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INLAND NAV. CO. v. UNITED STATES

March 8, 1948

INLAND NAV. CO. et al.
v.
UNITED STATES et al.



The opinion of the court was delivered by: BONE

DRIVER, District Judge.

This action, based upon the jurisdictional provisions of 28 U.S.C.A. 41(28) and 46-48, is brought to set aside and annul certain orders of the Interstate Commerce Commission, granting Tidewater Transportation Company, of Spokane, Washington, (hereinafter referred to as Tidewater) a certificate of public convenience and necessity as a common carrier by water under the so-called 'grandfather' clause, Sec. 309(a) of part III of the Interstate Commerce Act, 54 Stat. 929, 941, 49 U.S.C.A. 909(a).

 Briefly summarized, the history of the proceedings, which culminated in the Commission's order is as follows:

 On May 26, 1941, Tidewater filed with the Commission an application for a certificate under the 'grandfather' clause to transport general commodities by non-self-propelled vessels with the use of separate towing vessels between Portland, Oregon, and Attalia, Washington, on the upper Columbia River, and to serve certain intermediate points. On May 28, 1943, the application was amended, by letter, to include authority to perform general towage between the points designated. On July 23, 1943, without formal hearing, division 4 of the Commission granted the application and issued to Tidewater a certificate of convenience and necessity (260 I.C.C. 30), authorizing the transportation of general commodities and general towage in interstate commerce between all points on the Willamette and Columbia Rivers, between Portland, Oregon, and Pasco and Kennewick, Washington (Pasco and Kennewick are at the head of navigation on the Upper Columbia River, about ten miles above Attalia.) The certificate became effective October 14, 1943. Several competing water carriers filed exceptions with the Commission, and when a hearing was denied, commenced an action in this Court to set aside the Commission's certificate. The proceedings were then opened for reconsideration, and the action in this Court was dismissed.

 In a case such as this, involving the validity of an order of the Interstate Commerce Commission, the function of a reviewing Court is strictly limited. The Court may not properly weigh the evidence or substitute its judgment for the Commission's conclusions. If there has been a fair hearing, if the Commission has acted within the scope of its constitutional and statutory authority in a case where such authority has been competently invoked, and has not been arbitrary or capricious, and if the findings are supported by substantial evidence, then the Commission's order is judicially incontestable and must stand. Rochester Telephone Corporation v. United States, 307 U.S. 125, 139, 140, 59 S. Ct. 754, 83 L. Ed. 1147; United States v. Chicago Heights Trucking Co., 310 U.S. 344, 352, 60 S. Ct. 931, 84 L. Ed. 1243; Board of Trade of Kansas City v. United States, 314 U.S. 534, 546, 62 S. Ct. 366, 86 L. Ed. 432; Federal Power Commission v. Natural Gas Pipeline Co., 315 U.S. 575, 586, 62 S. Ct. 736, 86 L. Ed. 1037; Swift & Co. v. United States, 316 U.S. 216, 231, 62 S. Ct. 948, 86 L. Ed. 1391; Interstate Commerce Commission v. Jersey City, 322 U.S. 503, 512, 522, 64 S. Ct. 1129, 88 L. Ed. 1420.

 The reasons advanced by the plaintiffs for setting aside the Commission's orders, as stated in their opening brief, for the most part, are concerned with the sufficiency of the Commission's findings. It is contended that the Commission has failed to make basic essential findings sufficient to support its action, that the findings are not supported by the evidence, and are contrary to law, and that the findings are so vague and ambiguous that it is impossible to determine the basis or reason for the Commission's conclusions.

 The Commission's findings, embodied in its report on reconsideration (260 I.C.C. 510), are as follows:

 'In order to properly evaluate applicant's past service, it is necessary first to consider the history and nature of navigation on the waterway here in question. Prior to 1936, little or no commercial navigation was performed on the Columbia River above The Dalles, Oregon, a point about 60 or 70 miles above Vancouver, Washington. Navigation on the Columbia River above The Dalles is hazardous and difficult, the river being swift and treacherous and containing many rapids and other navigation hazards. Furthermore, the river runs through a sparsely populated country and few points have any facilities for shipping by water, so that only a very limited amount of traffic is available for movement.

 'On or about 1936, Kirk Thompson, an individual who is now general manager, treasurer, and director of the applicant corporation, investigated the feasibility of performing a water-carrier service in this area, and during that year, he commenced operation with one towboat and one barge and transported a barge load of gasoline from Portland to Attalia, Washington, the latter point being approximately 10 miles below the confluence of the Columbia and Snake Rivers. Having been convinced of the feasibility of performing a profitable service in this area, he induced others to join with him, and in 1937, the business was incorporated and additional equipment secured. On January 1, 1940, three towboats, six tank barges, and two dry-cargo barges were in service. Since that time, one towboat has been destroyed by fire, but two others have been added.

 'Applicant's principal service has consisted of transportation of bulk petroleum products and bulk wheat, which transportation is exempted from the provision of part III of the Interstate Commerce Act by section 303(b) or 303(d) (49 U.S.C.A. 903(b, d). Applicant, however, has not and does not confine itself to this type of traffic. It uses its equipment to the extent of its capacity in any water carrier service requested, but, owing to the limited offerings on this waterway, only a small amount of other traffic has been handled. Other commodities handled prior to January 1, 1940, were: wheat, in sacks; a water tank; a radio post; wire rope; steel; service station tanks; hoists and pumps; boxes of switches and a motor; and groceries. Some of the foregoing transportation was performed by applicant for its own account or for or in conjunction with other water carriers, but this service, nevertheless, evidences applicant's ability and holding out to perform any water carrier service requested. The same type of service has been continued since January 1, 1940. In addition to its carrying of commodities, applicant on many occasions has used its towing vessels to aid other watter carriers in retrieving their equipment from shoals and rocks and to aid Government engineers, engaged in improving the channel of the waterway. Most of these services were performed without charge, it being a reciprocal practice of the carriers on this waterway to help each other, and insofar as work was performed for Government engineers, applicant considers it was compensated by channel improvements made by them. Some towing of dredges and barges with rock has been performed for a construction company, and considerable towing of barges for other water carriers has been done. Considering the limited possibilities for performing transportation on this waterway, the record is convincing that the actual operations of applicant were consistent with its alleged holding out to perform a general barging and towing service. Under such circumstances, the fact that applicant has not performed a wide variety of nonexempt service should not be construed as a proper basis for modifying the authority previously authorized by division 4 so that applicant would not be able to handle other traffic which might develop in the future. We conclude that applicant was on January 1, 1940, and since that time has been, engaged in operation by non-self-propelled vessels with the use of separate towing vessels in the transportation of general commodities, and by towing vessels in the performance of general towage.'

 The Commission is not required to make formal or detailed findings of fact. The Interstate Commerce Act provides that the Commission shall make a report in writing, which shall state its 'conclusions' and 'its decision, order, or requirement in the premises.' The Act does not direct that findings of fact be made except where damages are awarded 49 U.S.C.A. § 14(1). All that is required of the Commission in a case such as the present one, where damages are not involved, is that its report, in writing, contain a statement of quasi-jurisdictional or basic findings, sufficient to enable a reviewing Court to determine whether the statutory standards, prescribed by Congress, and essential to the validity of the Commission's order, have been applied. United States v. Baltimore & Ohio Railroad Co., 293 U.S. 454, 463, 464, 465, 55 S. Ct. 268, 79 L. Ed. 587; United States v. Carolina Freight Carriers Corp., 315 U.S. 475, 488, 489, 62 S. Ct. 722, 86 L. Ed. 971.

 The question before the Commission for determination was whether the applicant was entitled to a certificate of convenience and necessity, under the pertinent 'grandfather' clause of the Interstate Commerce Act. The requirements of the clause are that the applicant carrier 'was in bona fide operation as a common carrier by water on January 1, 1940, over the route or routes or between the ports with respect to which application is made and has so operated since that time * * * .' 49 U.S.C.A. § 909(a). The act defines a 'common carrier by water' as 'any person which holds itself out to the general public to engage in the transportation by water in interstate or foreign commerce of passengers or property or any class or classes thereof for compensation .' 49 U.S.C.A. § 902(d).

 It clearly appears from the report on reconsideration that the foregoing statutory standards were applied. The Commission concluded that, although for the most part the applicant had transported commodities, exempt from regulation under the act, it had held itself out to carry all commodities offered and had transported a sufficient amount and variety of none-exempt articles to show good faith operation as a common carrier by water on January 1, 1940, and a continuance of the same type of service since that time. We think that the limited requirements as to findings of fact have been met and that the Commission's statement ...


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