Robertson Tank Lines, Inc. v. Louisiana Public Service Commission

349 So. 2d 1262, 1977 La. LEXIS 5876, 1977 WL 365297
CourtSupreme Court of Louisiana
DecidedSeptember 19, 1977
DocketNo. 59636
StatusPublished

This text of 349 So. 2d 1262 (Robertson Tank Lines, Inc. v. Louisiana Public Service Commission) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Robertson Tank Lines, Inc. v. Louisiana Public Service Commission, 349 So. 2d 1262, 1977 La. LEXIS 5876, 1977 WL 365297 (La. 1977).

Opinion

SUMMERS, Justice.

Groendyke Transport, Inc., a motor vehicle common carrier, filed a complaint before the Louisiana Public Service Commission under pertinent provisions of the Motor Carrier Act (La.Rev.Stat. 45:161-172) against Robertson Tank Lines, Inc., a common carrier; Robertson Tank Lines of Louisiana, Inc., a contract carrier; and Robertson Truck Lines, Inc., also a contract carri[1263]*1263er. Some of the services which Groendyke is authorized to render under its common carrier certificate are competitive with services performed by the three Robertson companies.

The complaint alleges that Robertson Tank Lines, Inc., was operating as a common carrier of special commodities by motor carrier within the State of Louisiana under a common carrier certificate issued by the Commission. At the same time Robertson Tank Lines of Louisiana, Inc., and Robertson Truck Lines, Inc., are also operating as contract carriers of special commodities by motor carrier in Louisiana under contract carrier permits issued by the Commission.

The complaints are based upon allegations that the three corporations are managed by, and under the common control of, substantially the same directors and officers. All, or substantially all, of the capital stock of these three corporations is owned and controlled by the same parties, whether directly or indirectly, either through subsidiary corporations or through direct or indirect ownership. The facilities used in the conduct of operations under the contract carrier permits and the common carrier certificate are substantially the same and are used interchangeably.

This common ownership and simultaneous operation under a common carrier certificate and contract carrier permits by corporations under common control is alleged to be contrary to the statutory prohibition that “[n]o person shall at the same time hold, or operate under, both a common carrier certificate and a contract carrier permit.” La.Rev.Stat. 45:165.

In addition, the complaint alleges that under these circumstances the two corporations holding contract carrier authority under the two permits together furnish transportation to more than five separate shippers of property. In doing so, it is contended, they are acting as common carriers, without certificates of public convenience and necessity unless they can show by a clear preponderance and to the satisfaction of the Commission that the character of their operations is not that of a common carrier. Thus, the complaint sets forth that a motor carrier cannot act as a common carrier without having obtained from the Commission a certificate of public convenience and necessity, for to do so is a violation of Section 1641 of the Motor Carrier Act, punishable as provided in Section 171 (La.Rev.Stat. 45:164, 171).

After a hearing on the complaint, the Commission found that the stock of all three carriers was owned wholly by Robertson Distribution Systems, Inc. It found also that the directors and officers of all three Robertson carriers are essentially the same; that a number of employees work for two or more of the three Robertson carriers and vehicles owned by one of the carriers at times are used by the other by lease or other arrangement.

With these findings and in light of the decision in American Courier Corporation v. Louisiana Public Service Commission, 256 La. 464, 236 So.2d 802 (1970), the Commission found that the operations conducted by the three Robertson carriers in Louisiana intrastate commerce were essentially that of one person and in violation of the prohibition contained in Section 165 of the Motor [1264]*1264Carrier Act against any person, at the same time, holding, or operating under, both a common carrier certificate and a contract carrier permit.

The Commission also found that the operations of the two carriers holding contract carrier permits were essentially that of one person and they were acting as common carriers as contemplated by Section 162(4) of the Motor Carrier Act2 because the essential nature of their business was soliciting or accepting property for transportation for compensation as a business and as such together they furnished such transportation to more than five separate shippers. To do so without obtaining a common carrier’s certificate as required by Section 164, the Commission decidéd, was a violation of the Act.

Accordingly, the Commission ruled that the three Robertson corporations must furnish an acceptable plan within forty-five days, which, when implemented, would result in compliance with its order, or submit an- application within that time to dispose of those certificates or permits which would prevent them from complying with the Act.

When the Commission denied a rehearing, the three Robertson corporations appealed to the Nineteenth Judicial District Court where the order of the Commission was affirmed on the record made before the Commission. This appeal by the three Robertson corporations was then perfected. We affirm.

The rule of law relied upon by the Commission and the District Court and recognized in American Courier Corporation v. Louisiana Public Service Commission, supra, holds that the identity of two corporations as separate entities wilLbe disregarded under Louisiana law by “piercing the corporate veil” when the theory of the separate entity leads to an absurdity, or when the persons involved in a corporation seek to use this legal fiction to immunize themselves from the consequences of their illegal actions.

A review of the evidence adduced before the Commission supports its finding. The vice president of all three corporations was called as a witness by Groendyke, the complainant. He testified that he was a member of the executive committee of all three Robertson corporations. His salary is prorated, among the three companies because he performs substantially the same duties in each. The same person serves as chairman of the board of all three corporations. All eight vice presidents and the two secretaries of the three corporations were the same persons on January 1, 1975. And the [1265]*1265four members of the three boards of directors are the same.

All of the stock in all of the three corporations is owned by Robertson Distribution Systems, Inc., a publicly owned holding corporation. The chief executive officer and president of the three operating companies is a member of the executive committee of the holding corporation.

The main office of each of the three operating companies is located in the same building at the same address in Houston, Texas. All mail dispatched to the three corporations is received in the same office. All managerial personnel except terminal-directors at the Louisiana terminals and those charged with travel safety are headquartered in the Houston office. Accounting, billing and payroll functions for all three operating companies are performed in the Houston office.

One salesman in Louisiana is a permanent employee devoting a portion of his time to each company.

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Related

Rubion Transfer & Storage Co. v. Louisiana Public Service Commission
123 So. 2d 880 (Supreme Court of Louisiana, 1960)
Transway, Inc. v. Louisiana Public Service Commission
221 So. 2d 53 (Supreme Court of Louisiana, 1969)
American Courier Corp. v. Louisiana Public Service Commission
236 So. 2d 802 (Supreme Court of Louisiana, 1970)

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Bluebook (online)
349 So. 2d 1262, 1977 La. LEXIS 5876, 1977 WL 365297, Counsel Stack Legal Research, https://law.counselstack.com/opinion/robertson-tank-lines-inc-v-louisiana-public-service-commission-la-1977.