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Restrictions upon operating rights. and services: In general, the scope of interstate operations is governed by the interpretation or construction placed upon such certificates by the issuing State agency. However, where the limitation upon the scope of the underlying intrastate authority is clearly directed against local traffic within the State, it is inapplicable to operations in interstate or foreign commerce. See Miller--Purchase--Newman, 57 MCC 395.-Wilson Trucking Corp.--Purchase --Compton Lines, Inc., 104 M.C.C. 806 (810-11).

Restrictions against tacking are undesirable and will not be imposed except where clearly shown in the public interest. Certificates of applicants speak for themselves, and it is not incumbent upon applicants to point out all tacking possibilities that would result from a unification. In general, acquired rights may be tacked freely with those of acquiring carrier unless protestant introduces specific evidence to justify a restriction. Burden of proof should remain upon protestants.-Chemical Leaman Tank Lines, Inc.--Pur.--Ryder, 104 M.C.C. 686(704-5).

111. Procedure, generally.--Upon amendment, in which all parties in control of vendee joined application and submitted satisfactory financial and other data as required by exhibit A to the application, the defect which required denial in the initial report, 104 MCC 578, has been corrected. Application approved.--Illinois-Calif. Express--Purchase-Ariz.-Utah, 104 M.C.C. 815 (816-7).*

Change of form rather than substance in the nature of transaction was not material insofar as notice to public in Federal Register was concerned, particularly as such notice did not even purport to give all details of proposed transaction. Moreover, even if notice were to be considered defective, it was cured by subsequent republication giving notice of amendment after which ample time remained for interested persons to file for intervention. Technical objection held to be de minimus and not warranting further delay or postponement of proceedings.--Chemical Leaman Tank Lines, Inc.--Pur.--Ryder, 104 M.C.C. 686(697-8).

Titling of an action is purely administrative and is not determinative of the nature of a transaction which may ultimately be approved. Although this application was docketed as a purchase (portion) based on the opening statement, no difference has been shown between this transaction and a true statutory merger, which is what it has been found to be, notwithstanding its title.--Id., p. 708-9.

Failure of persons in control to join the application herein makes it impossible to determine on this record whether control by them would be consistent with the public interest. Application denied without prejudice to an amended application.--Illinois-Calif. Express--Purchase-Ariz.-Utah Express, 104 M.C.C. 578(589-90).

While the commission has the necessary power under appropriate circumstances to consolidate proceedings in which the issues are closely

related, delay in deciding proposed merger transaction until such time as the Penn-Central merger is ready for final determination might endanger or defeat entirely a unification shown beyond question to be in the public interest. In view of the applicants' developing and relying on record sufficient to establish public interest, the adverse effect which could result from delayed determination of issues, and the adequate safeguards to the public through imposed conditions, consolidation of considered proceedings for decision with Penn-Central merger case is not required by public interest; nor is reopening of proceeding for further hearing necessary, since record is sufficiently well developed to permit separate determinations.--Norfolk & W. Ry. Co. and New York, C. & St. L. R. Co. Merger, 324 I.C.C. 1(18-19).

115. Evidence.--In discussing merits of proposed merger transaction, the commission takes official notice of facts obtained from annual reports filed with the commission by carriers involved, a report of the Securities and Exchange Commission, and data obtained from recognized finance and industry publications; however, pursuant to the Administrative Procedure Act, parties challenging them are afforded opportunity to show to the contrary upon timely filed petition setting forth objections. --Norfolk & W. Ry. Co. and New York, C. & 'St. L. R. Co. Merger, 324 I.C.C. 1(10).

$5(3). NONCARRIER DEEMED CARRIER UPON ACQUIRING CONTROL

10. Controlling person subject to reports, accounts, securities provisions.--The two corporations which constituted intermediate control between vendee and the individuals ultimately in control found to be principally engaged in activities related to transportation. On this basis they are both found to be carriers pursuant to §5(3) of the Act and subject to the reporting requirements therein.-Illinois-Calif. Express-Purchase--Ariz.-Utah, 104 M.C.C. 815 (818).*

$5(4). UNAUTHORIZED CONTROL: UNLAWFUL

1. Construction and interpretation.--A lawful lease of properties and operations of a carrier precludes a finding herein of unlawful control of the lessor by the lessee during the lease. There is no evidence that lessor would attempt to retain its control under its right of assignment of its right to purchase the stock to a third party in the event of denial of the transaction.--Consolidated Freightways Corp. of Del.--Control, 104 M.C.C. 658(659).*

$13 (1). COMPLAINT TO COMMISSION OF VIOLATION OF LAW BY CARRIER; REPARATION; INVESTIGATION

Hearing

123. Requisites of full hearing.--The principal issue in the instant proceeding is one of law. On this issue the procedure utilized

has constituted a full hearing within the meaning of the act, all parties having been given full opportunity to be heard as to the step proposed to be taken.*** It may also be that *** mixed questions of law and fact [may] arise whether the practices in connection therewith are reasonable, nondiscriminatory, or otherwise lawful, which will require oral hearings for the taking of testimony. If so, requests for such hearings will receive proper consideration. In the meantime, at this stage of the proceeding, such oral hearings would not be in the interest of justice nor serve any useful purpose. [citing 232 ICC 683 (686)].--Substituted Service--Piggyback, 322 I.C.C. 301 (348)*.

Evidence

135. Application of principles of stare decisis and res judicata. An administrative agency, even if it has followed a consistent line for some time, may, when faced with new developments or an appreciably changed factua picture in the segment of the national life which it is charged with regulating, alter its past interpretation in a formal proceeding where such rules as the proposed TOFC service rules having future effect are to be issued. When cogent reasons and the public interest compel it, even a consistent and generally unchallenged administrative practice may be overturned.-Substituted Service--Piggyback, 322 I.C.c. 301 (331)*.

§13a. DISCONTINUANCE OR CHANGE OF CERTAIN OPERATIONS OR SERVICES

2.

Construction and interpretation.--Under provisions of §13a (1), the commission has no discretion to approve or disapprove a proposed discontinuance of train service, but must investigate a proposal to discontinue Only upon finding that the operation of the involved train or trains is required by public convenience and necessity and will not unduly burden interstate commerce, may the railroad be required to continue or restore the service investigated, and in no event can the commission require the service to be continued for more than 1 year from the date of the order.--Louisville & N. R. Co. Discontinuance, 320 I.C.C. 669(690).

Congress, in enacting §13a was addressing itself to a problem quite distinct from that reflected by overall unprofitable operation of an entire segment of railroad line. Instead, it was primarily concerned with the problem posed by passenger services for which significant public demand no longer exists and which are consistently deficit-producing, thus forcing carriers to subsidize their operation out of freight profits.--Id., p. 694.

20. Showing required and burden of proof.--The issue of burden of proof in a discontinuance proceeding would be decisive only if no substantial evidence were adduced or if the evidence were equally balanced. Where neither of these conditions is present, the question of which party bears the burden of proof under §13a (1) is of more theoretical than practical importance.--Louisville & N. R. Co. Discontinuance, 320 I.C.C. 669 (671).

Notwithstanding substantial increases in population in areas

served by commuter trains to be discontinued, public patronage has declined steadily during the past 12 years. Protestants urge that the railroad has not encouraged use of the trains, nor attempted to generate more business by instituting a new stop at nearby NASA plant facility; however, when prospective passengers must be coaxed by advertising to use a particular commuter train they obviously have no urgent need for it. The evidence clearly shows that the railroad investigated every inquiry concerning service at the NASA plant without success, and in absence of assurances of additional passengers who would actually use such service, it could hardly be expected to assume substantial expenditures in purchasing additional equipment, construct station facilities, and revise its schedules, merely on a trial basis; moreover, its offer to provide service to the plant on a contractual basis was declined.-Id., pp. 764-5, 680-6, 691-2.

Protestants' evidence must be considered mainly in the light of the testimony of persons who actually depend on considered trains for essential transportation needs; and, in determining public convenience and necessity, needs of the entire public as distinguished from the relatively few must be the governing consideration. Accordingly, while residents of four small points served by the trains are without primary or secondary highways, have only the railroad's service available, and must use skiffs or other small boats to reach any highway, evidence established that daily average use of the trains in the preceding year was 1 and 1.5 passengers, respectively for two of those points and none for the other two.--Id., pp. 692-3.

In discontinuance proceedings the commission may properly give varying weights to the carrier's prosperity in different situations. Where directly affected communities would be subject to serious injury and continuous operation would impose relatively light burden on a prosperous carrier, it may be given great weight; but where demands of public convenience and necessity are slight and the carrier may not justly be required to continue to bear financial losses of continued operation, its overall prosperity may be given little weight. Evidence is persuasive that public needs for considered commuter service is slight; and, notwithstanding the carrier's overall prosperity, evidence of its substantial losses from operation of the trains, decreasing use thereof and resultant dwindling of revenues therefrom, warrant finding that their continued operation would constitute an undue burden on interstate commerce.--Id., pp.694-5.

25. Losses from operation.--Although the railroad has increased commuter fares between points served by the trains to be discontinued since the prior decision involving the same trains, 307 ICC 173, wherein it was found that operation between Ocean Springs and Pass Christian, Miss., was not required by public convenience and necessity but that existing public need required continued operation between latter point and New Orleans for a period of 1 year, improved operating results optimistically anticipated in that report have not materialized. Unrebutted evidence shows that outof-pocket costs have far exceeded revenues accruing from operation of considered commuter trains.--Louisville & N. R. Co. Discontinuance, 320 I.C.C. 669 (673-6,690).

Carrier continued operation of the trains for over 3 1/2 years after expiration of the 1-year period previously required, and although population increased in the area served, use of the trains substantially declined--from a daily average in 63 to an average of 38 passengers in last 5 years. Despite reduction in mileage and increased fares, revenue provided by considered trains has continued to decline while out-of-pocket losses have steadily increased; thus, it is clear that the hoped for "break-even" point in annual operating results has not been achieved. Residents in the area have had ample opportunity to demonstrate by regular patronage, that continued service is essential to their convenience and necessity; this they have failed to do. Evidence of carrier's substantial losses from operation of the trains, the decreasing use thereof, and resultant declining revenues, warrants finding that no public need exists for the commuter service and that continued operation of the trains would constitute an undue burden on interstate commerce.--Id., pp. 690-5.

30. Employees.--While public convenience and necessity embrace consideration of the interests of employees, the commission is without warrant in the last to impose employee protection conditions in passenger train discontinuances. And, since probable effect which discontinuance of considered commuter trains will have on the railroad's employees are not such as to require continued operation of those trains, it would be contrary to the national transportation policy to require continuance of wasteful and uneconomic transportation services merely to preserve jobs of the employees.-Louisville & N. R. Co. Discontinuance of Trains, 320 I.C.C.

669(695).

§14(1). REPORTS OF INVESTIGATIONS BY COMMISSION

1.

The report; requisites.--See also United States v. Allegheny-Ludlum Steel Corp., APA, 5 USC, Procedure

$20 (11). LIABILITY OF INITIAL AND DELIVERING CARRIER FOR LOSS; LIMITATION OF LIABILITY; NOTICE AND FILING OF CLAIMS

Regulations of the Commission

37 FR 4257, March 1, 1972, Part 1005: Principles and Practices for the Investigation and Voluntary Disposition of Loss and Damage Claims and Processing Salvage, new Part 1005, §§1005.1 - 1005.6, added to become effective April 20, 1972.

37 FR 9027, May 4, 1972, Part 1005: Principles and Practices for the Investigation and Voluntary Disposition of Loss and Damage Claims and Processing Salvage, effective date of prescribed regulations postponed until July 1, 1972, effective on date of order.

37 FR 20943, Oct. 5, 1972, Part 1005: Principles and Practices for the Investigation and Voluntary Disposition of Loss and Damage Claims and Processing Salvage, §1005.3(b) and $1005.4 (c) modified, effective Oct. 16, 1972.

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