Arizona Corp. Commission v. Pacific Motor Trucking Co.

UDALL, Chief Justice

(specially concurring).

I agree with the result reached by the majority, however, in view of the nature of the attack made on the general order or rule by the petitioners in their brief, I feel constrained to more fully express my reasons for affirming the judgment and holding the rule invalid.

The petitioners argue that the rule in effect modified their certificate and that unless they are given a hearing on the matter in accordance with the elementary requirements of due process, the Commission acted in excess of its jurisdiction. It should be emphasized that when an administrative body such as the Commission here, promulgates a general rule under proper delegated authority, they are performing a legislative-like function as opposed to a judicial or adjudicative function. A general rule thus promulgated is not invalid because it was adopted without affording every. individual affected thereby an adjudicative hearing; Air Lines Pilots Association, International v. Quesada, 276 F.2d 892 (2nd cir. 1960); United States v. Berwind-White Coal Min. Co., 274 U.S. 564 , 47 S.Ct. 727 , 71 L.Ed. 1204 (1927) ; Willapoint Oysters v. Ewing, 174 F.2d 676 (9th cir. 1949). See generally, 1 Davis, Administrative Law Treatise, Chapters 5, 6, and 7 (1958).

If the Commission were required to hold adjudicative-type hearings before they could adopt a general rule it may subject the Commission to such an intolerable burden which might well render it impossible for it to effectively discharge its duties. See A.R. S. §§ 40-604, 40-605, 40-606 (1956). The only hearing required for “rule-making” is a general “public” hearing pursuant to A.R. S. § 41-1002 (1956) which was held in this case.

The rule in this case is invalid for the reason that it contravenes the established “regulated monopoly” policy of this state and is therefore void. See Tucson Rapid Transit Co. v. Old Pueblo Transit Co., 79 Ariz. 327 , 289 P.2d 406 (1955). The effect *162 of the rule in this case would be to take away from the common carrier a portion of its existing “market” and allow additional common carriers along with the original carrier to compete for a certificate to serve that portion of the market (petroleum products in bulk) severed from the original market by operation of the rule. Under the “regulated monopoly” policy of this state, the original carrier must first be allowed the opportunity to serve all portions of his original market before another carrier can be eligible to “invade” the market. Whitfield Transportation v. Tucson Warehse. & T. Co., 78 Ariz. 136 , 276 P.2d 954 (1954).

For the foregoing reason the rule is invalid and the judgment of the superior court should be affirmed.

BERNSTEIN, Justice

(concurring).

The Corporation Commission has attempted to throw up a smoke screen and justify the order involved here as a safety measure. It is true that A.R.S. § 40-605(2) enacted in 1933, under which the Commission did not purport to act, authorized it to, “Regulate * * * the safety of operations of each common motor carrier.” In 1950 the legislature adopted the Uniform Act Regulating Traffic on Highways, A.R.S'. § 28-601, et seq. This latter act is a comprehensive code and includes a chapter on “Equipment”. Furthermore, A.R.S. § 28-962B specifically authorizes and directs the State Highway Commission “to promulgate such additional regulations governing the transportation of explosives and other dangerous articles upon the highways as it deems advisable for the protection of the public.” The legislature contemplated by the 1950 act, a comprehensive system of safety regulation, administered by the Highway Commission, and covering all carriers of dangerous articles including petroleum products. The Corporation Commission in law, as it is in fact, is solely an economic regulatory body, and cannot use “safety” as a subterfuge to reach an economic result. It cannot do indirectly that which cannot be done directly.