National Bus Traffic Association v. United States

143 F. Supp. 689, 1956 U.S. Dist. LEXIS 4191
CourtDistrict Court, D. New Jersey
DecidedJuly 30, 1956
DocketCiv. A. 736-55
StatusPublished
Cited by4 cases

This text of 143 F. Supp. 689 (National Bus Traffic Association v. United States) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
National Bus Traffic Association v. United States, 143 F. Supp. 689, 1956 U.S. Dist. LEXIS 4191 (D.N.J. 1956).

Opinions

BIGGS, Circuit Judge.

This is an action to set aside an order1 of the Interstate Commerce Corn-[690]*690mission in Docket No. M.C.-29488 (Sub. No. 3), Tauck Tours, Inc., Extension, New York, N. Y., granting Tauck an extension of its existing authority as a broker to conduct operations as described at a later point in this opinion. The plaintiffs are National Bus Traffic Association, Inc. and Hudson Transit Lines, Inc., who oppose the authority granted to Tauck on several grounds. National Bus Traffic Association, Inc. represents 383 common carriers of passengers by motor vehicle, carriers who have the certificated authority to carry passengers who are individual ticket holders and, as an incident of such certification, also to serve as charter operators. Hudson Transit Lines, Inc. is a New Jersey corporation holding, to use the words of the complaint, “a certificate from the Interstate Commerce Commission authorizing operations with which operations authorized by the [Commission’s] * * * order [in effect as to Tauck] would be directly competitive”. It is a member of the National Bus Traffic Association, Inc. and like it participated in all of the proceedings before the Commission.

Tauck has operated all-éxpense travel tours usually by motor bus, to various points in the United States and Canada from the New York City area since 1926. Before the present proceeding began Tauck had been licensed to engage as a broker of transportation by motor vehicle of passengers and their baggage pursuant to the “grandfather” clause of the Motor Carrier Act, 1935, now Section 209, Part II of the Interstate Commerce Act, 49 U.S.C.A. § 309, between New York City and Newark, New Jersey, as originating points on the one hand and destination points in a number of northeastern states and the District of Columbia on the other hand.2 In the present proceeding the Commission extended Tauck’s geographical authority as a broker to operate all-expense tours originating at New York, Newark and Philadelphia, to all points in the United States.3

Tauck’s tours are all-expense arrangements, so-called “package tours”. Tauck sells individual “certificates of membership” in a specific tour to individual travelers, who ordinarily make arrangements either through Tauck’s own offices or through travel bureaus or similar factors, which serve as selling agents for Tauck. The single price which the individual tourist pays for his certificate of membership covers almost all of the expenses of the trip, specifically including transportation, meals, and hotel accommodations. Tauck ordinarily uses motor buses as the means of transportation on its tours but railroad and water transportation are also employed occasionally. Only motor bus transportation is involved in the instant case. What the terms “charter” or “charter authority” mean is discussed at length hereinafter. It is sufficient to state at this point that Tauck’s practice is to charter a motor bus from an operator holding a certificate of convenience and necessity from the Interstate Commerce Commission under Section 207 of the Interstate Commerce Act. See 49 U.S. C.A. § 307. Since Tauck plans its trips far in advance, it must also, at least on occasion, charter a motor vehicle before it or its agents have concluded the sale of certificates of membership to the general public for that particular trip.

In the hearing before the Commission, Tauck estimated that 90% of the bus [691]*691transportation arranged by it was obtained from charter operators at a flat rate for the hire of the whole bus. Tauck does not own any motor vehicles and does not lease any. It does not operate the buses or other transportation facilities itself. The chauffeur or driver, employed by the bus company, controls the vehicle. In other words, the carrier has sole control of the bus or buses. Tauck does supply a tour director who looks after the comfort of the participants in the trip and is in general charge of accommodations and other similar arrangements. Tauck is one of the largest of a number of all-expense tour operators who have developed a substantial industry out of this branch of the vacation and tourist business in the United States.

In order to understand the difficulties in which Tauck presently finds itself it is necessary to review some of the provisions of the Motor Carrier Act of 1935, Section 201 et seq., Part II of the Interstate Commerce Act. See 49 Stat. 543, 49 U.S.C.A. § 301 et seq. Part II sets out a comprehensive scheme of regulation of motor carriers under the supervision of the Interstate Commerce Commission which is given broad power to grant certificates and licenses to motor carriers and to prohibit unregulated motor transportation of passengers and freight. The statutory scheme provides for licensing or certificating kinds of motor vehicle operators engaged in interstate commerce including common carriers, contract carriers, as well as motor transportation brokers. The various classifications are defined in Section 203, Part II, of the Act. 49 U. S.C.A. § 303.

The Commission has classified all-expense tour operators, including Tauck itself, as “brokers” under the Act.4

Tauck made its application to the Commission, the subject of the present proceedings, in 1948. In the administrative process before the Commission Tauek’s application was considered a number of times with different results. The Examiner who heard the case was of the view, and so recommended, that Tauck’s application should be denied on the ground that Tauck was not a broker but a common carrier. Division 5 of the Commission concluded that Tauck was acting as a broker and granted it the geographic extension it sought but expressly conditioned the grant by prohibiting Tauck from chartering buses or other motor transportation. This opinion required Tauck to use only motor carriers who had been authorized by the Commission to sell individual tickets to passengers. See 1949, 49 M.C.C. 491.

Division 5 then granted Tauek’s petition to reconsider and in a second opinion and order granted Tauck’s extension application and permitted Tauck to use charter bus service provided the certificates of membership issued to the individual tourists “should clearly specify that purchase of a share or membership in the group by the individual shall amount to a designation of * * * [Tauck] as agent for the group members singly and collectively for the purpose of arranging such motor transportation.” Division 5 also required that the contract for charter service “should be made in the name of the group by * * * [Tauck] as agent in order that there may be no question as to the carrier’s direct responsibility as a carrier to the group members.” See 1951, 52 M.C.C. 373.

The matter then came before and was decided by the Commission 5 on April 21, 1952. In substance the Commission affirmed the order of Division 5 on reconsideration, allowing Tauck to use charter service, but made three conditions: “(1) provided the contract negotiated with the carrier furnishing the motor transpor[692]*692tation is one between it and the group members collectively,6 (2)' provided the carrier is paid its full published charter fare, and (3) provided that * * * [Tauck] in arranging the motor transportation does not receive a commission from the carrier.” See 54 M.C.C. 291. The decision in the Tauck case has been followed by the Commission in disposing of a number of subsequent applications by all-expense tour operators.

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143 F. Supp. 689, 1956 U.S. Dist. LEXIS 4191, Counsel Stack Legal Research, https://law.counselstack.com/opinion/national-bus-traffic-association-v-united-states-njd-1956.