Schultz v. United States

59 F. Supp. 338, 1945 U.S. Dist. LEXIS 2542
CourtDistrict Court, W.D. Wisconsin
DecidedFebruary 9, 1945
DocketCivil Action No. 590
StatusPublished
Cited by4 cases

This text of 59 F. Supp. 338 (Schultz v. United States) is published on Counsel Stack Legal Research, covering District Court, W.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Schultz v. United States, 59 F. Supp. 338, 1945 U.S. Dist. LEXIS 2542 (W.D. Wis. 1945).

Opinion

PER CURIAM.

This is an action to set aside an order of the Interstate Commerce Commission dated September 7, 1943, in a proceeding reported in 39 M.C.C.321, wherein the Commission approved and authorized the purchase by Moland Brothers Trucking Company (hereinafter called “Moland”) of certain operating rights and property of Flam-beau Freight Lines (hereinafter called “Flambeau”). Such authorization and approval by the Commission is required under Sec. 5 of the Interstate Commerce Act, 49 U.S.C.A. § 5. This action is brought by other motor carriers who appeared as protestants in the proceedings before the Commission.

On October 30, 1942, Division 4 of the Commission, with three commissioners sitting, found in a two to one decision that the proposed transfer was not consistent with the public interest. 38 M.C.C.625. Commissioner Mahaffie concurred solely on the ground that Moland’s financial condition was such that the consummation of the proposed purchase would impair Mo-land’s ability to perform its duties adequately as a common carrier. However, Commissioner Mahaffie stated:

“I doubt if the disadvantage to competitors that would result from improved through service outweighs the benefit to the shipping public of such improved service.”

A hearing was held on May 19, 1943, before an examiner and proof was "given as to the improved financial condition of Mo-land. This was due in some part to the profits accruing to Moland by operating Flambeau under a temporary authority. Before the examiner’s report was made, a petition was filed under the Commission’s Rule 102, and upon consideration the entire commission decided, with four commissioners dissenting, that the proposed transfer was consistent with the public interest. An order was entered approving the transfer and that order is the subject of this controversy.

Sec. 5(2)' (b) of the Interstate Commerce Act provides:

“* * * if £he Commission finds that, * * * the proposed transaction * * * will be consistent with the public interest, it shall enter an order approving and authorizing such transaction, * *

Sec. 5(2) (c) provides:

“In passing upon any proposed transaction under the provisions of this paragraph (2), the Commission shall give weight to the following considerations, among others: (1) The effect of the proposed transaction upon adequate transportation service to the public; (2) the effect upon the public interest of the inclusion, or failure to include, other railroads in the territory involved in the proposed transaction; (3) [340]*340the total fixed charges resulting from the proposed transaction; and (4) .the interest of the carrier employees affected.”

The testimony before the Commission disclosed that Moland operates as a motor vehicle common carrier between Chicago, Illinois, and Duluth,-Minnesota, principally over three regular routes, all extending through the State of Wisconsin. Flam-beau operates as a motor vehicle common carrier between Duluth and Minneapolis and St. Paul (hereinafter called “Twin Cities”) via Ashland and Eau Claire, as well as serving certain intermediate points. Between Abbotsford and Ashland and for a stretch north of Ashland, Moland and Flambeau operate on the same highway and duplicate each other’s service. At times freight from Chicago or Milwaukee destined for the Twin Cities would be transferred from Moland to Flambeau at Eau Claire, but this happened very rarely. After the consolidation Moland would be enabled to give a through service from Chicago-Milwaukee to the Twin Cities.

Plaintiffs herein contend that in its decision the" Commission adopted the findings of its Division 4 and that, therefore, evidence was lacking to support the Commission’s conclusion that the proposed transfer would be in the public interest. An examination of the Commission’s decision discloses the following statements:

“ * * * The prior report of division 4 adequately states the issues. * * * The issues involved are clearly stated in the prior report, and a further hearing has been held in respect of those issues. * * * The facts involved, having been adequately set forth in the prior report, will be restated herein only to the extent necessary to clarity of understanding and as developed at the further hearing.”

The Commission’s decision then states the contention of the protestants and comments upon the financial improvement of Moland. A reference is then made to the Commission’s earlier decision in Standard Freight Lines, Inc. — Lease—Holt, 38 M.C. C. 483, wherein the lessee was authorized to lease rights of lessor between LaCrosse and Twin Cities, permitting a direct through service between Chicago and the Twin Cities, and the decision points out that the transaction was opposed by numerous motor carriers, including most of the protestants in the case at bar. After quoting from the Standard decision, the commission holds:

“The routes here under consideration would afford vendees an - opportunity to perform, following the unification, a through service between the same two principal terminal points. The evidence presented by protestants in the instant case as to the anticipated effect upon them and on their service, and on the general competitive situation, in our opinion, does not warrant a conclusion different from that in the Standard case. * * *” (Italics supplied.)

The majority opinion concludes:

“On further hearing, we find that purchase by * * * (Moland), of the previously described operating rights and property of * * * (Flambeau), upon the terms and conditions set forth above and in the prior report, which terms and conditions are found to be just and reasonable, is a transaction within the scope of section 5(2) (a), and will be consistent with the public interest * *

The order which was entered contained the following:

“Further investigation of the matters and things involved in this proceeding having been made, and the Commission, on the date hereof, having made and filed a report on further hearing containing its findings of fact and conclusions thereon, which report and the prior report of October 30, 1942, 38 M.C.C.625, are made a part heréof ^ ‡ ^

It is thus apparent the Commission intended that its decision from which quotations have heretofore been made did in effect also constitute its findings of fact and conclusions of law. However, the references to the prior decision of Division 4 as well as to its decision in the Standard case makes for confusion. Division 4 confirmed the report of Examiner Smith, which showed extensive carrier service between Eau Claire and the Twin Cities, and which found that after the unification Mo-land would operate a single line through service which would be a new service. Division 4 also found that numerous substantial operators afford service between the Twin Cities and Eau Claire "and thence to Milwaukee and Chicago, and that the movements of traffic between said points is becoming increasingly unbalanced, the heavier movements being westbound out of Chicago, necessitating expensive and wasteful backhauling of empty equipment. The division also found that further loss of eastbound traffic will necessitate a cur[341]*341tailment of service now maintained, and that all of the carriers in the territory are retrenching.

It is unfortunate that the Commission did not make specific findings upon which it based its conclusions.

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Related

Gateway Transportation Co. v. United States
260 F. Supp. 248 (W.D. Wisconsin, 1966)
Crowell v. Eastern Air Lines, Inc.
81 S.E.2d 178 (Supreme Court of North Carolina, 1954)

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Bluebook (online)
59 F. Supp. 338, 1945 U.S. Dist. LEXIS 2542, Counsel Stack Legal Research, https://law.counselstack.com/opinion/schultz-v-united-states-wiwd-1945.