Honorable Penrose B. Metcalfe, Chai-
'Honorable Fred Mauritz, Member
Committee on Highways and Motor Traffic
Texas Senate

Gentbemen:                          opinion NO. o-5165
                                    Re: Whether obedience to Office
                                    of Defense Transportation orders
                                    by truck operators would be a
                                    violation of The Texas Motor
                                    Carrier Act. (V.A.C.S. pllb
                                    and V.R.P.C. 16901.1.)

          By letter Senator Meuritz has asked the following questions:

          "Attached hereto is a motor vehicle lease form filled
     out to cover a possible transaction. Such lease may involve
     a longer or shorter period of time.

          "Is the fulfillment of this contract a violation of the
     Motor Carrier Act of Texas, on the part of either party to
     the contract?

                                "KXAMPLE

          "'A' is in the wholesale grocery business, and does
     not own any trucks. He leases one or more trucks from 'B'
     (who is not a carrier for hire) to be used.wholly in the
     transportation of his own merchandise, and under the con-
     trol specified in the above mentioned lease contract.

          "Is the legality of such a contract in any way af-
     fected by the circumstance,that:

               " 1.   'A' does own no trucks, or
               " 2.   'A' does own a number of trucks,
                       but finds it necessary to lease
                       additional trucks to handle
                       his business.

     "'A' is in the wholesale grocery business and own a truck.
     He transports a load of merchandise from his place to .deS-
     tination 'Y'. Under existing rules issued by the Office
     of Defense Transportation, he is not allowed to move an
Texas Senate, Page 2 (o-5165)



     empty truck back to his place of business. He is required,
     under such regulations, to seek a return load, leasing his
     truck to 'another person', who has merchandise to move to
     or in the direction of the place of businese from which the
     truck moved; hence, the need for leases involving only a
     short-term use of truck.

     "Is the legality of such a lease made in good faith, and
     conforming to OM' regulations, affected by the short per-
     iod of time specified in contract?

    "Is a short-term lease of this character forbidden by the
    Motor Carrier Act of Texas?

     "Is the legality of such lease contract affected by the
     circumstance that:

          1.   Lessee ie a shipper who owns no trucks.
          2.   Lessee is a shipper who owns trucks (private
               truck owner) but needs additional equipment.
          3.   Lessee is a carrier for hire."

          By letter of March 29, 1943, Senator Metcalfe, Chairman of
the Senate Committee on Highways and Motor Traffic, wrote us as follows:

          "Senator Mauritz, author of S. C. R. No. 23, has
     filed with you a question as to whether certain lease
     contracts made by certain motor carriers would be in
     violation of the Motor Carrier Act. This resolution
     has been considered by the Committee on Highways and
     Motor Traffic, and an opinion would be appreciated."

          The questions will be answered in the light of S. C. R. No.
23 now pending which reads:

     "By Mauritz.                               S. C. R. No. 23.

          "(In the Senate.-March 2, 1943, read first time
     and referred to Committee on State Affairs; March 2,
     1943, rereferred to Committee on Highways and Motor
     Traffic; March 17, 1943, reported favorably.)

          "SEHATE CONCURRENT RESOLUTION

     "BE IT RESOLVED by the Senate of the Legislature of Texas,
     the House of Representatives concurring, that

          "Whereas the Office of Defense Transportation of
     the United States, for the purpose of conserving rubber
     and motor equipment, has promulgated General Order O.D.T.
Texas Senate, Page 3 (o-5165)



     No. 17 which provides, among other things, in Part 501, Sub-
     part K, Section 501.69,as follows:

          "'Sec. 501.69. (a) No motor carrier shall operate any
     motor truck in over-the-road service unless it 16 loaded to
     capacity, except as follows:

         "'(2) On and after September 1, 1942, each motor car-
    rier and its representatives, including the representatives,
    in immediate control a@ pbsseeeion of the truck, shall en-
    deavor in good faith prior to its departure from any point
    when empty to lease or rent such truck consistent with any
    prior commitments involved in the use of said truck en route,
    to another person for the transportation of property. . .'

         "NOW THEREFORE, BE IT RESOLVED that Chapter 314, General
    Laws of the State of Texas, Forty-first Legislature, Regular
    Session, and amendments thereto, commonly known as the Motor
    Carrier Act of Texas, shall not be construed, for the period
    of time that the United States is engaged in war, or the
    Federal Government's Orders remain in force as to leasing of
    motor vehicles, to mean that it is a violation of said Act
    nor any amendment thereof for a private truck owner to lease
    or rent his truck to another person in compliance with said.
    General Order O.D.T. No. 17, and that where one private
    truck owner has leased or rented his truck to another person
    in compliance with said General Order 0. D. T. No. 17 and
    said truck is used and operated by said lessee, neither the
    lessor nor the lessee shall be deemed to have violated said
    Motor Carrier Act nor any amendment thereof, and that neither
    the lessor nor the lessee in such case shall be deemed to be
    a common carrier or contract carrier under said Motor Carrier
    Act, as amended, regardless whether under the terms of the
    lease contract the lessor does or does not furnish the driver
    for the truck and regardless whether the lessor does or does
    not agree, in whole or in part, to maintain and service the
    truck, provide gas, oil, tires, and pay other expenses nec-
    essary to operate the truck while'the same is leased to lessee.

         "BE IT FURTHER RESOLVED, That this resolution be published
    to the Railroad Commission of Texas, the law enforcement offi-
    cers and the Courts of this State."

          S. C. R. 23 is written for the praiseworthy and patriotic pur-
pose of preventing the enforcement of the Texas Motor Act in such a way
as to interfere with the order of the Office of Defense Transportation
to save rubber, motor-truckequipment and manpower. However, we believe
that it is written under a misapprehension that the Texas Motor Carrier
Act can conflict with the enforcement of the orders of the Office of
Defense Transportation. In a previous opinion to the Railroad Commission
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Texas Senate, Page 4 (0-5165)



of Texas, Opinion No. 0-5026,on the question of the right of the army
to have a carrier operate army trucks over highways without a permit
we took the view that whereever the Federal Government in exercise of its
war power directed that things be done in a certain way, that this war
power was superior to the State's police power, and that the Texas Motor
Carrier Act accordingly would be limited in its application so as not
to run athwart any order issued by the Federal Government pursuant to
authorization of Congress. We quote from said opinion:

                "Federal War Power is Superior to State
                           Police Power

         "We believe that it is possible to answer this question
    by predicating our answer upon the war powers of the federal
    government.

         "In upholding the right of the United States to take   over
    and control the railroads in time of war to the exclusion   of
    any rights of the states therein, Mr. Chief Justice White   in
    Northern Pacific Railroad Company vs North Dakota, 250 U.   S.
    135, said:

          "'The complete and undivided character of the war power
     of the United States is not disputable...

         "'The elementary principle that, under the Constitution,
    the authority of the government of the United States is para-
    mount when exerted as to subjects concerning which it has the
    power to control, is indisputable. This being true,  it results
    that although authority to regulate within a given sphere may
    exist in both the United States and in the states, when the
    former calls into play constitutional authority within such
    general sphere the necessary effect of doing so is, that to
    the extent that any conflict arises the state power is limited,
    since in case of conflict that which is paramount necessarily
    controls that which is subordinate.'

         "The powers of congress over intrastate commerce are
    plenary when a federal instrumentality or national purpose
    is involved.

         "In passing upon the same question the New York Court
    of Appeals in Public Service Commission vs New York Central
    Railroad 129 N. E. 455, said:

         "'This action (intrastate rate fixing by a federal
    agency) was not justified by any of the ordinary rules of
    law. It can be sustained solely as the exercise of the war
    powers of the United States. And these powers are not lim-
    ited by these ordinary rules. They are not bounded by any
,   .. -




           Texas Senate, Page 5 (0-51.65)



                specific grant of authority. They are not unlike what,
                in the states, we call the police power, but the police
                power raised to the highest degree. They are such pow-
                ers as are essential to preserve the very life of the
                nation itself. When requisite to this end the liberty
                of the citiien, the protection of private property, the
                peacetime rights of the states, must all yield to neces-
                sity.'

                      "The right of the federal government to invade the
                peace-time police powers of the State is shown in those
                cases upholding its authority to prevent sale of intoxi-
                cating liquors in areas about army posts in time of war,
                and avering like authority to punish in federal courts
                for the maintenance of houses of ill fame in areas about
                army posts, notwithstanding said areas are within a state.
                In U. S. vs Casey, 247 Fed. 362, in upholding the right of
                the Secretary of War to forbid the keeping of a house of
                ill fame within five miles of a military camp, the court
                said:
                       11I. 0 .In answer to the argument that the
                       power to establish the ordinary regulations of
                       police has been left to the individual states,
                       and cannot be assumed by the national govern-
                       ment, it is sufficient to say that the statute
                       here assailed rests, not upon the police power,
                       but upon the war power, conferred on Congress
                       and recognized by the law of nations."'

                     In case of conflict with the State's police power the federal
           war power is paramount thereto and controls. Therefore, our answer to
           your questions is that no truck owner, operator, lessor or lessee, wheth-
           er or not he has a certificate of public convenience and necessity or
           permit of the Railroad Commission, can be subjected to any of the fines
           and penalties provided for in the Texas Motor Carrier Act for using his
           truck in a particular manner if such action be required of him by a law-
           ful order of the 0. D. T., even though such order conflict with the terms
           of the Texas Motor Carrier Act.

           APPROVED APR 2, 1943                         Yours very truly,

           /s/ Grover Sellers                           ATTORNEY GENERAL OF TEXAS

           FIRST ASSISTANT             APPROVED
           ATTORNEY GENERAL            OPINION
                                      COMMITTEE         By   /s/ David W. Heath
                                                                 David W. Heath
           DWH:PM:LM                                                   Assistant
