INVESTIGATION AND SUSPENSION DOCKET No. M-12161 RUGS AND MATTING FROM THE EAST TO WESTERN TRUNK LINE TERRITORY

Decided July 10, 1944

On reconsideration, in the light of respondents' motions, proceedings, dealing with ratings and rates on hard-surface floor covering from certain points in New England and trunk-line territories to certain destinations in central and western trunk-line territories, discontinued. Prior reports 31 M. C. C. 193 and 34 M. C. C. 641.

Appearances shown in prior reports.

REPORT OF THE COMMISSION ON RECONSIDERATION

BY THE COMMISSION:

These proceedings deal with proposed ratings and rates on hardsurface floor covering from certain points in New England and trunk-line territories to certain destinations in central and western trunk-line territories. The issues and the facts of record are discussed in the prior reports, 31 M. C. C. 193, and 34 M. C. C. 641, and need not be repeated in detail here. In general, the proceedings brought in issue the lawfulness of proposed ratings and rates on hard-surface floor covering approximately 45 percent of first class, minimum 30,000 pounds, and 47.5 percent of first class, minimum 20,000 pounds. The record established that 20,000 pounds of this commodity could be loaded in one of the vehicles ordinarily used by the respondents in its transportation, but that at least two vehicles were required for the transportation of 30,000 pounds. Division 3 in its report, 31 M. C. C. 193, found that the ratings and rates proposed were just and reasonable and otherwise lawful except to the extent they were subject to a minimum of 30,000 pounds. It was further found that the proposed minimum of 30,000 pounds was unjust and unreasonable, and a minimum of 20,000 pounds was approved. The proposed schedules, to the extent they were found not just and reasonable, were ordered canceled without prejudice to the establishment of truckload rates, minimum 20,000 pounds, not less than 45 percent of the corresponding first-class rates.

1 This report also embraces I. and S. Docket No. M-1445, Linoleum and Related Articles from the East to Ohio.

Later, Investigation and Suspension Docket No. M-1216 was reopened and the parties were heard in oral argument. In our report on oral argument, 34 M. C. C. 641, we affirmed the findings of division 3 that the proposed rates 45 and 47.5 percent of first class were not unjust or unreasonable except to the extent that the proposed rates, 45 percent of first class, were subject to a minimum of 30,000 pounds. We further found that the proposed rates, minimum 30,000 pounds, would give an unjust advantage to shippers of 30.000-pound lots and be unjustly discriminatory to shippers of 20,000-pound lots. An examination of their tariffs indicated that the respondents had complied with the order of division 3 by establishing rates either 45 percent of first class, minimum 20,000 pounds, or 47.5 percent of first class, minimum 20,000 pounds. As those bases of rates did not appear to be unjust, unreasonable, or unjustly discriminatory, no order for the future was entered.

The respondents filed a suit in a three-judge district court to annul and set aside the order requiring the cancelation of the schedules proposed in I. & S. No. M-1216. The district court dismissed the bill of complaint, Eastern Central Motor Carriers Assn. v. United States, 48 Fed. Supp. 432, and on an appeal by the respondents to the Supreme Court of the United States, the judgment of the district court was reversed in Eastern Central Motor Carrier Assn. v. United States, 321 U. S. 194.

Division 3, in its report, adopted as a policy the condemnation of motor-carrier volume minimum weights unless it is shown clearly that the motor carriers can transport the traffic at the volume minimum weights at costs per 100 pounds which are less than the costs incurred at a reasonable truckload minimum weight. In our report on oral argument, we said that, for the future, we would follow the policy announced by division 3. The Supreme Court condemned these announcements of policy on the ground that the record did not supply a sufficient basis for its formulation. The Court pointed out that factors other than the cost of transportation, such as competition between carriers, should be considered by us in determining lawful rates. It emphasized that it did not question our authority to adopt and apply general policies appropriate to particular classes of cases, so long as they are consistent with the statutory standards which govern our action and are formulated, not only after due consideration of the factors involved, but with sufficient explication to enable the parties and the Court to understand, with a fair degree of assurance, the reasons for our action.

Pursuant to the decision of the Supreme Court, we reopened I. & S. No. M-1216 and its related proceeding, I. & S. No. M-1445, for further hearing. The parties were informed in a notice of the matters which

it was considered should be developed at the further hearing, and questionnaire was directed to the respondents calling upon them to supply information respecting the amount of hard-surface floor cov ering transported by them in truckloads from and to the points, the weight of the shipments tendered, the carrying capacities of the vehi cles in which the service was performed, and other facts bearing on the issues.

The respondents, by motions, ask that the proceedings be discontinued. In their motions they state that they no longer desire to maintain ratings or rates on the commodity subject to a minimum of 30,000 pounds, because the circumstances surrounding the transportation have been changed by recent economic conditions affecting transportation costs. They point out that they do not have rates in effect on the commodity from and to the points subject to a 30,000pound minimum, and they inform us that they do not now seek approval of the schedules which were found unlawful and do not at present intend to refile schedules in which the ratings and rates will be subject to a minimum of 30,000 pounds.

That further action by us was required by the decision of the Supreme Court is recognized by the respondents, but in view of their disavowal of any present purpose or desire to maintain ratings and rates on the commodity subject to a minimum of 30,000 pounds, they ask that we discontinue the proceedings. In a reply to the motions, the National Industrial Traffic League, one of the protestants, does not oppose the discontinuance of the proceedings.

The force of railroad competition was the principal ground relied upon by the respondents to justify the proposed ratings and rates. In their managerial discretion, the respondents have now decided they no longer desire to establish rates on the traffic subject to the same minimum as that of the railroads. There is, therefore, little reason for us to proceed further in our efforts to obtain the kind of record in the proceedings contemplated by the opinion of the Supreme Court.

In the instant proceedings, we believe the motions of the respondents should be granted since the actions of the respondents as described in the foregoing have made moot the proceedings before us. There are numerous rates maintained by motor common carriers subject to minimum weights higher than can be transported in a single motor vehicle, but we cannot deal with such rates except in the event of a complaint against them or the institution of a general investigation. We are not warranted, at this time, in entering into a general investigation of these rates and minimum weights.

We find that the motions of the respondents should be granted. An order will be entered discontinuing the proceedings.

No. MC-2880 (Sub-No. 1)

SOMERSET BUS CO., INC., EXTENSION OF OPERATIONSSOMERVILLE-NEW YORK CITY

Submitted December 24, 1942. Decided July 19, 1944

Public convenience and necsessity found to require operation by applicant, in interstate or, foreign commerce, as a common carrier by motor vehicle, of passengers and their baggage, between Somerville, N. J., and New York, N. Y., over a regular route, serving certain intermediate points. Issuance of a certificate approved upon compliance by applicant with certain conditions, and application in all other respects denied.

F.X O'Brien for applicant.

Earle J. Harrington, Leland Taliaferro, John F. Finerty, John E. Buck, W. Eugene Turton, Robert W. Lishman, George D. Rives, C. F. Cook, and George F. Conway for protestants.

Charles Wagner, George M. Eichler, Henry P. Goldstein, and Walter Hoagland for interveners.

REPORT OF THE COMMISSION

DIVISION 5, COMMISSIONERS LEE, ROGERS, AND PATTERSON BY DIVISION 5:

Exceptions to the order recommended by the examiner were filed by certain rail and motor-carrier protestants, and applicant and an intervener replied.

By application, as amended, filed May 18, 1940, Somerset Bus Co., Inc., of Mountainside, N. J., seeks a certificate of public convenience and necessity authorizing operation, in interstate or foreign commerce, as a common carrier by motor vehicle of passengers and their baggage, and express, mail, and newspapers in the same vehicle with pasengers, between Somerville, N. J., and New York, N. Y., over the routes described in the appendix hereto, serving all intermediate points except those in Essex and Hudson Counties, N. J. The Brotherhood of Locomotive Firemen and Engineers, The Order of Railway Conductors, the city of New York, and certain rail and motor carriers oppose the application. The township of Union, of Union County, N. J., and Essex Lodge 993 of the Brotherhood of Railroad Trainmen intervened in support of the application. Alma Lines, Inc., withdrew its opposition to the application at the time of the hearing. DeCamp Interstate Transit Company intervened in the proceedings as its interests might

appear.

The president of applicant and 18 other witnesses testified in support of the application. One of the witnesses, who gave expert testimony as to facts relative to a need for the proposed operation, is a traffic consultant at Belleville, N. J. Resolutions adopted by the governing bodies of civic organizations in the townships of Scotch Plains and Hillside, and the Boroughs of Plainfield, Roselle Park, Mountainside. and Somerville in New Jersey, favoring and urging a grant of the authority sought were received in evidence.

Applicant is now conducting intrastate operations in the transportation of passengers between Somerville and Newark, N. J.. over a regular route which generally parallels its proposed interstate route. It also holds a certificate issued in No. MC-2880 authorizing charter operations in the transportation of passengers and their baggage originating at and extending from points in Middlesex, Somerset. Union, Morris, and Essex Counties, N. J., to points in New Jersey, Pennsylvania, Maryland. and the District of Columbia, and return over irregular routes, traversing Delaware for operating convenience only. Applicant's proposed route between Somerville and midtown Manhattan covers a distance of approximately 42 miles and passes through Bound Brook, Dunellen, North Plainfield. Plainfield, Fanwood. Scotch Plains, Westfield, Garwood, Cranford, Roselle Park, Union, Hillside, and Newark, N. J. It is in proximity to and generally parallels the routes of seven or eight long-distance motor common carriers of passengers and the rail line of The Central Railroad Company of New Jersey.

The examiner found that public convenience and necessity require the proposed operation and recommended a grant of the authority sought, except with respect to the transportation of mail, express, and newspapers. On exceptions, Hudson & Manhattan Railroad Company, rail carriers in official classification territory, and four motor carriers contend that applicant has failed to establish that public convenience and necessity require the proposed service, and that the application should be denied.

In 1929. applicant transported passengers between Somerville and New York City for approximately 10 months. Because of the congestion in traffic on the city streets of New York and that encountered in crossing the Hudson River, it found such operations were not efficient or economical and therefore discontinued them. Now, however, it believes that the improvement in highway facilities makes it possible to reinstitute the operations with success. It proposes to operate 19 round trips daily on an hourly schedule. On east-bound trips its first bus would depart from Somerville at 6:15 a. m. and its last bus at 12:15 a.m. On west-bound traffic, its first bus would leave New York at 8 a. m. and its last bus at 2 a. m. The scheduled