assn. v. Aberdeen & R. R. Co., 192 I. C. C. 13; Dairy Products, Iowa to Dubuque, Iowa, and E. Dubuque, Il., 22 M. C. C. 405; and Dairy Products, Northwest to T. L. and N. E. Territories, 42 M. C. C. 607. We conclude that eggs and dressed poultry are embraced in the term "dairy products."

On reconsideration, we find that it will be unnecessary to change the findings in the prior report and order in 23 M. C. C. 131. Upon compliance by applicant with sections 215 and 218 of the act, with our rules and regulations thereunder, and with the requirements established in Contracts of Contract Carriers, 1 M. C. C. 628, an appropriate permit will be issued.