Honorable Jams B. EEIlday, Dirsotor
Motor '?renaportatIon Dlvieion
Railroad cgma&3sion or Texas
r;untIn, !rexae
Doer Sir:
                                OpInIon
                                      Ho. o-3994
                                Rer Does the Railroad Comalaelon
                                    have authority  to put a -oeIl-
                                    lllg on rrdght rates to be
                                    charged by oontraot oar&era?
               We have your letter or SeptemSber 17, 1941, to-
gether      with the enoloeed memorandumwhich memorandum is as
r0ii0w6     I
                “Tim ComIseion’s    attention     Is 0alled to
          the faot that the Attorney GenemY., 1088, ren-
          dered an optilon-    and the Fiat& Division has
          been following   and ir I’ollorlag    that  opinion--
          to the effeot that oontnot       aarrlers mray aharga
          as high rate6 a8 they want to aharge and that
          the only authorit    of thie O~iasion,         aoting
          through its Rate isIvlslon,     Is to fix a rigure
          below whIoh they oan not go In makingoharges.
               “1 have some doubt In ry mind ae to whether
          or not this oplnlon Is oorreot: and, whether or
          not It be oorreot or ineomeot,  I should 6ay
          that It Is against the pub110 Intereat.
                “&t le true that we very raeldosl have a com-
          plaint abouf a Gontraot oarrier going too high
          with his rates.   On the eontrary,  agoh oomplaints
          aa we reaeiva about thea am made by oommon oar-
          rier truok and rail lines and are always to the
          erreat that they ere not charging enough.
               “inhat I am trying t;o say in thlo memorandum
          Is that the Attorney General and our Rate DlvI-
          sion are In aaaord on the propositian   that a
     oontraatoarrlar oan go es highaa he wants                              to-   ,
     in making ohargos and that the only authorltr
     Of thin CIOIdSdOn is to m&O mra that the7                                      * 1
     rtay high aad that fhl.8C~malsslon bar no NL-
     thorltyto put a oalling on their rater.
                    wi%a         foregoing
                                         ir indloatad bf the attaoh-
     ed letter fromHr. lxo&~~ae,dated saptamber 4,
     1941, eddramad to Ur. 0. ,Ii. Gold, ,Trafflo I!R~-
     ymf,tha     Atlar Powder Gonpysny of Wilmington,
             .
                    *I believe that              the Attorney Generalshod
     be        raqua8t@d to roaxamine hlr predeoaeaorlr                     opin-
     ion with a view of trylng to do eomathiag for
     the Paopls in thl8 aattor of ratea.*
                                          .
          Under t&680 faOt8 youhate eubmittodto ua the
r0u0ring            tpmi0~

                    Doer         the Railroad CormPLeslonhata authority
     to put e oalllng on freight                         ratom to bo oh+rged
     bt oontraot oarrirrs?                                                        .,.

          saotion &a                      of ml010            Ollb, Ravlaa4 CWlf: #Stat-
at.8, ProvideaI

          Vba Coml~slaa ir hereby vaated with power
     and authority and it la hereby medo Ite duty to
     prelrorlbarules and reiWatlons oovarlng tha
   ’ oparatlon of contract oarrlcrein oclnpatltIon (’ .                                   ; ~.j.
     with oommon oarrlars ovar tha highways of this
     &ate and the Commleeion  ehall praeorlbe mlai-
     mum ratae, faras and ohar&as to be oollaotad br
     auah oontraot oarrlaro whloh ahall not be lanr
*.   than tha raterrprasorlbad for oommon oarriarr
     for rubatentlallythe came aervIoa..W
           Under tha above quoted provision of tha llotor
 Carriers Aot it aan be readily aaan that it irrmade manda-
 tory upon the OommissIon to rat tha mlulmum rata8 of eon-
 treat oarrlara oparatlng upon th,ahighways of.Tax&s, whloh
 rater shall not be lasr than the rate pramorlbad for eom-
non awrier    ror eubstantlally8he mma lrvloa. (TI Q PI
.xp 00, yd Railroad 0ondul6~~ a38 8. 1. Irma)oB9) uAaO?
                                          .i.*
                I            :
                                                                                                   *
          .,                          ,
                                                    :

 .                                                      . .
                         ’                                    ,..
                                    Pego
    HonorableJamorI. Xilday,DlSeotor,             a




    the prori8lons of thle 'rtatutestanding alone tha Commlr-
    aion would-hnva no euthorlty to plaoe a oalliw oa rate8
    to be ohargod by oontraot oarrlsrr but ir oonflned to the
    power therein given to regulate ths alnimunratorto br
    ohargadby muoh oerrlar.
               Upon a furthor extuslnetlonof the Aot In It8 on-
    tlretr we find that Seotloa 4-a of Artiole Ollb, Revirrd
    OIvil Btatuter,  provider 88 follower
                  *The Commission Is hereby vested with pawer
            and authority and it 18 hereby made lta duty to
            supervise and regulate the tranaportatlonof                I~ i
            properOt for componeetlonor hire by motor Tab     :.‘~“”
            hlola on any publio highway in this State, to
            rlx, presoribe or approve the maximum or mini-   ..?
            mum or maximum and mininun rates, rare6 and                /
            ohar&ea of aaoh..inotoraarrler in aooordanos wit& >'.'
            the opeoiflo provisions herein oontaiued, to I .’” .’
            prasorlbe all rulas and ragulatloae neoaeaary ‘~ I’        !
            for tha government of motor oarrlara,,to pro-              : ,,”
            sorlbe rules and re3ulatlonafor the eafetq cf        ,,    i’
            operations of aooh of euoh motor carrlere, to .. : ’
            require the flllne;of such monthly, annual and ‘:”‘.
            othar reports and other data of motor carriers ’ . .
            a8 the CozmIusLonmay deam .neoessary,to pre-       ‘. ,
        ’   aorlba the aoLedule8 end earvloee of motor oar-.
            rlare, operating as oomuon oarrlars, and to
            aupervlae and replete motor cerrlars.ln all
            matter6 affeotiag the relationship baiiweaneuoh
            oarriera end the ehlpplng publio whether hara-
.   .
            in spaoifloal~ymantlonod or not." (Underaoor-
            lng ours)
                 We rurthbr find that in Seotloa l-8 of Artlola.
' Sllb tha termmotor      oerrler is defined aa followr:

                   *The term *motor aarrlor’ maana any par-
            son, firm, oorporatlon, oampanp, co-partherahip,
            aasooiation or joint etook aesooiation, and tkelr
            lessae6, reoelrere   or trustee8 ap?olnted bp any
            Court what0oavar, owning, aontrolllng,managing,
            operatlw or onusing to be operated any motor
            propelled vahlole used in transporting   property    ..
            for compensationor hire over   MY pub110 highway
            in thou State, whrre In the ooume of amoh tranrr-
            portation   A highway brtnwn two or more  inOOmOr- .
  Eanoreblo fomo~)P. gildey,    Dlmotor, Pam 4


        atedoltler, ‘town8or villages 10 traverredl pro-
       vided that the tern ‘motor oarrler’ as usedin
       thl8 Aot #hell not Include, end this kot &tell
       not apply to motor vshiolas operatedexolusirrly
       within the lnoorporatedlielto of cities or tounr.~
                                   .’
            719further find that the tern oontraot oarrier                       i
  aa wood in the Aot 1s defined in Seotlon l-h as.tollow81
            The term t&ieot     oerrisrt mean8 any
  .    motor oarrler aa herelnubove dofined tremporO-
       1~4~property ior oomponeatioa or hiro over any
       highway in thle Stata othor then er e ooaunon
                                                                                     \


                                                                             I
       oerrler.m
              It   will be noted that In Seotlon &a of Artlolo,
'., Ollb, above aet iorth, it la w.-ovided,    ,mong other thlngrj
    that w the Ooumieeion ie hereby vsetod with po.:;er      and au-
    thoritp end it is hereby made its duty to euperviss end
  .reeulate  the traneportetlonof property r0r compensation
    or him by notor vehiole on any publio hi&way In thla
    State, to fix. preeoribe or.epprove the maxinun or ninl-
,. nnm or mxlc~urrl mci mi~nimm~   ratso. fores an4 ohcr@zsof saoh
   motor aarrir-rin uoaortiunoewii.hthe o~moitio         arovisions
   horein oontolne.~.ql  It   will be observed tnat    in thie pro-          !
    ~ialon of the rtetute the term *motor ctirrier"is uaod end
   aot Raorunonoerrierw or ‘“oontreotoarrier.” Looking to the
  .'deflnltionof motor oarrier aa horeincbovo net forth wa                   i
   .find that a motor carriermean8 any person, firm oorpora-
    tion, oompenf, oo-partnership,eaaooietion or joint atook
   aeeooiction, en& their leaseee, rooolvars or truoteea ep-
    pointed by any Court whatsoever, owni~, oontmlllng, men-
    aging, operating or oaualng to be operutod any motor pro-
   pellod vehlclor used in transportingproperty for oompenea-
    tion or hire over any pub110 hichwey In this Stats, Thlr
   d~flnitlont in our opinion, lncludeo both oommon oarrier
    end oontreot oerrier. In Sootion l-h oi dti0l.o Qllb, ebova
    set forth, the term oontreot oerrier la dsiinod a8 any motor
    oerrler aa hereinabove defined transportin% property SOr
    oompeneetion or hire over any highway In this Stat0 othor
 ..than ea a oommon oarrlar. Boaring this definition in mind
    it I8 our opinion that Saotlon 4-e. above aot iorth, eppllea
   ~both to oommon oerrlerr end.oontreot.oerrlorrellke and that
   oonrtrulng 1-0 im ooaneotiomwith        Sootion 67aa or Artlola
                               L# ", .I .a '.                  i "..     .               I
                            ,    .'         ,,'5.   ,'i; !,"  "' , ,i'
                 i..                                       8    :-
                                                                I.
                                          .
Boaorabla
        tea00 IL Xllddy, Dlrortor, Peeo 6



Ollb, aboo% ret forth, that 83otioa baa ploo%r a mande-
tory obligation on the Railroad Cotnmieeionto pr%eoribo
the minimum rate of oontreot oarriorr but does not pro-
hibit by it8    term   the Ocmmieslon from pUtti@ a oslll~
on maximum rater to bo ohargod by ooatraot oarrlsrr. There-
fore, Under the general powers given to the Comml~slon and
mad% its duty under Gootion 4-e, above l%t forth, th3 Com-
mission rould hare tho power, should it 313ot to ororoiso
831~13 to ntfgilato oontraot oarrlera to th3 oxte$ ;; ~utlng   .;
a oe111~ on the retoo to be oherged by them.
opinion that Sootlonr R, 3 end 4 of Artlole Ollb apply to
both oontreoa oerrierrrand oommon oarrim alike oxoopt la
thoao provlelon8     %xprcWJl~ thrroln rortrlotrd to ono or
the other.
          In the oaeo of Texas Paoiflo RollvrayCompan
al v* Rail ad Commleel~n, et el, (Cir. App. Austin,
lS136. W. f”edl9~3,.the rOllottial:
                                  18 6aidl
          Vho 1931 AOt via.11
                            obrlouelr lntondrd to
     oovcr and reculato ovary oharaoter of motor
    06Triage oi freight  for hire Ov%r tho hichwayr.
    It deAOmimt%a one olasr Of oarrlar err'OOt!iiWXl
    oerrlera’  though it nowhere undertaksr to dr-
    fine that  term; end the other 0133% a% ‘eon-
    traot  oarriors'whioh it dofin     6% say euoh
    motor oerrler other than a oommon oarrler. The
    definition of the ton    ‘motor oarrior’ in sub-
    divloiOn R, SeatiOn 1 f th d t. i% OlO%rl~
    oompreheneivosnou& tt inotudz within that
    39x-many and every ala%% or type of oarrior for
    511~ over the hitiwayo of the Stats.” (Undo+
    roaring oura)
          Purther quoting'from lald oplnlon ca page 9W
NO ibid the tollowiw~
              . . And where authorized ooatraot oar-
             l .
     rlers operate in oompatltlon with oommon oer-
     rlers the Commisrlon must presorlbs minimum ret&,
     farsm and oharges forsuah seruio%r whloh muet
     not be law%r then those prmeorlb%a tOr oommoa
     oerrlerr for rubutu@elly the lem~ IOMIOO~ SW
     600, 64etm (Undrrroorlneourr)
              I.L
                                                              .           ‘\
                                                                   or.%

    Honorable rame~ E, Kilday, Mreotor, Fags 6
                             .




               wSeotIon 4 OS the AOt also makea it the dutl
         o? the Oatrmisslon in the regulttlon o? author-
         ised transportationtar hire over the highwaya,
         Amos other thin&s @to ilr, preeorlbc or approvo
         the nazlmum or mlI&lum or maxlmum andmln.lmum
         rater, iarea and ohargee o? oaoh motor oarrier’
         In aooordanoe with the other wovislons o? the
         Aot.“(Underooorlpgourr)       -
              It ir our opinion that thie law WYBBdesigned to
    oarrelate all o? the Stats’s transportationagenolss. 1t
    Is made the duty o? the Commission to oatetully preserve
    and rooter tranaportatlon~ in all o? its <formaIn the Inter-
    eat or the pub110 and the oontraot carrier is entitled to
    the same proteotlon.‘undsr the law and under the rules and
    regulationa o? the Commission a8 a oonm~onoarrler. Thi0
    oonetruotlon itiborne-.out bt the deolaration o? polior
    oontslned In the Aot bding  Eeotlon 22-b thamo? wkloh ir
    aa ?0110ws:
              Veolaration or ~0110~.    The business o?
         operatlnf3as 8 motor aarrler  a? property ror
         hire along ths highways o? thie State is ds-
         olared to be a business atltsoted with the pub-
         110 Interact. The rapid lnorease of motor oar-
         rler trafrlo,.and t& ?aot that under existing
         1~ maaJ motor truakb are not fm30titdf     zeeg-
         uleted, have lnoreased the daay,ereand hazard8 on
         publio hlgh5hraya
                         and make It imperative that mora
         stringent regulation should be employed, to thr
         end thot the highways may be rendered safer for
         th.euss o? the general publloi that the wear o?
         such highways may be rearroad{that dleorlminatlon
         in ratar ohargoa may be sllminated; that  oonges-
         tion of traftio on the hlqi:~:ayemay be mInImIzedl
         that the uas o? the highways too tho transporta-
I        tlon a? property ?or hire may be restrioted to
         the extent required by the .neoesaItyo? the gan-
         eral publlo, and that the varioue trannportatloa
         agenoiss o? the 8tats may be,adJusted and uor-
         related 80 that publio highway@ may ierve tho
         bent htanst   of tho gmoral publio,'
Eoaorablo
        JuatrD. x.ila~,Mrootor,Fag* 7



          The right o? the State to regulate oomon aarrierr
and oontraot oarrlsr8 Is sustalnsd in the oaso o? Stephenson
v. Bln?ord, 53 Fed. (2d) 800, wherein the oonstitutlonallty
of the Ant now under dlsousslon was in question. It ir Hi4
la thir omer
            “Of all the problems prseeine upon thr state,
       mm   present more oomprehenelva,more far-reaohlng,
       raoretroublesomeaspeotr than do those arlrlr@ from
       the effeot upon the cstabllehed oommon oarrler tram-
       portatlon servloes by rail and road, of tho rapld-
       ly increasing uae of the highways for the aarrlago
       of freight for hlro by persona aosuming the real or
       pretended status of private oontraot oatrierr,  and
       asaertl~ their business to be unregulable. Theso
       problem have been attaoked In moat, l? not all,
       of the states by stetutee whloh, differing in un-
       substantialpaP%lculars,have been Ioi’lusnoobby
       and have presented the same general theory, given
       full and definite expreeaion by the Eupreme Court
       of Calliornla ln Frost v. Railroad Commission of
       state of Callforula,197 Cal. 230, 240 F. &6, that,
       slnoe etc,ttamay axolude oarrlera for hire rhema’i;
       oomon or oontraot altomthor   f ram the publio rodB,
       It may oillr aonditions uw4 their use of them.*
       ~ndereoorl~ oum)
              Main quoting from the,.
                                    samo oplnlon on pa60 814 us
find   the   followlngt
            *Standing out findeololons, text-books,
       and law artloles Ie the universally aooepted
       dootrlne that the use of pub110 road@for tho
       oonduot oi bueinees there&n, rshetherby OOQ-
       mea br by prlvnte aerriera, is an extraordinary
       use, and as.auoh is enjoyed, not as a right,
       but 81 a prI3,lle@h . .*
          The above ease reaohod ths SUprOaWOaUrt of the
United Btatea and was theree??Irmed,287 P. 8. 8511 77 1.
xa. 2881 83 8. at. i13ij87 aa L. R. 721*
          We am no8 unmind?ul o? the iaot that in ths op
Ialon bz tho Suprbmb Oourt of thr United Stetrr ia dir
oursing Sootion 6.aa of Artlolo Qllb the ?ollowllrglr l4idl
Boaorable J4mar        2.    tiiaay,      Dlrertor,      Pago 0




              The author189 i0 lmtod to tba fixiae0r
         mInImumratee.   ii0 oontraot oarrier may not
         ohargeless than the ratoa ro fixed, but i8 left
          rree   to ahargo     a8 muoh Iporeea ho 0001 flt and
          oan obtain.”
Ei:tIn making thlr rtatement the Suprerze Court had in mind
only Eeatioa 6-aa of sala art1010 and wau 6IaouasIng name
r;~to the oanotltutlonalltyaloar and not oonetruInt3: the
whole hot as wo are here doing.   ~hrmrora,  in our opinion,
the above quotation tror The oplnlon of the Eupreme Cou-
la merely dlota and were the matter pxtmntd to It frown
tho anale hem under dlaouarion auoh nouldnot be the hold-
iw or mitt aourt,
          Our attention haa bean oalled to a prior opinion
o? thi8 department In a latter to the IlonorableC. V. Torrtil
of ato February23, 1933, rlroraln the followl~ ir @aId&
               -18 will bd obaer+ad that in the oaao at
          oontraot oarrlars, tho Cocaniaalon la mpuaend
          to flx mIn.Imumratrr only..
                 This #ame broad rtatsment is mado in another opia-
Ioa by thI8department  to IIorrorablo
                                  0. V. TOrmU of data
Iebruary4, 1933. 43aInin opinion no, O-5465, rofemb 80
in your lottar,the r0liOab3b said:
                *Youritratquestion wae the wtbjoot of two
         opinion4 of the Attorney Qsnsrol QddmBaod to
         Ilonorabla a. V. Turrell, Chairman of t&e Rail-
         road Cornaiaslon of ToxaI, dated Ilabruary 4, 193f,
         and February MS, 1933, ard with whiah opinioni
         we eubatantially         lgroh     .   .   .*

          -In all of these opinion8 the quaatlon unaor eon-
oideratlan wee the baala to be used In fixing minimumrat.08
0s      oontraot oarrlera under the provIaIona 0s fieotion6-aa of
Art10109llb and not whetheror nrt                        the Crmmlaaion
                                                                      had tho
power      to plaoe a oelll~ on rates oharced                 by oontraot oarrlorr.
fnao?&r aa those ogIniona,or any rtatsmont tharoln, hold that
the Coo~laaion doe8 not have the power to plaoe l oolling  on
rater charged by oontraot oarrbea  we lxproa8ly overrule  MO*

          lfroi5 4 oonaideration or ml1 o? the provirloar of
She Yetor Carrlorr &Ot,.aonrtrulag It*   ~eolrr4tioa of polio)
.                                                          .- ..~.‘y-,,   I..” 869

    Honorable famea D. IllMu, Pago 9



    aa oontalnsd in Se&on 22-b, above quoted,
                                        ~~_       -in oanaaotion
    with S4OtiOA 5-aa with refOr4AOe t0 00A~rsot Oar'T14rs rpr-
    01Sioall.pand Srotlon 4-a doallng with motoroarrier8 gsn-
    orally, wo lmatecome to the OOAO~U~~OA and you are there-
    fore adrlred that ths Railroad Commls~l~n of Texao doss bari
    thm power, Phould it dseire to 60 exe~roise  the eamo, to put
    l reillng OA rates ohargsd by OOAtraot oarrierr     operating
    on the highway8 of this 6tate.

              Trurtlng   that   thl8   full7    an8w4ra gour qua&ion,
    wa are
                                               Yourr vary truly




FIRST ASSISTANT
ATTORNEYGEarw

    D3mlul                                         ,
