IN CERTIFICATE NO. MC-69116 (SUB-NO. 1), ISSUED MAY 1, 1942

Between Chicago, Ill., and St. Louis, Mo., as follows:

From Chicago over U. S. Highway 66 via Edwardsville, Ill., to its junction with By-pass U. S. Highway 40, thence over By-pass U. S. Highway 40, to its junction with Illinois Highway 157, thence over Illinois Highway 157 to its junction with U. S. Highway 40, and thence over U. S. Highway 40 to St. Louis.

From Chicago over U. S. Highway 66 to Hamel, Ill., thence over Illinois Highway 140 to its junction with unnumbered highway, thence over unnumbered highway to East Alton, Ill., and thence over Alternate U. S. Highway 67 to St. Louis. From Chicago over U. S. Highway 66 to Chenoa, Ill., thence over U. S. Highway 24 to Peoria, Ill., thence over U. S. Highway 150 to Bloomington, Ill., thence over U. S. Highway 51 to Decatur, Ill., thence over Illinois Highway 48 to its junction with U. S. Highway 66, thence over U. S. Highway 66 to Hamel, Ill., and thence as specified above to St. Louis.

From Chicago to Decatur, as specified above, thence over U. S. Highway 36 to Jacksonville, Ill., thence over U. S. Highway 67 to Alton, Ill., thence over Alternate U. S. Highway 67 to East Alton, Ill., thence over Illinois Highway 159 to Edwardsville, Ill., and thence as specified above to St. Louis.

And return over these routes to Chicago.

Service is authorized to and from the intermediate points of Joliet, Bloomington, Springfield, Peoria, Alton, East Alton, East St. Louis, and Wood River, Ill., and the off-route points of Roxana, Ill., University City, and Clayton, Mo.

APPENDIX B

Regular-route operating rights of Spector Motor Service, Inc., between Chicago, Ill., and St. Louis, Mo., following the purchase by Hancock Truck Lines, Incorporated, authorized in No. MC-F-3441

UNDER CERTIFICATES NOS. MC-69116 AND MC-69116 (SUB-NO. 1)

General commodities, with the same exceptions as at presentBetween Chicago, Ill., and St. Louis, Mo.: From Chicago over Illinois Highway 49 via Kankakee, Ill., to its junction with Illinois Highway 48, thence over Illinois Highway 48 via Fullerton, Ill., to Decatur, Ill., thence over U. S. Highway 36 via Springfield, Ill., to Jacksonville, Ill., thence over U. S. Highway 67 to Alton, Ill., and thence over Alternate U. S. Highway 67 via Wood River, Ill., to St. Louis, and return over the same route from St. Louis to Chicago.

Service is authorized to and from the intermediate points of Kankakee, Decatur, Springfield, Alton, East Alton, Wood River, and East St. Louis, Ill., and the offroute points of Roxana, Ill., and University City and Clayton, Mo.

50 M. C. C.

No. MC-F-3637

G. B. POWELL-LEASE-C. RAMPY

Submitted March 24, 1948. Decided April 30, 1948

Lease by G. B. Powell, doing business as G. B. Powell Truck Line, of the operating rights of C. Rampy, approved and authorized, subject to condition.

Cyril J. Smith for applicants.

REPORT OF THE COMMISSION

DIVISION 4, COMMISSIONERS MAHAFFIE, MILLER, AND ROGERS BY DIVISION 4:

G. B. Powell, doing business as G. B. Powell Truck Line, of Houston, Tex., and C. Rampy, also of Houston, by a joint application filed October 21, 1947, seek authority under section 5 of the Interstate Commerce Act for lease by the former of the operating rights of the latter for a 2-year period at a term rental of $4,000. A hearing has been held, at which the parties agreed to the omission of an examiner's proposed report.

By our order entered under section 210a (b), on November 19, 1947, lessee was authorized to lease the operating rights of lessor, except those covered by No. MC-64695 (Sub-No. 10) as to which the requested authority was denied,1 for a period expiring May 16, 1948, at a rental not exceeding $100 per month.

On June 6, 1947, in No. MC-44028, embracing No. MC-44028 (SubNo. 6), a certificate was issued to lessee authorizing operations, in interstate or foreign commerce, as a motor common carrier, over irregular routes, in the transportation (a) of machinery, equipment, materials and supplies used in, or in connection with, the discovery, development, production, refining, manufacture, processing, storage, transmission, and distribution of natural gas and petroleum and their products and byproducts, and (b) of machinery, materials, equipment and supplies used in, or in connection with the construction, operation, repair, servicing, maintenance and dismantling of pipe lines, including the stringing and picking up thereof, (1) between points in Texas, (2) between points in Louisiana, (3) between points in Louisiana, on the

1 Applicants' petition for reconsideration of our action as to No. MC-64695 (Sub-No. 10) was denied by the entire Commission on February 2, 1948.

one hand, and, on the other, points in Texas on, south, and east of a line beginning at the Louisiana-Texas State line and extending along designated highways through Gladewater, Tyler, Athens, Palestine, Crockett, Huntsville, Houston, and Angleton, to Corpus Christi, and (4) between points in Louisiana, on the one hand, and, on the other, points in Texas north and west of the same line. Lessee utilizes more than 20 motor vehicles in his operations.

On June 6, 1947, in No. MC-64695, a certificate was issued to lessor authorizing operations in interstate or foreign commerce, as a motor common carrier, over irregular routes, in the transportation of the same commodities as lessee, between points in Texas, Akansas, Kansas, Missouri, Oklahoma, and Tennessee. Under another certificate issued October 22, 1947, in No. MC-64695 (Sub-No. 10), lessor is authorized to conduct similar operations in transporting the same commodities (1) between points in Alabama, Georgia, Florida, and Mississippi, and (2) between points in the same four States, on the one hand, and, on the other, points in Texas and Arkansas, traversing Louisiana for operating convenience only.

By an order entered on February 14, 1946, in No. MC-FC-31228, W. F. Newton, doing business as Newton Well Service, was authorized to lease the operating rights of lessor under No. MC-64695 for a period to expire November 10, 1947, but after a few months returned them to lessor. On July 29, 1947, in No. MC-FC-31443, lessor again was authorized to lease the same rights to B. F. Cobb, doing business as B. F. Cobb Truck Line, for a period expiring July 1, 1950, but, because of Cobb's inability to comply with the insurance requirements of the act, he did not commence operations thereunder, and, on October 1, 1947, he also returned the rights to lessor. Prior to 1946, lessor operated as many as 70 pieces of equipment under the rights, but upon their return to him he did not resume operations thereunder. At the present time he has but 1 motor vehicle available for use in operating under the rights granted in the certificate in No. MC-64695 (SubNo. 10). He also engages in drilling activities in the oil fields and has found that drilling of wells and transportation are incompatible activities. The instant transaction was entered into with lessee because of his desire to devote his entire time to his drilling activities. Under an agreement of October 13, 1947, lessee would lease, for 2 years commencing with the date of our approval, all of lessor's operating rights described above under Nos. MC-64695 and MC-64695 (Sub-No. 10). The lease rental is $4,000 for the 2-year period, of which $2,000 is payable at any time during the first year, and the remainder at any time during the second year. Lessee is granted an option to purchase the operating rights for $30,000 at or prior to termi

nation of the lease period provided he gives lessor at least 30 days' written notice of his intention so to do. The agreement further provides that the lease will not be effective or binding on either party if this Commission should fail to approve the lease of lessee's interstate rights between points in Texas under No. MC-44028 to Buddy and Myrtle Sherrod,2 partners doing business as Gulf Welding & Machine Works, or if for some reason such lease is not consummated, unless lessee, within a reasonable time, shall lease the interstate rights in Texas to some other person. Although, as indicated, the lease contains an option to purchase, the parties at this time are requesting our approval of the lease only. Nothing herein contained is to be construed as authorizing an exercise of the purchase option without further authority from this Commission.

Lessee's balance sheet as of December 31, 1947, shows assets aggregating $145,149, consisting of: Current assets $33,285, principally cash (credit balance) $1,532, and accounts receivable $31,258; carrier operating property, less depreciation, $70,987; nonoperating property $11,815; intangible property $3,860; investment securities and advances $21,791; and deferred debits $3,411 and including prepayments $1,300. His liabilities were: Current liabilities $49,364, chiefly notes payable $14,911 and accounts payable $31,058; equipment obligations $47,634; other long-term obligations $25,000; and sole-proprietorship capital $23,151. His income statements for 1945, 1946, and 1947, show net incomes of $10,698, $3,820, and deficit of $631, respectively.

Lessor's balance sheet as of December 31, 1947, shows assets aggregating $23,175, composed of cash $4,577; tangible property, less depreciation, $16,148; and intangible property $2,450. His liabilities were comprised of accounts payable $310, taxes accrued $37, and soleproprietorship capital $22,828. No income statements for lessor are available.

Lessee's headquarters are at Houston, a center for the manufacture and distribution of oil-field equipment and supplies. He has had requests from shippers located there for service into all of the States authorized to be served by lessor, including two large oil companies and a drilling company who desire service into Alabama, Florida, Georgia and Mississippi. He has had 20 years' experience in this specialized field of transportation and at present has sufficient equipment, experi

In No. MC-FC-31501, lessee and Buddy and Mrytle Sherrod, partners doing business as Gulf Welding & Machine Works, of Conroe, Tex., made application, under section 212 (b), for authority to lease the former's interstate rights in Texas under certificate No. MC-44028 to the latter. However, that application was denied by division 5 by order of January 28, 1948, because the division in the rights as proposed would not be in conformity with the provisions of section 179.1 (c) of the Rules and Regulations Governing Transfers of Rights to Operate as a Motor Carrier in Interstate or Foreign Commerce.

enced personnel, and other facilities to conduct the unified operations and to provide the public with an improved and efficient service. He is prepared to acquire additional equipment and to hire additional employees, if needed, to meet any demands for increased service. No employees would be displaced by the transaction, and adequate competition would remain in the considered territory.

Under the operating authority leased, lessee would acquire, among others, rights between points in Texas which are entirely duplicated by his existing authority. Apparently because of his belief that the lease of duplicating rights would not be approved by this Commission, he sought authority to lease his own rights in that State in the proceeding mentioned in footnote 2. We do not understand, however, that approval of a lease of his own rights in Texas is a prerequisite to his consummation of the instant lease, should it be approved regardless of the overlapping authority which he would hold. Indeed, at the hearing, lessee requested the Commission to suspend his own operating authority in Texas, during the period of the lease, if a suspension was necessary to an approval. However, if his entire rights in Texas were suspended there would remain no common point of service or gateway at which the rights leased and those already held could be joined for purposes of performing a through service; for example, between points in Louisiana, on the one hand, and, on the other points in Kansas, Missouri, Oklahoma and Arkansas, hereinafter more fully discussed. Beginning with Southeast Ark. Frt. Line, Inc.-Lease-Herrin M. Lines, Inc., 38 M. C. C. 334, we have approved lease of duplicating rights where the circumstances warranted. In the instant case, lessee would obtain rights in nine additional States, including nonduplicating nonradial rights in each of them. Although in our opinion, lessee's purchase of the rights, with the resultant elimination of duplications, would be preferable to preservation of the duplicating rights by means of the lease, it appears that the proposed transaction may properly be approved. Compare Automobile Transport, Inc., of DelawareLease-Central, 50 M. C. C. 289.

As previously indicated, lessee has rights to operate between points in Louisiana, and between points in that State, on the one hand, and, on the other, points in Texas. Lessor may traverse Louisiana for operating convenience only. Since lessor, does not have authority to serve points in Louisiana, he may not originate or deliver shipments, or effect interchange of shipments with any other carriers, in Louisiana. Western Auto Transports, Inc., Extension-Pacific Coast, 26 M. C. C. 97, 99. The record does not show whether lessee expects to transport shipments under the unified rights between points in Louisiana and points in the nine new States covered by the lease, but, if he does, it is