DocketNumber: 13564
Citation Numbers: 167 S.E. 674, 168 S.C. 440, 1933 S.C. LEXIS 28
Judges: Stabeer, Justice'Brease, Messrs, Carter, Bonham, Cothran
Filed Date: 1/27/1933
Status: Precedential
Modified Date: 11/14/2024
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 442 January 27, 1933. The opinion of the Court was delivered by These two suits, instituted in the original jurisdiction of the Court, were heard together on argument, and will be disposed of in one opinion. For the sake of convenience we will refer to them as the Hicklin case and the Blalock case. With the exception of one question applicable only to the latter, the questions involved in the two cases are identical.
It is alleged and admitted that the respondents come within Class F of motor vehicle carriers, defined in the amendatory Act of April 7, 1930 (36 Stat. at Large, page 1068), as consisting of persons, firms, or corporations proposing to engage in the business known as contract hauling of freight or property, but not proposing to operate upon a regular schedule or over a regular route or to receive patronage along the route, and as such are required by the Act to obtain a certificate to operate and to pay the license fee therefor. It is further alleged that the respondents are now "carrying on their motor transportation business in the State of South Carolina over the public highways without any certificate and without paying any of the fees or taxes therefor, and in *Page 444 violation of the said laws hereinabove mentioned and of the orders and rules of the Railroad Commission issued thereunder."
The purpose of these actions, as set forth in the petitions, is to enforce the provisions of Sections 8507 to 8530, inclusive, of Chapter 162 of the Code of 1932 (Acts of 1925, page 252; Act 1928, page 1238; Acts 1930, pages 1068, 1100 and 1327; and Acts 1931, page 145), and to require the respondents to comply with these Acts and the rules and orders of the Railroad Commission promulgated thereunder. The prayer of the petitions is that these Acts be construed and enforced by this Court, that a mandatory order of injunction issue directing and requiring the respondents to comply therewith, and that they be enjoined from engaging in business as contract haulers without such compliance.
The respondents interposed demurrers to the petitions, and also made returns and answers.
With regard to the demurrers, it is sufficient to say that the identical grounds made in these cases were considered by the Court in King v. Aetna Insurance Company et al.
By their returns and answers the respondents challenge the constitutionality of the Acts referred to (Chapter 162 of the Code of 1932), Section 66 of the general appropriation Act of 1931 (37 St. at Large, page 453), and Section 34 of the general appropriation Act of 1932 (37 St. at Large, page 1605), applicable to contract carriers, as to both State and Federal Constitutions, contending that they are invalid because of certain exemptions made, requirements relating to cargo insurance, authority conferred on the Railroad Commission to regulate rates of contract carriers, the imposition of license fees based upon "carrying capacity," *Page 445 and the imposition of a tax upon the "gross receipts" of a carrier doing an interstate as well as an intrastate business.
In Stephenson v. Binford,
Section 8507 of the Code defines "motor vehicle carrier," for the purposes of the Act, as "every corporation or person * * * operating * * * any motor propelled vehicle * * * used in the business of transporting persons or property for compensation over any improved public highway * * * as hereinafter defined, in this State."
I. Section 8508 of the Code, which contains certain exemptions, is as follows: "No corporation or person, their lessees, trustees, or receivers, shall operate any motor-propelled vehicle as herein before defined for transportation of persons or property for compensation on any improved public highways in this State, except in accordance with the provisions of Sections 8507 to 8524, and such operation shall be subject to control, supervision and regulation by the commission in the manner provided by Sections 8507 to 8524: Provided, however, That nothing in Sections 8507 to 8524 contained shall apply to motor vehicles while used exclusively for transporting persons to and from schools, Sunday schools, churches, or religious services of any kind, or to or from picnics or upon special prearranged excursions, or to United States mail carriers operating star routes, while engaged solely in carrying mail, or to farmers or dairymen, hauling dairy or farm products; or lumber haulers engaged in transporting lumber and logs from the forest to the shipping points." *Page 446
The respondents urge that the exemption of "farmers or dairymen, hauling dairy or farm products, or lumber haulers engaged in transporting lumber and logs from the forest to the shipping points," is discriminatory, and violates the
In support of their contention, counsel for respondents rely in the main upon the case of Smith v. Cahoon,
In support of their position, petitioners rely mainly upon the case of Continential Baking Company v. Woodring,
"Section 1. (a) The terms ``motor vehicle when used in this Act means any automobile, automobile truck, trailer, motor bus, or any other self-propelled or motor-driven vehicle used upon any public highway of this State for the purpose of transporting persons or property. (b) The term ``public motor carrier of property' when used in this Act shall mean any person engaged in the transportation by motor vehicle of property for hire as a common carrier having a fixed termini or route. (c) The term ``contract motor carrier of property' when used in this Act shall be construed to mean any person not a public motor carrier of property engaged in the transportation by motor vehicle of property for hire as a business. (d) The term ``private motor carrier of property' when used in this Act shall be construed to *Page 448 mean any person engaged in the transportation by motor vehicle of property sold or to be sold by him in furtherance of any private commercial enterprise. (e) The term ``public motor carrier of passengers' when used in this Act shall mean any person engaged in the transportation by motor vehicle of passengers or express for hire as a common carrier having a fixed termini or route. (f) The term ``contract motor carrier of passengers' when used in this Act shall be construed to mean any person not a public motor carrier of passengers engaged in the transportation by motor vehicle of passengers or express for hire. (g) The term ``public highway' when used in this Act shall mean every public street, road or highway or thoroughfare of any kind used by the public.
"Sec. 2. That this Act shall not apply to motor carriers who shall operate wholly within any city or village of this State, or private motor carriers who operate within a radius of twenty-five miles beyond the corporate limits of such city, or any village, nor to the transportation of live stock and farm products to market by the owner thereof or supplies for his own use in his own motor vehicle; or to the transportation of children to and from school."
The Court in the Continental Baking Company case, in distinguishing that case from the Cahoon case, had this to say:
"The third exemption applies to ``the transportation of livestock and farm products to market by the owner thereof or supplies for his own use in his own motor vehicle.' InSmith v. Cahoon, supra, the State statute, which applied to all carriers for compensation over regular routes, including common carriers, exempted from its provisions ``any transportation company engaged exclusively in the transporting agricultural, horticultural, dairy or other farm products and fresh and Salt Fish and Oysters and Shrimp from the point of production to the assembling or shipping point enroute to primary market, or to motor vehicles used exclusively *Page 449 in transporting or delivering dairy products.' The stated distinction was thus established between carriers, and between private carriers, notwithstanding the fact that they were ``alike engaged in transporting property for compensation over public highways between fixed termini or over a regular route.' The Court was unable to find any justification for this discrimination between carriers in the same business, that is, ``between those who carry for hire farm products, or milk or butter, or fish or oysters, and those who carry for hire bread or sugar, or tea or coffee, or groceries in general, or other useful commodities.'
"The distinction in the instant case is of a different sort. The statute does not attempt to impose an arbitrary discrimination between carriers who transport property for hire, or compensation, with respect to the class of products they carry. The exemption runs only to one who is carrying his own livestock and farm products to market or supplies for his own use in his own motor vehicle. In sustaining the exemption, the District Court referred to the factual basis for the distinction. ``The Legislature knew,' said the Court ``that as a matter of fact farm products are transported to town by the farmer, or by a nonexempt "contract carrier" employed by him. The Legislature knew that as a matter of fact the use of the highways for the transportation of farm products by the owner is causal and infrequent and incidental; farmers use the highways to transport their products to market ordinarily but a few times a year. The Legislature rightly concluded that the use of the highways for carrying home his groceries in his own automobile is adequately compensated by the general tax imposed on all motor vehicles.' 55 F.2d [347] at page 352. And the Court properly excluded from consideration mere hypothetical and fanciful illustrations of possible discriminations which had no basis in the actual experience to which the statute was addressed. The Court found a practical difference between the case of the appellants ``who operate fleets of trucks in the *Page 450
conduct of their business and who use the highways daily in the delivery of their products to their customers,' and that of ``a farmer who hauls his wheat or livestock to town once or twice a year.' The Legislature in making its classification was entitled to consider frequency and character of use and to adapt its regulations to the classes of operations, which by reason of their habitual and constant use of the highways brought about the conditions making regulation imperative and created the necessity for the imposition of a tax for maintenance and reconstruction. As the Court said in Alwardv. Johnson,
The petitioners also rely upon the case of SchwartzmanService v. Stahl (D.C.)
"It must be acknowledged that the state has the power to regulate and control the movements of motor vehicles over its highways. This it may do in the interest of public convenience and safety and for the protection of the highways. Provisions of this character have been uniformly sustained. *Page 451 Buck v. Kuykendall,
"Moreover, while ``a citizen may have, under the
"The highways belong to the state. It may make provisions appropriate for securing the safety and convenience of the public in the use of them. Kane v. State of New Jersey,
"Assuming, therefore, the power and right of the state to regulate and supervise its highways, such right cannot be hampered or restricted within narrow bounds. On the contrary, to the end that such right might be fully enjoyed and exercised, there is a constant recognition of the principle that the state ``has a broad discretion in classification in the exercise of its power of regulation.' Smith v. Cahoon,
See, also, Sproles v. Binford,
The petitioners contend that the Cahoon case may be validly distinguished in the cases at bar as it was in the cases cited, and in this we agree. In the first place, in the Cahoon case, the Court was dealing with a criminal prosecution, which point it stressed, saying: "It should be observed that this is not an action in equity where the enforcement of a statute awaits the final determination of the Court as to validity and scope." The cases before us are suits in equity, in which this Court is asked to construe the acts in question. Also, in that case, the discrimination was in favor of "any transportation company" engaged in hauling the class of products therein mentioned, while in the cases at bar the discrimination is in favor of farm and dairy products only when hauled by farmers and dairymen, and in favor of lumber haulers engaged in transporting lumber and logs from the forest to the shipping points. In other words, there is a double element involved in the classification in this case, the class of persons and the class of products, while there was only one element of classification involved in the Cahoon case, namely, the class of products.
It must be conceded, as has been held in German AllianceInsurance Company v. Superintendent of Ins. of State ofKansas,
We think the respondents have failed to sustain the burden cast upon them of showing beyond a reasonable doubt that the exemption in question renders the Act unconstitutional and invalid.
It will be observed that this conclusion has been reached independently of the construction placed by the Railroad Commission upon the contested provision of the Act. We think that this construction is, in part, unsound. One hauling his own products in his own motor vehicle does not come within the purview of the Act, and no provision for his exemption is necessary. The Act applies only to those who are carriers for compensation, and the exemption can refer only to farmers and dairymen hauling farm and dairy products for compensation. The same may be said with regard to those hauling lumber and logs from the forest to the shipping points. See Sproles v. Binford, supra.
II. The respondents also contend that the Acts in question are invalid "because the requirements of Section 8511 that contract carriers must obtain and *Page 454
carry cargo insurance violates the
Section 8511 provides: "The commission shall, in the granting of a certificate, require the applicant to procure and file with said commission liability and property damage insurance, or surety bond with some casualty or surety company authorized to do business in this State, on such motor vehicle or vehicles to be used in the service aforesaid, in such amount as the commission may determine, insuring or indemnifying passengers or cargo and the public receiving personal injury by reason of any Act of negligence, and for damage to property of any person other than the assured; such policy or bond to contain such conditions, provisions, and limitations as the commissions may prescribe and the same shall be kept in full force and effect, and failure to do so shall be cause for the revocation of such certificate."
Respondents argue that one of the principal differences between a common carrier and a private or contract carrier is, that the common carrier is an insurer, while the private or contract carrier is not; and that the Legislature cannot compel private carriers to become or to assume the duties and liabilities of common carriers. They contend that in our statute the Legislature attempted to put both Classes of carriers upon an identical footing and subject them to the same obligations, which was beyond their power to do, citing in support of their contention Michigan Public UtilitiesCommission v. Duke,
Similarly, as also pointed out in the Stephenson case,Frost Frost Trucking Company v. R.R. Commission,
Our statute, however, like that construed in the Stephensoncase, expressly recognizes the distinction between common carriers and private contract carriers; and from an examination of the entire Act it is clear that the Legislature did not intend to put common carriers and private contract carriers on the same footing with regard to the matters here complained of. We think, and so hold, that in the case of private carriers, or contract carriers, the provisions of Section 8511 extend no further than to require such carriers to execute an indemnity bond, as the commission may prescribe under the provisions of the Act, for the protection of the public receiving injury, either in person or in property, by reason of any act of negligence of such private or contract carriers. We do not think it was the intent of the Legislature, in the passage of the Act, to require contract carriers to obtain and carry cargo insurance, and we construe the Act as not imposing upon them such requirement.
III. The respondents further contend that the Act is invalid "because the provision of Section 8516 vesting in the Railroad Commission the power and *Page 456 authority, and imposing upon it the duty, of regulating the rates of contract carriers is likewise in violation of said constitutional provisions, being an unwarrantable interference with the right of private contract."
Section 8516 reads as follows: "The commission is hereby vested with power and authority and it shall be their duty to supervise and regulate every motor carrier in this State; to fix or approve the rates, fares, charges, classification and rules and regulations pertaining thereto, of each such motor carrier: Provided, however, That the rate now obtaining by the respective motor carriers shall remain in effect until such time, when pursuant to complaint and proper hearing, the commission shall have determined that said rate or rates are unreasonable: Provided, That the said commission shall fix as to class certificate C a maximum rate only."
As it is conceded that the Railroad Commission, which is vested with the power and authority to fix and approve rates, etc., as provided by Section 8516, has never, since the enactment of the law, exercised its power, if any it has under the Act, to supervise and regulate rates of contract carriers, the respondents here have no ground for complaint. SeeStephenson v. Binford, supra.
IV. It is also contended that the Act is invalid "because the license fees required of contract carriers under Section 8512 are based solely upon ``carrying capacity,' and, hence, insofar as contract carriers engaged in interstate commerce are concerned, are void because they are not compensatory, and therefore violate Article 1, § 8, of the Constitution of the United States, and the
With regard to holders of certificate F, to which class the respondents herein belong, Section 8512 provides: "For vehicles of carrying capacity of not over one and one-half tons, Thirty ($30.00) Dollars; for vehicles of carrying capacity of over one and one-half tons and not over two tons, Sixty ($60.00) Dollars; for vehicles of carrying capacity *Page 457 of over two tons and not over three tons, One Hundred Twenty ($120.00) Dollars; for vehicles of carrying capacity of over three tons and not over four tons, two hundred ($200.00) Dollars; for vehicles of carrying capacity of over four tons and not over five tons, Four Hundred ($400.00) Dollars; for vehicles equipped fully with pneumatic tires; for vehicles equipped fully or partially with solid tires these fees shall be doubled."
In the Duke case, supra, the United States Supreme Court said: "A state which, at its own expense, furnishes special facilities for the use of those engaged in intrastate and interstate commerce may exact compensation therefor, and if the charges are reasonable and uniform, they constitute no burden on interstate commerce. Hendrick v. Maryland,
We have made a careful examination of the authorities with reference to this particular contention, and think it is without merit. Such fees are collected, as provided for by Section 8517, for the purpose of maintaining the public highways over which such motor vehicles shall operate, as compensation for their use. Further, they are reasonable as to amount, and tend to contribute to the protection of the highways. We do not think that the provision of the Act here complained of constitutes an undue burden on interstate commerce.
V. The respondents in the Blalock case also raise a question as to the tax imposed on all carriers for hire under Section 66 of the general appropriation Act of 1931, which they attack as being violative of the interstate commerce clause of the United States Constitution, for the following reasons: (a) That said tax, imposed by the terms of said Act upon the ``gross receipts' of such carriers, *Page 458
was a tax upon receipts from interstate as well as intrastate business, constituted a burden on interstate commerce in contravention of Article 1, Section 8, of the Constitution of the United States, and (b) was not in lieu of all other taxes, in violation of said last named provision and the
It is well settled that the State may impose taxes upon the intrastate operations of a motor carrier, though such motor carrier is also engaged in interstate operations. InterstateBusses Corporation v. Blodgett,
The judgment of this Court is:
First. That the demurrers interposed by the respondents be, and the same are hereby, overruled.
Second. That the Acts in question are construed as herein indicated, and that the taxes and license fees required of the respondents by the petitioners thereunder are lawful and due, and that the petitioners be authorized to proceed to the collection thereof.
Third. That the petitioners have the right to apply to this Court hereafter for the issuance of such order, or orders, writ, or writs, as may be necessary to carry into effect the *Page 459 conclusions and judgment of this Court, and upon their application therefor, at the proper time, that the order restraining the petitioners from proceeding to enforce the Acts of the General Assembly, referred to in these causes, be dissolved.
MR. CHIEF JUSTICE BLEASE and MESSRS. JUSTICES CARTER and BONHAM and MR. ACTING ASSOCIATE JUSTICE W.C. COTHRAN concur.
German Alliance Insurance v. Lewis , 34 S. Ct. 612 ( 1914 )
Interstate Busses Corp. v. Blodgett , 48 S. Ct. 230 ( 1928 )
Bekins Van Lines, Inc. v. Riley , 50 S. Ct. 64 ( 1929 )
Sproles v. Binford , 52 S. Ct. 581 ( 1932 )
Carley & Hamilton, Inc. v. Snook Chief of the Division of ... , 50 S. Ct. 204 ( 1930 )
Kane v. New Jersey , 37 S. Ct. 30 ( 1916 )
Smith v. Cahoon , 51 S. Ct. 582 ( 1931 )
Alward v. Johnson , 51 S. Ct. 273 ( 1931 )
Continental Baking Co. v. Woodring , 52 S. Ct. 595 ( 1932 )
Hendrick v. Maryland , 35 S. Ct. 140 ( 1915 )
Packard v. Banton , 44 S. Ct. 257 ( 1924 )
Stephenson v. Binford , 53 S. Ct. 181 ( 1932 )
Michigan Public Utilities Commission v. Duke , 45 S. Ct. 191 ( 1925 )
Frost & Frost Trucking Co. v. Railroad Comm'n of Cal. , 46 S. Ct. 605 ( 1926 )