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GRAY LINE NATL. TOURS CORP. v. UNITED STATES

July 31, 1974

Gray Line National Tours Corp., Plaintiff,
v.
United States of America and Interstate Commerce Commission, et al., Defendants



The opinion of the court was delivered by: FRIENDLY

FRIENDLY, Circuit Judge:

Plaintiff Gray Line National Tours Corporation (GLNT) is a wholly-owned subsidiary of Gray Line Sightseeing Companies Associated, Inc. (GLA), which is an association of companies in many cities in the United States and abroad. The members offer local sightseeing tours, often under the rubric "Gray Line". Some of the United States members have authority to engage in the motor carriage of passengers; more do not.

GLNT brought this action to set aside an order of the Interstate Commerce Commission, 114 M.C.C. 914 (1972), which denied its application for a brokerage license under § 211 of the Interstate Commerce Act. *fn1" Plaintiff had sought authority to operate as a broker at all points in the United States, in arranging for transportation in interstate or foreign commerce of passengers and their baggage, in all types of passenger service, between points in the United States, including Alaska and Hawaii. The Hearing Examiner had recommended the grant of a more limited license, authorizing operation as a broker in arranging for transportation by motor vehicle in interstate or foreign commerce of passengers and their baggage in all-expense sightseeing and pleasure tours within this country, and restricted against originating or arranging for the origination of traffic at New York, N.Y., and Boston, Mass, and points within 50 miles of each, and at San Francisco, Calif. *fn2" The Commission, acting through Division 1, based its denial on two grounds. One was the inadequacy of the evidence to show that GLNT would "contribute something of value or be of benefit to carriers or the public," the test adopted by the full Commission in Carla Ticket Service, Inc., Broker Application, 94 M.C.C. 579, 581 (1964). *fn3" The other was what the Division regarded as an undesirable relationship of GLNT with motor common carriers of passengers, to wit, members of GLA holding operating authority. *fn4"

 Since this aspect of this subsection of the Interstate Commerce Act has apparently been the subject of only one reported court decision in the nearly forty years it has been on the books, Collette Travel Service, Inc. v. United States, 263 F. Supp. 302 (D.R.I. 1966) (Aldrich, J.), some account of its legislative history may be useful, meager though that turns out to be. As is well known the sources of the Motor Carrier Act of 1935 were the ICC's report on Coordination of Motor Transportation, 182 I.C.C. 263 (1932), and three reports of Commissioner Joseph B. Eastman in his capacity as Federal Coordinator of Transportation during the Great Depression, S. Doc. No. 119, 73d Cong. 2d Sess. (1934), S. Doc. No. 152, 73d Cong. 2d Sess. (1934), and H.R. Doc. No. 89, 74th Cong. 1st Sess. (1935). The ICC report took note of the brokerage problem, saying at 182 I.C.C. at 279-80:

 
With the development of long-haul motor transportation of passengers there has grown up in many cities the practice of selling transportation by agencies which do not represent any regular bus line. The practices of these agencies have given rise to many of the complaints registered by interstate bus passengers. The agencies advertise rates appreciably less than the fares of regular bus lines and then make arrangements with irregular operators, frequently the owners of private automobiles, to transport the passengers, the agency retaining a per cent of the fare collected as commission.

 Its solution was to limit brokerage in passenger transportation to certificate holders, id. at 386.

 The first of the two relevant reports of the Coordinator, S. Doc. No. 152, supra, at 45-49, 359, recommended regulation of "transportation agents or brokers" but said only that brokers should have to obtain a "permit", without specifying the standard. The second report, which recommended what became § 211, is more informative. It said, H.R. Doc. No. 89, supra, at 61-62:

 
Provision for more thorough-going regulation of brokers or transportation agents is made in the bill. To avoid confusion, the term "license" instead of "permit" is applied to the authority issued for brokerage operations. Licenses are required of all persons selling tickets or making contracts, agreements, or arrangements to provide transportation of persons or property in interstate or foreign commerce.Exemption of the agents of carriers holding certificates or permits is provided.
 
A showing of public interest and financial responsibility is a condition to the issuance of a license. The Commission shall make reasonable rules and regulations and require bond to protect the traveling or shipping public. These licenses are subject to revocation, as provided in section 312.
 
A desirable control over transportation effected through brokerage operations is afforded by the provision which requires brokers to employ only carriers holding certificates or permits. If the broker or transportation agent himself performs any transportation, through agents or employees or by lease of equipment, he must secure a form of carrier authority, either a certificate or a permit, and take on the duties and responsibilities and subject himself to the regulation provided for motor carriers.
 
The Commission may prescribe the forms of brokers' accounts and require reports. It may also enforce appropriate penalties for unlawful operations.

 The brief Senate Report on what became the Motor Carrier Act, S. Rep. No. 482, 74th Cong. 1st Sess. (1935), says nothing about brokers and the House Report, H.R. Rep. No. 1645, 74th Cong. 1st Sess. at 4 (1935), contains simply a condensed version of § 211(b), indeed omitting any reference to "the public interest and the national transportation policy," see note 1 supra.

 In light of this history we cannot quarrel with the Commission's analysis in Carla, supra, 94 M.C.C. at 580-81:

 
The legislative history of section 211 of the act clearly reveals that the primary purpose of Congress in regulating motor transportation brokers is to protect carriers and the traveling and the shipping public against dishonest and financially unstable middlemen in the transportation industry. Although this may be the primary objective of section 211 of the act, it does not follow that this is the sole objective of section 211. If financial integrity and stability were the sole aim of regulation in this area, it would have been sufficient for Congress to have formulated a statutory standard in section 211(b) of the act which would have limited our function in broker application proceedings to determining whether or not the applicant is fit, willing, and able to perform the proposed service. Instead, the statutory standard formulated by Congress in section 211(b), in terms of which all broker applications must be evaluated, requires us to find (1) that the applicant is fit, willing, and able to perform the proposed service, and (2) that the proposed brokerage operation is or will be consistent with the public interest and the national transportation policy. As a matter of statutory construction, no word or clause in a statute should be rejected as superfluous or meaningless, but must be given its due force and meaning appropriate to the context, albeit not a strained or unnatural meaning. Cf., Keystone Transp. Co. Contract Carrier Application, 19 M.C.C. 475, 492. The "public interest" aspect of the ...

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