Untitled Texas Attorney General Opinion ( 1963 )

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October 3, 1963
Col. Homer Garrison, Jr. Opinion No. C-152
Director
Texas Department of Public Re: Multiple leases of com-
Safety mercial vehicle6 in intra-
Austin, Texas atate and Interstate
commerce under the pro-
visions of Article 670lc-1,
Vernon's Civil Statutes,
and multiple lessees in
leases under the provisions
of Article 6701c-1, Vernon's
Dear Col. Garrison: Civil Statutes.
In your letter of August 14, 1963, you requested an
opinion of this office on the following questions:
"1 . When a lease between A (the regis-~
tered owner) and B (the lessee) covering the
operation of a commercial motor vehicle ha8
been accepted for filing by the Department
of Public Safety, can the Department then ac-
cept a second lease on the same motor vehicle
from B (who becomes owner but not registered
owner) and C (who becomes the lessee) for
intrastate operation?
“2. In view of the Interstate Commerce
Commission rules and regulations governing
leasing and interchanging of equipment,
would your answer be the same as for our
question number 1 If B subleased the motor
vehicle to C for interstate operation?
“3. Can the Department accept for filing
a lease In which two lessees separate business
organizations or corporationsI are indicated?"
Article 6701``1, Section 3, Vernon's Civil Statutes,
provides as follows:
"When any such lease, memorandum, or
agreement, as required by Section 2 of this
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Col. Homer Garrison, Jr., page 2 (C-152 )
Act, shall have been filed with the Depart-
ment of Public Safety covering the operat,ion
of any commercial motor vehicle or truck-
tractor, no further such ,lease,memorandum,
or agreement coverlng,the operation of the
same commercial motor vehicle or truck-
tractor may be accepted by the Department
of Public Safety for filing until the exist-~
ing lease, memorandum, or agreement shall
have expired In accordance with its own
te~rmsor there shall have been filed with
the ,Departmentof Public Safety a full re-
,lease thereof."
The language of,the statute is explicit and provides
that .the Department of Public Safety "cannot accept a second
lease for filing covering the operatjon of any commercial
motor vehicle or truck-tractor:
I,
.,'i. . until the existing:,lease,memo-
randum tiragreement shall have expired in
accordance with its own terms or there
shall have been filed with the Departmen:
of Public Safety,,afull release thereof.
We, therefore, ~answer your first question in the negative.
The Department of Public Safety cannot accept a second lease
on the same motorvehicle covering intrastate operations until
the first lease has expired or been released.
Your second question we Interpret to apply to commodi-
ties and transportation for hire in interstate commerce only.
In relation to such Interstate operationsthe Texas Supreme
Court hasheld as follows:
"Under the Constitution of the United
States the power of Congress to regulate
Interstate commerce is supreme. (Cases
cited.) In the exercise of that power the
Federal Motor Carrier Act was passed, and
all existing state laws in conflict there-
with were superseded. (Cases and authori-
ties cited.) This insures uniformity of
regulation. It is quite obvlous~that many
conflicts would occur, and that much con-
fusion would follow if the different states
had the power to regulate Interstate com-
merce ifidependentof the power of Congress
. . . .
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- -
Col. Homer Garrison, Jr.; page 3 (C-152 )
The Court continues further on:
"Supreme control over the operation of
interstate commerce was assumed by the
Federal Motor Carrier Act." Railroad Com-
mission of Texas v. Querener, 150 Tex. go,
242 S .W .2d lob (1931).
The Interstate Commerce Commission has in Rx
MC-43 under authority of 49 U.S.C. 304, part 20'7,-=F&
promu ga ,e
-In rules and regulations covering the lease and inter-
change of vehicles. Under these rules and regulations a
lessee may in certain instances be considered as an "owner."
As such owner he may sublease, under the rules set out by
the Interstate Commerce Commission, to other authorized
carriers during the duration of,the ownership. Section 207.4
(4) (I), Ex parte No. MC-43. This would involve a two-lease
situation and as such would be in.violation of Article 6701d,
Vernon's Civil Statutes, if such statutes contemplated the
regulation of interstate commerce. Article 6701`` was origi-
nally enacted by the Legislature in 1953, long after the
Federal Government by the Interstate .CommerceAct had pre-
empted regulation of motor transportation for hire in inter-
state commerce. The Legislature must heaverconsidered this
fact when enacting Article 6701c-1 and obviously did not mean
to pass a statute which would be unconstitutional because It
invaded the field of interstate commerce already pre-empted
by federal legislation. The State Act must be interpreted
to make it constitutional and valid if by any reasonable con-
struction the enactment can be sustained. 39 Tex.Jur. 206,
Statutes, Sec. 111, and cases there cited. This office is
therefore, of the opinion that the term "registered owner
as used in Article 6701`` means, for interstate commerce
transoortation, the "owner" as reconnlzed bv the Interstate
CommeEce Commission. Rx parte MC-43, Section 207.4 (a) (4)
(I) provides:
"Lessee may be.considered as owner. Pro-
vision may be made therein for considering
the lessee as the,owner for the purpose of
subleasing under these rules,to other au-
thorized carriers during such duration."
To answer your second question literally, the Department of
Public Safety could not accept for filing the second lease.
However, if the first lease from A to B had not been filed
and the Department was furnIshed with satisfactory evidence
of compliance with EK parte MC-43 the Department would be
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Col. Homer Garrison, Jr., page 4 (C-152 )
authorized to consider the person recognized by the Inter-
state Commerce Commission as the owner, for purposes of
Article 67Olc-1. The lessee (person operating the vehicle),
however, would be required to satisfy the requirements of
Article 670112-lby furnishing the Department of Public Safety
with a copy of the lease between the "owner',as recognized
by the Interstate Commerce Commission and the lessee actually
using the equipment. Such lease and leasing transaction would
have to,comply with the terms and provisions of Article 6701c-1.
We are aware that this office in Opinion No. S-117,
dated December 23, 1953, held in part as follows:
"Article 67Olc-1, V.C.S., applies to all
operations of commercial motor vehicles and
truck-tractors, except to the operations there-
in specifically exempted, when the operator
thereof is not the registered owner of such
vehicle, or his agent, servant or employee,
regardless of the character of the operation
as being private or for hire, regulated or
nonregulated, intrastate or interstate, and
such application Is not violative of the Inter-
state Commerce Clause of the Constitution of
the United States."
Insofar as the quoted holding conflicts wlth this opinion on
the question of leases on commercial vehicles in interstate
commerce isgoverned by Ex parte MC-43, Opinion No. S-117 is
overruled.
You asked In your third question whether the Depart-
ment can accept for filing a lease in which two lessees are
indicated. Article 6701c-1, as amended by the Legislature
in 1963, contains the following language:
"Sec. 2. No commercial motor vehicle nor
any truck-tractor shall be operated over any
public highway of this State by any person
other than the registered owner thereof, or
his agent, servant or employee under the
supervision, direction, and control of such
registered owner unless such other person
under whose supervision, direction and con-
trol said motor vehicle or truck-tractor Is
operated shall have cause to be filed with
the Department of'Public Sar'etyan executed
copy of the lease, memorandum, or agreement
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Col. Homer Garrison, Jr.,.page 5 (C-152 .) ."~:,pi
under which such commetiial,motor vehicle or
truck-tractor Ianbeing operated. . . .
"Sec. ‘4. Such lease, memorandum, or
agreement as required by Section 2 of this
Act shall contain or provide, but shall not
be limited to, I. . (a provision) that the
operation of such vehicle shall be under
the full and complete control and super-
vision of the person other than the regis-
tered owner, : . . .' (Emphasis supplied.)
It therefore, becomes apparent that It would be Impossible to
have a commercial vehicle leased to more than one lessee at
any one time in view of the requirement in Section 4 that the
operation of such vehicle shall be under the "full and %om-
plete control and supervision" of the person other than the
registered owner operating the vehicle. No lessee would be
in a position to make this statement if at the time the lease
was entered into it was contemplated that he would "share"
such "full and complete control and supervision" of ,the
vehicle with another person. We are therefore, of the opinlon
that the Department may not accept for filing, under the pro-
visions of Article 6701``I., Vernon's Civil Statutes, a lease
of a commercial motor vehicle In which two leseees~(separate
business organizations or corporations) are indicated.
SUMMARY
The Department of Public Safety cannot ac-
cept for filing a lease on a motor vehicle
moving in intrastate commerce as long as there
Is a lease on the same motor vehicle on file
which has not expired or been released.
A lease, under interstate commerce rules
and regulations makes the lessee the "owner"
and makes such owner a "registered owner" as
that term is used In Article 6701~2-1. The
said "owner" can then lease the commercial
vehicle for interstate operations and the
lessee of such "owner" of such commercial
vehicle must file the lease under which he
is operating the vehicle as required by
Article 6701c-1.
The Department of Public Safety cannot
accept for filing a lease of a commercial
-Pm-
col. Homer Garrison, Jr., page 6 (C-152 )
vehicle under the terms of Article 6701c-1 ,in
which two lessees (separate business organ-
izations or corporations) are indicated.
Yours very truly,
NVS:aj:br
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
James M. Strock
George Gray
Linward Shivers
APPROVED FOR THE ATTORNEY GENERAL
By: Stanton Stone
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