Federal Armored Express, Inc. v. Public Service Commission

Smith, J., delivered the opinion of the Court. Federal Armored Express, Inc. (Federal), and its related corporation, Dunbar Armored Express, Inc. (Dunbar), applied to the Public Service Commission (PSC) for intrastate operating authority. Their joint application was denied. They appealed to the Circuit Court for Baltimore County.

Their petition filed there in support of their appeal pursuant to Maryland Rule B2 e included a request for a declaratory decree “that the business of armored car and courier carriage as conducted by [Federal and Dunbar] and others similarly situated is not properly within the sphere of regulation of the Public Service Commission,” a point pressed in their appeal here. Thus, we have the anomalous situation of their complaining because the PSC aid not grant their application and yet they are saying at the same time that they are not subject to PSC control. Federal and Dunbar have been engaged for a number of years in operating an armored car and courier business in ²³³ the Baltimore and Washington metropolitan areas. On September 6, 1972, the Director of Transportation of the PSC wrote to the President of Federal.

He forwarded a copy of a memorandum from PSC’s Assistant Director of Transportation concerning his investigation of a complaint made by Bonded Armored Carrier, Inc. (Bonded), an intervenor before the PSC and one of the appellees here, that Federal and Dunbar were operating in violation of the law. The president was advised that “[t]he memorandum [was] self-explanatory and indicate [d] that Federal Armored Express, Inc. [was] engaging in the intrastate movements of certain property which require[d] certification from [that] Commission under [Maryland Code (1957, 1969 Repl. Vol.)] Article 78, Section 32,” and that “[s]uch intrastate transportation should be properly regulated or discontinued.” It was pointed out that “[f]ailure to comply could result in infringement proceedings by the Commission as provided by Article 78, Section 100A (a).” The then counsel for Federal advised the PSC one week later that they were “reviewing [their] client’s situation in the light of [that] letter and the memorandum prepared by . . . [PSC’s Assistant Director of Transportation] after the complaint filed by Bonded Armored Carrier, Inc.” and that counsel had “obtained the necessary [application for] permits and the same [would] be filed as and when a full determination of [their] client’s position [was] completed.” On October 24, 1972, Federal and Dunbar filed a joint application “for permits to operate motor vehicles in public transportation over” certain specified routes that included a large part of the State. The requested permits were to be restricted “to the transportation of commercial papers, documents, and written instruments, including currency, and negotiable instruments used in the operations of banks and banking institutions; also, semi-processed (used) punch cards, business papers, records, and documents of all kinds used in the electronic processing and computing of business data; also film, photographic equipment and supplies, also whole human blood and blood derivatives, drugs, narcotics, pharmaceuticals and drug products.” The application was ²³⁴ subsequently amended by the inclusion of coins among the items sought to be transported.

After protests were received from other certificated carriers, the request for permission to transport film, photographic equipment and slides, whole human blood and blood derivatives, drugs, narcotics, pharmaceuticals, and drug products was deleted. Part of the application was a listing of motor vehicles for which permits were sought “to operate ... for public use on fixed routes in the State of Maryland.” Also appended was “public motor vehicle schedule of rates and fares,” specifying the rate to be charged for each of the items for which authority was sought. The matter was heard by a hearing examiner of the PSC. He filed a comprehensive report in which the evidence and the law were reviewed.

He concluded that the service performed by Federal and Dunbar was “public transportation for hire and not other transportation for hire on regular schedules and between fixed termini” and “[t]hat with the exception of exclusive use trips all of the transportation [then] provided by [Federal and Dunbar] requires a permit from [the PSC].” (Emphasis in original.) He found that Bonded and its affiliates were “performing satisfactory service to the public under the permits issued by [the PSC] and are capable of promptly meeting such additional service requirements as may result should the Commission adopt the findings and recommendations of its Examiner in this proceeding.” The Commission denied the requested permits. Motions to dismiss this appeal have been filed by the PSC and Bonded. The motions are based upon contentions that the record extract fails to comply with the provisions of subparagraphs b and c of Rule 828 and that the appeal should have been to the Court of Special Appeals. The latter contention is made notwithstanding the provisions of Maryland Code (1957,1969 Repl.

Vol.) Art. 78, § 98 providing for appeal to this Court by an aggrieved party. The provision for review of action of the PSC in § 90 is provided by § 91 to be to “the circuit court for any county within which ²³⁵ operations are carried on by the public service company involved, or in any equity court in Baltimore City.” Code (1974) § 12-308 (a) (13), Courts and Judicial Proceedings Article provides that the Court of Special Appeals “has exclusive initial appellate jurisdiction over any appeal” in “[a]ny action in which an appealable judgment or decree has been entered by a court of equity.” It is upon this basis that it is claimed that the appeal properly should be to the Court of Special Appeals. The contention is correct, but Rule 814 provides in pertinent part: “When it shall appear that an appellant is or may be entitled to have an appeal heard and determined in the Court of Appeals or in the Court of Special Appeals, but not in the appellate court to which an appeal has been taken or transferred, the appeal shall not on that account be dismissed; but the case shall be transferred by an order of the court to which the appeal was improperly taken or by the Court of Appeals to the docket of the proper court, upon such terms as to payment of costs, including reasonable attorneys’ fees, as the order may provide.” Since the case has been fully argued in this Court, we shall follow the procedure of our predecessors in Moulden v. State, 217 Md. 351, 353 , 142 A. 2d 595 (1958), and treat the appeal as an application for certiorari and grant the application. Since the appellants intended from the beginning to come to this Court, we shall decide so much of the case as can be decided with the abbreviated record extract before us.

Because there are issues presented here which can be decided with the abbreviated record extract, we shall not dismiss the appeal on that account. Federal and Dunbar first ask us to determine that the PSC “does not have jurisdiction over the appellants in that they are private carriers and not common carriers.” The requirement relative to permits for “motor carrier companies” is found in Code (1957,1969 Repl. Vol.) Art. 78, § 32 (a-1) which states in pertinent part: ²³⁶ “(a-1) When permits required. — With the exceptions enumerated in subsection (b) of this section, no motor vehicle shall be used in the public intrastate transportation for hire, or in any transportation for hire on regular schedules and between fixed termini (as these terms are defined in Article 66V2, § 2) of passengers, or of property or freight. .. without a permit from the Commission to the owner, which shall prescribe the route and schedule, if any, of operation.” None of the exceptions contained in subsection (b) of § 32 are here applicable. The examiner found that the, activities of Federal and Dunbar did not constitute “other transportation for hire on regular schedules and between fixed termini.” Thus, to be subject to PSC regulation it must be found that Federal’s and Dunbar’s operations are “public intrastate transportation for hire.” The scope of our review is set forth in Art. 78, § 97 where it is said that a decision of the PSC “shall be prima facie correct and shall be affirmed unless clearly shown to be (1) in violation of constitutional provisions, or (2) not within the statutory authority or jurisdiction of the Commission, or (3) made upon unlawful procedure, or (4) arbitrary or capricious, or (5) affected by other error of law, or (6) if the subject of review is an order entered in a contested case after hearing, such order is unsupported by substantial evidence on the record considered as a whole.” The term “public intrastate transportation for hire” is not defined in Art. 78, but § 2 of that article defines “common carrier” as “any person . . . engaged in the public transportation for hire of persons, property or freight. . . .” (Emphasis added.) It will be recalled that reference was made to a “public service company” in § 91 which section provides where an appeal should be docketed.

The definition of “public service company” in § 2 (0) is: “(0) ‘Public service company’ means a common carrier company, gas company, electric company, steam heating company, telephone company, ²³⁷ telegraph company, water company, sewage disposal company, and/or any combination thereof. Two public service companies shall be considered of the same class, where they are both common carrier companies or both gas companies, electric companies, gas and electric companies, steam heating companies, telephone companies, telegraph companies, water companies or sewage disposal companies.” The Public Service Commission was created by Chapter 180 of the Acts of 1910. By Chapter 610 of the Acts of 1916 the PSC was granted the right to regulate motor vehicles used in the public transportation of passengers for hire, the provision becoming Code (1912) Art. 56, § 189. Smith v. State, 130 Md. 482, 483 , 100 A. 778 (1917), construed this provision as “relating to the licensing of motor vehicles used as common carriers.” It also said: “The distinction is sought to be drawn on the basis of definite route and an established schedule.

This ground is not tenable. The intent of the legislative enactment is perfectly clear. What that body was attempting to do, was to distinguish as between motor vehicles operated as common carriers, and those not regularly so operated; the former would be subject to the provisions of Chapter 610; the latter governed by the provisions of Chapter 687.” Id. at 485. This provision of the Code was again before the Court in Towers v. Wildason, 135 Md. 677 , 109 A. 471 (1920).

By that time the Act of 1916 had been amended by Chapter 199 of the Acts of 1918. Under that law it was “the duty of each owner of a motor vehicle to be used in the public transportation of passengers for hire operating over State . . . roads ... in the State of Maryland to secure a permit from the Public Service Commission of Maryland . . . .” Wildason lived near Bel Air in Harford County and was employed at Aberdeen Proving Ground. He was in the habit ²³⁸ of transporting five of his fellow employees to their place of employment in the morning and bringing them back in the evening “for a definite compensation per week.” He had taken out a “hiring license” from the Commissioner of Motor Vehicles. The PSC brought suit to enjoin him “from operating one or more motor vehicles in the public transportation of passengers for hire from the town of Bel Air, in Harford County, ... to the town of Aberdeen, in said county .. . over any State .. . road . . . without first having secured a permit so to do from the Public Service Commission of Maryland . . . .” Judge Thomas for our predecessors referred to the language used in Smith and said: “With this construction of the two Acts of 1916, it is apparent that unless the use the defendant made of his car brought him within the definition of a common carrier he was not subject to the provisions of Chapter 610.

Chapter 180 of the Acts of 1910 (Sec. 413 of Art. 23 of the Code of 1912), declares that the term ‘common carrier’ shall include all railroad corporations, etc., ‘and all persons and associations of persons, * * * operating such agencies for public use in the conveyance of persons or property within this State,’ and Section 1½ of Chapter 445 of the Act of 1914 (Section 413-A of Art. 23, Vol. 3, of the Code), provides that ‘The term “common carrier,” * * * shall likewise include all automobile transportation companies, and all persons and associations of persons, whether incorporated or not, operating automobiles or motor