Corporation Commission v. Pacific Greyhound Lines , 64 Ariz. 273 ( 1946 )

The Chief Justice has set out all the pertinent facts. From what has been said, it is evident that only one real question is involved, and that is whether under the proviso of section 66-506, A.C.A. 1939, the phrase "or in a territory already served by a common motor carrier" applies in this case. To put it otherwise, the question is this: If a motor carrier holds a certificate of convenience and necessity over a certain road between two cities, and a subsequent applicant petitions the commission to carry passengers and baggage between said cities over an entirely different route, must the commission first give the prior certificate holder an opportunity to provide such service between such cities over the new and different route?

The corporation commission is the constitutional body which alone has the right to issue certificates of convenience and necessity. Northeast Rapid Transit Co. v. Phoenix, 41 Ariz. 71,15 P.2d 951. The legislature has the power to limit the rights of the commission in the issuance of certificates and they may be issued only in compliance with the legislative acts. Arizona Corp. Comm. v. Hopkins, 52 Ariz. 174, 79 P.2d 946. However, any law or act which limits the constitutional or general lawful powers of the commission is a restrictive measure and must be strictly construed. The proviso cannot be held to apply to situations not covered by its terms or beyond its plain intendments. 50 Am.Jur. 458, sec. 437, Statutes.

The proviso "or in a territory already served by a common motor carrier" applies against a route carrier, from one terminus to another, which attempts to extend its service in such a manner as to do a local business at one of the termini where such local business is already under a certificate of convenience and necessity to another motor carrier. Betts v. Roberts, Ariz.,162 P.2d 423. Thus, the fact that the applicant in that case was carrying freight into and from the terminus over a designated route did not authorize it to extend its service within the terminus so as to compete with a local trucker who held a certificate of convenience and necessity for trucking privilege within a 25 mile radius of the terminus. Under these circumstances, it was held that as a predicate to the issuance of the certificate of convenience and necessity to the applicant, the vicinity motor carrier must be given an opportunity to provide the service deemed satisfactory to the commission.

It is settled that where one carrier has a certificate of convenience and necessity to operate over a route or routes to serve two or more points, that no certificate can be issued to a later applicant over such route to serve the same places, except upon a showing of convenience and necessity, and only after the existing carrier is given the opportunity to provide for the service which is deemed satisfactory to the commission. Corporation Comm. v. Pacific Greyhound Lines, 54 Ariz. 159,94 P.2d 443; Corporation Comm. v. People's Freight Line, Inc., 41 Ariz. 158, 16 P.2d 420. The same rule applies in the case of an existing territorial or vicinity carrier. Arizona Corporation Comm. v. Hopkins, supra.

It is my view that the phrase "or in a territory already served by a common motor carrier" was never intended to and does not mean that the termini alone constitute "territory" within the meaning of the proviso. The "territory" consists of the termini and the route served. Where the termini is to be served by a wholly different route, opening up new country, the result is a new territory, and the fact that both the old and new carriers will serve the termini does not bring the case within the exception. The defendant's certificate as issued by the commission over highway 80 and 89, a wholly different and separate route and territory from that over which the plaintiff operates, was not unauthorized as being in violation of the provision of the statute which requires opportunity to the existing motor carrier serving such territory to first provide for such service.

Any other construction would lead to absurdities. If a motor carrier secures a certificate of convenience and necessity to carry passengers and baggage between two points over a certain road, and later other roads are constructed between the two points, opening up new and different territory, there is no reason why the first certificate holder should have the prior right to operate over such new and additional roads. If the carriage of passengers and baggage into a certain city is to be construed, as applying to that city, as territory served, then logically if a new road is constructed which opens up altogether different territory and connects the terminus with another city, the certificate holder would be entitled to the first right to put in the service over the new road. Thus, for instance, a certificate holder having the right to carry passengers and baggage between Phoenix and Gila Bend to Ajo, would also have the first right, if a new road were opened between Ajo and Yuma, to operate its service over that road, if the necessity so required. It seems obvious to me that the phrase "or in a territory already served by a common motor carrier" means just what it says, the transaction of business or transportation from one point to another in that particular territory. It does not mean transportation into and out of a particular place.

By so holding we are not departing from the rule of regulated monopoly rather than the competitive system. Corporation Comm. v. People's Freight Line, and Corporation Comm. v. Pacific Greyhound Lines, supra. As we said in the latter case, "It would be an abuse of discretion to authorize a competing carrier to enter into a certain class of business so long as an existing carrier, with a prior certificate of convenience and necessity for that class of business, furnished proper service."

Under the provisions of section 66-506, supra, before a certificate may be issued to any applicant, the evidence must show that the public convenience and necessity requires the proposed service. Here the evidence unquestionably disclosed the convenience and necessity of the proposed service over the new route. If the plaintiff had been adequately furnishing all service necessary between Tucson and Florence over its route, and there was no necessity shown for the service over the proposed route, the permit could not have been issued, because in that case there would be no showing of convenience and necessity. Under such circumstances it would be an abuse of discretion for the commission to issue the new permit under the rule heretofore announced by this court. It seems to me that the rights of a route carrier from one point to another may properly be protected under this rule. The point is that the statute does not give to the prior carrier over an established route between two points the first right to initiate service over a wholly new and different route. Whether a permit shall be issued to the new applicant is largely within the discretion of the commission.

The evidence before the commission and the court, as already stated, showed the public convenience and necessity for the proposed service over highway 80-89. The fact that neither the commission nor the court made any finding to this effect is immaterial. It is the evidence rather than the findings which must control. There is nothing in the evidence to indicate that the issuance of the certificate would constitute an abuse of discretion. The testimony was sufficient to justify a finding that the plaintiff was not adequately furnishing all service necessary between Tucson and Florence, and that the public convenience and necessity required the service over highway 80-89.

For the reasons stated in the opinion of the Chief Justice, and as supplemented by this concurring opinion, the judgment should be reversed.