Yellow Freight System, Inc. v. PSC

269 N.W.2d 548, 84 Mich. App. 241, 1978 Mich. App. LEXIS 2482

• Court: Michigan Court of Appeals
• Decided: June 20, 1978
• Docket: Docket No. 23211
• Status: Published

Opinions

Bashara, J.

Plaintiffs appeal a decision of the Michigan Public Service Commission holding that their certificate of authority to operate over a certain intrastate route was revoked by operation of law pursuant to 1933 PA 254, § 13. MCL 476.13; MSA 22.546.

We need not review the 17-year history of this controversy, nor specify the facts. Both are adequately delineated in our previous opinion. See Yellow Freight System, Inc v Public Service Comm, 73 Mich App 476; 252 NW2d 495 (1977).

The fact-finding ambiguity, with which our previous opinion was concerned, has been resolved by the revised opinion of the PSC. Therefore, in conjunction with our conclusion on this issue in our prior opinion,¹ we hold that the facts found by the PSC have adequate evidentiary support.

In reaching its decision, the PSC considered the "essential character” of the shipments made during the period in which it was claimed that no intrastate shipments occurred. Finding that the shipments were "essentially” interstate in character, the PSC concluded that no intrastate shipments were made for more than ten days.

Specifically, the PSC found that during the period in question there was some separation in shipments between Marysville and Centerline. However, it was also found that these shipments were merely incidental to an interstate purpose, because the trailers used continued on to a destination outside of Michigan.² The nature of the facility at which the separation occurred was also considered as indicative of an interstate purpose.³

Support for utilizing an "essential character” standard was derived from two cases concerned with the rate structures applicable to the shipments involved.⁴ Those cases necessarily focused upon the intention of the shipper, not the carrier, in determining whether the shipments were to be carried at interstate or intrastate rates. But that perspective is inappropriate for deciding whether a carrier has rendered intrastate service.

Merely because shipments wholely within the state contain cargo that the shipper intends to subsequently transport to a destination outside the state does not mean that from the carrier’s position the shipment was interstate. Nor does the fact that interstate and intrastate cargo is carried in the same trailer mean that intrastate service has not been rendered by the carrier.

The facts found by the PSC indicate that intrastate shipments were made during the pertinent period. To revoke the carrier’s certificate of authority requires a finding that no intrastate shipments were made for the statutorily prescribed period. Associated Truck Lines, Inc v Public Service Comm, 377 Mich 259, 291; 140 NW2d 515, 528 (1966), J E Bejin Cartage Co v Public Service Comm, 352 Mich 139, 151; 89 NW2d 607, 614 (1958). Consequently, the decision of the PSC is based upon an erroneous application of the controlling legal principles. Since intrastate service was rendered during the time in question, the carrier’s certificate of authority was not revoked by operation of law.

Reversed. No costs, a public question being involved.

D. T. Anderson, J., concurred.

1 See Yellow Freight System, Inc v Public Service Comm, 73 Mich App at 485-488; 252 NW2d at 499-500.

2 The pertinent text of the PSC opinion is as follows:

"The next question to be considered is the nature of the shipments between Marysville and Centerline. It is generally true that the question is determined by the essential character of the commerce, the most important factor being the presence or absence of a fixed and persisting intent of the shipper that his goods move to a destination in another state. Baltimore & OS WR Co v Settle, 260 US 166, 43 S Ct 23; 67 L Ed 189 (1922).

"Case law does support appellant’s contention that for-hire motor transportation within the confines of a single state, of property which has moved from or will move to points beyond the same state by private carriage, is intrastate. Report of Interstate Commerce Commission, 94 MCC 541. Also, wherever a separation in fact exists between transportation services wholly within the state and that between the states, a like separation may be recognized between the control of the state and that of the nation. Chicago and Eastern Illinois R Co v Public Service Commission of Indiana, 205 Ind 253 [186 NE 330] (1933).

"In this case, the record establishes that there was a separation in fact between transportation service wholly within the state and that between the states. However, the shipments in question were purely incidental to the interstate purpose being carried out, inasmuch as the trailers used for such shipments went from Centerline to destinations in other states which were known when the shipments originated. There is no evidence to support a finding that the separation of goods occurring in Centerline was for the purpose of intrastate delivery. In fact, all the evidence is to the contrary, including testimony regarding the nature of the facilities at Centerline.”

3 The facility was Chrysler Corporation’s national parts distribution center at Centerline, Michigan.

4 In Baltimore & OSWR Co v Settle, 260 US 166, 170; 43 S Ct 28; 67 L Ed 189 (1922), the Court concluded that "whether the interstate or the intrastate tariff is applicable depends upon the essential character of the movement”. Nothing in the opinion of Mr. Justice Brandéis would suggest that the essential character of shipments should alter the nature of the service rendered by a carrier shipping certain cargo between two points within the same state.

Similarly, in Chicago & Eastern I R Co v Public Service Comm, 205 Ind 253; 186 NE 330 (1933), the issue concerned the applicable rates chargeable by a carrier transporting freight within the state, but ultimately destined for points outside the state. The Court held:

"The movement from the Sunnyside mine to the interchange track at Devon street was no part of an interstate movement. It was not by said movement placed in interstate commerce, as the journey to another state had not yet begun. The cars were delivered to the purchaser at the place agreed upon, and there accepted by it and removed to its yards, to await distribution. It is our judgment that interstate commerce did not actually begin till the cars were assigned to their destination and had started on their final journey out of the state. ” Id. at 262; 186 NE at 333. (Emphasis added.)

Even if this rationale was applicable to the case under review, the shipments made from Marysville to Centerline would retain their intrastate character, since the carrier did not commence any transportation of the separated cargo in interstate commerce. This result is not changed by the fact that such cargo was shipped in vehicles with other cargo that continued on to destinations outside the state.