A-48173, JUNE 21, 1933, 12 COMP. GEN. 656

A-48173: Jun 21, 1933

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THERE IS GIVEN SPECIFIC AUTHORITY TO THE POSTMASTER GENERAL BY THE ACT OF APRIL 29. EXTEND AIR-MAIL ROUTES AND UNDER SUCH LAW THERE IS ALSO INCIDENTAL AUTHORITY TO CURTAIL SUCH ROUTES OR EXTENSIONS MADE THEREUNDER AS THE NEEDS OF THE POSTAL SERVICE MAY REQUIRE. 1933: REFERENCE IS MADE TO YOUR LETTER OF MARCH 22. AS FOLLOWS: REFERENCE IS MADE TO THE AUTHORITY GRANTED THIS DEPARTMENT UNDER THE ACT OF APRIL 29. WHEN IN HIS JUDGMENT THE PUBLIC INTEREST WILL BE PROMOTED THEREBY. MAY MAKE ANY EXTENSIONS OR CONSOLIDATIONS OF ROUTES WHICH ARE NOW OR MAY BE HEREAFTER ESTABLISHED.'. THE DEPARTMENT HAS IN THE PAST ISSUED ROUTE CERTIFICATES FOR ALL OF THE ROUTES THAT WERE ORIGINALLY ADVERTISED FOR BIDS.

A-48173, JUNE 21, 1933, 12 COMP. GEN. 656

CONTRACTS - AIR MAIL - CANCELLATION OF EXTENSIONS ASIDE FROM THE SPECIFIC PROVISIONS OF SECTION 5 OF THE ACT OF JUNE 16, 1933, 48 STAT. 305, RELATING TO THE MODIFICATION OR CANCELLATION OF EXISTING CONTRACTS INVOLVING TRANSPORTATION OF PERSONS AND/OR THINGS, AND THE GENERAL RIGHT AND DUTY OF THE POSTMASTER GENERAL TO ACT IN THE PROPER ADMINISTRATION OF THE POSTAL SERVICE IN THE ENTERING INTO AND REQUIRING PERFORMANCE OF CONTRACTS FOR THE TRANSPORTATION OF THE MAILS, THERE IS GIVEN SPECIFIC AUTHORITY TO THE POSTMASTER GENERAL BY THE ACT OF APRIL 29, 1930, 46 STAT. 259, AMENDING THE PRIOR AIR-MAIL ACTS, TO ISSUE ROUTE CERTIFICATES FOR EXISTING AIR-MAIL CONTRACTS AND MODIFY, CONSOLIDATE, AND EXTEND AIR-MAIL ROUTES AND UNDER SUCH LAW THERE IS ALSO INCIDENTAL AUTHORITY TO CURTAIL SUCH ROUTES OR EXTENSIONS MADE THEREUNDER AS THE NEEDS OF THE POSTAL SERVICE MAY REQUIRE.

COMPTROLLER GENERAL MCCARL TO THE POSTMASTER GENERAL, JUNE 21, 1933:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 22, 1933, AS FOLLOWS:

REFERENCE IS MADE TO THE AUTHORITY GRANTED THIS DEPARTMENT UNDER THE ACT OF APRIL 29, 1930, 39 U.S.C. 464, SUPP. V., TO ISSUE A ROUTE CERTIFICATE IN SUBSTITUTION FOR AN AIR-MAIL CONTRACT, AND PARTICULARLY TO SECTION 7 OF THIS ACT, READING AS FOLLOWS:

"THE POSTMASTER GENERAL, WHEN IN HIS JUDGMENT THE PUBLIC INTEREST WILL BE PROMOTED THEREBY, MAY MAKE ANY EXTENSIONS OR CONSOLIDATIONS OF ROUTES WHICH ARE NOW OR MAY BE HEREAFTER ESTABLISHED.'

ACTING IN ACCORDANCE WITH THE CONSTRUCTION PLACED UPON THIS LEGISLATION, THE DEPARTMENT HAS IN THE PAST ISSUED ROUTE CERTIFICATES FOR ALL OF THE ROUTES THAT WERE ORIGINALLY ADVERTISED FOR BIDS, AFTER THE CONTRACTOR HAD SATISFACTORILY OPERATED FOR A PERIOD OF AT LEAST TWO YEARS. HOWEVER, THE ORIGINAL ROUTES, AFTER BEING ISSUED ROUTE CERTIFICATES, HAVE BEEN GRANTED VARIOUS EXTENSIONS. AS A CASE IN POINT, LET ME ILLUSTRATE:

TABLE

MILES MILES ROUTE C.A.M. 9 WAS ADVERTISED FOR BIDS AUGUST

16, 1926; TIME FOR BIDS EXPIRED SEPTEMBER

4, 1926; CONTRACT AWARDED SEPTEMBER 7,

1926, TO NORTHWEST AIRWAYS, INC., FOR

CARRYING AIR MAIL ON A ROUTE FROM CHICAGO, ILL.,

VIA MILWAUKEE AND LACROSSE, WIS., TO

ST. PAUL AND MINNEAPOLIS, MINN., A DISTANCE

OF------------------------------------------------- 377 ON DECEMBER 15, 1928, AN EXTENSION WAS GRANTED

FROM MILWAUKEE TO GREEN BAY, A DISTANCE OF--------- --- 123 ON MARCH 8, 1930, AN EXTENSION WAS GRANTED FROM

CHICAGO TO MADISON, A DISTANCE OF------------------ --- 134

ON SEPTEMBER 1, 1930, THE COMPANY SURRENDERED ITS

CONTRACT AND ACCEPTED A ROUTE CERTIFICATE. ON FEBRUARY 2, 1931, THE ROUTE WAS EXTENDED FROM

ST. PAUL TO PEMBINA, N.DAK., A DISTANCE OF-------- --- 382 ON MAY 30, 1931, THE ROUTE WAS EXTENDED FROM

ST. PAUL TO DULUTH, MINN., A DISTANCE OF---------- --- 143

ON JUNE 2, 1931, THE ROUTE WAS EXTENDED FROM FARGO

TO BISMARCK-NANDAN, N.DAK., A DISTANCE OF--------- --- 190 ON MARCH 2, 1933, THE ROUTE WAS EXTENDED FROM

BISMARCK TO BILLINGS, MONT., A DISTANCE OF-------- --- 394 ON MARCH 2, 1933, THE ROUTE WAS EXTENDED FROM

MILWAUKEE TO DETROIT, MICH., A DISTANCE OF-------- --- 253

377 1,619

REGARDLESS OF THE MERITS OF ANY OF THESE EXTENSIONS TO THIS ROUTE, OR THOSE MADE ON OTHER ROUTES, THE DEPARTMENT IS NOW FACED WITH THE MATTER OF ADMINISTERING THE AIR-MAIL SERVICE ON A REDUCED APPROPRIATION, AND IN SOME CASES THE EXTENSIONS HAVE NOT BEEN SUFFICIENTLY PATRONIZED TO WARRANT THEIR CONTINUANCE FROM A SERVICE STANDPOINT.

IT IS BELIEVED THAT INASMUCH AS THERE APPEARS TO BE THE RIGHT TO EXTEND ROUTES, IT SHOULD ALSO FOLLOW THAT THE DEPARTMENT MAY CANCEL OR CURTAIL SUCH EXTENSIONS WHEN THE SMALL AMOUNT OF TRAFFIC WARRANTS SUCH ACTION OR WHEN THE APPROPRIATION IS NOT SUFFICIENT TO MAKE IT POSSIBLE FOR THE DEPARTMENT TO PROVIDE ADEQUATE RATES TO COVER THE ENTIRE SERVICE INCLUDING EXTENSIONS, OR FOR OTHER SERVICE REASONS.

A COPY OF THE ROUTE CERTIFICATE ISSUED IN SUBSTITUTION FOR THE CONTRACT TO CARRY AIR MAIL ON ROUTE A.M. 9 IS ENCLOSED. THE ROUTE CERTIFICATES ARE UNIFORM ON ALL ROUTES. A COPY OF THE ORDER ISSUED AT THE TIME THE EXTENSION FROM BISMARCK TO BILLINGS WAS ORDERED IS ALSO ENCLOSED; OTHER EXTENSION ORDERS WERE SIMILARLY DRAWN.

IT IS REQUESTED THAT AFTER AN EXAMINATION OF THIS ROUTE CERTIFICATE, THE EXTENSION ORDER AND THE LAW RELATING TO THE SUBJECT, YOU ADVISE THIS DEPARTMENT:

FIRST, WHETHER THERE IS AUTHORITY ON THE PART OF THE DEPARTMENT TO CANCEL OR CURTAIL EXTENSIONS MADE TO AIR MAIL ROUTES SINCE THE PASSAGE OF THE ACT OF APRIL 29, 1930;

SECOND, WHETHER IN THE EVENT THE DEPARTMENT DOES NOT HAVE THE POWER TO CANCEL ANY OR ALL EXTENSIONS MADE SINCE THE PASSAGE OF THE ACT OF APRIL 29, 1930, IT CAN REVIEW AND CANCEL CERTAIN EXTENSIONS MADE A FEW DAYS PRIOR TO MARCH 4; VIZ, ON MARCH 2, AN EXTENSION OF 394 MILES TO ROUTE A.M. 9, FROM BISMARCK TO BILLINGS, AND AN EXTENSION ON THE SAME DATE OF 253 MILES FROM MILWAUKEE TO DETROIT.

IT IS PROPER TO STATE THAT REPLY TO YOU SUBMISSION WAS WITHHELD IN VIEW OF LEGISLATION PENDING BEFORE THE CONGRESS AT ITS SPECIAL SESSION JUST ENDED, AND THERE WAS ENACTED SECTION 5 OF THE ACT OF JUNE 16, 1933, PUBLIC, NO. 78, 48 STAT. 305 AS FOLLOWS:

WHENEVER IT SHALL APPEAR TO THE PRESIDENT, IN RESPECT OF ANY CONTRACT ENTERED INTO BY THE UNITED STATES PRIOR TO THE DATE OF ENACTMENT OF THIS ACT FOR THE TRANSPORTATION OF PERSONS AND/OR THINGS, THAT THE FULL PERFORMANCE OF SUCH CONTRACT IS NOT REQUIRED IN THE PUBLIC INTEREST, AND THAT MODIFICATION OR CANCELLATION OF SUCH CONTRACT WILL RESULT IN SUBSTANTIAL SAVINGS TO THE UNITED STATES, THE PRESIDENT IS HEREBY, UPON GIVING SIXTY DAYS' NOTICE AND OPPORTUNITY FOR PUBLIC HEARING TO THE PARTIES TO SUCH CONTRACT, AUTHORIZED, IN HIS DISCRETION, ON OR BEFORE APRIL 30, 1935, TO MODIFY OR CANCEL SUCH CONTRACT. WHENEVER THE PRESIDENT SHALL MODIFY OR CANCEL ANY SUCH CONTRACT, HE SHALL DETERMINE JUST COMPENSATION THEREFOR; AND IF THE AMOUNT THEREOF, SO DETERMINED BY THE PRESIDENT, IS UNSATISFACTORY TO THE INDIVIDUAL, FIRM, OR CORPORATION ENTITLED TO RECEIVE THE SAME, SUCH INDIVIDUAL, FIRM, OR CORPORATION SHALL BE ENTITLED TO RECEIVE SUCH PORTION THEREOF AS THE PRESIDENT SHALL DETERMINE AND SHALL BE ENTITLED TO SUE THE UNITED STATES TO RECOVER SUCH FURTHER SUM AS, ADDED TO SAID PORTION SO RECEIVED, WILL MAKE UP SUCH AMOUNT AS WILL BE JUST COMPENSATION THEREFOR, IN THE MANNER PROVIDED FOR BY PARAGRAPH 20 OF SECTION 41 AND SECTION 250 OF TITLE 28 OF THE UNITED STATES CODE: PROVIDED, THAT WHERE ANY SUCH CONTRACT MAKES PROVISION FOR SETTLEMENT IN THE EVENT OF MODIFICATION OR CANCELLATION, THE AMOUNT OF JUST COMPENSATION AS DETERMINED HEREUNDER SHALL NOT EXCEED SUCH AMOUNT AS IS AUTHORIZED BY SAID CONTRACT. ANY APPROPRIATION OUT OF WHICH PAYMENTS UPON THE SAID CONTRACT WERE AUTHORIZED TO BE MADE IS HEREBY MADE AVAILABLE FOR THE PAYMENT OF SUCH JUST COMPENSATION.

THIS SECTION MAKES PROVISION FOR MODIFICATION OR CANCELLATION OF EXISTING CONTRACTS INVOLVING TRANSPORTATION OF PERSONS AND/OR THINGS, BUT DISCLOSES NO PURPOSE TO RESTRICT OR LIMIT AUTHORITY EXISTING IN THE POSTMASTER GENERAL PRIOR TO ITS ENACTMENT. IT MAY BE SAID IN GENERAL THAT EVERY CONTRACT INVOLVING THE CARRYING OF MAIL MUST BE SUBJECT TO THE CONDITION, WHETHER OR NOT SPECIFICALLY EXPRESSED IN THE CONTRACT, THAT ITS PERFORMANCE WILL ACCOMPLISH THE PURPOSE FOR WHICH MADE. IF, UNDER SUCH CONTRACT, CONTINUED OPERATION IS USELESS OR A WASTE OF PUBLIC MONEYS, THEN IT IS NOT ONLY THE RIGHT, BUT THE DUTY, OF THE POSTMASTER GENERAL TO TERMINATE OR MODIFY SUCH CONTRACT IN THE PUBLIC INTEREST. WHETHER SUCH ADMINISTRATIVE ACTION WOULD GIVE RIGHT TO THE CONTRACTOR TO CLAIM DAMAGES SEEMS DOUBTFUL. THE CONTRACT CAN READILY BE VIEWED FROM THE SUBJECT MATTER AS CONDITIONED UPON THE PUBLIC INTEREST REQUIRING ITS PERFORMANCE, BUT EVEN IF THERE BE A POSSIBILITY OF A CLAIM FOR DAMAGE BECAUSE OF SUCH TERMINATION OR MODIFICATION, THE MATTER WOULD APPEAR TO BE FOR CONSIDERATION UNDER THIS SECTION OF THE ACT OF JUNE 16, 1933, SUPRA.

ASIDE FROM THE SPECIFIC PROVISIONS AS CONTAINED IN SECTION 5 OF THE ACT OF JUNE 16, AND THE GENERAL RIGHT AND DUTY OF THE POSTMASTER GENERAL TO ACT IN THE PROPER ADMINISTRATION OF THE POSTAL SERVICE, THERE ARE FOR CONSIDERATION WITH RESPECT TO THE QUESTIONS SUBMITTED IN YOUR LETTER THE PROVISIONS RELATING TO THE CONSOLIDATION, EXTENSION AND MODIFICATION OF AIR MAIL ROUTES IN THE ACT OF APRIL 29, 1930, 46 STAT. 259, AMENDING THE PRIOR AIR MAIL ACTS OF MAY 17, 1928, 45 STAT. 594; JUNE 3, 1926, 44 STAT. 692; AND FEBRUARY 2, 1925, 43 STAT. 805. OF COURSE, IT IS OBVIOUS THAT AS TO SUCH CONTRACTS AND EXTENSIONS AS WERE MADE AFTER JULY 1, 1931, WHETHER MADE IMMEDIATELY PRIOR TO MARCH 4, 1933, AS REFERRED TO IN THE SECOND QUESTION OF YOUR SUBMISSION, OR PRIOR THERETO, IN CONTRAVENTION OF THE PROVISIONS OF SECTION 9 OF SAID ACT OF 1930, THEY WOULD BE WITHOUT EFFECT TO OBLIGATE PUBLIC FUNDS AND IF SUCH THERE BE, SERVICE THEREON SHOULD BE IMMEDIATELY DISCONTINUED AND PAYMENTS STOPPED; ALSO, THERE APPEARS NO QUESTION AS TO THE AUTHORITY OR PROPRIETY OF CANCELLING CONTRACTS OR EXTENSIONS IN THE PUBLIC INTEREST WITH THE CONSENT OF THE CERTIFICATE HOLDER.

THE GENERAL QUESTION SUBMITTED BY YOU IS WHETHER ACTION HERETOFORE TAKEN BY THE POSTMASTER GENERAL IN AUTHORIZING AN EXTENSION TO A ROUTE COVERED BY A CERTIFICATE BINDS THE GOVERNMENT TO MAINTAIN AND PAY FOR SERVICE ON SUCH EXTENSION THROUGHOUT THE LIFE OF THE CERTIFICATE, NOTWITHSTANDING THE PUBLIC INTEREST MAY REQUIRE DISCONTINUANCE OF SUCH SERVICE AND CANCELLATION OF THE EXTENSION.

IN ADDITION TO THE PROVISIONS OF SECTION 7 QUOTED IN YOUR LETTER, THE ACT OF APRIL 29, 1930, PROVIDED ALSO IN SECTION 6 THAT:

THE POSTMASTER GENERAL MAY, IF IN HIS JUDGMENT THE PUBLIC INTEREST WILL BE PROMOTED THEREBY, UPON THE SURRENDER OF ANY AIR MAIL CONTRACT, ISSUE IN SUBSTITUTION THEREFOR A ROUTE CERTIFICATE FOR A PERIOD OF NOT EXCEEDING TEN YEARS FROM THE DATE SERVICE STARTED UNDER SUCH CONTRACT TO ANY CONTRACTOR OR SUBCONTRACTOR WHO HAS SATISFACTORILY OPERATED AN AIR MAIL ROUTE FOR A PERIOD OF NOT LESS THAN TWO YEARS, WHICH CERTIFICATE SHALL PROVIDE THAT THE HOLDER THEREOF SHALL HAVE THE RIGHT, SO LONG AS HE COMPLIES WITH ALL RULES, REGULATIONS, AND ORDERS THAT MAY BE ISSUED BY THE POSTMASTER GENERAL FOR MEETING THE NEEDS OF THE POSTAL SERVICE AND ADJUSTING MAIL OPERATIONS TO THE ADVANCES IN THE ART OF FLYING AND PASSENGER TRANSPORTATION, TO CARRY AIR MAIL OVER THE ROUTE SET OUT IN THE CERTIFICATE OR ANY MODIFICATION THEREOF AT RATES OF COMPENSATION TO BE FIXED FROM TIME TO TIME, AT LEAST ANNUALLY, BY THE POSTMASTER GENERAL, AND HE SHALL PUBLISH IN HIS ANNUAL REPORT HIS REASONS FOR THE CONTINUANCE OR THE MODIFICATION OF ANY RATES: PROVIDED, THAT SUCH RATES SHALL NOT EXCEED $1.25 PER MILE. SUCH CERTIFICATE MAY BE CANCELED AT ANY TIME FOR WILLFUL NEGLECT ON THE PART OF THE HOLDER TO CARRY OUT ANY RULES, REGULATIONS, OR ORDERS MADE FOR HIS GUIDANCE, NOTICE OF SUCH INTENDED CANCELLATION TO BE GIVEN IN WRITING BY THE POSTMASTER GENERAL AND FORTY-FIVE DAYS ALLOWED THE HOLDER IN WHICH TO SHOW CAUSE WHY THE CERTIFICATE SHOULD NOT BE CANCELED.

THE ROUTE CERTIFICATES ISSUED UNDER THE PROVISIONS OF THIS LAW PROVIDE IN GENERAL THAT THE CONTRACTOR SHALL HAVE THE RIGHT, SO LONG AS IT COMPLIES WITH ALL RULES, REGULATIONS, AND ORDERS THAT MAY BE ISSUED BY THE POSTMASTER GENERAL FOR MEETING THE NEEDS OF THE POSTAL SERVICE AND ADJUSTING MAIL OPERATIONS TO ADVANCES IN THE ART OF FLYING AND PASSENGER TRANSPORTATION, TO CARRY AIR MAIL OVER ROUTES SET OUT IN THE CERTIFICATE "OR ANY MODIFICATION THEREOF, AT RATES OF COMPENSATION FIXED HEREIN, OR TO BE FIXED FROM TIME TO TIME AT LEAST ANNUALLY BY THE POSTMASTER GENERAL" SUBJECT TO CERTAIN TERMS AND CONDITIONS THEREIN SET FORTH. THE PERTINENT PROVISIONS OF THESE TERMS AND CONDITIONS IN THE ROUTE CERTIFICATE SUBMITTED WITH YOUR LETTER ARE AS FOLLOWS:

2. THE ROUTE OVER WHICH THE CARRIER SHALL HAVE THE RIGHT TO CARRY AIR MAIL SHALL BE FROM CHICAGO, ILLINOIS, BY CERTAIN DESIGNATED POINTS, TO MINNEAPOLIS AND ST. PAUL, MINNESOTA, AND RETURN, INCLUDING ANY EXTENSION OR OTHER MODIFICATION OF SAID ROUTE THAT MAY BE MADE AS HEREINAFTER PROVIDED.

3. UPON 60 DAYS' NOTICE TO THE CARRIER, THE POSTMASTER GENERAL FROM TIME TO TIME MAY MODIFY SAID ROUTE BY AN EXTENSION OR EXTENSIONS THEREOF, INCLUDING LATERAL EXTENSIONS OR CONSOLIDATIONS, AND PRESCRIBE THE SCHEDULE THEREFOR, INCLUDING THE STOPS THEREON, AND DETERMINE THE MILEAGE UPON WHICH THE COMPENSATION OF THE CARRIER IS TO BE BASED.

4. FOR THE PURPOSES OF THIS CERTIFICATE THE DISTANCE BETWEEN THE TERMINAL POINTS OF THE ROUTE HEREINBEFORE PRESCRIBED SHALL BE DEEMED TO BE 407 MILES.

THERE FOLLOWS, UNDER PARAGRAPH 6 AND SUBDIVISIONS THEREOF, A SCHEDULE OF THE VARIOUS SERVICES REQUIRED ON THE ROUTE AT VARYING RATES OF COMPENSATION AND IN PARAGRAPH 7 IT IS PROVIDED:

UPON 60 DAYS' NOTICE TO THE CARRIER, THE POSTMASTER GENERAL MAY INCREASE, DIMINISH, OR MODIFY THE SERVICE ABOVE PRESCRIBED, AND MAKE SUCH ADJUSTMENTS IN THE COMPENSATION OF THE CARRIER AS HE MAY DEEM PROPER.

IT APPEARS THAT BY THE PROVISIONS OF SECTION 7 OF THE AIR MAIL ACT AS AMENDED BY THE ACT OF 1930, THERE IS SPECIFICALLY RESERVED TO THE POSTMASTER GENERAL THE RIGHT TO MAKE EXTENSIONS OR CONSOLIDATIONS OF ROUTES "WHICH ARE NOW OR MAY HEREAFTER BE ESTABLISHED," AND BY THE PROVISIONS OF THE ROUTE CERTIFICATE SUBMITTED, AND OF WHICH THE EXTENSIONS BECOME A PART, THE RIGHT UPON 60 DAYS' NOTICE, TO INCREASE, DIMINISH, OR MODIFY THE SERVICE THEREIN PRESCRIBED, AND TO MAKE SUCH ADJUSTMENTS IN THE COMPENSATION OF THE CARRIER AS HE MAY DEEM PROPER. THERE APPEARS NOTHING IN THE LAW OR IN THE PROVISIONS OF THE ROUTE CERTIFICATE REQUIRING AGREEMENT BY THE CERTIFICATE HOLDER TO PERMIT THE POSTMASTER GENERAL TO EXERCISE THE POWERS AND RIGHTS SO RESERVED TO HIM. IN THE ADMINISTRATION OF THE LAW, IT APPEARS THAT CHANGES IN AIR-MAIL ROUTES HAVE INVOLVED BOTH EXTENSIONS AND DISCONTINUANCES. IT IS TO BE NOTED THAT THE ORDER OF THE POSTMASTER GENERAL DATED MARCH 1, 1933, AND MADE EFFECTIVE MARCH 2, 1933, PROVIDES NOT ONLY FOR THE EXTENSION OF SERVICE ON ROUTE 9 FROM BISMARCK, N.DAK., TO BILLINGS, MONT., BUT FOR DISCONTINUANCE OF SERVICE FROM MANDAN TO FARGO IN NORTH DAKOTA. IT MAY BE, AS WOULD APPEAR FROM THE STATEMENT OF THE THEN POSTMASTER GENERAL IN LETTER OF JANUARY 30, 1933, TO HON. JAMES M. MEAD, CHAIRMAN, COMMITTEE ON POST OFFICES AND POST ROADS, HOUSE OF REPRESENTATIVES, SUCH CHANGES WERE MADE WITH THE CONSENT OF THE CARRIER, BUT IT DOES NOT NECESSARILY FOLLOW THAT SUCH CONSENT WAS ESSENTIAL.

ANY THEORY THAT AN EXTENSION ONCE MADE VESTS IN THE CERTIFICATE HOLDER A RIGHT TO RENDER SERVICE THEREON TO THE END OF THE CERTIFICATE PERIOD, REGARDLESS OF THE PUBLIC INTEREST, WOULD CONFLICT WITH THE STATUTORY AUTHORITY OF THE POSTMASTER GENERAL TO EFFECT CONSOLIDATION OF ROUTES. SECTION 7 SPECIFICALLY AUTHORIZES THE POSTMASTER GENERAL, IN THE PUBLIC INTEREST, TO EFFECT "CONSOLIDATION OF ROUTES" THEN OR THEREAFTER ESTABLISHED. THERE COULD NOT BE CONTRACTED AWAY SUCH AUTHORITY AND ANY CONSOLIDATION OF EXISTING ROUTES MIGHT INVOLVE A TAKING FROM ONE CERTIFICATE HOLDER AND A GIVING TO ANOTHER. FURTHERMORE, AS A MATTER OF PRACTICAL ADMINISTRATION UNDER THE RIGHT SPECIFICALLY RESERVED IN THE POSTMASTER GENERAL TO "DIMINISH" SERVICE AND MAKE ADJUSTMENTS IN COMPENSATION THERE COULD BE ACCOMPLISHED VIRTUAL CANCELLATION OF ANY EXTENSION, THE PUBLIC INTEREST OR REDUCED APPROPRIATIONS CLEARLY REQUIRING.

AS STATED IN YOUR LETTER, THE POWER AND RIGHT IN THE POSTMASTER GENERAL TO EXTEND AND CONSOLIDATE AIR-MAIL ROUTES, CARRIERS WITH IT THE AUTHORITY TO DISCONTINUE THE EXTENSIONS AND MAKE SUCH FURTHER ADJUSTMENTS IN THE ROUTES AS MAY BE REQUIRED IN THE PUBLIC INTEREST AND PROPER CONDUCT OF THE POSTAL SERVICE, AND, IN SPECIFIC ANSWER TO THE QUESTION SUBMITTED BY YOU, I HAVE TO ADVISE THAT IF THE INTERESTS OF THE POSTAL SERVICE REQUIRE IT, THERE IS AUTHORITY IN THE POSTMASTER GENERAL TO EFFECTIVELY CURTAIL ANY AND ALL EXTENSIONS MADE UNDER SECTION 7 OF THE ACT OF APRIL 29, 1930, REGARDLESS OF THE DATE OR DATES SUCH EXTENSIONS WERE MADE AFTER THE ROUTE CERTIFICATE WAS ISSUED.